G.R. No. 58122. December 29, 1989
MOBIL OIL PHILIPPINES, INC., PETITIONER, VS. THE HONORABLE COURT OF APPEALS AND FERNANDO A. PEDROSA, RESPONDENTS.
PARAS, J.:
Before Us is a petition for review which
questions the decision[1]
of the Court of Appeals affirming in toto
the decision[2]
of the Court of First Instance of Quezon City in
Civil Case No. Q-18580, the dispositive part of which
reads as follows:
“WHEREFORE, judgment is hereby rendered sentencing defendant
to pay plaintiff the following sums:
P3,470.00 – for unearned profits on the subject pre-paid
order of February 15, 1974;
P2,360.00 – for loss of
earnings due to the suspension of gasoline deliveries, occasioned by
plaintiff’s refusal to pay the price differentials;
P25,000.00 – for exemplary damages
P50,000.00 – for moral damages, and
P10,000.00 – for attorney’s fees
P90,830.00 – T o t a l
Defendant’s counterclaim against plaintiff is hereby dismissed for
lack of merit.”
The original case was an
action for damages filed by private respondent Fernando A. Pedrosa
against petitioner Mobil Oil Philippines alleging that the latter deliberately
delayed the delivery of gasoline to him notwithstanding his pre-paid order dated
February 14,
1974.
The undisputed facts of
the case as found by the lower court and affirmed by the appellate court are as
follows:
Plaintiff is a dealer of defendant’s petroleum products and
accessories, operating a Mobil gasoline service station under the name of Anne
Marie Mobil Service Station located at Aurora Blvd.,
San Juan, Metro Manila. The contractual relationship between
plaintiff and defendant is governed by a Retail Dealer Contract, Exh. A, also Exh.
1.
In the later part of 1973, an international oil crisis came about
by reason of the concerted action of principal oil producing countries to
increase the oil prices. The Philippines
was not spared of this economic scourge, and to meet the emergency, as the commodity became scarce
while the demand therefore remained the same.
On February 15, 1974
– a Friday – while there was still this oil crisis, plaintiff placed with
defendant a pre-paid order for 8,000 liters of premium gasoline and 2,000 liters of regular gasoline paying
therefore a PBTC Cashier’s Check in the amount of P4,610.00
was received at on the basis of
the following computations:
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The above computation is contained in a product order form, Exh. 3, which was prepared and filled up by defendant’s
order clerk when plaintiff placed his order on Feb. 15, 1974, as in fact the
handwritings thereon are those of the said order clerk. It is stated in Exh.
6 that the order was taken at ‘2:20’ (Exh. 3-A) and 12/15′
and the delivery due date is ‘Today’.
Mr. Alberto Latuno, defendant’s
accounting analyst assigned on the order and billing section, explains the
processing of an order, thusly: The
order clerk prepares the product order form (Exh. 6)
and it goes to him for checking then to the credit clerk for checking in their
ledger; then to the credit man, Mr. F. Marcella, who has all the necessary
documents and the authority to cause the approval of the release of the order;
then to the volume comptroller; then to the coupon clerk; then it goes back to
him for final invoicing. (Tsn., 9-8-75, pp. 135-144)
Mr. Floro Marcella, defendant’s credit
man, approved this order of February
15, 1974 (Tsn., 9-3-75, p. 89), although
he was no longer involved in its subsequent processing in fact, even when there
was a price differential which occurred after his approval was made, the said
order was not given back to him for reprocessing (Tsn.,
9-3-75, p. 66).
Mr. Alberto Latuno further states that
the order, Exh. B, did not come back to him for
invoicing that Friday afternoon (February 15, 1974); it was on February 19,
1974 that he received again the order, because the processing thereof by one
coupon comptroller was completed only on that day, the reason for the delay
being that on February 18 there was a price increase and they had to give
priority to the recall of invoices already with their warehouse and dispatcher
for re?pricing. (Tsn., 9-8-75, pp. 144-148). He also stated that since Exh.
8 was covered by the price increase, he altered the computation therein and
made the necessary changes; this, he crossed out the old computation and re-filled
with a new one based on the new increased price, and placed the words ‘short P2,880.00′.
