ACI Philippines, Inc. v. Edita Coquia (E.

Cardozo Coquia Enterprise)

G.R. No. 174466; 14 July 2008; Tinga, J.
Digest by: Jocs Dilag (lifted from Ateneo)

FACTS
ACI Phils contracted w/Coquia for the purchase of several thousand tons of flint cullets. After several
deliveries they demanded the reduction of the purchase price to which Coquia agreed but after
receiving the order they refused to pay further demanding reductions.(from 4.2 went down to 3.65 then
to 3.1)
Coquia filed a complaint for ACI to accept and pay for the delivery at the reduced price of 3.65. After 3
days, ACI paid.
TC ruled in favor of Coquia and ordered ACI to accept and pay for the deliveries at 4.20 per kilo + 2.5M in
damages plus interest at legal rate + 200k Attys fees +20k cost of suit.
CA affirmed but deleted Attys fees & cost of suit. It held that the Purchase Order was a contract of
adhesion which must be strictly construed against ACI, it was also contrary to the orig agreement since it
reduced the price.
ACI claims that CA was wrong in compelling them to pay at 4.20 and to pay damages for the alleged
unrealized profits and it wasnot a contract of adhesion since Coquia had the freedom to negotiate the
terms of the contract she entered. It maintained that it didn’t exercise any intimidation on Coquia to
agree on the new Purchase order and assuming that it did it was ratified by the delivery and that the
Statment of Acct already reflected the reduced price. It alsoentered into the contract upon Coquia’s
assurance that she would promptly deliver. Both courts erred in refusing to receive evidence aliunde to
prove that time was an important element of the agreement.

ISSUES
1. WON the PO was a contract of adhesion? NO! Coquia has financial savvy, she deals with big
corporations like La Tondena. She was also the one who sought the contract with ACI. Even the
terms and conditions of the purchase orders themselves don’t show any hint of one-sidedness.
2. WON Courts erred in refusing to receive evidence aliunde to prove that time was an important
element of the agreement? NO! Condition 4 of the PO specifically mentions that the "delivery
date shown on (the purchase order) shall be of the essence of any contract arising" and that
"delivery must be made in strict accordance with the order or delivery schedule..." but the PO
didn’t mention when the cullets were needed.

RATIO
ACI argued that the PO failed to express the true intent of the parties, i.e., that petitioner entered into a
contract with respondent conditioned upon the latter's prompt delivery of flint cullets.
TC rejected claim based on the parol evidence rule.The written document is the best evidence of its own
contents. When the written contract is established as the repository of the parties' stipulations, any
other evidence is excluded and the same cannot be used as a substitute for such contract, nor even to
alter or contradict them.The exception is Sec 9, Rule 130, a party may present evidence to modify,
explain or add to the terms of the agreement if he puts in issue in his pleading the failure of the written
agreement to express the true intent and agreement of the parties. Since an exception was raised as an
issue in the answer, the trial court should not have been so inflexible as to completely disregard ACI’s
evidence.
Coquia was not given definite days during which she should deliver the flint cullets but ACI presented
the unrebutted testimony of Batalon, its materials control manager, to prove that it agreed to the P4.20
per kilo purchase price only because Coquiaassured it of prompt deliveries sufficient for their production
requirements.
ACI was able to prove that the second purchase order with the reduced the price was accepted by
Coquia and they didn’t contain the quantity to be delivered. And she accepted the payment for these
deliveries without protest.