G.R. No. 233073 - L.C. Big Mak Burger, Inc. vs. McDonald's Corp.

Prior to December 4, 1911, negotiations took place between W. Borck and Benito Valdes regarding the purchase of a portion—and eventually the entirety—of the Nagtajan Hacienda located in Sampaloc, Manila, which was owned by Benito Legarda.
During these negotiations, the parties discussed the price, payment modalities, and the scope of the property sale, establishing an expectation on both sides.

On December 4, 1911, Benito Valdes, acting as attorney-in-fact for Benito Legarda (as evidenced by the power of attorney, Exhibit A), sent a letter (Exhibit E) to W. Borck.

This letter offered Borck an option for a period of three months to purchase the Nagtajan Hacienda at its assessed government valuation.
The document, although seemingly an offer of sale or an option, did not expressly indicate any consideration or a firm commitment on the payment terms beyond stating a three-month duration for exercise.

W. Borck responded by sending several letters (notably Exhibits G, J, and K) that:

Acknowledged receipt of the offer/option.
Stated his intention to accept the offer and tendered payment under conditions he later claimed amounted to “immediate and in cash.”
Requested the inspection and delivery of the title and related documents, thereby practically attempting to convert the option into a binding contract.

The defendant (Valdes, as agent for Legarda) had undertaken to convey the Nagtajan Hacienda in accordance with the terms of the letter (Exhibit E).
He had made a sufficient tender of performance through his acceptance and attempted payment as outlined in his subsequent letters.
The defendants had persistently refused to deliver the property’s Torrens title and related documents as required for the execution of a deed of conveyance.

Due to the defendants’ tardiness and refusal, Borck suffered significant financial losses and damages.
Relief was prayed for in the form of:

Specific performance (i.e., execution of the deed) upon payment of the stipulated price, or

ii. An award of alternative damages, in addition to an accounting of rents and profits accrued from the property.

The complaint either misjoined the parties or failed to allege facts constituting a valid cause of action against them.
Ambiguities and vagueness in the complaint, including the proper interpretation of the option/offer and acceptance.

The trial court overruled the demurrers and admitted various exhibits (A, E, G, J, K, among others) as evidence.

The letter of December 4, 1911 (Exhibit E), supported by the power of attorney (Exhibit A) and the acceptance letter (Exhibit G), constituted a contract whereby the defendants were obligated to convey the property.
Borck had sufficiently tendered performance as required under section 347 of the Code of Civil Procedure.

Specific performance by instructing that upon the payment of ₱307,000, the proper deed of conveyance be executed, or, alternatively, damages of ₱73,000 should be awarded if conveyance could not be made timely.
An accounting of rents and profits collected from the property since January 19, 1912.

There was confusion regarding the mode and timing of payment.
Borck’s acceptance altered the original terms by proposing to make payment under conditions other than “immediate and in cash” as originally stipulated.

The defendants argued that the acceptance deviated materially from Valdes’s original offer, thereby failing to create mutual consent on essential terms.

Whether the document dated December 4, 1911 (Exhibit E) constituted a binding option or an offer to sell that could automatically convert into a contract upon acceptance.
Whether Borck’s subsequent letters (notably Exhibits G, J, and K) amounted to an unequivocal acceptance of the offer or instead introduced conditional modifications regarding the mode and timing of payment.
Whether there was a meeting of minds (mutual assent) on all essential terms—particularly on the requirement of “immediate and in cash” payment—which is necessary for a valid contract under the Civil Code.
Whether the trial court erred in its finding that the contract was perfected and that specific performance was therefore merited, versus holding that no enforceable contract existed due to the variations introduced by Borck.
Whether the inclusion of both defendants (Valdes as agent and Legarda as principal) was proper to determine the complete rights and obligations under the transaction.