COCA-COLA BOTTLES PHILIPPINES, INC., v.

THE HONORABLE COURT OF

APPEALS and MS. LYDIA GERONIMO.
18 October 1993
Article 1171

Facts:
Private respondent filed a case against petitioner. She alleged that she was a
proprietress of an enterprise engaged in the sale of soft drinks and other goods. Further
alleging, that on or about 12 August 1989 some parents complained about foreign
substances being present in the soft drinks which she was selling. Upon the discovery of
such foreign substances in the beverages, her sale plummeted and as a result incurred
losses. As a result of her losses, she had to lose the shop and, thus, became jobless and
destitute.

Issue:
Whether or not private respondent may seek to annul the contract between her and the
petitioner on the basis of fraud?

Resolution:
Yes. The High Tribunal provided that the vendee is given the right to ask for the
annulment of the contract upon proof of error or fraud, in which case the ordinary rule
on obligations shall be applicable. Under the law on obligations, responsibility arising
from fraud is demandable in all obligations and any waiver of an action for future fraud
is void. Responsibility arising from negligence is also demandable in any obligation, but
such liability may be regulated by the courts, according to the circumstances. Those
guilty of fraud, negligence, or delay in the performance of their obligations and those
who in any manner contravene the tenor thereof are liable for damages.