47.

SOLER v CHESLEY
Romualdez, J. | June 20, 1922
Topic: Covenants: Obligations of the Seller

PARTIES:
SELLER - ANDRES SOLER plaintiff-appellee,
BUYER - EDWARD CHESLEY defendant-appellant.

DISPUTED MATTER:
Liability of Soler for the late deliveries of the machineries sold to Chesley

Note: If you’re in a rush u can just read the parts in bold for the facts hehe

FACTS

1ST CONTRACT OF SALE - PLAINTIFF SOLER AGREED TO BUY CERTAIN MACHINERY FROM WM. H.
ANDERSON AND CO. (ANDERSON)
- Anderson agrees to deliver to Soler coconut oil machinery (See exhibit A for a more detailed
description of the machineries)
- Terms and conditions of the contract of sale between ANDERSON and SOLER
o Price - manufacturer’s price + charges, interest, commission
o Terms of payment - 50% deposit upon arrival of the machinery, the balance 90 days after
delivery
o In case Soler is unable to comply with this agreement, Anderson may terminate the contract and
payments already made by Soler will be forfeited in favor of Anderson
o Ownership of machinery shall remain with Anderson until full payment is made by Soler

2nd CONTRACT OF SALE - ON NOVEMBER 16, 1918, PLAINTIFF SOLER SOLD TO DEFENDANT
CHESLEY ALL OF HIS (SOLER’S) RIGHTS AND INTERESTS IN THE AFOREMENTIONED CONTRACT
OF SALE (BETWEEN SOLER AND ANDERSON)
- Terms and conditions of the contract of sale between SOLER and CHESLEY
o Chesley assumes Soler’s rights and obligations under the 1st contract of sale
o Price of the sale of machinery - 100k
o Chelsey will pay Soler the difference in the amount stated in invoices of the machinery
and the sum of one hundred thousand pesos (since in the 2nd COS, the agreed price is only
100k. so if the amount that Anderson would bill is higher than 100k, then Chesley will pay for the
excess as well)
o Soler will be relieved from the contract between him and Anderson

IN THE CONTRACT OF SALE BETWEEN SOLER AND CHESLEY, SOLER INDICATED THAT SOME OF
THE MACHINERY WERE ALREADY IN MANILA AND SOME WERE ALREADY ON THE WAY
- Hence, It was guaranteed by Soler that by November 16, 1918 (date of execution of contract), the
parts were either in Manila or on the way to Manila

HOWEVER, BY NOVEMBER 16, 1918 (DATE OF 2nd CONTRACT OF SALE), MOST OF THE PARTS
WERE NEITHER IN MANILA NOR ON THE WAY TO MANILA. MOST OF THEM WERE SHIPPED AFTER
NOVEMBER 16, 1918 AND ARRIVED AS LATE AS AUGUST 23, 1919
- Oil expellers: Shipped - Dec. 12, 1918; Delivered - Feb. 13, 1919
- Motors: Shipped - Jan. 8, 1919; Delivered - Mar. 8, 1919
- Machinery: Shipped - Jan. 16, 1919; Delivered - April 27, 1919
- Grinding Mills: Shipped - Feb. 21, 1919; Delivered - August 23, 1919
WHEN CHESLEY RECEIVED THE GOODS, HE PAID UNDER PROTEST ARGUING THAT GOODS WERE
NOT DELIVERED WITHIN THE PERIOD STIPULATED IN THE CONTRACT; CHESLEY SOUGHT
RESCISSION
- On the date of the execution of the contract between Soler and Chesley (Nov. 16, 1918), Soler
asserted that the goods were already in Manila or on its way to Manilam. But in truth, they were only
shipped days after the execution of the contract

SOLER NOW COMMENCES THIS ACTION, PRAYING THAT HE BE PAID THE DIFFERENCE BETWEEN
THE INVOICE PRICE AND 100K
- Soler prays that Chesley be sentenced to pay him Php30,546.03 representing the invoice price and
Php100,000

