ABS-CBN

vs.
COURT OF APPEALS
G.R. No. 128690. January 21, 1999

FACTS: 

In 1990, ABS CBN and Viva executed a Film Exhibition Agreement whereby Viva gave ABS
CBN an exclusive right to exhibit some Viva films.  Said agreement contained a stipulation that ABS
shall have the right of first refusal to the next 24 Viva films for TV telecast, provided that such right
shall be exercised by ABS from the actual offer in writing. Hence, through this agreement, Viva
offered ABS a list of 36 films from which ABS may exercise its right of first refusal.  ABS however,
through VP Concio, did not accept the list since she could only tick off 10 films.  This rejection was
embodied in a letter. In 1992, Viva again approached ABS with a list consisting of 52 original films
where Viva proposed to sell these airing rights for P60M. Viva’s Vic del Rosario and ABS’ general
manager Eugenio Lopez III met at the Tamarind Grill to discuss this package proposal.  What
transcribed at that meeting was subject to conflicting versions.
According to Lopez, he and del Rosario agreed that ABS was granted exclusive film rights to
14 films for P36M, and that this was put in writing in a napkin, signed by Lopez and given to del
Rosario.  On the other hand, del Rosario denied the existence of the napkin in which Lopez wrote
something, and insisted that what he and Lopez discussed was Viva’s film package of the 52
original films for P60M stated above, and that Lopez refused said offer, allegedly signifying his
intent to send a counter proposal.  When the counter proposal arrived, Viva’s BoD rejected it;
hence, he sold the rights to the 52 original films to RBS.
Thus, ABS filed before RTC a complaint for specific performance with prayer for TRO against
RBS and Viva.  RTC issued the TRO enjoining the airing of the films subject of controversy.   After
hearing, RTC rendered its decision in favor of RBS and Viva contending that there was no meeting
of minds on the price and terms of the offer.  The agreement between Lopez and del Rosario was
subject to Viva BoD approval, and since this was rejected by the board, then, there was no basis for
ABS’ demand that a contract was entered into between them.  That the 1990 Agreement with the
right of first refusal was already exercised by Ms. Concio when it rejected the offer, and such 1990
Agreement was an entirely new contract other than the 1992 alleged agreement at the Tamarind
Grill. 

ISSUE: 

Whether or not there was a perfected contract between Lopez and del Rosario.

RULING:

NO.

Contracts that are consensual in nature are perfected upon mere meeting of the minds. 
Once there is concurrence between the offer and the acceptance upon the subject matter,
consideration, and terms of payment, a contract is produced.  The offer must be certain.  To convert
the offer into a contract, the acceptance must be absolute and must not qualify the terms of the
offer; it must be plain, unequivocal, unconditional, and without variance of any sort from the
proposal.  A qualified acceptance, or one that involves a new proposal, constitutes a counter offer
and is a rejection of the original offer.  Consequently, when something is desired which is not
exactly what is proposed in the offer, such acceptance is not sufficient to generate consent because
any modification or variation from the terms of the offer annuls the offer.
In the case at bar, when Del Rosario met with Lopez at the Tamarind Grill, the package of 52
films was Viva’s offer to enter into a new Exhibition Agreement.  But ABS, through its counter
proposal sent to Viva, actually made a counter offer.  Clearly, there was no acceptance.  The
acceptance should be unqualified.