Case Digest (G.R. No. 108129)
Facts:
In Aerospace Chemical Industries, Inc. v. Court of Appeals, petitioner Aerospace purchased 500 metric tons of 98–99% sulfuric acid from private respondent Philippine Phosphate Fertilizer Corporation under a June 27, 1986 letter‐form contract. The agreement provided for payment in Philippine pesos five days before shipment from designated loadports—100 MT at Basay, Negros Oriental, and 400 MT at Sangi, Cebu—and required the buyer to arrange transport. On October 3, 1986, Aerospace paid ₱553,280.00 for the full lot. On November 19, 1986, it chartered M/T Sultan Kayumanggi, which loaded only 70.009 MT at Basay before listing and undergoing repairs, and 157.51 MT at Sangi before sinking with 227.519 MT aboard. Aerospace then chartered M/T Don Victor and sought replacement of the sunken quantity, but Philphos declined due to supply constraints. After repeated demand letters, Aerospace filed on May 4, 1989 a complaint in the Pasig RTC for specific performance or damages. The trial couCase Digest (G.R. No. 108129)
Facts:
- Contract and Purchase
- On June 27, 1986, Aerospace Chemical Industries, Inc. (buyer) and Philippine Phosphate Fertilizer Corp. (seller) executed a letter‐form contract for 500 MT of 98–99% sulfuric acid: 100 MT FOB Basay @ US$50/MT; 400 MT FOB Sangi @ US$54/MT. Buyer to pay in PHP five days before shipment and to arrange transport.
- On October 3, 1986, buyer paid P553,280.00 for the full 500 MT.
- Attempted Shipments and Delay Notices
- November 19–20, 1986: Buyer’s chartered vessel M/T Sultan Kayumanggi loaded only 70.009 MT at Basay (listing, aborted), then 157.51 MT at Sangi; the vessel later sank with 227.519 MT on board. Third‐party SGS surveys attributed failures to vessel unseaworthiness, not force majeure.
- Buyer chartered M/T Don Victor to lift remaining 272.481 MT and requested additional 227.519 MT; seller refused due to supply constraints.
- Seller’s letters (Dec 12, 1986) demanded removal of acid by Dec 15 or storage/maintenance charges (P2,000/day at Basay; P32,000/month at Sangi). Buyer’s repeated demands for replacement or withdrawal persisted into 1988.
- Trial Court and Court of Appeals Proceedings
- May 4, 1989: Buyer sued for specific performance/damages. Trial court (Pasig RTC) awarded P306,060.77 (undelivered acid) + P91,818.23 (unrealized profits) + P30,000 exemplary + P30,000 attorney’s fees, 12% interest; dismissed seller’s counterclaim.
- August 19, 1992: CA reversed, found buyer guilty of delay, dismissed complaint, granted seller P324,516.63 maintenance/tank rental damages.
- Buyer’s motion for reconsideration denied (Dec 21, 1992). Buyer petitioned the Supreme Court.
Issues:
- Did the buyer breach the contract by failing to lift the full 500 MT despite full payment, and was any delay waived by agreement for an additional 227.519 MT?
- Were damages properly awarded to the seller for the buyer’s delay?
- Are storage and maintenance expenses for fungible goods chargeable to the seller under Civil Code Article 1504?
Ruling:
- (Subscriber-Only)
Ratio:
- (Subscriber-Only)
Doctrine:
- (Subscriber-Only)