CHESLEY FILES COUNTER CLAIM, ASKING FOR RESCISSION OF THE CONTRACT ON THE GROUND
THAT SOLER FALSELY ASSERTED THAT THE GOODS WERE ALREADY IN OR OTW TO MANILA
WHEN THEY’RE NOT
- He consented to the contract only because Soler asserted/represented to him that the goods were
already either in Manila or on its way to Manila at the time of the perfection of the contract
- Good arrived long after the perfection of the contract
- Prayed that the contract be rescinded, that Soler receive the machineries from Chesley, and that Soler
be liable for damages

TRIAL COURT IN FAVOR OF SOLER

- Sentenced Chesley to pay Soler Php30,546.03

HENCE, CHESLEY NOW APPEALS TO THE SC

ISSUE-HELD

W/N Chesley may be held to pay Soler 30,546 pesos, which is the difference - NO

THE ARRIVAL OF THE GOODS WITHIN A REASONABLY SHORT TIME WAS ONE OF THE
DETERMINING ELEMENTS OF CHESLEY’S CONSENT (Chesley consented to the contract precisely
because he expected the goods to be delivered within a reasonably short period of time)
- Instances that prove this:
o The act of Chesley in insisting that this guaranty as to the arrival of the machinery be stated in
the contract
o Chesley’s repeated complaints and protests when he afterwards made payments as the parts
arrived
o Soler presented to Chesley letters from Anderson, wherein Anderson said that the goods had
already been sent out by the manufacturers

THE FACT THAT SOLER WAS IN GOOD FAITH AND HAD NO CONTROL OF THE PROMPT
TRANSPORTATION/SHIPMENT OF THE GOODS WILL NOT RELIEVE HIM FROM HIS GUARANTY THAT
THE GOODS ARE IN MANILA/ON ITS WAY TO MANILA
- Soler bound himself to Chesley to guaranty that the goods are either in manila or will arrive within
a short period of time, even though no such guaranty to the date of delivery nor price was given
to Soler by Anderson
o Soler bound himself in favor of the defendant for more than what Anderson had bound
themselves for in his favor
- It was Soler who contracted with Chesley, not Anderson. Hence, Soler is the one obligated to Chesley
o He who contracts and assumes an obligation is presumed to know the circumstances under
which said obligation can be complied with (Ferrer vs. Ignacio, 39 Phil., 446)

SOLER ARGUES THAT THE PROMPT DELIVERY IS NOT A CONDITION TO THE CONTRACT BECAUSE
ACCORDING TO SOLER, THE TERMS AND CONDITIONS ARE STATED IN PARAGRAPH THREE (SEE
EXHIBIT B)
 - SC: DEINS BRO
o It is true that it is only in paragraph three where the detailed terms and conditions are stated.
BUT, those terms in conditions under paragraph 3, are premised on the understanding under
paragraph two that the goods are already in or on the way to Manila

SOLER IMPLIEDLY MADE A GUARANTY THAT THE GOODS WILL ARRIVE IN EARLY JAN 1919
- Even though Soler did not specify the date or time of the arrival of the goods, he asserted that the
goods were already in Manila or otw to Manila
- His assertion is tantamount to saying that the goods will arrive early in January 1919, based on normal
conditions/circumstances, taking into account that the expellers, which were shipped on
December 12, 1918, arrived at Manila on February 13, 1919. (since under the
circumstances/conditions, the goods take about 2 months to ship. Hence, when Soler said that the
goods are already being shipped, it was safe for Chesley to assume that it would take 2 months to
arrive)
o NCC 1521 - Where by a contract of sale the seller is bound to send the goods to the buyer, but
no time for sending them is fixed, the seller is bound to send them within a reasonable time.
o ‘Reasonable time’ - dependent on the circumstances
- ITC - the last parts of the machinery, to wit, the grinding mills not having arrived at Manila until the 23rd
of August, 1919, they not having been shipped until as late as the 21st of February of that year.
o Hence, Soler has failed to carry out his obligation incurred under the second paragraph of the
contract and has, therefore, no right to compel the defendant to comply with his obligation to
pay the plaintiff the sum claimed in the complaint (art. 1124, Civil Code).

