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Go (Ayesha) o As exclusive distributor, Cordero offered for

May 4, 2010 sale to prospective buyers the 25-meter


ALLAN C. GO, doing business under the name and style "ACG Aluminum Passenger catamaran known as
Express Liner," Petitioner, the SEACAT 25
vs. After negotiations with Gos lawyers, Cordero was
MORTIMER F. CORDERO, Respondent. able to close a deal for the purchase of 2 SEACAT 25
as evidenced by the MOA (1997)
MORTIMER F. CORDERO, Petitioner, o They executed Shipbuilding Contract No.
vs. 7825 for one 1 high-speed catamaran
ALLAN C. GO, doing business under the name and style "ACG (SEACAT 25) for the price of
Express Liner," FELIPE M. LANDICHO and VINCENT D. US$1,465,512.00
TECSON, Respondents. o Per agreement between, Cordero shall
Villarama, Jr. J receive commissions totaling
US$328,742.00, or 22.43% of the purchase
SUMMARY: Cordero was an exclusive distributor of a shipping price, from the sale of each vessel
company is Brisbane. After incurring travel expenses and Cordero made 2 trips to the AFFA Shipyard in
closing his first deal with a Cordero, he found out that the latter Australia, and on 1 occasion even accompanied Go
was directly dealing with the shipping company for the second and his family and Landicho, to monitor the progress
transaction, cutting off his commissions. Worse, his lawyers of the building of the vessel
also connived with the client and the shipping company to o He shouldered all the expenses for airfare,
take him out of the picture. He sued them all for conspiring in food, hotel accommodations, transportation
violating his exclusive distributorship in bad faith and wanton and entertainment during these trips
disregard of his rights. The SC held that the existence of the o also spent for long distance telephone calls
contract and knowledge by the alleged interferers was not to Robinson, Go, Tecson and Landicho
disputed. As to the legal justification, it found that while the However, Cordero later discovered that Go was
motive was to reduce the price of the transaction, the bounds dealing directly with Robinson when he was
of permissible financial interest was transgressed, since Go informed by Dennis Padua of Wartsila Philippines that
already incurred expenses in closing the deal, and the lawyers Go was canvassing for a second catamaran engine
still demanded their cut from him, despite going behind his from their company which provided the ship engine
back in procuring another deal. for the first SEACAT 25
o Padua told Cordero that Go instructed him to
Doctrine: The elements of tort interference are: (1) existence fax the requested quotation of the second
of a valid contract, (2) knowledge on the part of the third engine to the Park Royal Hotel in Brisbane
person of the existence of a contract, and (3) interference of where Go was then staying
the third person is without legal justification. As to the third o Cordero tried to contact Go and Landicho to
element, to sustain a case for tortuous interference, the confirm the matter but they were nowhere to
defendant must have acted with malice or must have been be found, while Robinson refused to answer
driven by purely impure reasons to injure the plaintiff. his calls
o Cordero immediately flew to Brisbane to
Notes: Without So Ping Bun v. CA and Lagon v. CA, this clarify matters with Robinson, only to find
would have been a case for tortious interference. The SC had out that Go and Landicho were already
to rely in Article 19, to uphold its ruling that there was tortious there in Brisbane negotiating for the
interference. All of this when Article 1314 does not in itself second sale
require malice. Despite repeated follow-up calls, no
explanation was given by Robinson,
CAST: (lol) Go, Landicho and Tecson who
Mortimer F. Cordero Vice-President of Pamana Marketing even made Cordero believe there
Corporation (Pamana) would be no further sale between
Tony Robinson an Australian national based in Brisbane, AFFA and ACG Express Liner.
Australia, who is the Managing Director of Aluminium Fast In a handwritten letter, Cordero informed Go that such
Ferries Australia (AFFA). act of dealing directly with Robinson violated his
exclusive distributorship and demanded that they
Allan C. Go owner/operator of ACG Express Liner of Cebu
respect the same.
City, a single proprietorship o Corderos lawyer, Atty. Tabujara, also wrote
Felipe Landicho and Vincent Tecson lawyers of Go ACG Express Liner assailing the fraudulent
actuations and misrepresentations
FACTS: committed by Go in connivance with his
1996, Cordero ventured into the business of lawyers in breach of Corderos exclusive
marketing inter-island passenger vessels distributorship appointment
o After contacting various overseas fast ferry o Having been apprised of Corderos demand
manufacturers from all over the world, he letter, the lawyers of AFFA and Robinson,
came to meet Robinson. faxed a letter to Corderos lawyers asserting
June and August 1997, Robinson signed that the appointment of Cordero as
documents appointing Cordero as the exclusive AFFAs distributor was for the purpose of
