Lee v. De Guzman
REITERATIONFacts
The Antecedents: On November 8, 1983, Arsenio Tumibay, a salesman for Motorcars, Inc. (then Delta Motors Corporation), signed a price quotation for a Toyota Corolla Liftback for petitioner Alex B. Lee. Petitioner Lee signed the vehicle sales order (Exhibit "C"), and delivery was expected within November 1983. Petitioner Lee deposited P1,000.00 on November 10, 1983. On December 15, 1983, petitioner's counsel demanded delivery. Motorcars, Inc., through its counsel, replied on December 19, 1983, stating they were exercising the option in the sales order due to a sudden change in manufacturer prices, offering to refund the deposit. The sales order stated that sales were at the option of Motorcars, Inc., and required acceptance by specific dealership officers to be valid. Procedural History: The Regional Trial Court (RTC) ruled in favor of Motorcars, Inc., finding no perfected contract because the sales order was not properly accepted and that the company validly exercised its option. The RTC ordered petitioner to pay damages and attorney's fees. The Court of Appeals reversed the RTC, finding a perfected contract of sale and ordering Motorcars, Inc. to deliver the vehicle. This Court, in G.R. No. 77992, affirmed the Court of Appeals' decision, finding no reason to disturb the factual findings on the perfected contract and the branch manager's authority. The Petition: Upon remand, petitioner filed a motion for writ of execution. Motorcars, Inc. filed a motion to quash, alleging impossibility of performance because Delta Motors Corporation had closed shop. The RTC denied the motion to quash and issued an alias writ of execution. Motorcars, Inc. continued to defy the order, leading petitioner to file a motion for contempt. The RTC issued the questioned order dated August 10, 1989, favoring Motorcars, Inc. by denying the contempt charge, which petitioner alleged was contrary to the previous order granting the alias writ of execution. Hence, this petition for certiorari with mandamus.
Issue(s)
Whether the decision rendered by the Court of Appeals and affirmed by the Supreme Court is capable of performance and can be judiciously executed. Whether the corporation officers are liable for contempt.
Ruling
The petition for certiorari with mandamus is DISMISSED insofar as the denial of the motion for contempt by the lower court is concerned. However, the respondent is ordered to give to the petitioner the amount of P50,000.00 as damages.
Ratio Decidendi
On the issue of whether the decision is capable of performance and can be judiciously executed: The Court acknowledged that while a perfected contract of sale existed between petitioner Lee and private respondent Motorcars, Inc., as affirmed by this Court's resolution dated August 31, 1987, the obligation to deliver the specific 1983 Toyota Liftback had become impossible to perform. This impossibility arose from the fact that Delta Motors, the manufacturer of the 1983 models, had admittedly closed shop. The Court reiterated the well-settled principle that when facts and circumstances transpire after a judgment has become final and executory, rendering its execution impossible or unjust, the interested party may ask a competent court to stay its execution or prevent its enforcement. Therefore, the respondent Court did not commit grave abuse of discretion in denying the motion for contempt, as literal compliance with the writ of execution was no longer feasible. On the issue of whether the corporation officers are liable for contempt: The Court found that the respondent Court did not act with grave abuse of discretion in denying the motion for contempt. While there was a perfected contract of sale, the subsequent closure of the manufacturer, Delta Motors Corporation, rendered the specific performance of delivering the 1983 Toyota Liftback impossible. The Court noted that petitioner had indicated a willingness to accept a second-hand car but failed to show its availability, and the respondent company offered P20,000.00 as a gesture of settlement. Given the impossibility of performance, holding the corporation officers in contempt for failing to deliver the specific vehicle would be unjust. The relief available to the petitioner was not specific performance or contempt, but damages.
Main Doctrine
When facts and circumstances transpire after a judgment has become final and executory, rendering its execution impossible or unjust, a competent court may stay its execution or prevent its enforcement. However, the party seeking to be relieved of the obligation may still be liable for damages under Article 1170 of the Civil Code.