(Tsn., 9-8-75, pp. 148-150). Plaintiff was informed of the difference in price, and as the price differential was not paid by plaintiff, he gave
Exh. 3 back to the clerk assigned to the order
and billing section. (Tsn., 9-8-75, 151).
It appears that due to a posting error
committed by defendant’s employees in the preparation of plaintiff’s monthly
statement of account, there remained outstanding against plaintiff an
obligation in the sum of P5,653.34, which he paid
after proper verification by his accountant.
However, plaintiff refused to
pay the price differential of P2,880.00 corresponding to the February 15,
order, as reflected in Exhibit 3, but this notwithstanding
defendant delivered to plaintiff this February 15 order on March 5, 1974,
albeit on the basis of the new increased prices thus reflecting an outstanding obligation of P2,880.00 against
plaintiff.
(pp. 51-53, Rollo)
Thus it appears from the
record that there was an increase in the price of gasoline on February 18, 1974. Plaintiff
was charged the cost of the gasoline under the increased rates, or in the total
sum of P7,490.00 including delivery and freight
charges. It was defendant’s contention
that since the gasoline was actually delivered on March 5, 1974, the then
prevailing increased rates should be made to apply and not the price
prevailing on February 14, 1974 the date when the order was made and paid by
plaintiff with a cashier’s check.
To such contention, plaintiff disagreed by arguing that defendant
committed a contractual breach and incurred in delay that should make it liable
for damages when it did not deliver the gasoline to plaintiff on the agreed due
date of delivery appearing on the prepaid order i.e. February 15, 1974 and that
therefore defendant cannot claim benefits by reason of this breach.
Both the trial court and the appellate court found in favor of
plaintiff, as mentioned earlier, hence, defendant now comes to Us on a petition
by certiorari submitting that the:
“Respondent Hon. Court of Appeals in its Decision of June 22,
1981 (Annex “A”) and its Resolution of September 3, 1981 (Annex
“G”), decided questions of substance contrary to law and evidence as
well as the applicable decisions of the Honorable Court, and acted without
jurisdiction and/or with grave abuse of discretion when it failed to make the
finding that:
1. The retail dealer
agreement (Exh. 1) is merely a contract to buy and
sell, and is not a perfected contract to sell.
2. Under the retail
dealer agreement, the respondent, as buyer, must make an order for the products
covered, and the petitioner as seller has to approve the order, before there
can be a perfected sale.
3. The product order
form (Exh. 3) was merely an offer made by the
respondent to purchase the goods listed therein and was not a perfected
contract of sale.
4. The offer (product
order form, Exhibit 3) became a perfected contract of sale only upon delivery of the products ordered.
5. The proper price that
should be paid by respondent is that prevailing at the time of actual delivery.
6. Petitioner was not
guilty of delay in delivering gasoline.
7. Granting for the sake
of argument, that there was delay on the part of petitioner, the same was not
deliberate.
8. Petitioner did not
suspend gasoline deliveries from February
18 to February 23, 1974.
9. Respondent did not
suffer damages, actual or otherwise.
(pp. 172-173, Rollo)
Simply stated, petitioner
contends that it did not commit a breach of contract since there was no
perfected contract of sale with the private respondent and therefore petitioner
cannot be made liable for any damage due to delay or breach of contract. Petitioner contends that Exh.
“A” or Exh.
“1” the Retail Trade Agreement is merely a contract to buy and sell.
We cannot sustain petitioner’s
contentions.
The pertinent provision of the Retail Trade
Agreement or Exh. “A”
or Exh. “1”, which is Par. 2 reads
as follows:
“2 PRICES, TERMS, DELIVERIES SELLER
agrees to sell and BUYER agrees to purchase at SELLER’s
current wholesale/dealer’s prices and/or current dealer’s discounts prevailing on
date and at point of delivery and in such quantities as the BUYER may from time
to time require and the SELLER may approve at SELLER’S option. All prices are payable in cash at the time of
delivery or at the time the order is
placed, except to the extent credit is extended. x x x (pp. 53-54, Rollo)
Thus, it can be gathered
clearly from the above quoted portion of the dealership agreement that
“the price prevailing on date and at point
of delivery should determine how respondent dealer should pay
defendant (petitioner) on the order of February 15, 1974.
