Professional Documents
Culture Documents
*
G.R. No. 128066. June 19, 2000.
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* SECOND DIVISION.
685
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686
“This will confirm that Pure Foods has awarded to your firm
(FEMSCO) the project,” could not be more categorical. While the
same letter enumerated certain “basic terms and conditions,”
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687
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688
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BELLOSILLO, J.:
Gentlemen:
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691
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2
stand up very well in a court of law.” Meanwhile trial
proceeded as regards the case against PUREFOODS.
On 28 July 1994 the trial court rendered a decision
ordering PUREFOODS: (a) to indemnify FEMSCO the sum
of P2,300,000.00 representing the value of engineering
services it rendered; (b) to pay FEMSCO the sum of
US$14,000.00 or its peso equivalent, and P900,000.00
representing contractor’s mark-up on installation work,
considering that it would be impossible to compel
PUREFOODS to honor, perform and fulfill its contractual
obligations in view of PUREFOOD’s contract with
JARDINE and noting that construction had already started
thereon; (c) to pay attorney’s fees in an amount equivalent
to 20% of the total amount due; and, (d) to pay the costs.
The trial court dismissed the counterclaim filed by
PUREFOODS for lack of factual and legal basis.
Both FEMSCO and PUREFOODS appealed to the Court
of Appeals. FEMSCO appealed the 27 June 1994
Resolution of the trial court which granted the Demurrer to
Evidence filed by JARDINE resulting in the dismissal of
the complaint against it, while PUREFOODS appealed the
28 July 1994 Decision of the same court which ordered it to
pay FEMSCO.
On 14 August 1996 the Court of Appeals affirmed3
in toto
the 28 July 1994 Decision of the trial court. It also
reversed the 27 June 1994 Resolution of the lower court
and ordered JARDINE to pay FEMSCO damages for
inducing PUREFOODS to violate the latter’s contract with
FEMSCO. As such, JARDINE was ordered to pay
FEMSCO P2,000,000.00 for moral damages. In addition,
PUREFOODS was also directed to pay FEMSCO
P2,000,000.00 as moral damages and P1,000,000.00 as
exemplary damages as well as 20% of the total amount due
as attorney’s fees.
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2 Resolution of the trial court dated 27 June 1994; Rollo of G.R. No.
128066, p. 66.
3 Special Fifteenth Division; Decision penned by Associate Justice
Maximiano C. Asuncion, concurred in by Associate Justices Godardo A.
Jacinto, Chairman, and Celia Lipana-Reyes.
692
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4
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fulfillment of a prestation to give, to do, or not to do.”
There can be no contract unless the following requisites
concur: (a) consent of the contracting parties; (b) object
certain which is the subject matter of the contract;
5
and, (c)
cause of the obligation which is established. A contract
binds both contracting parties and has the force of law
between them.
Contracts are perfected by mere consent, upon the
acceptance by the offeree of the offer made by the offeror.
From that moment, the parties are bound not only to the
fulfillment of what has been expressly stipulated but also
to all the consequences which, according to their nature,
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may be in keeping with good faith, usage and law. To
produce a contract, the acceptance must not qualify the
terms of the
7
offer. However, the acceptance may be express
or implied. For a contract to arise, the acceptance must be
made known to the offeror. Accordingly, the acceptance can
be withdrawn or revoked before it is made known to the
offeror.
In the instant case, there is no issue as regards the
subject matter of the contract and the cause of the
obligation. The controversy lies in the consent—whether
there was an acceptance of the offer, and if so, if it was
communicated, thereby perfecting the contract.
To resolve the dispute, there is a need to determine what
constituted the offer and the acceptance. Since petitioner
PUREFOODS started the process of entering into the
contract by conducting a bidding, Art. 1326 of the Civil
Code, which provides that “[advertisements for bidders are
simply invitations to make proposals,” applies. Accordingly,
the Terms and Conditions of the Bidding disseminated by
petitioner PUREFOODS constitutes the “advertisement” to
bid on the project. The bid proposals or quotations
submitted by the prospective suppliers including
respondent FEMSCO, are the offers. And,
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694
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8 G.R. No. 124045, 21 May 1998, 290 SCRA 532, citing Romero v. Court
of Appeals, G.R. No. 107207, 23 November 1995, 250 SCRA 223, and Lim
v. Court of Appeals, G.R. No. 118347, 24 October 1996, 263 SCRA 569.
695
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As can be inferred from the actual phrase used in the first portion
of the letter, the decision to award the contract has already been
made. The letter only serves as a confirmation of such decision.
Hence, to the Court’s mind, there is already an acceptance made
of the offer received by Purefoods. Notwithstanding the terms and
conditions enumerated therein, the offer has been accepted and/or
amplified the details of the terms and conditions contained in the
Terms and Conditions 9
of Bidding given out by Purefoods to
prospective bidders.
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9 Decision of the appellate court, pp. 7-8; Decision of the trial court, p.
5.
10 Art. 1320, Civil Code.
696
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11 Decision of the appellate court, pp. 9-10; Decision of the trial court,
pp. 5-6.
697
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698
SO ORDERED.
——o0o——
699
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