CASE#2

ACE FOODS, INC., Petitioner,

vs.
MICRO PACIFIC TECHNOLOGIES CO., LTD., Respondent.

G.R. No. 200602               December 11, 2013

I. SUMMARY OF FACTS:

1. ACE Foods, Inc. trades and distributes items on a wholesale and retail basis while
Micro Pacific Technologies Co., Ltd. (MTCL) is a company that supplies computer
hardware and equipment.

2. On September 26, 2001, MTCL submitted to ACE Foods a letter-proposal for the
delivery and sale of the subject products. Aside from itemization of the products, the
proposal stipulates that 30 days from the date of delivery, prices are subject to change
without notice and are based on the current dollar rate. For items in stock, delivery is
immediate; otherwise, delivery is 30-45 days from receipt of Purchase Order. Parts and
services are covered by a one-year warranty.

3. On October 29, 2001, MTCL's proposal was accepted, and ACE Foods issued
Purchase Order No. 100023 in the amount of P646,464.00 which is the purchase price.

4. As evidenced by Invoice No. 773311(Invoice Receipt) dated March 4, 2002, MTCL

delivered the items to ACE Foods. Written in the invoice was “title to sold property is
reserved until full compliance with the terms and conditions and payment of the amount”.

5. The products were then installed and configured at ACE Foods. However, ACE Foods
did not pay the purchase amount. Instead, on September 19, 2002, ACE Foods write a
letter to MTCL saying that it has been returning the subject products to MTCL through its
sales representative Mr. Mark Anteola but has yet to do so.

6. Finally, on October 16, 2002, ACE Foods filed a Complaint against MTCL with the
Regional Trial Court, requesting that MTCL shall remove the products from Ace Foods
premise due to MTCL's breach of obligation on its after-delivery services and that the
products were faulty and unusable.

MTCL counterclaimed that it had met its obligations to ACE Foods, no agreement was
made on the supposed "after delivery services" and ACE Foods refused to pay despite
using the products for nine (9) months.

7. On February 28, 2007, Regional Trial Court rendered Decision in favor of ACE
Foods.

8. On October 21, 2011, Court of Appeals reversed and set aside the RTC’s ruling.
II. Issue/s in Relation to the Law on Sales

The key issue in the case between ACE foods and MTCL is whether or not ACE
foods should pay the purchase price for the products acquired to MTCL.

III. Ruling or Decision of the Supreme Court

In this instance, the Court agrees with the CA that the parties entered into a
contract of sale, not a contract to sale, as the RTC determined. A contract of sale had
been perfected at the precise instant ACE Foods, as evidenced by its act of sending
MTCL the Purchase Order, accepted the latter's proposal to sell the subject products in
exchange for the purchase price of 646,464.00. The reciprocal responsibilities of the
parties – namely, on the one hand, MTCL's obligation to deliver the aforementioned
products to ACE Foods and, on the other hand, ACE Foods' obligation to pay the
purchase price within thirty (30) days of delivery – arose at that point and may be
sought. This is stated clearly in Article 1475 of the Civil Code:

Art. 1475. The contract of sale is perfected at the moment there is a meeting of minds
upon the thing which is the object of the contract and upon the price.

Finally, ACE Foods' allegations of violation – either with respect to MTCL's

putative "after delivery services" obligations or the faulty condition of the items – were
not adequately demonstrated in this matter, hence the return of the subject products
pursuant to a rescissory action is not warranted. The rule is simple: each party must
prove his own affirmative allegation; the party asserting the affirmative of the issue bears
the burden of presenting at the trial such amount of evidence required by law to obtain a
favorable judgment, which in civil cases is preponderance of evidence.ACE Foods, on
the other hand, failed to do so in relation to its charges of breach. As a result, the
situation cannot continue.

THE PETITION IS THEREFORE DENIED. As a result, the Court of Appeals'

Decision of October 21, 2011 and Resolution dated February 8, 2012 in CA-G.R. CV No.
89426 are therefore AFFIRMED.