Facts:

The case of Juan G. Bosque vs. Yu Chipco arose from a contractual dispute regarding the construction of a house. On August 1, 1905, Juan G. Bosque (the plaintiff and appellant) entered into a contract with Yu Chipco (the defendant and appellee) for the construction of a house, with a stipulated completion period of four months. The construction commenced, but Bosque made changes to the original plans, which were agreed upon by Chipco, leading to a new contract. However, Bosque failed to secure the necessary permits from the city of Manila for these changes, which delayed Chipco's work for several weeks.

Bosque had provided timber valued at P132 for the construction, while Chipco claimed to have spent P500 on labor and materials for the additional work. The original contract required Bosque to make four equal payments based on the state of completion of the house. Evidence indicated that the house had progressed beyond the point for the first payment, yet Bosque did n...

Facts:

1. Contract Formation: On or about August 1, 1905, Juan G. Bosque (plaintiff) and Yu Chipco (defendant) entered into a contract for the construction of a house. The defendant was to complete the house within four months after the contract was signed.

2. Modification of Contract: The plaintiff made changes and additions to the original plans, which were agreed upon by the defendant. A new contract was made to reflect these changes.

3. Delay in Construction: The defendant was delayed in continuing the construction because the plaintiff failed to secure the necessary permit from the city authorities for the changes and additions. This delay lasted several weeks.

4. Materials and Payments: The plaintiff furnished timber worth P132 for the construction. Under the original contract, the plaintiff was to make four equal payments as the construction progressed. However, the plaintiff did not make any payments under either the original or the modified contract.

5. Dispute Over Materials: The plaintiff claimed that the materials used by the defendant were not of the agreed quality, but the defendant's witnesses testified that the materials were as per the contract.

6. Destruction of the House: The house was destroyed by a baguio (typhoon) before its completion.

7. Legal Action: On December 19, 1906, the plaintiff filed a lawsuit to recover P132 for the materials he furnished and P600 in damages for the defendant's failure to complete the house within the agreed period. The defendant counterclaimed for P1,928.56, citing the plaintiff's failure to make payments.

8. Lower Court Decision: The lower court found that both parties had failed to fulfill their contractual obligations. It awarded the plaintiff P132 for the materials he furnished and the defendant P500 for labor and materials expended on the additions. The net result was a judgment in favor of the defendant for P368.

Issue:

1. Whether the lower court erred in not absolving both parties from further liability under the contract, as per Article 1124 of the Civil Code.

2. Whether the lower court erred in not holding the defendant liable for the destruction of the house by the baguio.

Ruling:

The Supreme Court affirmed the lower court's decision. It held that:

1. The lower court's judgment effectively absolved both parties from further liability under the contract, even though it did not explicitly state so.

2. The plaintiff was not entitled to damages for the destruction of the house by the baguio, as there was no evidence that the destruction was due to defects in the construction.

Ratio:

1. Absolution from Liability: The court ruled that the plaintiff's failure to perform his obligations under the contract (i.e., making payments) precluded him from insisting on the defendant's performance or claiming damages for breach. The judgment of the lower court, which balanced the failures of both parties, effectively absolved them from further liability.

2. Liability for Destruction: The court held that the plaintiff could not recover damages for the destruction of the house by the baguio unless he could prove that the destruction was due to defects in the construction. Since no such proof was presented, the defendant could not be held liable.