Matute v. Cheong Boo
REITERATIONFacts
The Antecedents: On January 14, 1915, Amadeo Matute (plaintiff) and Cheong Boo (defendant) entered into a contract for the sale of 300 to 500 piculs of mastic (almaciga) at P8.50 per picul, to be delivered within February 1915. The plaintiff collected and transported approximately 500 piculs to Zamboanga, notifying the defendant on February 22, 1915. The defendant refused to accept delivery. Procedural History: The plaintiff stored the almaciga and filed an action in the Court of First Instance of Zamboanga, praying for specific performance and damages. The trial court found the contract valid, the almaciga merchantable, and the defendant in breach. Judgment was rendered ordering the defendant to accept the almaciga and pay P4,861.17 plus interest and costs, with a provision for the plaintiff to sell the almaciga if the defendant failed to comply within thirty days. The Petition: Both parties appealed. The defendant desisted from his appeal. The case proceeded in the Supreme Court solely on the plaintiff's appeal, challenging the trial court's disallowance of certain damages, particularly storage charges.
Issue(s)
Whether the plaintiff, in an action for specific performance, is entitled to recover storage and other expenses incurred for the goods pending litigation. Whether the trial court erred in limiting the recovery of storage charges to P141.00. Whether the delivery of 500 piculs of almaciga constitutes sufficient compliance with a contract to deliver less than 500 piculs.
Ruling
The Supreme Court modified the judgment, ordering the defendant to accept the 500 piculs of almaciga and rendering judgment in favor of the plaintiff for P5,402.27, plus interest, and costs. The plaintiff is entitled to recover all reasonable expenditures for storage and guarding the property pending litigation.
Ratio Decidendi
On the entitlement to storage and incidental expenses: The Court held that the plaintiff is entitled to recover all expenses incident to the storage of the almaciga pending litigation. While the Spanish procedural rules regarding judicial deposit were no longer strictly in vogue, the substantial right of the seller to enforce compliance and recover full damages was not abolished. The Court reasoned that by instituting an action for specific performance, the seller places the merchandise at the disposal of the court, essentially holding it for the adversary. The Court asserted its inherent power, akin to courts of equity, to manage property in litigation, including ordering its sale if advisable for the protection of parties. Therefore, expenses incurred due to the buyer's refusal to accept are recoverable as general damages under Article 1124 of the Civil Code. On the limitation of storage charges: The Court disagreed with the trial court's limitation of storage charges to P141.00, finding that the plaintiff should recover the full amount expended for storage prior to July 15, 1915 (P678.50), and all reasonable expenditures thereafter until delivery or sale. The trial court's rationale that the plaintiff should have sold the almaciga within a reasonable time (30 days) was deemed erroneous because the plaintiff had elected to enforce specific performance, not rescission. The Court clarified that the seller cannot convert the action to one for rescission unless performance becomes impossible, which would occur if the goods were sold prematurely. On the sufficiency of delivery: The Court held that the delivery of 500 piculs of almaciga was a sufficient compliance with the contract to deliver a quantity less than 500 piculs. Applying the principle of de minimis non curat lex (the law does not concern itself with trifles), the Court found the discrepancy to be negligible and disregarded it, deeming the plaintiff's performance adequate under the contract.
Main Doctrine
In an action for specific performance of a contract of sale, where the buyer refuses to accept the goods, the seller, upon electing to enforce compliance, may be entitled to recover storage and other incidental expenses incurred pending litigation, provided the court exercises its power to manage the property in litigation, including its sale if necessary, to protect the interests of all parties.