Barzaga vs. Court of Appeals

A seller who fails to deliver goods at the specific time verbally agreed upon incurs in delay and is liable for damages under Article 1170 of the Civil Code, even when the exact time of delivery is not indicated in the written invoice, where the verbal commitment of the seller's agent binds the seller and time is of the essence given the buyer's pressing circumstances.

Ignacio Barzaga was a grieving husband whose wife had died on December 19, 1990, after a prolonged illness, and who had expressed her dying wish to be buried before Christmas Day. Angelito Alviar operated a hardware store in Dasmarinas, Cavite, from which Barzaga sought to purchase construction materials for a niche or tomb for his deceased wife. The transaction was a contract of sale wherein Barzaga would pay the purchase price in full and Alviar would deliver the materials to the Memorial Cemetery in Dasmarinas, Cavite, where Barzaga's hired workers were already waiting.

Ignacio Barzaga's wife died on December 19, 1990, after a prolonged illness. Before her death, she expressed her wish to be laid to rest before Christmas Day to spare her family from keeping vigil over her remains during the Christmas celebration. On December 21, 1990, at about three o'clock in the afternoon, Barzaga went to the hardware store of respondent Angelito Alviar to inquire about the availability of materials for the construction of a niche for his wife and whether the materials could be delivered at once. Marina Boncales, Alviar's storekeeper, replied that she had yet to verify if the store had pending deliveries that afternoon because if there were, all subsequent purchases would have to be delivered the following day. With that reply, petitioner left.

At seven o'clock the following morning, December 22, Barzaga returned to the hardware store to follow up his purchase. He told the store employees that the materials had to be delivered at the Memorial Cemetery in Dasmarinas, Cavite, by eight o'clock that morning since his hired workers were already at the burial site and time was of the essence. Marina Boncales agreed to deliver the items at the designated time, date, and place. With this assurance, Barzaga purchased the materials and paid in full the amount of P2,110.00. He then joined his workers at the cemetery, which was only a kilometer away, to await the delivery.

The construction materials did not arrive at eight o'clock as promised. At nine o'clock, the delivery was still nowhere in sight. Barzaga returned to the hardware store to inquire about the delay. Boncales assured him that although the delivery truck was not yet around, it had already left the garage and the materials would be brought over to the cemetery as soon as it arrived. By ten o'clock, there was still no delivery, and Barzaga returned again to the store, receiving the same answer from respondent's employees, who cajoled him to go back to the burial place. After hours of waiting, Barzaga became extremely upset, dismissed his laborers for the day, and proceeded to the police station to lodge a complaint against Alviar, which was entered in the police blotter. When he returned to the store, he saw the delivery truck already there but the materials he purchased were not yet ready for loading. Distressed that Alviar's employees were not the least concerned despite his impassioned pleas, Barzaga decided to cancel his transaction and look for construction materials elsewhere.

In the afternoon of that day, Barzaga was able to buy from another store, but since darkness was already setting in and his workers had left, he decided to start his project the following morning, December 23. He knew the niche would not be finished in time for the scheduled burial the following day. His laborers had to take a break on Christmas Day and could only resume in the morning of December 26. The niche was completed in the afternoon, and Barzaga's wife was finally laid to rest two-and-a-half days behind schedule.

On January 21, 1991, Barzaga wrote Alviar demanding recompense for the damage he suffered. Alviar did not respond, and Barzaga sued him before the Regional Trial Court. Resisting the claim, Alviar contended that no specific time of delivery was agreed upon because the invoices did not contain any stipulation as to the exact time of delivery, that the delivery truck suffered a flat tire on the way to the store to pick up the materials, and that his men were ready to make the delivery by ten-thirty in the morning of December 22 but petitioner refused to accept them. According to Alviar, it was petitioner's obstinate refusal to accept delivery that caused the delay. The trial court found for petitioner, but the Court of Appeals reversed, ruling that there was no contractual commitment as to the exact time of delivery since this was not indicated in the invoice receipts, and that the arrangement merely implied delivery within a reasonable time. The Court of Appeals also held that assuming there was delay, petitioner still had sufficient time to construct the tomb and hold his wife's burial as she wished.

