Katigbak v. CA 4 SCRA 242

Facts:

Artemio Katigbak upon reading an advertisement for the sale of the Double Drum Carco Tractor Winch placed by V. K. Lundberg, owner and operator of the International Tractor and Equipment Co., Ltd., went to see Lundberg and inspected the equipment. It was agreed that Katigbak was to purchase the winch for P12,000.00, payable at P5,000.00 upon delivery and the balance of P7,000.00 within 60 days. The condition of the sale was that the winch would be delivered in good condition. Katigbak was apprised that the winch needed some repairs, which could be done in the shop of Lundberg. It was then stipulated that the amount necessary for the repairs will be advanced by Katigbak but deductible from the initial payment of P5,000.00. The repairs were undertaken and the total of P2,029.85 for spare parts was advanced by Katigbak for the purpose. For one reason or another, the sale was not consummated and Katigbak sued Evangelista, Lundberg and the latter’s company, for the refund of such amount. Lundberg and Evangelista filed separate Answers to the complaint, the former alleging non-liability for the amount since the same (obligation for refund) was purely a personal account between defendant Evangelista and plaintiff Katigbak. Evangelista, on his part, claimed that while there was an agreement between him and Katigbak for the purchase and sale of the winch and that Katigbak advanced the payment for the spare parts, he (Katigbak) refused to comply with his contract to purchase the same; that as a result of such refusal he (Evangelista) was forced to sell the same to a third person for only P10,000.00. The lower court ruled in favor of Katigbak, but the same was reversed by the CA.

Issue:

Is the lower court correct in ruling in favor of Katigbak?

Held:

No. It was Katigbak who committed a breach of contract. Hence, it follows that the present action was unjustified and he must be held liable to appellant Evangelista for attorney’s fees in the sum of P700.00. Also, pursuant to Hanlon case, when a purchaser of goods upon an executory contract fails to take delivery and pay the purchase price. The vendor in such case is entitled to resell the goods. If he is obliged to sell for less than the contract price, he holds the buyer for the difference. But it has never been held that there is any need of an action of rescission to authorize the vendor, who is still in possession, to dispose of the property where the buyer fails to pay the price and take delivery/ The facts of the case under consideration are identical to those of the Hanlon case. The herein petitioner failed to take delivery of the winch, subject matter of the contract and such failure or breach was, according to the Court of Appeals, attributable to him, a fact which

Digest Credit: Mac Burdeos Camposuelo

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