WITH REGARD TO THE COUNTERCLAIM OF CHESLEY, IT APPEARS THAT HE ALREADY SOLD THE
GOODS TO PHILIPPINE REFINING CO. IN CASES LIKE THIS, THE RESCISSION OF THE CONTRACT
DOES NOT LIE

DISPOSITIVE
The judgement appealed from is reversed, and the defendant absolved from the complaint, and the plaintiff
from the counterclaim and other claims of the defendant without special pronouncement as to costs. So
ordered.

EXHIBIT A (Contract of sale between Anderson and Soler)

This agreement made and entered into by and between Wm. H. Anderson and Co., party of the first part, and
Andres Soler, party of the second part, Witnesseth:

Wm. H. Anderson (SELLER) agrees to deliver to soler (BUYER) a coconut oil machinery which was ordered by
cable by the WHA on March 4, 1918, and Soler agrees to purchase the said machinery from the party of the first
part on the terms and conditions given below:

1. 4 Anderson oil expellers No. 1, side drive complete with stationary strainer, and fitted with a 15-h. p. motor, the
same mounted on a special base on the expeller and connected to the expeller by a suitable silent chain drive.

2. 4 Rotary pumps (oil) attached to and driven from expeller.

3. Sufficient 6" and 9" metal conveyor, etc., for the 4 expellers to make complete conveyor line with supports for
securing to expeller.

4. 1 Vertical triplex pump, 2 ½" x 4", 1 ½ suction and discharge, capacity 12 gallons per minute, belt drive.

5. 1 Bauer ball-bearing motor-driven attrition mill, 22", fitted with 2 15-h. p. electric motors, 220 volt, 2 phase, 60
cycle, direct-connected and complete with automatic starter,

6. 1 Shriver filter press, 30", 36 plates, complete with one extra set of filter cloths.
7. 1 Buckeys cooker, 62", 3 high, direct-connected by silent chain drive to a 15-h. p., 220 volt, 2 phase, 60 cycle,
alternating current motor.

8. Sufficient meters of standard chain elevator, etc.

Terms and conditions: The foregoing machinery is to be invoiced at manufacturers' price, plus all charges such as
freight, insurance, interest and exchange, arrastre, landing charges, delivery, internal revenue, etc., plus a buying
commission of 5 per cent.

The terms of payment are fifty per cent (50%) deposit to be made upon arrival of the machinery, and the balance
ninety (90) days after delivery of the machinery.

In the event that buyer soler fails to live up to the terms of this agreement, such failure by soler will be sufficient
cause to terminate this contract, and any payments made by soler shall be forfeited to WHA

The title of the machinery in question is to remain in the name of the party of the first part (WHA) until payment in full
has been made, at which time transfer of all right and title to the above mentioned machinery will be made to the
party of the second part.

This agreement is contingent upon strikes, fire, accidents, extraordinary shipping and other conditions imposed on
account of war and other causes unavoidable or beyond the control of the party of the first part.

It is strictly understood that the quotations made to Mr. Andres Soler under date of February 27, 1919, were
approximated and were subject to change without notice. We can therefore make no guarantee as to prices and
delivery, it being understood that prices charged will be those shown on the invoices of the manufacturers, and
shipment will be made by first possible opportunity.

EXHIBIT B (Contract of Sale between Soler and Chesley) - RELEVANT CONTRACT

First. That Mr. Andres Soler has an agreement in due form with Messers. Wm. H. Anderson and Co. for the
purchase of a coconut oil machinery, more particularly described in the said agreement as follows: * * *.

1. 4 Anderson oil expellers No. 1, side drive complete with stationary strainer, and fitted with the 15-h. p. motor, the
same mounted on a special base on the expeller and connected to the expeller by a suitable silent chain drive, * * *.