A scrutiny of the prepaid
product order form dated February 15, 1974 shows that the delivery date was stated as
“Today” or February 15, 1974 and also the word “rush”. Since the said prepaid order was prepared on
the same date by petitioner’s Order Clerk and after being thus approved by
petitioner’s credit man, private respondent paid for the price therein
indicated by tendering a Prudential Bank Cashier’s Check #19972. Because of this, petitioner Mobil became duty
bound to deliver the gasoline to private respondent on February 15, 1974 and
the price paid for by private respondent was that price then prevailing which
was the amount indicated in private respondent’s cashier’s check given to
petitioner. By actually delivering the
gasoline on March 6, 1974, petitioner committed a contractual breach
and incurred in delay that should make it liable for damages.
In invoking that no
contract of sale was existing, petitioner referred to
the RTA dealership as merely a contract to buy and sell. Private respondent agreed that the RTA
dealership agreement is not a contract of sale but in the same vein argued that
it is a mere trade agreement or contract governing the relationship between
Mobil and respondent Pedrosa regarding the operation
of a gasoline station and the marketing of Mobil petroleum products and
prescribing in general terms, among other things, how the ensuing subsidiary
contract orders for Mobil products were to be placed and delivered under said
dealership agreement. And one such
contract order is that product order form (Exh.
“3”) which listed down the gasoline ordered by respondent Pedrosa and its corresponding price which was approved by
Mobil and paid for by respondent Pedrosa with his
Cashier’s check as already
mentioned earlier. Said prepaid order
form was a perfected contract of sale the moment it was approved and accepted
by Mobil though its proper representative on the same day and paid for by
respondent Pedrosa likewise on the same day as evidenced
by Mobil’s Cash Receipt No. C-078355. On the part of Pedrosa
it can even be said that the contract was consummated as far as he was
concerned since he executed his part of the contract by his prepayment of the
order.
The other assigned errors of petitioner question the finding of
facts of the Court of Appeals affirming those of the trial court quoted as
follows:
“The second issue to be resolved is whether or not the delay
in the delivery was intentional. The
Court finds and so holds that defendant deliberately delayed the delivery of
the gasoline in question to a date subsequent to February 15, 1974, in the erroneous belief that thereby it
could impose upon the defendant the increased new price that took effect on February 18, 1974, considering the following
facts and circumstances to wit:
1. The delay in the
delivery of the gasoline according to defendant’s witness Mr. Alberto Latuna was due to the fact that the processing of the
subject order by the coupon comptroller was completed only on February 19, 1974
because on February 18 there was a price increase and they had to give priority
to the recall of invoices already
with their warehouse and dispatcher for re-pricing. (Tsn., 9-8-75, pp. 144-176).
Thus, another Mobil dealer, plaintiff’s witness Joaquin Coronel, suffered the same fate, although his prepaid order
was made earlier on February 14, 1974, a Thursday.
2. Defendant alleges
that for ‘plaintiff refusal to pay the price differential,’ aside from the fact
that he had an outstanding account with defendant Mobil did not deliver the
order of February 15, 1974 until March 5 of the same year, plaintiff having
paid the day previously his indebtedness to Mobil in the sum of P5,653.34’ (on p. 4 of Memorandum of the Defendant). As heretofore discussed, plaintiff’s refusal
to pay the price differential was justified, and therefore cannot be considered
as a valid reason for the delay. The
alleged outstanding account of plaintiff in favor of defendant is admittedly
due to a posting error committed by defendant’s employees, which upon proper
verification by plaintiff’s accountant was fully paid. During the month of January 1974, this
outstanding account already surfaced which the said posting error was
discovered, but it did not affect the gasoline deliveries for the same month of
January and early part of February 1974.
However, when defendant anticipated the February 18 increase in oil
prices, it conveniently invoked this outstanding account to delay the
plaintiff’s pre-paid order of February 15.
There is evident bad faith in the aforegoing
actuations of defendant.
3. Defendant argues that
plaintiff’s pre-paid order of February 15, a Friday, could not be delivered
until after February 18 because it was placed at 2:20
p.m. and defendant makes no delivery on Saturdays and Sundays. The argument pales vis-a-vis the fact, as shown by the very
evidence of defendants; vis
the due date of delivery is February
15, 1974, a Friday. Besides,
it has been proved that defendant has made gasoline deliveries on a Saturday,
within the months of January and February 1974, to wit: January 5, 1974 (Exhs. J & K; Tsn. 4-22-76, pp. 20 & 27). And February 28, 1974 (Exh. L & M; Tsn., 4-11-76, pp. 26-27, 32-33).
