ARTEMIO KATIGBAK, petitioner, vs.

COURT OF APPEALS, DANIEL

EVANGELISTA and V. K. LUNDBERG, respondents,
4 SCRA 243, January 31, 1962

Facts:
Artemio Katigbak read an advertisement regarding a sale of a winch by V.K.
Lundberg, owner and operator of the International Tractor and Equipment Co., Ltd.
Being interested in purchasing the object Artemio wanted a reduction of the quoted
price and referred to the owner which was, Daniel Evangelista. It was agreed upon
Katigbak was to buy the winch for 12, 000 pesos, payable at 5, 000 pesos upon
delivery and the balance of 7, 000 pesos within 60 days. It was stipulated as a
condition that the item would be delivered in good condition. But Katigbak was
shocked when the item needed repairs, which could be done in the shop of
Lundberg. The repairs cost Katigbak 5, 000 pesos which was deducible from his
initial payment.
Katigbak sued Evangelista and Lundberg which lead to the sale not being
consummated and the latter demanded for a refund for the repairs. Since it was
purely a personal account between defendant Evangelista and plaintiff Katigbak,
Lundberg alleged the non-liability for the amount. While Evangelista claim that
Katigbak refused to comply with his contract to purchase the winch so he was forced
to sell the same to a third person.

Issue:
Whether or not the petitioner is entitled to a refund for the repairs undertaken,
despite the fact that the breach of contract was committed by him.

Ruling:
Yes. Appellee has a right to a refund, but equally undeniable is appellant
Evangelista's right to recover from him his loss of P2, 000.00, which is the difference
between the contract price for the sale of the winch between him and appellee and
the actual price for which it was sold after the latter had refused to carry out his
agreement, notwithstanding the breach of contract committed by him. If the
purchaser fails to take delivery and pay the purchase price of the subject matter of
the contract, the vendor, without the need of first rescinding the contract judicially, is
entitled to resell the same, and if he is obliged to sell it for less than the contract
price, the buyer is liable for the difference. This loss, which is the subject matter of
Evangelista's main counterclaim, should therefore be set off against the sum claimed
by appellee.
Considering that it was appellee who committed a breach of contract, it follows that
the present action was unjustified and he must be held liable to appellant
Evangelista for attorney's fees.