distributor of AFFA catamaran and other fast ferry 1 transaction only and that the offer of
vessels in the Phils exclusive distributorship was already
being revoked for failure of Cordero to
Go v Cordero |1
return the draft agreement within a It was Cordero who stopped communicating.
reasonable time. o He was not doing his part in making
Cordero later testified that, on the same day, progress status reports that Go had to
Landicho talked to him over the telephone and offered engage the services of Landicho to fly to
to amicably settle the dispute Australia to handle matters.
o Tecson and Landicho offered to convince Go As to the inquiry for a Wartsila ship engine, Cordero
to honor his exclusive distributorship with misinterpreted this as indication that Go was buying a
AFFA and to purchase all vessels for ACG second vessel.
Express Liner through him for the next three The lawyers had no transaction with Cordero.
(3) years. o As to the supposed meeting, this was due to
Landicho set up a meeting with Cordero at Mactan the malicious demand of Cordero to be given
Island Resort Hotel lobby. US$3,000,000 as otherwise he will expose in
o However, only Landicho and Tecson came the media the alleged undervaluation of the
o lawyers proposed that they will convince Go vessel with the BOC.
to pay him US$1,500,000.00 on the In any case, Cordero no longer had cause of action
condition that they will get a cut of 20% for his commission for the sale of the second vessel
o so it was agreed that the lawyers will give under the 1997 MOA considering the termination of
Cordero a weekly status report and that the his authority by AFFAs lawyers on 1998.
matter will be settled amicably within 3-4 wks
Cordero would give Landicho and Tecson their RTC QC: in favor of Cordero. (P16,291,352.43) as actual
respective commission, or cuts from his own damages with legal interest from 25 June 1998 until fully paid;
commission P1M as moral damages; P1M as exemplary damages; P1M as
o Said amounts were apart from the earlier attys fees.
expenses shouldered by Cordero for
Landichos airline tickets, transportation, CA: AFFIRMED TC, holding:
food and hotel accommodations for the trip Cordero (not Pamana) was appointed by AFFA as the
to Australia. exclusive distributor in the Phils. as evidenced by the
o However, no such weekly status report Certification issued by Robinson, that Robinson and
was made as it turned out that they had AFFA dealt only with Cordero, and the commissions
no intention to do so and were just were directly paid by Robinson to Cordero.
buying time as the catamaran vessel was o That this distributorship was not limited to
due to arrive from Australia. the sale of one catamaran
Cordero then filed a complaint with the Bureau of He is entitled to a commission of 22.43%
Customs (BOC) to prohibit the entry of SEACAT 25 o However, Cordero is entitled only to
from Australia based on misdeclaration and commission for the sale of the first
undervaluation catamaran obtained through his efforts.
o an Alert Order was issued by BOC for the Cordero is entitled to damages for the breach of his
vessel which in fact arrived on July 17, 1998 exclusive distributorship agreement with AFFA.
o Cordero claimed that Go and Robinson had o As to the P800,000.00 representing
conspired to undervalue the vessel by expenses incurred (airfair, phonebills,
around US$500,000.00 entertainment, etc.) by Cordero: no basis for
Cordero instituted a Civil Case seeking to hold such award, the same being the logical and
Robinson, Go, Tecson and Landicho liable jointly necessary consequences in the field of sales
and solidarily for conniving and conspiring and distribution.
together in violating his exclusive distributorship CA reduced the awards to P500,000.00, P300,000.00
in bad faith and wanton disregard of his rights, and P50,000.00, respectively.
thus depriving him of his due commissions Appellants were held solidarily liable pursuant to the
(balance of unpaid commission from the sale of the provisions of Article 1207 in relation to Articles 19, 20,
first vessel in the amount of US$31,522.01 and 21 and 22.
unpaid commission for the sale of the second vessel
in the amount of US$328,742.00) and causing him BOTH parties appealed
actual, moral and exemplary damages, including Petitioner:
P800,000.00 representing expenses for airplane
travel to Australia, telecommunications bills and Cordero is not the real party-in-interest, it should be
entertainment, on account of AFFAs untimely Pamana
cancellation of the exclusive distributorship No breach in the alleged exclusive distributorship
agreement agreement.
o Cordero also prayed for the award of moral They are not liable for unpaid commissions (and also
and exemplary damages, as well as damages, attorneys fees, and litigation expenses) for
attorneys fees and litigation expenses. it was Robinson who undertook to pay Cordero
Cordero presented documentary evidence including supposed commissions.
photographs of the meeting with Landicho, Tecson Even so, they should not be held solidarily liable with
and Atty. Tabujara at Shangri-la, photographs taken Robinson and AFFA
in Brisbane showing Cordero, Go with his family, Respondent:
