“The Supreme Court enumerated ‘three essential elements of a valid contract of sale: ‘a) consent, or meeting of the minds to transfer ownership in exchange for the price; b) [determinate] subject matter; and c) price certain in money or its equivalent’”
(First of 2 parts)
An invoice is issued when goods or products have been delivered or services rendered to a client.
Most of the time a contract or agreement precedes the issuance of an invoice because the former specifies the terms and conditions of the agreement, like the terms of payment, delivery requirements, performance of services, and warranties, among others.
In the case of Chevron Philippines, Inc. v. Alberto Loyuuko, et al., Chevron (then known as Caltex Philippines, Inc.) filed a complaint against Alberto as proprietor, and Achilles and Julieta as officers of the said Noah’s Ark Group of Companies, alleging on various dates from April to Nov. 1997, the latter purchased from the former petroleum products and services (including, but not limited to, bunker fuel oil and pumping/sealing refinery services) (GR 236525, March 29, 2023).
The products were hauled from Chevron’s distribution terminal at the Pandacan Oil Depot in Manila and brought to Noah’s Ark Sugar Refinery, Inc. (Noah’s Ark) in Barrio Hulo, Mandaluyong City. The “[s]aid purchases were covered by a total of 105 invoices addressed to the name and account of the said Noah’s Ark Sugar Refinery, Inc” (loc. cit.).
The failure of Alberto and Noah’s Ark to pay the purchases despite repeated letter reminders from Chevron prompted the latter to send a last and final demand to settle its outstanding account of P7,381,510.70.
This amount represented the 105 unsettled invoices, exclusive of interest.
In his Answer, Alberto explained “no Vinculum Juris exists between him and [Chevron] relative to the alleged transactions/purchases, since he never entered into any agreement with [Chevron] for the same.”
“He also denied any participation in the supposed receipt of the petroleum products hauled to Noah’s Ark Sugar Refinery’s premises” (loc. cit.).
On the other hand, Achilles and Julieta in their Answer alleged “they were never parties to, nor participants in, the alleged purchases of [Chevron’s] products, since they were never employees/officers of Noah’s Ark Sugar Refinery.”
They alleged “[t]he 105 invoices are actually addressed to Noah’s Ark Sugar Refinery, and not to Noah’s Ark Group of Companies” (loc. cit.).
In ruling on the dispute, the Supreme Court, citing Coronel v. Court of Appeals enumerated “three essential elements of a valid contract of sale: ‘a) consent, or meeting of the minds to transfer ownership in exchange for the price; b) [determinate] subject matter; and c) price certain in money or its equivalent’” (loc. cit.).
“Absent any of these elements, the existence of a perfected contract of sale is essentially negated.
“This is in accordance with Article 1318 of Republic Act 386, otherwise known as the Civil Code of the Philippines, which states that ‘[t]here is no contract unless the following requisites concur: 1) Consent of the contracting parties; 2) Object certain which is the subject matter of the contract; 3) Cause of the obligation which is established.’”
“The fact that Alberto admitted to being the registered proprietor of Noah’s Ark Sugar Refinery… brings to the foreground other facts that are easily ascertainable by him…
“For example, the records and files of Noah’s Ark Sugar Refinery relative to the questioned transactions should have been easily produced, or if they were non-existent… relevant employees of the refinery to aver the non-existence of any purchase order or delivery of [Chevron’s] bunker fuel” (loc. cit.).
But here, Alberto and Noah’s Ark’s (Achilles and Julieta) “own evidentiary efforts [fell] short of the burden of evidence, which is defined under the same Section l, Rule 131 as ‘the duty of a party to present evidence sufficient to establish or rebut a fact in issue to establish a prima facie case.’”
“Even Section 3(d), Rule 131 of the Revised Rules on Evidence makes it a disputable presumption ‘[t]hat a person takes ordinary care of his or her concerns.’”
“But his mere flat-out denials averring no personal knowledge of the questioned transactions, purchases, and deliveries, coupled with his failure to state any affirmative defense with supporting evidence, cannot be considered by the Court as sufficient specific denials.
“These are indeed, to his own detriment, admissions” (loc. cit.).