Case Digest (G.R. No. 95329) Core Legal Reasoning Model
Facts:
This case revolves around a dispute between Weldon Construction Corporation (the petitioner) and Manuel Cancio (the private respondent) regarding a construction contract for the Gay Theater building located at the corner of Herran and Singalong Streets in Manila. The case originated in the then Court of First Instance of Manila, where the petitioner sought to recover two amounts from the respondent: P62,378.83, which represented a commission of ten percent (10%) of the total construction cost, and P23,788.32 for additional works performed on the building. The claim for commission was based on an alleged contract of supervision of construction (Exhibit "A") purportedly signed on March 7, 1961, between Cancio and a predecessor of the petitioner. The private respondent, however, contested this claim, arguing that the theater was constructed under a separate contract (Exhibit "5") at a fixed price of P600,000, which had already been fully paid.
In the initial t
Case Digest (G.R. No. 95329) Expanded Legal Reasoning Model
Facts:
- Background and Parties
- The controversy arose from the construction of the Gay Theater building located at the corner of Herran and Singalong Streets in Manila.
- Petitioner: Weldon Construction Corporation, successor-in-interest of Weldon Construction and its principal, Lucio Lee.
- Respondent: Manuel Cancio, the theater owner who was responsible for the project.
- Two distinct proposals/documents were submitted by Weldon Construction:
- Exhibit “A”: A proposal for a contract of supervision of construction rendered on a commission basis.
- Exhibit “5”: A Building Contract for the construction of the theater building at a stipulated price.
- Nature of the Documents and Transactions
- Exhibit “A” (Dated March 7, 1961)
- Offered supervision services for the construction of the theater building.
- Provided for the setting up of a revolving fund of P10,000.00 pesos to cover costs (materials, labor, etc.) with periodic replenishments by the owner.
- Stipulated payment of a 10% commission on the total cost of construction.
- Was presented as an offer without the owner’s signature, thereby remaining a proposal.
- Subsequent Documents and Developments
- Exhibit “4”: A second proposal submitted by Weldon Construction for the construction of the building at a fixed price.
- Exhibit “5”: A Building Contract dated March 30, 1961 which:
- Outlined the construction of the cinema-commercial building at a stipulated price of P600,000.00 pesos.
- Construction commenced based on Exhibit “5”, with subsequent payments made by Cancio in varying amounts (from P25,000.00 to P70,000.00 pesos) in line with progress.
- Claims and Dispute
- Weldon Construction Corporation (petitioner) claimed:
- Payment of a 10% commission on the total cost of construction as per Exhibit “A”.
- Reimbursement of additional costs amounting to P23,788.32 pesos incurred for “extra works”.
- Manuel Cancio (respondent) contended:
- The project was governed by the Building Contract (Exhibit “5”), establishing a contract for a stipulated price (P600,000.00 pesos).
- The construction work had been fully rendered and paid, rendering any claim for supervision commission or extra works unjustified.
- Procedural History:
- The trial court ruled in favor of enforcement of the supervision contract (Exhibit “A”) ordering the payment of the commission.
- On appeal, the Court of Appeals reversed the trial court by dismissing the complaint and awarding damages against the petitioner.
- Subsequent motions for reconsideration by both parties resulted in a modified decision, which was ultimately elevated to the Supreme Court on certiorari under Rule 45.
Issues:
- Principal Issue
- Whether the agreement between the parties is to be interpreted as:
- A contract of supervision of construction on a commission basis under Exhibit “A”, making a 10% commission legally demandable, or
- A construction contract for a stipulated price as evidenced by Exhibit “5”, which has been fully performed and paid.
- Ancillary Issue
- Whether the petitioner (Weldon Construction Corporation) is entitled to recover the cost of additional works (i.e., extra works on the building) beyond the stipulated contract price.
Ruling:
- (Subscriber-Only)
Ratio:
- (Subscriber-Only)
Doctrine:
- (Subscriber-Only)