Title
Cruz vs. Valero
Case
G.R. No. L-2826
Decision Date
Jun 11, 1951
A sugar planter sued Luzon Sugar Co. for lost sugar, molasses, and truck parts. Court ruled loss due to WWII bombing and Japanese occupation, exempting defendants under force majeure.

Case Digest (G.R. No. 263061)
Expanded Legal Reasoning Model

Facts:

  • Parties and Transaction Background
    • The appellant, Alfredo N. Cruz, is a sugar cane planter and member of the Luzon Sugar Company.
    • The respondent, Luzon Sugar Company, along with its President and General Manager, Jose M. Valero, undertook the milling of sugar cane and the manufacture of various types of centrifugal sugar.
    • Under the milling contract, the appellant deposited different classifications of sugar with the company:
      • Domestic centrifugal sugar (normal or “B sugar”) initially amounting to 1,544.38 piculs, later reduced to 632.03 piculs after various withdrawals.
      • Reserve centrifugal sugar (“C sugar”) totaling 152.39 piculs.
      • Additional centrifugal sugar amounting to 297.37 piculs.
    • The appellant also claimed entitlement to certain quantities of molasses and proceeds from sugar cane crops.
  • Nature of the Complaint and Alleged Wrongdoing
    • The appellant brought suit to recover his deposited sugar and molasses, or the monetary equivalent, based on a market rate of P91 per picul.
    • The relief sought also included P140, representing the value of two tires and tubes allegedly taken by the Luzon Sugar Company.
    • Moreover, the appellant sought a judicial declaration that Jose M. Valero had disposed of his centrifugal sugar without his knowledge or consent and had misappropriated the proceeds for personal gain.
  • Events and Evidentiary Testimonies
    • The controversy arose when, on 26 and 27 December 1941, the appellant discovered discrepancies in the quantity of sugar and molasses stored in the company’s Calumpit warehouse:
      • Testimonies indicated that the sugar deposited by the appellant was either missing or replaced by sugar from another manufacturer (Pasudeco).
      • Witnesses, such as Amado de Guzman and Petra Cristobal, provided conflicting accounts regarding the disposal and location of the sugar.
    • A crucial piece of evidence was a letter dated 26 December 1941 by the appellant, and an accompanying response (Exhibit G) purportedly from the company:
      • The letter expressed the appellant’s desire to withdraw his sugar upon discovering the shortage.
      • The letter, however, was damaged—with a missing upper portion—leading to the introduction of a copy marked Exhibit G-1, which purportedly filled in the missing contents.
    • Further testimonies included:
      • Ciriaco B. Serrano, the company chemist and key custodian of the warehouse keys, who testified about the state of the warehouse on 28 December 1941.
      • Other witnesses including Nicolas S. Cruz, Fausto Carlos, and Jose Lopez, who corroborated that there was sufficient sugar in storage prior to the bombing.
      • Testimony from the appellees stressed that on 28 December 1941 the compound was bombed by Japanese airplanes, thus accounting for the discrepancy in stock.
  • Occurrence of the Fortuitous Event
    • The Luzon Sugar Company argued that the shortage of sugar and molasses resulted from:
      • A series of unfortunate events including the bombing of the Calumpit compound by Japanese aircraft.
      • Subsequent looting and requisitioning of sugar by the Imperial Japanese Army following the occupation.
    • The appellant’s claim that the sugar was disposed of without his consent is juxtaposed with evidence showing:
      • The company maintained adequate stocks in its subsidiary warehouse at the Insular Refining Company.
      • Conflicting evidence from the damaged Exhibit G creates doubts regarding the precise amounts originally stored in Calumpit.
  • Resolution at Trial Level
    • The trial court dismissed the complaint, holding that:
      • The loss of the appellant’s sugar deposit was attributable to a fortuitous event (force majeure) resulting from the war.
      • The respondent was therefore not liable for the delivery or misappropriation of the sugar.
    • The counterclaim of the Luzon Sugar Company was also dismissed because there was insufficient proof of malice on the part of the appellant.

Issues:

  • Liability for the Loss of Sugar and Molasses
    • Is the Luzon Sugar Company, through its officer, legally liable for the loss or alleged misappropriation of the appellant’s sugar deposit?
    • Did the actions of Jose M. Valero constitute an unauthorized sale and misappropriation of funds?
  • Impact of the Fortuitous Event (Force Majeure)
    • To what extent can the damages and shortage be attributed to the bombing of the company’s compound by Japanese forces?
    • Does the occurrence of war, with its attendant uncertainties and losses, relieve the company from contractual or fiduciary responsibilities?
  • Evidentiary Issues Regarding the Disputed Documents
    • How reliable is the evidence pertaining to the missing portions of Exhibit G and its purported recreation in Exhibit G-1?
    • Do the conflicting testimonies sufficiently establish that there was an actual misappropriation by the management?
  • Preponderance of Evidence and Standard of Proof
    • Whether the evidence supports the claim that the sugar loss occurred solely due to a force majeure event rather than any wrongful act by the appellees.
    • Determination of whether any malice can be established on the part of the appellant in filing the suit.

Ruling:

  • (Subscriber-Only)

Ratio:

  • (Subscriber-Only)

Doctrine:

  • (Subscriber-Only)
Unlock Full Case Digest

Analyze Cases Smarter, Faster
Jur is a legal research platform serving the Philippines with case digests and jurisprudence resources. AI digests are study aids only—use responsibly.

About Privacy Terms