SECOND DIVISION
FRANCISCO CULABA
AND DEMETRIA CULABA,
DOING BUSINESS UNDER
THE NAME AND STYLE
"CULABA STORE,"
Petitioners,
G.R.
No.
125862
April 15, 2004
-versus-
COURT OF APPEALS
AND SAN MIGUEL CORP.,
Respondents.
D E C I S I O N
CALLEJO,
SR., J.:chanroblesvirtuallawlibrary
This is a petition for
review under Rule 45 of the Revised Rules of Civil Procedure of the
Decision[1]
of the Court of Appeals in CA-G.R. CV No. 19836 affirming in toto the
Decision[2]
of the Regional Trial Court of Makati, Branch 138, in Civil Case No.
1033
for collection of sum of money, and the Resolution[3]
denying the motion for reconsideration of the said decision. The Undisputed
Facts
The spouses Francisco
and Demetria Culaba were the owners and proprietors of the Culaba Store
and were engaged in the sale and distribution of San Miguel
Corporation’s
(SMC) beer products. SMC sold beer products on credit to the
Culaba
spouses in the amount of P28,650.00, as evidenced by Temporary Credit
Invoice
No. 42943.[4]
Thereafter, the Culaba spouses made a partial payment of P3,740.00,
leaving
an unpaid balance of P24,910.00. As they failed to pay
despite
repeated demands, SMC filed an action for collection of a sum of money
against them before the RTC of Makati, Branch 138.chanrobles virtuallaw libraryred
The defendant-spouses
denied any liability, claiming that they had already paid the plaintiff
in full on four separate occasions. To substantiate this claim, the
defendants
presented four (4) Temporary Charge Sales (TCS) Liquidation Receipts,
as
follows:
April 19, 1983 Receipt No.
27331
for P8,000[5]
April 22, 1983 Receipt No.
27318
for P9,000[6]
April 27, 1983 Receipt No.
27339
for P4,500[7]
April 30, 1983 Receipt No.
27346
for P3,410[8]
Defendant Francisco
Culaba testified that he made the foregoing payments to an SMC
supervisor
who came in an SMC van. He was then showed a list of customers’
accountabilities
which included his account. The defendant, in good faith, then paid to
the said supervisor, and he was, in turn, issued genuine SMC
liquidation
receipts.cralaw:red
For its part, SMC submitted
a publisher’s affidavit[9]
to prove that the entire booklet of TCSL Receipts bearing Nos.
27301-27350
were reported lost by it, and that it caused the publication of the
notice
of loss in the July 9, 1983 issue of the Daily Express, as follows:chanrobles virtuallaw libraryred
NOTICE OF LOSS
OUR CUSTOMERS ARE HEREBY
INFORMED THAT TEMPORARY CHARGE SALES LIQUIDATION RECEIPTS WITH SERIAL
NOS.
27301-27350 HAVE BEEN LOST.
ANY TRANSACTION,
THEREFORE,
ENTERED INTO WITH THE USE OF THE ABOVE RECEIPTS WILL NOT BE HONORED.
SAN MIGUEL CORPORATION
BEER DIVISION
Makati Beer Region[10]
The Trial Court’s
Ruling
After trial on the merits,
the trial court rendered judgment in favor of SMC, and held the Culaba
spouses liable on the balance of its obligation, thus:
Wherefore, judgment
is hereby rendered in favor of the plaintiff, as follows:
1. Ordering defendants to pay the amount of P24,910.00 plus legal
interest
of 6% per annum from April 12, 1983 until the whole amount is fully
paid;
2. Ordering defendants to pay 20% of the amount due to plaintiff as and
for attorney’s fees plus costs.chanrobles virtuallaw libraryred
SO ORDERED.[11]
According to the trial
court, it was unusual that defendant Francisco Culaba forgot the name
of
the collector to whom he made the payments and that he did not require
the said collector to print his name on the receipts. The court also
noted
that although they were part of a single booklet, the TCS Liquidation
Receipts
submitted by the defendants did not appear to have been issued in their
natural sequence. Furthermore, they were part of the lost booklet
receipts,
which the public was duly warned of through the Notice of Loss the
plaintiff
caused to be published in a daily newspaper. This confirmed the
plaintiff’s
claim that the receipts presented by the defendants were spurious ones.
