THIRD DIVISION
|
BENGUET CORPORATION, DENNIS R. BELMONTE, EFREN
C. REYES and GREGORIO A. FIDER, Petitioners, - versus - CESAR
CABILDO, Respondent. |
G.R.
No. 151402
Present: YNARES-SANTIAGO, J.,
Chairperson, AUSTRIA-MARTINEZ, CHICO-NAZARIO, NACHURA, and REYES, JJ. Promulgated: August 22, 2008 |
x------------------------------------------------------------------------------------x
DECISION
NACHURA, J.:
This
is a petition for review on certiorari
assailing the Court of Appeals (CA) decision[1] in
CA-G.R. CV No. 37123 which affirmed with modification the decision[2] of
the Regional Trial Court (RTC), Branch 6, Baguio City in Civil Case No. 593-R.
Petitioner
Benguet Corporation is a mining company with three (3) mining sites: Balatoc,
Antamok and Acupan. Petitioners Dennis R. Belmonte,[3]
Efren C. Reyes,[4] and Gregorio
A. Fider[5]
are all officers and employees of Benguet Corporation.[6] On
the other hand, respondent Cesar Cabildo and Rolando Velasco, defendant before
the lower courts, were former employees of Benguet Corporation.
At the time of his retirement on
Sometime in February 1983, Cabildo
submitted his quotation and bid for the painting of Benguet Corporation’s
Upon approval of his quotation and
bid, Cabildo forthwith wrote Reyes on
On
On even date, Cabildo submitted his
first work accomplishment covering carpentry work and installation of the
scaffolding for which he received a partial payment of P10,776.94.
Subsequently, on
(1) [Cabildo]
shall paint the
(2) For and in consideration of the work to be done by [Cabildo], [Benguet Corporation] shall pay [Cabildo] at the rate herein provided, as follows:
(a) Painting
|
|
Steel & Concretes |
Wood |
|
|
|
|
|
1st coat |
|
|
|
2nd coat |
2.50/sq. m. |
2.10/sq. m. |
(b) Scrapping and Cleaning
P1.85/sq.
m.
(c) Scaffolding
P0.50/sq.
m.
(d) De-zincing
P1.25/sq.
m.
(e) Dismantling of sidings & ceilings
P2.50/sq.
m.
(f) Installation of sidings & ceilings
P5.50/sq.
m.
(g) Handling of Lumber & installation
P275.00/cu.
m.
(3) [Cabildo] shall employ his own workers and employees, and shall have the sole and exclusive obligation to pay their basic wage, overtime pay, ECOLA, medical treatment, SSS premiums, and other benefits due them under existing Philippine laws or other Philippine laws which might be enacted or promulgated during the life of this Contract. If, for any reason, BENGUET CORPORATION is made to assume any liability of [Cabildo] on any of his workers and employees, [Cabildo] shall reimburse [Benguet Corporation] for any such payment.
(4) [Cabildo] shall require all persons before hiring them in the work subject of this Contract to obtain their clearance from the Security Department of Baguio District Gold Operations of BENGUET CORPORATION.
(5) BENGUET CORPORATION shall retain 10% of every performance payment to [Cabildo] under the terms and conditions of this Contract. Such retention shall be cumulative and shall be paid to [Cabildo] only after thirty (30) days from the time BENGUET CORPORATION finally accepts the works as fully and completely finished in accord with the requirements of [Benguet Corporation]. Before the 10% retention of performance payments will, however, be fully paid to [Cabildo], all his workers and employees shall certify under oath that they have been fully paid their wages, SSS, medicare, and ECC premiums, ECOLA, overtime pay, and other benefits due them under laws in force and effect and that they have no outstanding claim against [Cabildo]. BENGUET CORPORATION has the right to withhold from the 10% retention any amount equal to the unsatisfied claim of any worker against [Cabildo] until the claim of the worker is finally settled.
(6) [Cabildo] shall not be allowed to assign or subcontract the works, or any phase thereof, and any violation of this provision will entitle BENGUET CORPORATION the sole and exclusive right to declare this Contract as cancelled and without any further force and effect.
(7) [Cabildo] and his heirs shall be solely and directly liable – to the exclusion of BENGUET CORPORATION, its stockholders, officers, employees, and agents and representatives – for civil damages for any injury or death of any of his employees, workers, officers, agents and representatives or to any third person and for any damage to any property due to faulty or poor workmanship or negligence or willful act of [Cabildo], his workers, employees, or representatives in the course of, during or when in any way connected with, the works and construction. If for any reason BENGUET CORPORATION is made to assume any liability of [Cabildo], his workers, employees, or representatives in the course of, during or when in any way connected with, the works and construction. If for any reason BENGUET CORPORATION is made to assume any liability of [Cabildo], his workers, employees, or agents or representatives under this provision, [Cabildo] and his heirs shall reimburse the CORPORATION for any payment.
(8) [Cabildo] hereby undertakes to complete the work subject of this Contract within (no period fixed) excluding Sundays and Holidays, otherwise, [Benguet Corporation] shall have the sole and exclusive right to cancel this Contract.
