Case Digest (G.R. No. 225438)
Facts:
Voltaire Hans N. Bongcayao, doing business under the name and style of VHB Biopro Enterprises, and Pete Nicomedes Prado v. Confederation of Sugar Producers Cooperatives (CONFED), Jose J. Jison and Prudential Guarantee and Assurance, Inc., G.R. No. 225438, January 20, 2021, the Supreme Court Third Division, Inting, J., writing for the Court.On October 16, 2007, CONFED, through its Chief Operating Officer and General Manager Jose J. Jison, solicited the supply of urea fertilizer from VHB Biopro Enterprises (VHB Biopro). On December 11, 2007 the parties executed a written Sales and Purchase Agreement under which VHB Biopro agreed to supply 250,000 bags of urea, to be delivered ex-pier at Bredco Port, Bacolod City, with payment by CONFED through an irrevocable domestic letter of credit and, to secure VHB Biopro’s performance, a P5,000,000.00 Performance Bond to be procured through Prudential Guarantee and Assurance, Inc. (PGAI). VHB Biopro, represented by its attorney-in-fact Pete Nicomedes Prado, procured the Performance Bond dated December 26, 2007 and secured it with a real estate mortgage; CONFED opened Domestic Letter of Credit No. BCD2008-01D on January 14, 2008.
VHB Biopro did not deliver the fertilizer as obliged. CONFED demanded payment under the Performance Bond and PGAI paid CONFED P5,000,000.00 (receipt and release dated April 2, 2008). VHB Biopro and Prado filed a complaint with an application for TRO/preliminary injunction in the Regional Trial Court (RTC), Branch 133, Makati City, on March 17, 2008 seeking nullification of the Sales and Purchase Agreement for alleged ambiguity and enjoining PGAI from foreclosing/collecting on the Performance Bond. The RTC issued a TRO on April 10, 2008; the injunction was dissolved on August 1, 2012.
At trial the parties disputed whether the contract was ambiguous and whether VHB Biopro breached its obligations. CONFED counterclaimed for P30,000,000.00 actual/compensatory damages (lost profits), P5,000,000.00 temperate damages, P2,000,000.00 moral damages, and P1,000,000.00 attorney’s fees. PGAI counterclaimed for various sums based on the indemnity agreement and sought enforcement of its mortgage.
On March 11, 2014 the RTC rendered judgment in favor of VHB Biopro and Prado ordering CONFED to return P5,000,000.00 to PGAI, PGAI to return the security document to Prado free of encumbrance, and dismissing the defendants’ counterclaims. PGAI and CONFED appealed. On January 19, 2016 the Court of Appeals (CA) in CA-G.R. CV No. 102712 reversed and set aside the RTC: it dismissed the plaintiffs’ complaint, dismissed PGAI’s countercla...(Pro-only)
Issues:
- May the Supreme Court review and resolve disputed factual findings in this Rule 45 petition given conflicting findings between the RTC and the Court of Appeals?
- Whether VHB Biopro breached the Sales and Purchase Agreement such that CONFED’s claim on the Performance Bond and PGAI’s payment were proper?
- Whether the compensatory damages of Php30,000,000.00 awarded by the Court of Appeals (and the awards of moral damages...(Pro-only)
Ruling:
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Ratio:
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Doctrine:
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