Bunge Corporation v. Camenforte
REITERATIONFacts
The Antecedents: Plaintiffs-appellees (Bunge Corporation and Universal Commercial Agencies) entered into a contract with defendants-appellants (Elena Camenforte & Company, doing business as Visayan Products Company) on October 22, 1947, for the sale of 500 long tons of Philippine copra at a specified price, C & F Pacific Coast, U.S.A. The contract stipulated shipment during November or December 1947. Plaintiffs claim defendants failed to deliver the copra within the agreed period, causing them damages. Plaintiffs had, in turn, sold the copra to El Dorado Oil Works, believing defendants would comply with their contract. Procedural History: The trial court ordered Elena Camenforte & Company to pay plaintiffs P79,744, with legal interest and costs. In case of insolvency, co-defendants were to pay jointly and severally. Defendants appealed. The Petition: Appellants contend that the lower court erred in awarding damages because their failure to deliver was due to force majeure (destruction of stored copra by a storm), which should exempt them from liability. They now admit a contract was entered into, abandoning their lower court defense of denying the contract's existence.
Issue(s)
Whether the obligation to deliver 500 tons of Philippine copra was extinguished by the destruction of the defendants' gathered stock in Samar due to a storm (force majeure).
Ruling
The Supreme Court affirmed the decision of the lower court, holding that the defendants are liable for damages. The Court ruled that the obligation was generic and thus not extinguished by the destruction of the specific copra stored by the defendants.
Ratio Decidendi
On Issue 1: The Court held that the subject matter of the contract—500 long tons of merchantable Philippine copra—was generic because the agreement did not refer to any particular or specific lot of copra, nor did it mention a specific source or place of origin. Since the contract gave the vendor the liberty to acquire the copra from any part of the Philippines and no portion had been earmarked or segregated, the copra stored in Samar was not the specific object contemplated by the parties. Applying the principle of 'genus nunquan perit' (the genus never perishes), the Court emphasized that a generic obligation is not extinguished by the loss of a particular item belonging to that class. Citing De Leon v. Soriano, the Court noted that unless there is a stipulation that the goods were to be produced from a specific land, a fortuitous failure of crops or stock does not excuse performance. Furthermore, under the ruling in Reyes v. Caltex, catastrophes such as floods or wars are considered collateral incidents that the debtor should provide for via specific stipulations if they wish to limit their liability. Because 'Philippine copra' remains available as a commodity, the destruction of the defendants' specific warehouse inventory did not terminate their legal duty to deliver the quantity agreed upon to the plaintiffs.
Main Doctrine
A generic obligation is not extinguished by the loss of a specific thing belonging to a particular genus, as the genus itself never perishes (genus nunquam perit).