Case Digest (G.R. No. 52267)
Facts:
Engineering & Machinery Corporation v. Court of Appeals and Ponciano L. Almeda, G.R. No. 52267, January 24, 1996, Supreme Court Third Division, Panganiban, J., writing for the Court. The case reached the Court by a petition for review on certiorari under Rule 45 assailing the Court of Appeals' Special Tenth Decision of November 28, 1978 affirming the Court of First Instance of Rizal's April 15, 1974 decision in Civil Case No. 14712.Pursuant to a written contract dated September 10, 1962, Engineering & Machinery Corporation (petitioner) agreed to fabricate, furnish and install a central air‑conditioning system in Ponciano L. Almeda’s (private respondent) building on Buendia Avenue for P210,000. The system was completed in 1963 and accepted by private respondent, who paid the contract price in full. On September 2, 1965, private respondent sold the building to the National Investment and Development Corporation (NIDC); after NIDC’s breach the sale was rescinded and ownership reverted to private respondent who regained possession around 1971 and then learned from NIDC employees of alleged defects in the system.
Private respondent commissioned Engineer David R. Sapico to evaluate the system; Sapico’s report catalogued numerous defects and concluded the system could not maintain the stipulated temperature. On May 8, 1971 private respondent sued petitioner in the Court of First Instance of Rizal (Civil Case No. 14712) for P210,000 (rectification costs), P100,000 (damages) and P15,000 (attorneys’ fees), alleging the installation failed to comply with agreed plans and specifications.
Petitioner moved to dismiss on prescription grounds, invoking warranty provisions on hidden defects (Arts. 1566, 1567, in relation to Art. 1571, Civil Code) which it argued carried a six‑month prescriptive period. Private respondent countered that the contract was one for a piece of work under Article 1713 and thus actions are governed by the ten‑year prescriptive period for written contracts under Article 1144. The trial court denied the motion to dismiss, concluded petitioner deviated from the specifications and omitted required parts, ordered rectification and awarded damages and costs; it held the complaint was timely under a ten‑year rule because the contractor manufactured and installed the system. The trial court also granted private respondent’s ex parte motion for preliminary attachment (bond posted).
T...(Pro-only)
Issues:
- Under Rule 45, may this Court re‑examine the lower courts’ factual findings in this petition for review on certiorari?
- Was the contract between the parties a contract of sale or a contract for a piece of work?
- Does private respondent’s acceptance of the completed system and payment of the contract price extinguish petitioner’s liability for defects?
- What is the prescriptive period for an action based on the breach alleged in this case — six months under Art. 1571 (redhibition), four years under Art. 1389...(Pro-only)
Ruling:
- (Pro-only)
Ratio:
- (Pro-only)
Doctrine:
- (Pro-only)