In view of the above findings
a) that defendant
committed a contractual breach and incurred in delay with respect to
plaintiff’s pre-paid order of February 15, 1974, by delivering the subject
gasoline beyond the agreed due date of delivery;
and
b) that
the delay in the delivery was intentional on the part of the defendant, in
anticipation of the increase of oil prices on February 18, 1974, for the obvious purpose of profiting
thereby;
the
Court holds liable to plaintiff for damages, as follows:
1. Plaintiff is entitled
to the profits that would have accrued in his favor if the gasoline covered by
the subject pre-paid order of February
15, 1974 was timely delivered to him. As reflected in Exh. I, such profits amount to P3,470.00.
2. Due to the suspension
in gasoline deliveries between the period from February 18 to 28, 1974, plaintiff suffered loss of earnings amounting to P2,380.00
per computation in Exh. I.
3. Defendant took unfair
advantage of the anticipated oil increase on February 18, 1974, motivated by a desire to rake for
itself substantial profits that legitimately belonged to its Mobil dealers,
similarly situated as plaintiff. It
threatened plaintiff and made good its
threat to suspend gasoline deliveries, if plaintiff should not accede to its
undue demand for the payment of the price differential. These actuations of defendant are indeed
oppressive and malevolent that should make it liable for exemplary damages,
which this Court assesses in the amount of P25,000.00.
4. On his moral damage
claim, plaintiff testified as follows:
ATTY. FERRER
Q Now,
aside from this actual damages or compensatory damages that you were testifying
to a while ago, can you tell us in what way this particular incident you had
with the Company regarding the withholding of the February 15 order and so on,
affect you personally and your clientele?
A In
the first place, you will recall that this time there was a very harsh demand
for gasoline and there were about at least two hundred or three hundred cars
lined up waiting for their chance to get their twenty (20) liters fuel for the
day and since we have been operating since 1966 we have developed a clientele
which relied on us for their fuel supplies, because of the fact that we were
unable, by virtue of this failure to deliver by Mobil Oil, to provide our
clientele and the public in general with this allocation of ours, my oil customers were highly disgusted with
us. And in fact some customers
complained to the Metrocom that we are not giving
gasoline as required by the President no less.
Q Were
you visited by the Metrocom or any other Government
Agency regarding your failure to sell gasoline to the public during this
period?
A Yes, sir.
Q What
happened?
A There
was a Metrocom, I believe it was a Lieutenant, who
demanded to know why we are not giving gasoline to the public and we could only
explain we had no gasoline in the first place.
They did not believe us, so we showed them the contents of the tank
which was empty. In the second place, a
team from the Price Control Council
accompanied by a Metrocom Sergeant,
visited us to demand from us why we were not supplying our customers. They insinuated that we were hoarding
gasoline and in fact the empty oil cans in the gasoline station were brought out and they said there were prima facie evidence of hoarding. In fact I have to remind them that if l am
hoarding I would have gasoline, not to mention of course near fistheads (sic) during the day caused near fistfights with
my boss in the station. On the personal side
I felt that as I explained to Mr. Oliveros, I felt
that it was a matter of principle that I would have to stand for what I believe
on, any due right to be delivered what I have paid for and that considering
that our relationship with Mobil Oil had been such a long standing one,
they should have considered that this
price increase should have been handled with more objectivity.
Q How about you personally, how did
this incident affect you?
ATTY. VENERACION:
That is what he has
been answering, Your Honor.
ATTY. FERRER:
Q Personally and emotionally?
A As Mr. Oliveros
and Mr. Estagle know I was very very
upset over this matter. In fact, I was
practically shouting over the telephone over this matter and I was deeply upset
over this matter, Your Honor. (Tsn., 1-8-75, pp. 70-76).
Considering the foregoing, the Court holds
defendant liable to plaintiff for moral damages, which is assessed at P50,000.00.
5. Plaintiff has been
compelled to litigate in this instance, and justifiably so, for which reason
this Court holds defendant liable to plaintiff for attorney’s fees, which is
fixed at P10,000.00.
