G.R. No.
L-2724 August 24, 1950 that of its nature, to the genus (genero) to which
it pertains, such as a horse, a chair.
JOSE DE LEON, CECILIO DE LEON, in their
individual capacity, and JOSE DE LEON and Except as to quality and quantity, the first of which
CECILIO DE LEON , as administrators of the is itself generic, the contract sets no bounds or
intestate estate of Felix de Leon, petitioner, limits to the palay to be paid, nor was there even
vs. any stipulation that the cereal was to be the
ASUNCION SORIANO, respondent. produce of any particular land. Any palay of the
quality stipulated regardless of origin on however
FACTS: Jose de Leon, Cecilio de Leon and acquired (lawfully) would be obligatory on the part
Albina de Leon, petitioners herein were natural of the obligee to receive and would discharge the
children of Felix de Leon, deceased, while obligation. It seems therefore plain that the
Asuncion Soriano, respondent herein is his alleged failure of crops through alleged fortuitous
widow. In the administration and settlement of the cause did not excuse performance.
decedent's estate then pending in the Court of
First Instance, Asuncion and the natural children Where a person by a contract charges
reached on March 23, 1943 an agreement, himself with an obligation possible to be
approved by the probate court, whereby the performed, he must perform it, unless its
natural children obligated themselves at the end performance is rendered impossible by
of each of agricultural year (the month of March the act of God, by the law, or by the other
of every year), to give to Asuncion the total party, it being the rule that in case the
amount of 5,700 cavanes of palay. Delivery of the party desires to be excused from
palay shall be made in the warehouse required by performance in the event of
the government, or if there be none such, at the contingencies arising, it is his duty to
warehouse to be selected by Asuncion, in San provide therefor in his contract. Hence,
Miguel, Bulacan, free from the cost of hauling, performance is not excused by
transportation, and from any all taxes or charges. subsequent" inability to perform, by
It is expressly stipulated that this annual payment unforseen difficulties, by unusual or
of palay shall cease upon the death of Asuncion unexpected expenses, by danger, by
and shall not be transmissible to her heirs or to inevitable accident, by the breaking of
any other person. The defendants made machinery, by strikes, by sickness, by
deliveries to the plaintiff a total of 2,300 cavanes failure of a party to avail himself of the
which was 3,400 cavanes short of the 5,700 benefits to be had under the contract, by
cavanes. It was to recover this shortage or its weather conditions, by financial
value that this action was commenced. stringency, or by stagnation of business.
Neither is performance excused by the
The defendants averred that their failure to pay fact that the contract turns out to be hard
the exact quantities of palay promised for 1944, and improvident, unprofitable or
1945 and 1946 was due to "the Huk troubles in impracticable, ill advised, or even foolish,
Central Luzon which rendered impossible full or less profitable, or unexpectedly
compliance with the terms of the agreement;" and burdensome. (17 C. J. S. 946 - 948).
it was contended that "inasmuch as the
obligations of the defendants to deliver the full In the absence of a statute to the
amount of the palay is depending upon the contrary, conditions arising from a state
produce as this is in the nature of an annuity, . . . of war in which the country is engaged,
the obligations of the defendants have been fully will not ordinarily constitute an excuse for
fulfilled by delivering in good faith all that could be non-performance of contract; and
possible under the circumstances." impossibility of performance arising from
the acts of the legislature and the
CFI: Ordered plaintiff to pay for 3,400 cavanes of executive branch of government in war
palay or its equivalent in cash, which was found time does not, without more, constitute
to be 24,900, and legal interest. an excuse for non-performance. (17
C.J.S., 953, 954.)
