Case Digest (G.R. No. 225433)
Facts:
- Lara's Gifts & Decors, Inc. (Lara's Gifts) purchased industrial and construction materials from Midtown Industrial Sales, Inc. (Midtown) between January and December 2007.
- The total purchase amount was PHP 1,263,104.22, with a 60-day credit term and a 24% per annum interest rate on overdue accounts.
- Lara's Gifts issued post-dated checks, which were dishonored due to insufficient funds or closed accounts.
- Midtown sent a demand letter on January 21, 2008, but Lara's Gifts did not settle the account.
- Midtown filed a Complaint for Sum of Money with Prayer for Attachment on February 5, 2008.
- Lara's Gifts admitted the purchases but claimed the materials were substandard, leading to rejected products by U.S. buyers, an economic recession, and a fire that destroyed its factory on February 19, 2008.
- The RTC of Caloocan City ruled in favor of Midtown on January 27, 2014, ordering Lara's Gifts to pay the principal amount plus 24% interest per annum from February 5, 2008, attorney's fees of PHP 50,000, and the cost of the suit.
- The Court of Appeals upheld the RTC's decision.
- Lara's Gifts filed a Petition for Review with the Supreme Court, which was denied on August 28, 2019, affirming the lower courts' decisions with modifications regarding damages.
- Midtown filed a Motion for Reconsideration, leading to the current resolution.
Issue:
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Ruling:
- The Supreme Court held that Lara's Gifts' general denial amounted to an admission of the genuineness and due execution of the sales invoices.
- The Court found that Lara's Gifts was in default of its obligation as it failed to settle the account despite receiving a demand letter.
- The Court ruled that Lara's Gifts failed to prove its claim that the materials delivered were substandard and of poor quality.
- The Court upheld the validity of the 24% per annum inter...(Unlock)
Ratio:
- The Supreme Court reasoned that Lara's Gifts' general denial in its Answer did not meet the specific denial requirements under the Rules of Court, thus amounting to an admission of the genuineness and due execution of the s...continue reading
Case Digest (G.R. No. 225433)
Facts:
In the case of "Lara's Gifts & Decors, Inc. v. Midtown Industrial Sales, Inc.," the petitioner, Lara's Gifts & Decors, Inc. (Lara's Gifts), purchased various industrial and construction materials from the respondent, Midtown Industrial Sales, Inc. (Midtown), between January and December 2007. The total amount of the purchases was PHP 1,263,104.22, and the transactions were on a 60-day credit term with a stipulated interest rate of 24% per annum on overdue accounts. Lara's Gifts issued post-dated checks to cover the purchases, but these checks were dishonored due to insufficient funds or closed accounts. Midtown sent a demand letter on January 21, 2008, but Lara's Gifts failed to settle the account, leading Midtown to file a Complaint for Sum of Money with Prayer for Attachment on February 5, 2008. Lara's Gifts admitted the purchases but claimed the materials were substandard, leading to the rejection of finished products by U.S. buyers, compounded by an economic recession and a fire that destroyed its factory on February 19, 2008. The Regional Trial Court (RTC) of Caloocan City ruled in favor of Midtown on January 27, 2014, ordering Lara's Gifts to pay the principal amount plus 24% interest per annum from February 5, 2008, attorney's fees of PHP 50,000, and the cost of the suit. The Court of Appeals upheld this decision, prompting Lara's Gifts to file a Petition for Review with the Supreme Court. On August 28, 2019, the Supreme Court denied the petition, affirming the lower courts' decisions with modifications regarding damages. Midtown...