• Specific Time of Delivery: Petitioner argued that a specific time for delivery was verbally agreed upon with respondent's storekeeper, who assured him that the materials would be delivered at the cemetery by eight o'clock in the morning of December 22, and that the absence of the time in the invoices was immaterial given the positive verbal commitment.

• Time of the Essence: Petitioner maintained that under the prevailing circumstances, time was of the essence in the delivery of the materials to the grave site, as the niche had to be constructed at the very least on December 22 considering that it would take about two days to finish the job if the interment was to take place on December 24.

• Bad Faith and Suppression of Information: Petitioner argued that respondent's storekeeper deliberately suppressed the information that the delivery truck had come from a delivery of materials in Langcaan, Dasmarinas, Cavite, and that had she disclosed this fact, petitioner would not have bought the materials from respondent's store but elsewhere which could meet his time requirement.

• No Specific Time of Delivery: Respondent contended that legal delay could not be validly ascribed to him because no specific time of delivery was agreed upon between them, pointing out that the invoices evidencing the sale did not contain any stipulation as to the exact time of delivery.

• Fortuitous Event: Respondent invoked fortuitous event as an excuse, maintaining that the delivery truck suffered a flat tire on the way to the store to pick up the materials, and that petitioner should have allowed his delivery men a little more time since a few hours more would not really matter.

• Petitioner's Refusal to Accept Delivery: Respondent argued that his men were ready to make the delivery by ten-thirty in the morning of December 22 but petitioner refused to accept them, and that it was this obstinate refusal that caused the delay in the construction of the niche and the consequent failure of the family to inter their loved one on December 24.

• Delay in Delivery: Whether respondent incurred in delay in the performance of his contractual obligation to deliver the construction materials despite the absence of a specific delivery time in the written invoices.

• Fortuitous Event Defense: Whether the flat tire suffered by the delivery truck constituted a fortuitous event that excused respondent's delay in delivery.

• Time of the Essence: Whether time was of the essence in the delivery of the materials to the grave site under the prevailing circumstances.

• Temperate Damages: Whether the trial court correctly awarded temperate damages to petitioner for the wages of hired workers and expenses incurred during the extra two days of the wake.

• Delay in Delivery: Yes. Respondent incurred in delay in the performance of his contractual obligation, as there was a specific time verbally agreed upon for the delivery of the materials to the cemetery, and the positive verbal commitment of respondent's storekeeper bound respondent notwithstanding the absence of the time in the invoices.

• Fortuitous Event Defense: No. The flat tire was a foreseeable event that should have been reasonably guarded against, given the nature of respondent's business which requires that he be ready at all times to meet contingencies of this kind.

• Time of the Essence: Yes. Time was of the essence in the delivery of the materials to the grave site, as the niche had to be constructed at the very least on December 22 considering that it would take about two days to finish the job if the interment was to take place on December 24.

• Temperate Damages: No. The award of temperate damages was erroneous because the pecuniary losses petitioner suffered, such as wages for hired workers and expenses during the extra days of the wake, could be established with certainty by means of payment receipts, and thus fell within the realm of actual or compensatory damages, not temperate damages.