CA: Affirmed CFI
In considering the effect of impossibility
SC Ruling: of performance on the rights of the
parties, it is necessary to keep in mind
the distinction between: (1) Natural
Article 1182 of the Civil Code which was in force impossibility preventing
at the time agreement in question was entered performance from the nature of the
into, provide that "Any obligation which consists things and (2) impossibility in fact, in the
in the delivery of a determinate thing shall be absence of inherent impossibility in the
extinguished if such thing should be lost or nature of the thing stipulated to be
destroyed without fault on the part of the debtor performed. (17 C.J.S., 951.) In the words
and before he is in default. Inversely, the of one Court impossibility must consist in
obligation is not extinguished if the thing that the nature of thing to be done and not in
perishes is indeterminate. the inability of the party to do it. (City of
Montpelier vs. National Surety Co., 122
Manresa explains the distinction between A., 484; 97 Vt., Ill; 33 A.L.R., 489.) As
determinate and generic thing in his comment on others have put it, to bring the case within
article 1096 of the Civil Code of Spain, saying that the rule of impossibility, it must appear
the first is a concrete, particularized object, that the thing to be done cannot by any
indicated by its own individuality, while a generic means be accomplished, for if it is only
thing is one of whose determination is confined to improbable or out of the power of the
obligor, it is not in law deemed RTC: Ruled in favor of herein private respondent
impossible. (17 C.J.S., 442). The first
class of impossibility goes to the WHEREFORE, judgment is rendered in
consideration and renders the contract favor of the plaintiff and against the
void. The second, which is the class of defendants. The defendants are ordered
impossibility that we have to do here, to pay solidarity to the plaintiff the present
does not. (17 C.J.S., 951, 952.) value of the motorcycle which was totally
destroyed, plus interest equivalent to
what the Kabankalan Sub-Branch of the
Development Bank of the Philippines will
G.R. No. 91029 February 7, 1991 have to charge the plaintiff on fits
account, plus P50.00 per day from
NORKIS DISTRIBUTORS, INC., petitioner, February 3, 1980 until full payment of the
vs. said present value of the motorcycle, plus
THE COURT OF APPEALS & ALBERTO P1,000.00 as exemplary damages, and
NEPALES, respondents. costs of the litigation. In lieu of paying the
present value of the motorcycle, the
defendants can deliver to the plaintiff a
FACTS: Petitioner Norkis Distributors, Inc. is the brand-new motorcycle of the same
distributor of Yamaha motorcycles with Avelino brand, kind, and quality as the one which
Labajo as its Branch Manager. Private was totally destroyed in their possession
respondent Alberto Nepales bought from the last February 3, 1980.
Norkis a brand new Yamaha Wonderbike
motorcycle. The price of P7,500.00 was payable
CA: Affirmed RTC but deleted the award of
by means of a Letter of Guaranty from the
damages "in the amount of Fifty (P50.00) Pesos
Development Bank of the Philippines (DBP),
a day.
which Norkis' Branch Manager Labajo agreed to
accept. Hence, credit was extended to Nepales
for the price of the motorcycle payable by DBP ISSUE: Who should bear the loss of the
upon release of his motorcycle loan. As security motorcycle
for the loan, Nepales would execute a chattel
mortgage on the motorcycle in favor of DBP. The answer to this question would
Branch Manager Labajo issued Norkis Sales depend on whether there had already been a
Invoice showing that the contract of sale of the transfer of ownership of the motorcycle to private
motorcycle had been perfected. Nepales signed respondent at the time it was destroyed.
the sales invoice to signify his conformity with the
terms of the sale. In the meantime, however, the SC RULING: AFFIRMED CA
motorcycle remained in Norkis' possession.
The issuance of a sales invoice does not prove
The motorcycle was then registered in the Land transfer of ownership of the thing sold to the
Transportation Commission in the name of buyer. An invoice is nothing more than a detailed
Alberto Nepales. The registration fees were paid statement of the nature, quantity and cost of the
by him, evidenced by an official receipt. thing sold and has been considered not a bill of
sale. In all forms of delivery, it is necessary that
On January 22, 1980, the motorcycle was the act of delivery whether constructive or actual,
delivered to a certain Julian Nepales who was be coupled with the intention of delivering the
allegedly the agent of Alberto Nepales but the thing. The act, without the intention, is insufficient.