Robinson and Landicho, and also various documents, CA should have sustained TCs award of actual
communications, vouchers and bank transmittals. damages for his commission for the second vessel,
Petitioner:
Go v Cordero |2
since there is sufficient evidence to prove that there While it is true that a third person cannot possibly
was a second sale of a vessel. be sued for breach of contract because only
o 1997 MOA provides that go was parties can breach contractual provisions, a
contractually bound to buy two (2) vessels contracting party may sue a third person not for
from AFFA. breach but for inducing another to commit such
o Gos position paper filed before BOC, admits breach.
under oath that he had indeed purchased a Art. 1314 Any third person who induces another to violate his
second vessel from AFFA. contract shall be liable for damages to the other contracting
o Go admitted in their pre-trial brief that they party.
had purchased a second vessel. The elements of tort interference are:
He is entitled to his commissions for the second (1) existence of a valid contract;
vessel, since it was his efforts which actually (2) knowledge on the part of the third person of the
facilitated and set-up the transaction for Go. existence of a contract;
CA should have sustained original amount of (3) interference of the third person is without legal
consequential damages awarded by TC considering justification.
gos bad faith and fraudulent conduct The presence of the first and second elements is not
disputed
ISSUES: o Go et al were clearly aware of the contract
1. WoN Cordero has a cause of action against Go et al between Cordero and AFFA
(YES) o Landicho and Tecson aware of Corderos
2. WoN Go can be held liable even if they are not parties authority, which can be gleaned from their
to the contract (YES) act of immediately furnishing him with copies
3. WoN Go et als interference was unjustified (YES) of bank transmittals everytime Go remits
4. WoN Go et als liability with Robinson and AFFA is payment to Robinson
solidary (YES) o (as to 3rd element, see below)
5. WoN awards justified (YES)
3. interference unjustified
HELD: CA AFFIRMED with MODIFICATION: moral and as enunciated and reiterated in So Ping Bun v. CA:
exemplary damages are reduced to P300,000.00 and A duty which the law of torts is concerned with is
P200,000.00, respectively respect for the property of others, and a cause of
action ex delicto may be predicated upon an unlawful
RATIO: interference by one person of the enjoyment by the
1. Cordero has cause of action other of his private property. This may pertain to a
Cordero is the exclusive distributor and not Pamana situation where a third person induces a party to
(adopted CAs ratio) AND Cordero has proprietary renege on or violate his undertaking under a contract.
rights under the agreement that he may protect. General rule: justified interference with the
Yu v. CA: the right to perform an exclusive distributorship business relations of another exists where the actors
agreement and to reap the profits resulting from such motive is to benefit himself
performance are proprietary rights which a party may protect. o It is sufficient if the impetus of his conduct
rights granted not be rendered illusory by interposing lies in a proper business interest rather than
a person to obtain goods for which the exclusive in wrongful motives
distributorship was conceptualized. o He acts in self-protection in this case
o Cordero was no longer informed and had NOT necessary that the interferers
clearly been cut off from the transaction until interest outweigh that of the party
the arrival of the first SEACAT 25 whose rights are invaded
o was not paid the balance of his commission NOT necessary that an individual
o Go et al directly dealt with Robinson behind acts under an economic interest
Corderos back that is substantial, not merely de
o Worse, AFFA even terminated his exclusive minimis
dealership insisting that his services were Unjustified interference: sole motive is to cause harm
engaged for only 1 transaction. to the other
GO et al: this case not similar to Yu v.CA o induce refers to situations where a
no conclusive proof that they actually purchased a person causes another to choose one
second SEACAT 25 directly from AFFA course of conduct by persuasion or
hence there was no violation of the exclusive intimidation
distributorship agreement o Malice connotes ill will or spite, and speaks
SC: YES, there is NO sufficient evidence of second purchase. not in response to duty
BUT this will not absolve Go et al from liability. implies an intention to do ulterior
They clearly acted in bad faith in bypassing and unjustifiable harm
Cordero. Malice is bad faith or bad motive
Cordero incurred losses as he was not paid the
balance of his commission and his exclusive Lack of malice precludes damages. But it does not
distributorship was revoked. relieve a person of the legal liability for entering into
contracts and causing breach of existing ones.
2. Go et al can still be held liable (despite Gos averments o Gilchrist vs. Cuddy: Not a malicious
that it was AFFAs obligation and not theirs) interferer if there is no malice and the

