Case Digest (G.R. No. 200602)
Facts:
Ace Foods, Inc. v. Micro Pacific Technologies Co., Ltd., G.R. No. 200602, December 11, 2013, the Supreme Court Second Division, Perlas-Bernabe, J., writing for the Court.Ace Foods, Inc. (ACE Foods) is a domestic trader/distributor of consumer goods; Micro Pacific Technologies Co., Ltd. (MTCL) supplies computer hardware and equipment. On September 26, 2001 MTCL sent a letter-proposal offering Cisco routers and frame relay products (the subject products) with terms including thirty (30) days payment upon delivery and a one-year parts-and-service warranty. On October 29, 2001 ACE Foods issued Purchase Order No. 100023 for P646,464.00. MTCL delivered and installed the products on March 4, 2002 and issued Invoice No. 7733, which contained a fine-print clause reserving title in MTCL until full payment (the title reservation stipulation). ACE Foods used the installed equipment but did not pay.
MTCL demanded payment on September 3, 2002. ACE Foods responded by letter dated September 19, 2002 asserting it was returning the equipment through MTCL’s sales representative and on October 16, 2002 filed suit in the Regional Trial Court (RTC) of Makati (Civil Case No. 02-1248) seeking the pull-out of the products for alleged breach of post-delivery obligations (installation/configuration, cost-benefit study, and training) and alleging defects. MTCL answered and counterclaimed, asserting proper delivery, performance (including training), and ACE Foods’ refusal to pay despite use for nine months; it sought the purchase price and damages.
The RTC (Branch 148) rendered judgment on February 28, 2007 directing MTCL to remove the products and awarding ACE Foods actual damages of P200,000 and attorney’s fees of P100,000, reasoning that the invoice’s title reservation made the agreement a contract to sell and thus title remained with MTCL until full payment. MTCL appealed.
The Court of Appeals (CA) in CA‑G.R. CV No. 89426, in a Decision dated October 21, 2011, reversed and ordered ACE Foods to pay MTCL P646,464.00 with 6% interest from April 4, 2002, plus P50,000 attorney’s fees, holding the parties’ transaction a consummated contract of sale perfected upon ACE Foods’ Purchase Order and MTCL’s delivery/installation; it fou...(Pro-only)
Issues:
- Should ACE Foods be held liable to pay MTCL the purchase price for the subject products? ...(Pro-only)
Ruling:
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Ratio:
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Doctrine:
- (Pro-only)