(Amended Record on Appeal, pp. 66-80)
One of the reasons why Mobil
Oil Philippines, Inc. did not deliver immediately the pre-paid order of February
15, 1974 involved in this case is because appellee
Fernando A. Pedrosa had an unpaid balance of
P5,653.34 on his account as of December 31, 1973 and it was company policy to
require all dealers to liquidate all their outstanding balances at the end of
1973 before further delivery of oil products would be made to them (T.S.N.,
January 8, 1975, p. 30; April 2, 1975, pp. 25-27, p. 8) and that the price
differential of P2,880.00 had not yet been paid.
However, the exact state of appellee’s
account balance with Mobil was really immaterial for the purpose of filling appellee’s February 15th order because as judicially
represented by appellant in their answer, appellee’s
order of February 15, 1974 involved in this case was duly approved by Mobil’s
credit man as follows:
On February 15, 1974,
plaintiff, thru his representative, placed a product order at 2:20 P.M. and to accommodate plaintiff, the
said order was approved by the credit man before closing of the Mobil Terminal
at 4:00 P.M. with a final warning that
no further delivery would be acted upon unless the outstanding balance of P5,653.34 is fully paid.
(Paragraph 5, Affirmative and Special Defenses, Amended Answer, p. 28,
Record on Appeal)
Mobil’s credit man, Floro Marcella
testified that he did approve the order of February 15, 1974 (T.S.N., September 3, 1975, p. 63). This clearly means that Mobil would deliver
the order of February 15th although there was still an unpaid balance of P5,653.34 because what would really be affected by the unpaid
balance of P5,653.34 are the order subsequent to the order of February 15, 1974. And that order of February 15 was delivered
on March 5 even though appellee had not (and still up
to the present has not) yet paid the price differential of P2,880.00
that appellant was demanding. This goes
to show, that contrary to appellant’s contention, they do deliver orders even
if the customer has unpaid balance on account.
Another reason or excuse advanced by the appellant why the delivery
of the pre-paid order of February 15,
1974 was suspended was because Mobil does not make any delivery on
Saturdays and Sundays effective September
8, 1973 (Exhibit 2).
Dioscoro Franco, another Mobil dealer and
witness for appellee, testified that he placed orders
on Fridays which were delivered the following day, Saturday, as evidenced by the following exhibits:
1. Exhibits
J and K – Sales Invoices Nos. 35416 and 35417 for 6,000 and 12,000 liters of
gasoline, respectively, both dated January 4, 1974 (a Friday) and both shipped
or delivered on January 5, 1974 (a
Saturday). Mr. Franco testified that he
actually requested that those particular orders be delivered that same day,
Friday, but Mobil delivered them the following day instead, a Saturday (t.s.n., April 22, 1976, pp. 17-21).
2. Exhibits
L and M – Sales Invoices Nos. 04295 and 04296 for 12,000 and 14,000 liters of gasoline, respectively, both dated
February 22, 1974, (a Friday) and both shipped or delivered on
February 23, 1974 (a Saturday). Mr.
Franco testified that he requested that those particular orders be delivered
the following day, a Saturday, and Mobil complied (surprisingly in the face of its supposed ‘no Saturday delivery’
rule). (T.s.n.,
April 22, 1976, pp. 25-26)
Mobil’s witness, Mario Oliveros, tried
self-exoneratingly to justify and qualify these
Saturday deliveries to Mr. Franco as being exceptions but he could not say who in Mobil decides on the exceptions (T.s.n., April 23, 1975, pp. 61-63).
Still, another excuse given by Mobil was that the coupon system was
a cause of the delay in the
delivery of the fuel.
Appellant’s witness Mario Oliveros stated
that the coupon system of rationing gasoline among the consumers was another
cause for the delay in delivery of plaintiff?appellee’s
pre-paid order of February 15, 1974. The supposed laborious work involved in a
dealer submitting these coupons to the oil company when placing an order unduly
burdened the system of placement and processing of orders (T.s.n.,
April 23, 1975, p. 62).
The evidence clearly shows that the coupon system could not be a
reason for the delay in appellant’s deliveries of appellee’s
pre-paid order. (Exhibits J, K, L, and M
show that the orders of Mr. Dioscoro Franco were
served on the day following the date of the invoice and the day of service was even a Saturday.)