• Delay in Delivery: The Court found that contrary to the appellate court's factual determination, there was a specific time agreed upon for the delivery of the materials to the cemetery. Petitioner went to respondent's store on December 21 precisely to inquire if the materials could be delivered immediately, and was told by the storekeeper that if there were still deliveries to be made that afternoon, his order would be delivered the following day. With this in mind, Barzaga decided to buy the construction materials the following morning after he was assured of immediate delivery according to his time frame. The Court held that the argument that the invoices never indicated a specific delivery time must fall in the face of the positive verbal commitment of respondent's storekeeper, and that it was no longer necessary to indicate in the invoices the exact time the purchased items were to be brought to the cemetery. Storekeeper Boncales herself admitted that it was her custom not to indicate the time of delivery whenever she prepared invoices. The Court cited Article 1170 of the Civil Code, which provides that those who in the performance of their obligation are guilty of fraud, negligence, or delay, and those who in any manner contravene the tenor thereof, are liable for damages. The Court characterized the case as one of non-performance of a reciprocal obligation under Article 1169, last paragraph, of the Civil Code, noting that petitioner had already complied fully with what was required of him as purchaser by paying the purchase price of P2,110.00, and it was incumbent upon respondent to immediately fulfill his obligation to deliver the goods otherwise delay would attach.

• Fortuitous Event Defense: The Court found respondent's justification that his truck had a flat tire unacceptable, as this event, if indeed it happened, was foreseeable according to the trial court and should have been reasonably guarded against. The nature of respondent's business requires that he should be ready at all times to meet contingencies of this kind. The Court also noted that respondent's witness Marina Boncales testified that the delivery truck arrived a little late than usual because it came from a delivery of materials in Langcaan, Dasmarinas, Cavite. This information was withheld from petitioner when he was negotiating for the purchase of construction materials. The Court reasoned that had she told petitioner of this fact and that the delivery would consequently be delayed, petitioner would not have bought the materials from respondent's hardware store but elsewhere which could meet his time requirement. The deliberate suppression of this information by itself manifests a certain degree of bad faith on the part of respondent's storekeeper.

• Time of the Essence: The Court found petitioner's assertion that time was of the essence to be anchored on solid ground. The niche had to be constructed at the very least on December 22 considering that it would take about two days to finish the job if the interment was to take place on December 24. Respondent's delay in the delivery of the construction materials wasted so much time that construction of the tomb could start only on December 23. It could not be ready for the scheduled burial of petitioner's wife, which undoubtedly prolonged the wake, in addition to the fact that work at the cemetery had to be put off on Christmas Day. The Court held that respondent had no right to manipulate petitioner's timetable and substitute it with his own, as petitioner had a deadline to meet, and a few hours of delay was no piddling matter to him who in his bereavement had yet to attend to other pressing family concerns.

• Temperate Damages: The Court deleted the award of temperate damages, citing Article 2224 of the Civil Code, which provides that temperate damages are more than nominal but less than compensatory, and may be recovered when the court finds that some pecuniary loss has been suffered but the amount cannot, from the nature of the case, be proved with certainty. The trial court found that petitioner suffered damages in the form of wages for the hired workers for December 22, 1990, and expenses incurred during the extra two days of the wake, but the record did not show that petitioner presented proof of the actual amount of expenses he incurred. The Court held this was an erroneous application of the concept of temperate damages, as while petitioner may have indeed suffered pecuniary losses, these by their very nature could be established with certainty by means of payment receipts, and thus the claim falls unequivocally within the realm of actual or compensatory damages. The Court cited the rule that in determining actual damages, the court cannot rely on mere assertions, speculations, conjectures or guesswork but must depend on competent proof and on the best evidence obtainable regarding the actual amount of loss.

• Mora Solvendi in Reciprocal Obligations — In reciprocal obligations, the obligor incurs in delay from the time the other party has complied with his own obligation. Here, petitioner had already paid the purchase price in full, and it was incumbent upon respondent to immediately fulfill his obligation to deliver the goods, otherwise delay would attach. The Court applied Article 1169, last paragraph, of the Civil Code to establish respondent's delay.

• Liability for Damages for Breach of Contract — Those who in the performance of their obligations are guilty of fraud, negligence, or delay, and those who in any manner contravene the tenor thereof, are liable for damages under Article 1170 of the Civil Code. The Court applied this provision to hold respondent liable for the damages suffered by petitioner as a consequence of the delay in delivery.

