Case Digest (G.R. No. 55665)
Facts:
In Delta Motor Corporation v. Genuino, petitioner Delta Motor Corporation, a duly organized Philippine corporation, submitted two letter-quotations in July 1972 to respondents Eduarda Samson Genuino, Jacinto S. Genuino, Jr., Victor S. Genuino, Hector S. Genuino, and Evelyn S. Genuino—owners of the Espana Extension Iceplant and Cold Storage in Quezon City—for the sale of black iron pipes. The first letter‐quotation, dated July 3, 1972, offered 1,200 lengths of Schedule 40, 2″×20′ pipes at a total price of ₱66,000, with a 20% down payment upon signing (₱13,200), another 20% before delivery, and the balance of 60% (₱39,600) to be covered by a promissory note bearing 14% interest and payable in twelve equal monthly installments. The second letter‐quotation, dated July 18, 1972, offered 150 lengths of Schedule 40, 1¼″×20′ pipes at ₱5,400, with 50% down (₱2,700) and 50% before delivery. Both quotations provided that prices would remain firm for thirty days and that delivery was ex‐stoCase Digest (G.R. No. 55665)
Facts:
- Parties
- Petitioner Delta Motor Corporation
- Private respondents Espana Extension Iceplant and Cold Storage, owned by Eduarda S. Genuino et al.
- Formation of Contracts
- July 3, 1972 letter-quotation (Exh. “A”/“1”)
- Sale of 1,200 lengths of black iron pipes, schedule 40, 2"×20" at P66,000.00, delivery ex-stock subject to prior sales
- Payment terms:
- 20% (P13,200.00) upon signing
- 20% (P13,200.00) before delivery
- 60% (P39,600.00) via promissory note, 14% p.a. interest, 12 monthly installments, plus 8% financing charge and 14% penalty on delays
- Price firm for 30 days from July 3, 1972
- July 18, 1972 letter-quotation (Exh. “C”/“2”)
- Sale of 150 lengths of black iron pipes, schedule 40, 1¼"×20" at P5,400.00, delivery ex-stock subject to prior sales
- Payment terms:
- 50% (P2,700.00) upon signing
- 50% (P2,700.00) before delivery
- Price firm for 30 days from July 18, 1972
- Acceptance and Initial Performance
- Hector Genuino signed quotations on July 17 and 24, 1972
- Down payments totaling P15,900.00 made on July 28, 1972 (Exhs. “B” and “D”)
- Subsequent Events
- Delta’s offer to deliver in August 1972 refused by Genuinos due to incomplete plant construction
- No further payments or execution of promissory note for first contract
- April 15, 1975: Genuinos demand delivery within 30 days and offer to pay pending installments
- Delta invokes 30-day price firmness clause, sends new quotations:
- P241,800.00 for 1,200 pipes (Exh. “G-1”)
- P17,550.00 for 150 pipes (Exh. “G-2”)
- Genuinos file complaint for specific performance with damages; Delta answers seeking rescission under Art. 1191, New Civil Code
- Procedural History
- Court of First Instance, Quezon City (Civil Case No. Q-20120): rescinds contracts, orders refund of P15,900.00, attorney’s fees, costs
- Court of Appeals (CA-G.R. No. 59848-R): reverses; orders Genuinos to pay outstanding installments, execute promissory note, and Delta to deliver at original prices
- CA rationale: (a) Delta failed to stipulate delivery deadline or insist on delivery in 1972; (b) unfair to shift price increase to Genuinos after acceptance and down payment
- Petition for review by certiorari filed before the Supreme Court
Issues:
- Whether Delta’s obligation to deliver under the two contracts was properly subject to suspensive conditions and whether non-performance by Genuinos justified rescission under Art. 1191, New Civil Code.
- Whether Delta effectively waived any suspensive conditions by failing to insist on delivery or rescind the contracts within the 30-day price firmness period.
- Whether the price-firmness clause remained operative after acceptance and thus barred Delta from insisting on re-quoted prices.
Ruling:
- (Subscriber-Only)
Ratio:
- (Subscriber-Only)
Doctrine:
- (Subscriber-Only)