Cordial v. Miranda
REITERATIONFacts
1. The Antecedents: Respondent David Miranda, a businessman, engaged in the rattan trade, had previously dealt with Gener Buelva as a supplier. Following Buelva's death, his widow, Cecilia Buelva, introduced petitioner Genaro Cordial to respondent Miranda. Cordial expressed interest in supplying rattan poles, and Miranda allegedly agreed to be supplied, discussing specific sizes and prices, and directing Cordial to consult with Roberto Savilla regarding necessary permits and fees for sourcing rattan from Palawan. Cordial, accompanied by Savilla, proceeded to Palawan, established a buying station, and purchased approximately 50,540 pieces of rattan poles using his own funds, amounting to about P164,000.00, between June and October 1992. These purchases were recorded in Cordial's notebook. 2. Procedural History: On October 29, 1992, Cordial shipped the rattan poles to Manila, where they arrived on November 2, 1992. Cordial notified Miranda of the arrival, and Miranda allegedly sent a truck to transport the rattan poles to Angeles City, where they were purportedly received by Miranda. A scale report was issued in the name of Roberto Savilla. Cordial protested the report and the lack of payment, but Miranda allegedly dismissed his concerns. After repeated demands for payment of P375,000.00, Miranda, in a reply dated January 12, 1993, denied any privity of contract with Cordial, stating he dealt only with Roberto Savilla and had already paid for all deliveries. Consequently, on April 19, 1993, Cordial filed a complaint against Miranda. The Regional Trial Court (RTC) ruled in favor of Cordial, declaring the verbal agreement valid and enforceable and ordering Miranda to pay Cordial P375,000.00 plus interest, litigation expenses, and attorney's fees. The Court of Appeals (CA), however, reversed the RTC decision, finding no written memorandum of the contract and concluding that Miranda had contracted with Savilla, not Cordial, who was merely an agent or partner. The CA based its ruling on the scale report bearing Savilla's name and cash vouchers reflecting Savilla's alleged cash advances. 3. The Petition: Petitioner Genaro Cordial filed a Petition for Review on Certiorari under Rule 45 of the Rules of Court, seeking to nullify the Court of Appeals' decision. Cordial argues that the CA erred in reversing the factual findings of the RTC and in completely disregarding them based on suppositions, surmises, and conjectures. He contends that the CA's decision lacks factual and legal basis. The core issues presented to the Supreme Court are whether the CA erred in reversing the trial court's factual findings and whether the Statute of Frauds is applicable to the case. Cordial asserts that a verbal contract existed, was partially executed by his delivery of the rattan poles, and therefore, the Statute of Frauds, which applies only to executory contracts, is not a bar to its enforcement.
Issue(s)
Whether the Court of Appeals erred in reversing the factual findings of the trial court. Whether the Statute of Frauds is applicable to the present case.
Ruling
The Petition is granted. The assailed Court of Appeals Decision is set aside, and the trial court Decision is reinstated.
Ratio Decidendi
On the issue of factual findings of the RTC and the CA: The Court found the petition meritorious, stating that while generally questions of fact are not raised in a petition for review, this rule does not apply when the factual findings of the RTC and the CA are opposite. The Court reviewed the records and found a cogent basis to reverse the CA's factual findings and uphold those of the trial court. The CA's conclusion that petitioner was a mere agent or partner of Savilla was based on the Scale Report bearing Savilla's name and cash vouchers reflecting Savilla's advances. However, the Court found that these documents did not prove partnership or agency. The bulk of the alleged cash advances were made before petitioner and respondent met, suggesting they were personal to Savilla. Furthermore, the Scale Report bearing Savilla's name did not necessarily negate petitioner's claim, as respondent did not sufficiently controvert petitioner's testimony of delivery. The CA's other bases, such as petitioner going to Savilla's residence and Savilla accompanying petitioner to Palawan, were considered mere conjectures and surmises, consistent with petitioner's assertion that Savilla, being more experienced, helped him secure permits. On the applicability of the Statute of Frauds: The Court reiterated that the Statute of Frauds applies only to executory agreements, not to completed, executed, or partially executed contracts. Where one party has performed its obligation, oral evidence is admissible to prove the agreement. In this case, the Court found it clearly established that petitioner had delivered the rattan poles to respondent on November 3, 1992. Since the contract was partially executed, the Statute of Frauds was not applicable. The Court emphasized that a contract will be upheld as long as there is proof of consent, subject matter, and cause, and that it is generally obligatory in whatever form it is entered into. The perfection of a valid contract between respondent and petitioner was evident in the testimonies of both petitioner and Cecilla Buelva, which the CA did not provide a cogent justification for overruling.
Main Doctrine
A verbal contract that has been completed, executed, or partially consummated is enforceable and not barred by the Statute of Frauds, which applies only to executory agreements.