The Case on Appeal
On appeal, the appellants
interposed the following assignment of errors:
I
THE TRIAL COURT
ERRED
IN FINDING THAT THE RECEIPTS PRESENTED BY DEFENDANTS EVIDENCING HIS
PAYMENTS
TO PLAINTIFF SAN MIGUEL CORPORATION, ARE SPURIOUS.
II
THE TRIAL COURT
ERRED
IN CONCLUDING THAT PLAINTIFF-APPELLEE HAS SUFFICIENTLY PROVED ITS CAUSE
OF ACTION AGAINST THE DEFENDANTS.
III
THE TRIAL COURT
ERRED
IN ORDERING DEFENDANTS TO PAY 20% OF THE AMOUNT DUE TO PLAINTIFF AS
ATTORNEY’S
FEES.[12]
The appellants asserted
that while the trial court’s observations were true, it was the usual
business
practice in previous transactions between them and SMC. The SMC
previously
honored receipts not bearing the salesman’s name. According to
appellant
Francisco Culaba, he even lost some of the receipts, but did not
encounter
any problems.cralaw:red
According to appellant
Francisco, he could not be faulted for paying the SMC collector who
came
in a van and was in uniform, and that any regular customer would,
without
any apprehension, transact with such an SMC employee.
Furthermore,
the respective receipts issued to him at the time he paid on the four
occasions
mentioned had not yet then been declared lost. Thus, the subsequent
publication
in a daily newspaper declaring the booklets lost did not affect the
validity
and legality of the payments made. Accordingly, by its
actuations,
the SMC was estopped from questioning the legality of the payments and
had no cause of action against the appellants.chanrobles virtuallaw libraryred
Anent the issue of attorney’s
fees, the order of the trial court for payment thereof is without
basis.
According to the appellant, the provision for attorney’s
fees
is a contingent fee, already provided for in
the
SMC’s contract with the law firm. To further order them to pay 20% of
the
amount due as attorney’s fees is double payment, tantamount to undue
enrichment
and therefore improper.[13]
The appellee,
for its part, contended that the primary issue in the case at bar
revolved
around the basic and fundamental principles of agency.[14]
It was incumbent upon the defendants-appellants to exercise ordinary
prudence
and reasonable diligence to verify and identify the extent of the
alleged
agent’s authority. It was their burden to establish the true identity
of
the assumed agent, and this could not be established by mere
representation,
rumor or general reputation. As they utterly failed in this regard, the
appellants must suffer the consequences.cralaw:red
The Court of Appeals
affirmed the decision of the trial court, thus:
In the face of the somewhat
tenuous evidence presented by the appellants, we cannot fault the lower
court for giving more weight to appellee’s testimonial and documentary
evidence, all of which establish with some degree of preponderance the
existence of the account sued upon.chanrobles virtuallaw libraryred
ALL CONSIDERED, we cannot
find any justification to reject the factual findings of the lower
court
to which we must accord respect, for which reason, the judgment
appealed
from is hereby AFFIRMED in all respects.cralaw:red
SO ORDERED.[15]
Hence, the instant petition.cralaw:red
The petitioners pose
the following issues for the Court’s resolution:
I.
WHETHER OR NOT THE
RESPONDENT HAD PROVEN BY PREPONDERANT EVIDENCE THAT IT HAD PROPERLY AND
TIMELY NOTIFIED PETITIONER OF LOST BOOKLET OF RECEIPTS
II.
