Facts:
Ravago Equipment Rentals, Inc. (
Ravago) filed a complaint for a sum of money against Alcolex Corporation (
Alcolex) in connection with a lease arrangement involving a
Caterpillar Diesel Generator, Model 3412. The complaint alleged that on or about
10 October 1990, Ravago entered into a
Lease Contract with Alcolex, under which the generator was leased on terms requiring payment of
P120,000.00 per month, with the monthly rental covering “
use, non-use or standby” and/or “
200 operating hours within the period whichever comes first.” It further alleged that
operation in excess of 200 hours would be charged at
P600.00 per hour, and that when the generator was used on a
holiday or a Sunday, a minimum of
eight (8) hours per day would be charged. Ravago asserted that from
10 October 1990 to 1 February 1991, the total rental/charges due amounted to
P1,172,406.50, of which Alcolex paid only
P525,437.50, leaving an unpaid balance of
P646,969.00, for which Ravago sought payment of the balance plus
exemplary damages,
attorney’s fees, and
costs. In its answer, Alcolex denied the
genuineness and due execution of the lease contract, averred that
Edgardo Chua, who signed the contract for Alcolex, was not authorized and had been dismissed even before completing probationary employment, and also admitted paying
P525,437.50 while maintaining that it constituted
full, total and final payment for the entire period of use under the agreed terms and price. On
14 September 1992, the Regional Trial Court ordered Alcolex to pay
P646,969.00 for overtime use and unpaid rentals/charges,
P20,000.00 as
exemplary damages,
P20,000.00 as
attorney’s fees, and litigation expenses. On appeal, the Court of Appeals rendered a decision dated
10 January 1995 setting aside the trial court’s decision and dismissing the complaint; its resolution dated
24 July 1995 denied Ravago’s motion for reconsideration. Ravago then elevated the matter via a petition for review on certiorari, contending, among others, that the Court of Appeals erred in considering an issue raised only on appeal and in holding that Ravago failed to prove its claim.
Issues:
Whether Alcolex is liable to Ravago for
overtime charges and unpaid rentals/charges under the lease contract notwithstanding Alcolex’s payment of
P525,437.50 and its denial of the basis and proof of overtime use.
Ruling:
Ratio:
Doctrine: