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[ G.R. No. 135428. January 20, 1999]

GAUDENCIO A SARANGAYA III, et al. vs. OLANDO, et al.

FIRST DIVISION

Gentlemen:

Quoted hereunder, for your information, is a resolution of this Court dated JAN 20, 1999.

G.R. No. 135428 (Gaudencio A. Sarangaya III and Antonio Sarangaya vs. Olando Boncat, etc and Longwood Co., Inc.)

Respondents Olando Bongat was the Purchasing Manager of Unique Builders and at the same time, the Vice-President and General Manager of co-respondent Longwood Co., Inc. (LCI) which was engaged in the marketing and retailing of narra lumber and manufacture of parquet flooring (tilewood). On June 10, 1979, respondent Bongat (buyer) and petitioner Gaudencio A. Sarangaya III (supplier) entered into a "Contract of Supply " where the supplier agreed to supply and deliver to the lumber yard of respondent LCI or to the sawmill site of Unique Builders some narra branches, tops, stumps and other log wastes from Quirino Province subject to the condition that cash advances made by respondent Bongat. As of August 1979, the total cash payment exceeded the actual deliveries by P264,569.00. Petitioners have since failed and refused to make subsequent deliveries despite repeated demands from respondents Bongat, the latest of which was on August 25, 1987. In a suit against petitioners, the trial court rules in favor of respondents Bongat and ordered petitioner Gaudencio A. Sarangaya III to pay respondent Bongat the amount of P264,569.00 representing excess payments with legal interest at 12% per anum commencing from January 1980 until paid, 20% of said amount as attorney's fees, and costs of suit, but it dismissed the complaint against petitioner Antonio Sarangaya as well as the counterclaims of petitioner. On appeal, the Court of Appeals affirmed the trial court's decision but deleted the award for attorney's fees. His motion for reconsideration having been denied, petitioner Gaudencio A. Sarangaya III filed this instant certiorari petition.

The petition is bereft of merit. No significant and compelling reason have been advanced by petitioner which would warrant a reveal of the conclusion of the trial court as affirmed by the Court of Appeal. In the absence of any reversible error, we adhere to the time-honored doctrine that factual findings of the trial court especially because it was affirmed by the Court of Appeals is well nigh conclusive in the appeal. [Salao vs. Court Appeals, 284 SCRA 493]. It is not the function of this Court to weigh anew the evidence already passed upon by the Court of Appeals.

Under Article 1159 of the New Civil Code, "Obligations arising from contracts have the force of law between the contracting parties and should be complied with in good faith." A contract is a meeting of minds between two persons thereby one binds himself, with respect to the other to give something or to render some service. (Article 1305, New Civil Code). Contracts are perfected by mere consent and from that moment the parties are bound not only to the fulfillment of what has been expressly stipulated but also to all the consequences which according to their nature may be in keeping with good faith, usage and law. (Article 1315, New Civil Code). Thus, when petitioner Sarangaya III reneged on his undertaking pursuant to the agreed "Contract of Supply" with respondent Bongat, the latter acquired the right to institute an action in court to ensure faithful compliance from the former pursuant to the agreed contract." Where one of the parties to a contract (herein petitioner) did not perform the undertaking which he was bound by the terms of the agreement to perform, he is not entitled to insist upon the performance of the other party (herein respondent). [Agustin vs. Court of Appeals, 186 SCRA 375]

ACCORDINGLY, the petition is DISMISSED.

Very truly yours,

(Sgd.) VIRGINIA ANCHETA-SORIANO

Clerk of Court

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