Also, there are the rebuttal exhibits regarding Mr. Dioscoro Franco’s orders Exhibits Q, Q-1 to Q-24 covering
the period from January 14 to February
28, 1974 which are described as follows:
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The above rebuttal evidence clearly, indisputably and conclusively
shows that Mobil Oil Philippines, Inc. made deliveries to Mr. Dioscoro Franco’s gasoline station on the same day as the
date of the invoices in accordance with the request that the delivery be made
“today”. These invoices
disprove the excuses of Mobil that it had a beck-log of gasoline orders and
that the coupon system of distribution then in force accounted for the alleged
delay in delivery of plaintiff’s order.
Another Mobil dealer and witness for appellee,
Joaquin Coronel, testified in this case in connection with a pre-paid order he placed with
the company on February 14, 1974,
a Thursday, which was never delivered because the price increase took effect on
February 18, 1974 and Mobil
wanted him to pay the price differential.
Mr. Coronel refused to pay the price
increase differential and filed an administrative case against Mobil with the
Oil Industry Commission (OIC), OIC Case No. 193 entitled “In the Matter of
the Refusal to Deliver Prepaid Oil Products, Joaquin P. Coronel,
Petitioner, versus Mobil Oil Philippines, Inc., Respondent.”
In its decision, the Oil Industry Commission, while finding itself without the jurisdiction or power to grant
the relief Mr. Coronel prayed for, nonetheless found
respondent Mobil definitely guilty of the charge imputed to it by complainant Coronel. Hence, on
pages 4 and 5 of the decision, the Oil Industry Commission said:
On this, it is our considered view that the enticement of
additional profit should not be allowed to prevail over the social and economic
responsibility that the oil companies assumed the very moment they set out to
manufacture and sell petroleum products in this country. When the incident subject matter of this case
occurred, the whole country including the Metropolitan Manila Area, was in the
grip of an acute fuel shortage. This was
precisely the reason why the government, through all the agencies concerned,
was pushing through a campaign intended to make available to the consuming
public as much product as possible by going against hoarders and blackmarketers and conducting inventories of all kinds of
petroleum products in refineries, depots, and gasoline stations. Any act of withholding any quantity of
petroleum product from the market then undermined to the same extent the
efforts of the government to insure a continuous flow of supply.
x x
x. This
Commission, however, could see no reason (and no reason really was put forward
by respondent) for withholding the delivery, except that respondent had
anticipated the grant of the increase in prices, and motivated by a desire to
realize more profit, held on to its product instead of causing its immediate
delivery to the petitioner. The adverse
effect on the jeepney drivers and operators and the
commuting public of such ill-advised decision of respondent can only be
imagined. But certainly 6,000 liters of
diesel oil could have caused many jeepneys to ply
their respective routes and carry passengers to their places of work and
thereby afforded many segments of the community some form of benefit or
another. (Exhibit N, pp. 4 and 5)
Therefore, in the dispositive portion of
the decision, the Oil Industry Commission declared:
. . . declares respondent’s act of
unreasonably delaying delivery of petroleum products ordered and paid for in
advance by petitioner to be violative of the
directives and regulations on the matter, and hereby sternly warns said
respondent that any other similar act that it may commit in the future with
respect to herein petitioner or to any of its other dealers shall be dealt with
more severely.
(Exhibit N, p. 7)
We will now determine whether the award by the court a quo of P25,000.00 for exemplary and
P50,000.00 for moral damages is reasonable or not.
Alberto Latuno, witness for defendant?appellant, on direct examination
testified as follows:
Q. What
about the 18th, why was it not proceeded on the 18th?
A. Because on the 18th, sir, we had this
price increase and we had to give priority to the invoices already with our
warehouse and dispatcher which were recalled for re-pricing.
Q. They
were recalled, Mr. Latuno, for re-pricing because of
the price increase?
A. Yes,
sir.
COURT:
Mr. Latuno,
in order for your company to increase the price in accordance with the price
increase which took effect in February 19?
A. Yes,
Your Honor.
COURT:
Proceed.
ATTY. VENERACION:
And this invoice was
already in the warehouse.
A. And
bulk dispatcher, sir.