WHETHER OR NOT
RESPONDENT
HAD PROVEN BY PREPONDERANT EVIDENCE THAT PETITIONER WAS REMISS IN THE
PAYMENT
OF HIS ACCOUNTS TO ITS AGENT.[16]
According to the petitioners,
receiving receipts from the private respondent’s agents instead of its
salesmen was a usual occurrence, as they had been operating the store
since
1979. Thus, on four occasions in April 1983, when an agent of the
respondent
came to the store wearing an SMC uniform and driving an SMC van,
petitioner
Francisco Culaba, without question, paid his accounts. He received the
receipts without fear, as they were similar to what he used to receive
before. Furthermore, the petitioners assert that, common experience
will
attest that unless the attention of the customers is called for, they
would
not take note of the serial number of the receipts.cralaw:red
The petitioners contend
that the private respondent advertised its warning to the public only
after
the damage was done, or on July 9, 1993. Its belated notice showed its
glaring lack of interest or concern for its customers’ welfare, and, in
sum, its negligence.cralaw:red
Anent the second issue,
petitioner Francisco Culaba avers that the agent to whom the accounts
were
paid had all the physical and material attributes or indications of a
representative
of the private respondent, leaving no doubt that he was duly authorized
by the latter. Petitioner Francisco Culaba’s testimony that “he
does
not necessarily check the contents of the receipts issued to him except
for the amount indicated if [the] same accurately reflects his actual
payment”
is a common attitude of customers. He could, thus, not be faulted for
paying
the private respondent’s agent on four occasions. Petitioner
Francisco
Culaba asserts that he made the payment in good faith, to an agent who
issued SMC receipts which appeared to be genuine. Thus, according to
the
petitioners, they had duly paid their obligation in accordance with
Articles
1240 and 1242 of the New Civil Code.cralaw:red
The private respondent,
for its part, avers that the burden of proving payment is with the
debtor,
in consonance with the express provision of Article 1233 of the New
Civil
Code. The petitioners miserably failed to prove the self-serving
allegation
that they already paid their liability to the private respondent.
Furthermore,
under normal circumstances, an obligor would not just pay a substantial
amount to someone whom he saw for the first time, without even asking
for
the latter’s name.
The Ruling of the
Court
The petition is dismissed.cralaw:red
The petitioners question
the findings of the Court of Appeals as to whether the payment of the
petitioners’
obligation to the private respondent was properly made, thus,
extinguishing
the same. This is clearly a factual issue, and beyond the purview of
the
Court to delve into. This is in consonance with the well-settled rule
that
findings of fact of the trial court, especially when affirmed by the
Court
of Appeals, are accorded the highest degree of respect, and generally
will
not be disturbed on appeal. Such findings are binding and conclusive on
the Court.[17]
Furthermore, it is not the Court’s function under Rule 45 of the Rules
of Court, as amended, to review, examine and evaluate or weigh the
probative
value of the evidence presented.[18]chanrobles virtuallaw libraryred
To reiterate, the issue
being raised by the petitioners does not involve a question of law, but
a question of fact, not cognizable by this Court in a petition for
review
under Rule 45. The jurisdiction of the Court in such a case is limited
to reviewing only errors of law, unless the factual findings being
assailed
are not supported by evidence on record or the impugned judgment is
based
on a misapprehension of facts.[19]
A careful study of the
records of the case reveal that the appellate court affirmed the trial
court’s factual findings as follows:
First. Receipts Nos.
27331, 27318, 27339 and 27346 were included in the private respondent’s
lost booklet, which loss was duly advertised in a newspaper of general
circulation; thus, the private respondent could not have officially
issued
them to the petitioners to cover the alleged payments on the dates
appearing
thereon.cralaw:red
Second. There was something
amiss in the way the receipts were issued to the petitioners, as one
receipt
bearing a higher serial number was
issued ahead of another
receipt bearing a lower serial number, supposedly covering a later
payment.
The petitioners failed to explain the apparent mix-up in these
receipts,
and no attempt was made in this regard.cralaw:red
Third. The fact that
the salesman’s name was invariably left blank in the four receipts and
that the petitioners could not even remember the name of the supposed
impostor
who received the said payments strongly argue against the veracity of
the
petitioners’ claim.cralaw:red
We find no cogent reason
to reverse the said findings.cralaw:red
The dismissal of the
petition is inevitable even upon close perusal of the merits of the
case.chanrobles virtuallaw libraryred
Payment is a mode of
extinguishing an obligation.[20]
Article 1240 of the Civil Code provides that payment shall be made to
the
person in whose favor the obligation has been constituted, or his
successor-in-interest,
or any person authorized to receive it.[21]
In this case, the payments were purportedly made to a “supervisor” of
the
private respondent, who was clad in an SMC uniform and drove an SMC
van.
