Case Summary (G.R. No. L-2724)
Procedural History
- March 23, 1943: Parties entered into court-approved agreement for annual palay payments.
- Court of First Instance: Judgment awarded respondent 3,400 cavanes of palay (P24,900) plus interest for undelivered grain.
- Court of Appeals: Affirmed the lower court’s judgment.
- Supreme Court: Appeal by certiorari filed by petitioners.
Agreement Terms
- Annual deliveries of palay (generic, not tied to specific land):
• 1,200 cavanes in March 1943
• 1,400 cavanes in March 1944
• 1,500 cavanes in March 1945
• 1,600 cavanes in March 1946 and each year thereafter - Delivery free of hauling, transportation, taxes, to a government or selected warehouse
- Payments cease upon widow’s death; constitute a first lien on estate rice lands
Factual Findings
- Actual deliveries totaled 2,300 cavanes (1,200 in 1943; 700 in 1944; 200 in 1945; 200 in 1946)
- Shortfall of 3,400 cavanes through 1946
- Petitioners cited Huk insurgency as an excuse for non-performance
Issue
Does a fortuitous event or external disturbance excuse the delivery of a generic obligation where the contract imposes a fixed annual quantity?
Applicable Law
- Constitution: 1935 Philippine Constitution (operative at decision date)
- Civil Code (then in force): Article 1182 (distinguishing determinate and generic things)
- Precedents:
• Yu Tek & Go. vs. Gonzalez (29 Phil. 384)
• Toribio Reyes vs. Caltex (84 Phil. 654) - American authorities on impossibility and risk allocation (17 C.J.S.)
Analysis and Rationale
- Generic obligation: Palay defined by genus and quantity, not by individuality or source.
- Article 1182: Loss of a generic thing does not extinguish the obligation; debtor must still deliver.
- Fortuitous events (insurgency, war, crop failures) do not excuse performance unless contract so provides.
- Distinction:
• Natural impossibility (inherent to the object) voids the obligation.
• Impossibility in fact (external hardship) does not—risk lies with obligor. - Foreign and local jurisprudence uniformly holds that absent specific contractual
Case Syllabus (G.R. No. L-2724)
Procedural History
- Petition for certiorari filed before the Supreme Court from a decision of the Court of Appeals
- Court of Appeals had affirmed a judgment of the Court of First Instance of Bulacan
- Lower courts ruled in favor of Asuncion Soriano for undelivered palay or its cash equivalent
Facts of the Case
- Felix de Leon died intestate, leaving a widow (Asuncion Soriano) and three natural children (Jose, Cecilio, Albina de Leon)
- Estate settlement pending in the Court of First Instance of Bulacan
- On March 23, 1943, widow and children entered into an approved agreement concerning annual delivery of palay
Contractual Agreement
- Natural children obligated to deliver palay to the widow at the end of each agricultural year (March)
- Scheduled deliveries:
• 1943 – 1,200 cavanes
• 1944 – 1,400 cavanes
• 1945 – 1,500 cavanes
• 1946 and succeeding years – 1,600 cavanes annually - Delivery terms: government warehouse or widow’s choice in San Miguel, Bulacan, free of hauling, transportation, taxes, or charges
- Stipulation that the annual payment:
• Ceases upon widow’s death
• Is non-transmissible to heirs
• Constitutes a first lien on the decedent’s rice lands during her lifetime
Breach and Defendants’ Defense
- Actual deliveries:
• 1943 – 1,200 cavanes
• 1944 – 700 cavanes
• 1945 – 200 cavanes
• 1946 – 200 cavanes - Total delivered through 1946: 2,300 cavanes; shortage of 3,400 cavanes
- Defendants attributed shortfall to “Huk troubles in Central Luzon” rendering full performance impossible
- Characterized