Q. So
that was given priority?
A. Yes,
sir.
(T.S.N., September 3,
1975, pp. 145-147)
Mr. Mario Oliveros, witness for
defendant-appellant, also testified that they had to recall and re-process all
orders previously invoiced because of the price increase which took effect on
February 18, 1974 (T.s.n., April 2, 1975, p. 14).
The above clearly indicates that defendant-appellant gave priority
to the recall and reprocess of all invoices already with their warehouse and
dispatcher for re-pricing because of the price increase which took effect on February 18, 1974. This means that all invoices covering orders
already paid for as early as February 14 and 15, 1974 were recalled and revised
to reflect the price increase and said orders were not delivered unless the
dealers pay the corresponding price differential. Defendant-appellant cancelled the orders of
dealers like Dioscoro Franco and Joaquin P. Coronel who refused to pay the price differentials and
their payments were just treated as payments on their respective accounts (T.s.n., April 22, 1976, pp. 61-63)
Therefore,
defendant-appellant’s act of unreasonably delaying delivery of petroleum
products ordered and paid for in advance by its dealers is not only violative of the directives and regulations of the Oil
Industry Commission, but also allowed
appellant to amass unreasonably huge profits which if it had exercised
fairness, honesty, good faith, and ordinary diligence in its business dealings,
said profits should have gone to its dealers to whom it legitimately belonged. Such awards are necessary retribution for the
oppressive, malevolent, unfair and high-handed actuations of the
defendant-appellant.
(Rollo,
pp. 55-67)
We find the above factual
findings as a fair, reasonable and just conclusion well grounded on the documentary
and testimonial evidence presented in court which were
not convincingly disputed by petitioner Mobil Oil Philippines. As We found nothing capricious, whimsical, speculative or
arbitrary in the conclusions arrived at, the same cannot
be disturbed on appeal.
Finally, We will consider private respondent’s motion addressed to Us
pending final judgment of this case
–
a) to require petitioner to
file a supersedeas bond or deposit with this Court
the amount awarded to private respondent by the lower court; and
b) the
judgment award should be adjusted upward by at least 150% in keeping with the
inflation that has supervened.
Petitioner in their
“Rejoinder and Opposition” assured this Court that “it has more than adequate assets or financial resources to pay any judgment that may be rendered against it, in fact, it emphasized that “it has already taken sufficient steps
for the protection of the interest of its creditors and has even appointed
trustees x x
x, for
the purpose of receiving all claims against the petitioner for settlement. Aside from this, the issue has already become
moot and academic at this stage. On the
second issue for adjustment claims, private respondent has no basis in contract
or in law. Parenthetically, the
principle We laid down in the case of Commissioner of
Public Highways vs. Burgos (96 SCRA 831) can be applied here, to wit:
“xxx an agreement is needed
for the effects of an extraordinary inflation to be taken into account to alter
the value of the currency at the time of the establishment of the obligation
which, as a rule, is always the determinative element, to be varied by
agreement that would find reason only in the supervention
of extraordinary inflation or deflation.”
(pp. 837-838 underscoring ours).
Moreover, in his concurring opinion in the same case, Justice
Claudio Teehankee stated:
“I concur in the result with the observation that the
statements in the main opinion re the applicability or non?applicability
of Article 1250 of the Civil Code should be taken as obiter dicta,
since said article may not be invoked
nor applied without a proper declaration
of extraordinary inflation or deflation of
currency by the competent authorities.”
(p. 840, underscoring ours)
In the case at bar, the obligation
of the petitioner, if any, is based on law since the same calls for the
application of the Civil Code provisions on damages. Moreover, there has been no official
pronouncement or declaration of the existence of extraordinary inflation or deflation.
WHEREFORE, premises considered, finding lack of merit
in the petition, the same is hereby DISMISSED and the appealed judgment of the
appellate court is hereby AFFIRMED.
SO ORDERED.
Melencio-Herrera, (Chairman), Sarmiento, and Regalado, JJ., concur.
Padilla, J., no part; former
counsel of petitioner-company.
[1]
Penned by Justice Jose A.R. Melo,
concurred in by Justices Mama D. Busran and Guillermo
P. Villasor.
[2]
Penned by Judge Ulpiano Sarmiento.