He appeared to be authorized to accept payments as he showed a list of
customers’ accountabilities and even issued SMC liquidation receipts
which
looked genuine. Unfortunately for petitioner Francisco Culaba, he did
not
ascertain the identity and authority of the said supervisor, nor did he
ask to be shown any identification to prove that the latter was,
indeed,
an SMC supervisor. The petitioners relied solely on the man’s
representation
that he was collecting payments for SMC. Thus, the payments the
petitioners
claimed they made were not the payments that discharged their
obligation
to the private respondent.cralaw:red
The basis of agency
is representation.[22]
A person dealing with an agent is put upon inquiry and must discover
upon
his peril the authority of the agent.[23]
In the instant case, the petitioners’ loss could have been avoided if
they
had simply exercised due diligence in ascertaining the identity of the
person to whom they allegedly made the payments. The fact that they
were
parting with valuable consideration should have made them more
circumspect
in handling their business transactions. Persons dealing with an
assumed
agent are bound at their peril to ascertain not only the fact of agency
but also the nature and extent of authority, and in case either is
controverted,
the burden of proof is upon them to establish it.[24]
The petitioners in this case failed to discharge this burden,
considering
that the private respondent vehemently denied that the payments were
accepted
by it and were made to its authorized representative.chanrobles virtuallaw libraryred
Negligence is the omission
to do something which a reasonable man, guided by those considerations
which ordinarily regulate the conduct of human affairs, would do, or
the
doing of something, which a prudent and reasonable man would not do.[25]
In the case at bar, the most prudent thing the petitioners should have
done was to ascertain the identity and authority of the person who
collected
their payments. Failing this, the petitioners cannot claim that they
acted
in good faith when they made such payments. Their claim therefor is
negated
by their negligence, and they are bound by its consequences. Being
negligent
in this regard, the petitioners cannot seek relief on the basis of a
supposed
agency.[26]
WHEREFORE, the instant
petition is hereby DENIED. The assailed Decision dated April 16, 1996,
and the Resolution dated July 19, 1996 of the Court of Appeals are
AFFIRMED.
Costs against the petitioners.cralaw:red
SO ORDERED.cralaw:red
Puno, J., (Chairman),
Quisumbing, Austria-Martinez, and Tinga, JJ., concur.
____________________________
Endnotes:
[1]
Penned by Associate Justice Godardo A. Jacinto, with Associate Justices
Salome A. Montoya and Romeo A. Brawner concurring.
[2]
Penned by Judge Fernando P. Agdamag.chanrobles virtuallaw libraryred
[3]
Dated July 19, 1996.chanrobles virtuallaw libraryred
[4]
Exhibit “A”, Records, Vol. I, p. 61.
[5]
Exhibit “1”, Id. at 107.chanrobles virtuallaw libraryred
[6]
Exhibit “2”, Id. at 108.
[7]
Exhibit “3”, Id. at 109.
[8]
Exhibit “4”, Id. at 110.
[9]
Exhibit “F”, Id. at 66.
[10]
Ibid.chanrobles virtuallaw libraryred
[11]
Records, Vol. II, p. 596.chanrobles virtuallaw libraryred
[12]
CA Rollo, p. 26-B.chanrobles virtuallaw libraryred
[13]
Brief for the Defendants-Appellants, CA Rollo, p. 26-P.
[14]
Brief for Plaintiff-Appellee, Id. at 33.chanrobles virtuallaw libraryred
[15]
CA Rollo, p. 49.chanrobles virtuallaw libraryred
[16]
Rollo, p. 15.chanrobles virtuallaw libraryred
[17]
Cresenciano Duremdes v. Agustin Duremdes, G.R. No. 138256, November 12,
2003.
[18]
Asiatrust Development Bank v. Concepts Trading Corporation, G.R. No.
130759,
June 20, 2003.
[19]
Cosmos Bottling Corporation v. National Labor Relations Commission, et.
al., G.R. No. 146397, July 1, 2003.
[20]
Article 1231(1) of the Civil Code provides that obligations are
extinguished
by payment or performance.
[21]
Montecillo v. Reynes, 385 SCRA 244 (2002).chanrobles virtuallaw libraryred
[22]
Victorias Milling Co., Inc. v. Court of Appeals, 333 SCRA 663 (2000).
[23]
Dizon v. Court of Appeals, 302 SCRA 288 (1999).chanrobles virtuallaw libraryred
[24]
Yu Eng Cho v. Pan American World Airways, Inc., 328 SCRA 717 (2000).
[25]
Raynera v. Hiceta, 306 SCRA 102 (1999).chanrobles virtuallaw libraryred
[26]
Dizon v. Court of Appeals, supra. |