NFF Industrial Corporation v. G & L Associated Brokerage, Inc.
REITERATIONFacts
The Antecedents: Petitioner NFF Industrial Corporation (NFF) sold 2,000 pieces of bulk bags to respondent G & L Associated Brokerage, Inc. (G & L) for a total price of ₱760,000.00, payable within 30 days from delivery. The Purchase Order specified delivery to "G & L Associated Brokerage, Inc., c/o Hi-Cement Corporation, Norzagaray, Bulacan." NFF made deliveries on July 30, August 4, and August 6, 1999, evidenced by delivery receipts and sales invoices, which were allegedly acknowledged by G & L's representatives. NFF sent demand letters for payment, but G & L failed to pay. Procedural History: The Regional Trial Court (RTC) ruled in favor of NFF, ordering G & L to pay the overdue account, attorney's fees, and costs. The Court of Appeals (CA) reversed the RTC decision, dismissing NFF's complaint. NFF's motion for reconsideration was denied. The Petition: NFF filed a petition for review on certiorari, arguing that preponderance of evidence shows G & L accepted delivery, that their conduct indicates acceptance, that the trial court's findings of fact are entitled to great weight, and that sustaining the CA decision would result in unjust enrichment.
Issue(s)
Whether there was valid delivery and acceptance of the bulk bags by petitioner to respondent. Whether respondent Gerardo Trinidad can be held jointly and severally liable with respondent company.
Ruling
The petition is GRANTED. The Decision of the Court of Appeals is REVERSED AND SET ASIDE, and the Decision of the Regional Trial Court is AFFIRMED with modification regarding the interest rates.
Ratio Decidendi
On the issue of valid delivery and acceptance: The Court held that delivery, under Article 1497 of the Civil Code, means placing the thing sold in the control and possession of the vendee. Ownership is acquired by the vendee from the moment of delivery. While the Purchase Order specified delivery to a particular representative, the evidence showed that the bulk bags were delivered to the designated site (Hi-Cement Corporation) and acknowledged by respondent Trinidad through phone calls and by allowing entry into the premises. The Court found it significant that Ramil Ambrosio, the named representative, was not on the payroll during the delivery dates, suggesting his unavailability. Furthermore, respondent Trinidad admitted seeing the delivery receipts attached to billings, and Marian Gabay, his helper, received the sales invoices without objection. The Court also noted that respondents failed to question the delivery receipts and demand letters, which is inconsistent with a claim of non-delivery. The conduct of the respondents, including the use of the bulk bags in their business operations, constituted acceptance under Article 1585 of the Civil Code, which deems goods accepted when the buyer does any act inconsistent with the seller's ownership or retains the goods without intimating rejection after a reasonable time. The Court found that the evidence preponderantly established valid delivery and acceptance, preventing unjust enrichment. On the liability of Gerardo Trinidad: The Court affirmed the RTC's finding that Gerardo Trinidad was sued only in his capacity as General Manager of the respondent company. There was no showing of circumstances warranting the piercing of the corporate veil, as the wrongdoing required for such action was not clearly and convincingly established. Therefore, he cannot be held jointly and severally liable for the company's obligation.
Main Doctrine
Delivery, in the context of the Law on Sales, is the transfer of control and possession of the thing sold, signifying the transfer of ownership. Acceptance of goods can be inferred from the buyer's conduct, even if delivery was not strictly made to the specified representative, especially when the buyer uses the goods or fails to object to invoices and demand letters.