2. 4 Rotary pumps (oil) attached to and driven from expeller . . . .

3. Sufficient 6" and 9" metal conveyor, etc., for the 4 expellers to make complete conveyor line with supports for
securing to expeller * * *.

4. 1 Vertical triplex pump, 2 ½ x 4", 1 ½" suction and discharge, capacity 12 gallons per minute, belt drive * * *.

5. 1 Bauer ball-bearing motor-driven attrition mill, 22" fitted with 2 15-h. p. electric motors, 220 volt, 2 phase, 60
cycle, direct-connected and complete with automatic starter * * *.

6. 1 Shriver filter press, 30", 36 plates, complete with one extra set of filter cloths * * *.

7. 1 Buckeys cooker, 62", 3 high, direct-connected by silent chain drive to a 15-h. p., 220 volt, 2 phase, 60 cycle,
alternating current motor * * *.

8. Sufficient meters of standard chain elevator, etc., * * *.

(2nd par.) Second. That a part of the aforesaid machinery is at this time on the way, the other part being
already in this city of Manila, the price of which has not as yet been paid by Mr. Soler to Messrs. Wm. H.
Anderson and Co. * * *.
(3rd par.) Third. That being interested in acquiring the aforesaid machinery, Mr. Edward Chesley has made Mr. Soler
a proposition whereby soler should transfer it to him, and he (Chesley) should assume the obligation to pay Messrs.
Wm. H. Anderson and Co. the amount of the invoices thereof, Mr. Soler to be relieved from his contract with Messrs.
Wm. H. Anderson and Co., which proposition has been agreed to as hereinbelow set forth, and to have an evidence
of the agreement this contract is made and entered into by them in the following terms and conditions:

(a) Mr. Andres Soler conveys and transfers to Mr. Edward Chesley all the rights and interest which he may have in
his agreement with Messrs. Wm. H. Anderson and Co. for the purchase of the oil machinery, more particularly
described in the first paragraph hereof; Mr. Chesley being subrogated, therefore, to whatever rights and obligations
Mr. Soler may have acquired and contracted under the aforesaid agreement. * * *.

(b) This sale of the said machinery is for the price of one hundred thousand pesos, Philippine currency, the same to
be paid by Mr. Chesley by paying Messrs. Wm. H. Anderson and Co. the amount of the invoices of said machinery,
and Mr. Andres Soler the difference which may be found to exist between the amount of said invoices and the
above mentioned sum of one hundred thousand pesos, said payment to be secured by a personal or corporation
bond to the satisfaction of Mr. Soler. * * *.

(c) In subrogating himself to the right and obligations which Mr. Soler may have under his agreement with Messrs.
Wm. H. Anderson and Co. for the purchase of the aforesaid machinery, Mr. Chesley relieves Mr. Soler from
whatever obligation he has, or may have, under the aforesaid agreement with Wm. H. Anderson and Co.,
concerning the machinery hereinbefore more particularly described. * * *.

(d) Messrs. Soler and Chesley declare that Messrs. Wm. H. Anderson and Co. have actual knowledge of this sale of
the machinery, as well as of Mr. Chesley being subrogated to the rights and obligations created by the agreement
entered into by and between Mr. Soler and Messrs. Wm. H. Anderson and Co., the latter being in absolute
conformity therewith. * * *.

And (e) Mr. Chesley shall pay Mr. Soler the difference which may be found to exist between the amount of the
invoices of the machinery and the sum of one hundred thousand pesos immediately upon the arrival of said
machinery at this city of Manila; provided that if any part of the machinery not affecting the expellers is found
lacking, a proportional deduction shall be made from the amount which Mr. Soler may have received from Mr.
Chesley. * * *.

And fourth. That Messrs. Soler and Chesley solemnly make and enter into this contract on the terms and conditions
hereinbefore set forth. * * *.