Case Digest (G.R. No. 92299)
Facts:
In Song Fo & Company v. Hawaiian-Philippine Co. (47 Phil. 821, decided Sept. 16, 1925), the plaintiff-appellee, Song Fo & Company, sued the defendant-appellant, Hawaiian-Philippine Company, in the Court of First Instance of Iloilo for breach of a molasses‐sale contract. The complaint, based on two causes of action, sought ₱70,369.50 plus interest and costs. The defendant answered with a cross‐complaint, alleging that Song Fo & Company had defaulted on payment and that it therefore validly rescinded the contract. The case was submitted on a stipulation of facts and documentary exhibits. The trial court found in favor of the plaintiff, ordering the defendant to pay ₱35,317.93 with interest from the date of complaint and costs. Only the defendant appealed, assigning errors regarding (1) the agreed quantity of molasses, (2) the right to rescind, (3) the proper judgment on the cross-complaint, and (4) denial of a new trial. Central to the dispute were two letters (Exhibits F and G) eCase Digest (G.R. No. 92299)
Facts:
- Parties and Proceedings
- Song Fo & Company (plaintiff) filed a complaint in the Court of First Instance of Iloilo alleging breach of contract and demanding ₱70,369.50, plus interest and costs.
- Hawaiian-Philippine Co. (defendant) countered with an amended answer and cross-complaint, asserting plaintiff’s default in payment and right to rescind the contract.
- Contract Formation
- Exhibit F (Dec. 13, 1922): Letter from defendant proposing delivery of 300,000 gallons of molasses at prior year’s price, plus “possible” extra 100,000 gallons before Nov. 1, 1923, with monthly payment at period end.
- Exhibit G (Dec. 16, 1922): Letter from plaintiff confirming the 300,000-gallon agreement, reiterating price at 2¢/gallon, specifying handling charges and locomotive service terms, and acknowledging payment terms.
- Performance and Payment
- Deliveries: Defendant delivered 55,006 gallons before claiming breach.
- Payment terms: Accounts to be settled “upon presentation” at month’s end; plaintiff paid December molasses on Feb. 20, 1923 (20 days late), then paid subsequent deliveries timely.
- Rescission notice: Defendant’s April 2, 1923 letter terminated the contract citing payment breach.
- Trial Court Judgment and Appeal
- CFI Iloilo awarded plaintiff ₱35,317.93 with interest from complaint date and costs.
- Defendant appealed, assigning errors regarding quantity agreed, right to rescind, judgment in plaintiff’s favor, and denial of new trial.
Issues:
- Was the contract for the sale of 400,000 gallons of molasses or 300,000 gallons?
- Did the defendant have a legal right to rescind the contract for plaintiff’s delayed payment?
- What is the proper measure of damages for defendant’s breach?
Ruling:
- (Subscriber-Only)
Ratio:
- (Subscriber-Only)
Doctrine:
- (Subscriber-Only)