• Temperate Damages — Under Article 2224 of the Civil Code, temperate damages are more than nominal but less than compensatory, and may be recovered when the court finds that some pecuniary loss has been suffered but the amount cannot, from the nature of the case, be proved with certainty. The Court held that temperate damages are not proper where the pecuniary losses could be established with certainty by means of payment receipts, as such claims fall within the realm of actual or compensatory damages, and failure to prove actual expenditure conduces to a failure of the claim.

• Foreseeability of Contingencies in Business — The nature of a business requires that the obligor should be ready at all times to meet contingencies of the kind that occurred, such as a flat tire on a delivery truck. A foreseeable event that should have been reasonably guarded against does not constitute a fortuitous event that excuses delay in performance.

• "The argument that the invoices never indicated a specific delivery time must fall in the face of the positive verbal commitment of respondent's storekeeper. Consequently it was no longer necessary to indicate in the invoices the exact time the purchased items were to be brought to the cemetery." — This passage establishes the ratio decidendi that a verbal commitment as to delivery time binds the seller even when the written invoice does not state the time, and is central to the Court's finding of delay.

• "Private respondent had no right to manipulate petitioner's timetable and substitute it with his own. Petitioner had a deadline to meet. A few hours of delay was no piddling matter to him who in his bereavement had yet to attend to other pressing family concerns." — This passage articulates the Court's rejection of respondent's attempt to minimize the significance of the delay and underscores the principle that time may be of the essence to the obligee.

• "The deliberate suppression of this information by itself manifests a certain degree of bad faith on the part of respondent's storekeeper." — This passage identifies the suppression of material information regarding the delivery truck's prior commitments as evidence of bad faith, supporting the award of moral and exemplary damages.

• "While petitioner may have indeed suffered pecuniary losses, these by their very nature could be established with certainty by means of payment receipts. As such, the claim falls unequivocally within the realm of actual or compensatory damages. Petitioner's failure to prove actual expenditure consequently conduces to a failure of his claim." — This passage defines the proper scope of temperate damages and explains why the trial court's award of temperate damages was erroneous, as the losses were provable with certainty.

• Dichoso vs. Court of Appeals, G.R. No. 55613, December 10, 1990, 192 SCRA 169 — Cited for the rule that in determining actual damages, the court cannot rely on mere assertions, speculations, conjectures or guesswork but must depend on competent proof and on the best evidence obtainable regarding the actual amount of loss.

• People vs. Rosario, G.R. No. 108789, July 18, 1995, 246 SCRA 658 — Cited alongside Dichoso for the same proposition regarding the proof required for actual damages.

• Philippine Airlines, Inc. vs. Court of Appeals, G.R. Nos. 50504-05, August 13, 1990, 188 SCRA 461 — Cited for the rule that the award of damages, attorney's fees, and litigation costs is left to the sound discretion of the court, and if such discretion be well exercised, it will not be disturbed on appeal.

• Article 1170, Civil Code — Provides that those who in the performance of their obligations are guilty of fraud, negligence, or delay, and those who in any manner contravene the tenor thereof, are liable for damages. The Court applied this provision to hold respondent liable for damages arising from his delay in delivering the construction materials.

• Article 1169, last paragraph, Civil Code — Provides that in reciprocal obligations, the obligor incurs in delay from the time the other party has complied with his own obligation. The Court applied this provision to establish that respondent incurred in delay because petitioner had already fully complied with his obligation as purchaser by paying the purchase price.

• Article 2224, Civil Code — Defines temperate damages as more than nominal but less than compensatory, recoverable when the court finds that some pecuniary loss has been suffered but the amount cannot, from the nature of the case, be proved with certainty. The Court applied this provision to delete the trial court's award of temperate damages, holding that the losses were provable with certainty and thus fell within the realm of actual or compensatory damages.

Padilla, Vitug, Kapunan, and Hermosisima, Jr., JJ., concurred.