Go v Cordero |3
impulse behind ones conduct lies in a Exemplary damages is also in order
proper business interest rather than in o However, RTC and CA awards excessive
wrongful motives o Awards reduced
o Lagon v. CA: to sustain a case for tortuous
interference, the defendant must have acted
with malice or must have been driven by
purely impure reasons to injure the plaintiff
(unjustified interference)
In this case!
act of Go, Landicho and Tecson in inducing Robinson
and AFFA to enter into another contract to obtain a
lower price for the second vessel resulted in AFFAs
breach of its contractual obligation to pay in full
the commission due to Cordero and unceremonious
termination of Corderos appointment as exclusive
distributor
such act may not be deemed malicious if impelled by
a proper business interest rather than in wrongful
motives (Gilchrist)
o however! it was demonstrated that Go et
al transgressed the bounds of
permissible financial interest to benefit
themselves at the expense of Cordero
o they furtively went directly to Robinson after
Cordero had worked hard to close the deal
for them
o worst, even as Go et al secretly negotiated
with Robinson for the purchase of a second
vessel, Landicho and Tecson continued to
demand and receive from Cordero their
commission or cut from Corderos own
earned commission from the first sale
lawyers failed to refute the receipts
signed by them
o They clearly connived not only in ensuring
that Cordero would have no participation in
the second sale, but also that he would not
be paid the balance of his commission
This, despite their knowledge that it
was commission already earned by
and due to Cordero
o The failure of Robinson, Go, Tecson and
Landicho to act with fairness, honesty
and good faith, to the prejudice of
Cordero, is further proscribed by CC Art.
19 (complemented with 21)

Go et al: There was another contract superseding the 1997


MOA and that Cordero merely misinterpreted the inquiry on
engine price.
SC: allegations unconvincing and a mere afterthought
It appears that the purported second contract stating
a lower price of US$1,150,000.00 (not
US$1,465,512.00) was only presented before the
BOC to show that the vessel imported was not
undervalued by almost US$500,000.00

4. solidarily liable
Conformably with NCC 2194, the responsibility of two
or more persons who are liable for the quasi-delict is
solidary
Obligations arising from tort are, by their nature,
always solidary.

5. moral damages may be recovered (NCC 2219)


Go et al acted in bad faith
Go v Cordero |4