True Facts

In: Social Issues

Submitted By francoamba
Words 9967
Pages 40
Gaite v. Fonacier
Facts:
Gaite was appointed by Fonacier as attorney-in-fact to contract any party for the exploration and development of mining claims. Gaite executed a deed of assignment in favor of a single proprietorship owned by him. For some reasons, Fonacier revoked the agency, which was acceded to by Gaite, subject to certain conditions, one of which being the transfer of ores extracted from the mineral claims for P75,000, of which P10,000 has already been paid upon signing of the agreement and the balance to be paid from the first letter of credit for the first local sale of the iron ores. To secure payment, Fonacier delivered a surety agreement with Larap Mines and some of its stockholders, and another one with Far Eastern Insurance. When the second surety agreement expired with no sale being made on the ores, Gaite demanded the P65,000 balance. Defendants contended that the payment was subject to the condition that the ores will be sold.
Issue:
(1) Whether the sale is conditional or one with a period
(2) Whether there were insufficient tons of ores
Held:
(1) The shipment or local sale of the iron ore is not a condition precedent (or suspensive) to the payment of the balance of P65,000.00, but was only a suspensive period or term. What characterizes a conditional obligation is the fact that its efficacy or obligatory force (as distinguished from its demandability) is subordinated to the happening of a future and uncertain event; so that if the suspensive condition does not take place, the parties would stand as if the conditional obligation had never existed.
A contract of sale is normally commutative and onerous: not only does each one of the parties assume a correlative obligation (the seller to deliver and transfer ownership of the thing sold and the buyer to pay the price),but each party anticipates performance by the other from the very start.…...

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