FACTS : Chevron Philippines, Inc. (formerly Caltex Philippines, Inc.) filed a complaint for collection of sum of money and damages against Alberto Looyuko, Achilles Pacquing, and Julieta Go, alleging that from April to November 1997, Noah's Ark Sugar Refinery purchased petroleum products and refinery services on credit amounting to ₱7,381,510.70, covered by 105 invoices. Despite repeated demand letters, the obligation remained unpaid. Chevron claimed that Alberto, as proprietor of Noah's Ark Sugar Refinery, and Achilles and Julieta, as its officers, were liable for the unpaid account.
Alberto challenged the complaint, arguing that he had not been validly served with summons and denying liability. He asserted that Noah's Ark Sugar Refinery had ceased operations in 1997, that he never personally entered into the transactions, and that no contractual relationship existed between him and Chevron. Achilles and Julieta likewise denied liability, claiming they were neither officers nor employees of Noah's Ark Sugar Refinery and had no participation in the purchases.
The Regional Trial Court ruled in favor of Chevron, holding Alberto personally liable as the sole proprietor of Noah's Ark Sugar Refinery and ordering his estate to pay the principal obligation, accrued interest, attorney's fees, litigation expenses, and continuing interest at 24% per annum. The RTC, however, dismissed the complaint against Achilles and Julieta for lack of evidence.
On appeal, the Court of Appeals reversed the RTC's decision and dismissed Chevron's complaint, finding that Chevron failed to establish Alberto's liability for the transactions and that the evidence presented was insufficient to support the collection of the claimed obligation.
ISSUE : WON the CA is Correct
HELD : The Supreme Court granted Chevron Philippines, Inc.'s petition, reversing the Court of Appeals and reinstating the RTC decision with modifications. Although petitions under Rule 45 of the Rules of Court generally raise only questions of law, the Court held that the case fell within an exception because the RTC and CA reached conflicting factual findings. It also ruled that respondents' failure to include page references in their appellant's brief was merely a formal defect. On the merits, the Court found that while Chevron failed to present a written supply agreement, the 105 invoices, delivery records, witness testimonies, and surrounding circumstances sufficiently established the existence of repeated deliveries of bunker fuel to Noah's Ark Sugar Refinery. Applying Article 1318 of the Civil Code on the requisites of contracts, Articles 1403 and 1405 on the Statute of Frauds, and Rule 131 on burden of proof, the Court held that the repeated acceptance and receipt of the fuel removed the transactions from the Statute of Frauds and proved the existence of enforceable sales.
The Court further held that respondent Alberto Looyuko, who admitted being the registered sole proprietor of Noah's Ark Sugar Refinery, failed to specifically deny the genuineness and due execution of the invoices as required under Rule 8, Sections 8 and 10 of the Rules of Court. His general denials and failure to present evidence disputing the refinery employees' authority or the deliveries amounted to implied admissions, while his failure to object to the invoices' admission in evidence constituted a waiver of any challenge to their authenticity. Applying Articles 1910 and 1911 of the Civil Code on agency by estoppel, the Court ruled that Alberto was bound by the acts of the refinery employees whom he allowed to appear authorized to receive and acknowledge the deliveries. Accordingly, Chevron successfully proved respondents' liability for the unpaid petroleum products and services.
The Court, however, modified the monetary awards. Pursuant to Article 2212 of the Civil Code and BSP Circular No. 799, it imposed 12% interest per annum from August 21, 1998 until June 30, 2013, and 6% interest per annum from July 1, 2013 until full payment, with 6% legal interest on the total judgment from finality of the decision until full satisfaction. It likewise awarded 20% of the principal obligation as attorney's fees in accordance with the invoices' conditions of sale, replacing the RTC's earlier computation. Finally, the Court affirmed the dismissal of respondents Julieta and Achilles as defendants because their personal liability and authority to bind the sole proprietor were not sufficiently established.
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