latter denies it. The record shows that Alberto and
Julian Nepales presented the unit to DBP's When the motorcycle was registered by Norkis in
Appraiser-Investigator Ernesto Arriesta. The the name of private respondent, Norkis did not
motorcycle met an accident on February 3, 1980. intend yet to transfer the title or ownership to
An investigation conducted by the DBP revealed Nepales, but only to facilitate the execution of a
that the unit was being driven by a certain chattel mortgage in favor of the DBP for the
Zacarias Payba at the time of the accident. The release of the buyer's motorcycle loan. The Letter
unit was a total wreck, was returned, and stored of Guarantee issued by the DBP, reveals that the
inside Norkis' warehouse. execution in its favor of a chattel mortgage over
the purchased vehicle is a pre-requisite for the
On March 20, 1980, DBP released the proceeds approval of the buyer's loan. If Norkis would not
of private respondent's motorcycle loan to Norkis accede to that arrangement, DBP would not
in the total sum of P7,500. As the price of the approve private respondent's loan application
motorcycle later increased to P7,828 in March, and, consequently, there would be no sale.
1980, Nepales paid the difference of P328 and
demanded the delivery of the motorcycle. When In other words, the critical factor in the different
Norkis could not deliver, he filed an action for modes of effecting delivery, which gives legal
specific performance with damages against effect to the act, is the actual intention of the
Norkis. He alleged that Norkis failed to deliver the vendor to deliver, and its acceptance by the
motorcycle which he purchased, thereby causing vendee. Without that intention, there is no
him damages. tradition.
Norkis answered that the motorcycle had already In the case of Addison vs. Felix and Tioco (38
been delivered to private respondent before the Phil. 404, 408), this Court held:
accident, hence, the risk of loss or damage had
to be borne by him as owner of the unit.
The Code imposes upon the vendor the
obligation to deliver the thing sold. The
thing is considered to be delivered when
it is "placed in the hands and possession
of the vendee." (Civil Code, Art. 1462). It
is true that the same article declares that
the execution of a public instrument is
equivalent to the delivery of the thing
which is the object of the contract, but, in
order that this symbolic delivery may
produce the effect of tradition, it is
necessary that the vendor shall have had
such control over the thing sold that, at
the moment of the sale, its material
delivery could have been made. It is not
enough to confer upon the purchaser
the ownership and the right of
possession. The thing sold must be
placed in his control. When there is no
impediment whatever to prevent the thing
sold passing into the tenancy of the
purchaser by the sole will of the vendor,
symbolic delivery through the execution
of a public instrument is sufficient. But if
notwithstanding the execution of the
instrument, the purchaser cannot have
the enjoyment and material tenancy of
the thing and make use of it himself or
through another in his name, because
such tenancy and enjoyment are
opposed by the interposition of another
will, then fiction yields to reality-the
delivery has riot been effects .
The Court of Appeals correctly ruled that the
purpose of the execution of the sales invoice and
the registration of the vehicle in the name of
plaintiff-appellee (private respondent) with the
Land Registration Commission was not to
transfer to Nepales the ownership and dominion
over the motorcycle, but only to comply with the
requirements of the Development Bank of the
Philippines for processing private respondent's
motorcycle loan. Before private respondent's loan
was released and before he even paid Norkis, the
motorcycle had already figured in an accident
while driven by one Zacarias Payba. Payba was
not shown by Norkis to be a representative or
relative of private respondent. The latter's
supposed relative, who allegedly took possession
of the vehicle from Norkis did not explain how
Payba got hold of the vehicle. Norkis' claim that
Julian Nepales was acting as Alberto's agent
when he allegedly took delivery of the motorcycle
is controverted by the latter. Alberto denied
having authorized Julian Nepales to get the
motorcycle from Norkis Distributors or to enter
into any transaction with Norkis relative to said
motorcycle. This circumstances more than amply
rebut the disputable presumption of delivery upon
which Norkis anchors its defense to Nepales'
action.
Article 1496 of the Civil Code which provides that
"in the absence of an express assumption of risk
by the buyer, the things sold remain at seller's risk
until the ownership thereof is transferred to the
buyer," is applicable to this case, for there was
neither an actual nor constructive delivery of the
thing sold, hence, the risk of loss should be borne
by the seller, Norkis, which was still the owner
and possessor of the motorcycle when it was
wrecked. This is in accordance with the well-
known doctrine of res perit domino.