IN WITNESS WHEREOF, the parties have
hereunto affixed their signatures on this 23rd day of March, 1983 at
Itogon,
BENGUET CORPORATION
By:
|
(sgd.) DENNIS R. BELMONTE Vice-President Benguet Gold Operations |
(sgd.) CESAR Q. CABILDO Contractor |
SIGNED IN OUR PRESENCE:
_____sgd.______ Witnesses _____sgd.______[7]
Apart from the price schedule stipulated
in the Contract of Work, which only reproduced the quotation and bid submitted
by Cabildo, and the preliminary discussions undertaken by the parties, all the
stipulations were incorporated therein by Benguet Corporation which solely
drafted the contract.
To undertake the project, Cabildo
recruited and hired laborers – thirty-three (33) painters and carpenters –
including petitioner Velasco as his general foreman.
The succeeding events, narrated by
the trial court as echoed by the appellate court in their respective decisions,
led to the parties’ falling out:
[I]t must be pointed out that the Mill Buildings in Balatoc were about 28 buildings in all interconnected with each other grouped into 9 areas with some buildings very dangerous since it housed the machineries, agitators and tanks with cyanide solutions to mill the ores while the bunkhouses, which housed the laborers, were about 38 buildings in all averaging about 30 to 35 meters in height or more than 100 feet and thus would take sometime to paint and repair probably for about one and a half (1˝) years.
Thus, the need for scaffoldings to paint the Mill buildings and bunkhouses so that the workers would be safe, can reach the height of the buildings and avoid the fumes of cyanide and other chemicals used in the Milling of the ores.
Payment was to be made on the basis of work accomplished at a certain rate per square meter in accordance with the prices indicated in the Contract. The procedure followed was that [Cabildo] requested the office of Reyes for measurement; then Reyes assign[s] an employee to do the measurement; the employee was accompanied by [Cabildo] or his authorized representative for the measurement; upon completion of the measurement, the computations were submitted to Engr. Manuel Flores, the Supervisor assigned to the work area; if Engr. Flores approved the computation, it was then recommended to Reyes for liquidation; and Reyes thereafter issued the Liquidation Memo to schedule payment of work accomplished.
[Cabildo] was represented in the measurement by either his foreman or his son while Mr. Licuben was assigned to do the measurement for the company.
x x x x
On
On P2,035.00.
x x x Apparently, the above contract of work of Velasco is in Antamok while the Contract of Work of [Cabildo] is in Balatoc.
On
Hence, on June 13, 1983, Rolando Velasco
entered into another Contract of Work with [Benguet Corporation], represented
by Godofredo Fider, to paint the underneath of Mill Buildings No. 702 at
Balatoc Mill, Barangay Virac, Itogon, Benguet and install the necessary
scaffoldings for the work for the sum of P5,566.60.
On the same date of P8,866.00.
x x x x
[Cabildo] complained and protested
but Reyes said the Contract of Work of [Cabildo] covers only the painting of
exterior of the
Because of these developments, Cabildo
enlisted the services of Atty. Galo Reyes, who wrote both Fider and Jaime
Ongpin, President of Benguet Corporation, regarding the ostensibly overlapping
contracts of Cabildo and Velasco.
Parenthetically,
at some point in June 1983, Cabildo was allowed to paint the interiors of various parts of the Mill
Buildings, specifically, the Mill and Security Office, Electrical Office,
Baldemor Office, and Sala Shift Boss.
On
On
July 2, 1983, Benguet Corporation’s Group Manager for Legal and Personnel,
Atty. Juanito Mercado, who prepared and notarized the Contract of Work,
responded to Cabildo’s counsel, declaring that Benguet Corporation’s Contract
of Work with Cabildo only covered exterior painting of the Mill Buildings and
Bunkhouses, whereas the contract with Velasco covered interior painting of the
Mill Buildings, steel structures and underneath the GI Roofing.
Eventually, upon his visit to Benguet
Corporation accompanied by counsel, Cabildo was paid for the
As regards the repairs of defects and
leaks of previous work accomplishments, which were the only job Cabildo was
allowed to work on, these were repaired satisfactorily and Cabildo was paid the
previously withheld amount of P19,775.00.
Once
again, in August of the same year, Cabildo wrote petitioner Belmonte appealing
his preclusion from continuing the Contract of Work and the overlapping
contracting jobs continuously given to Velasco. Yet, Cabildo was still
disallowed to perform the job under the Contract of Work for the month of
September up to December 1983.
With
respect to the Bunkhouses, the petitioners did not require Cabildo to paint them. Neither did petitioners provide the materials
needed therefor. The petitioners simply claimed that Cabildo was not at all
allowed to perform work on the Bunkhouses due to the rainy season and because
of the financial difficulties Benguet Corporation was then experiencing.
Thus,
Cabildo filed a complaint for damages against the petitioners and Velasco
before the RTC, claiming breach by Benguet Corporation of their Contract of
Work. Further, Cabildo sought damages for the petitioner’s harassment and
molestation to thwart him from performing the job under the Contract of Work.
Lastly, Cabildo prayed for damages covering lack of payments and/or
underpayments for various work accomplishments.
The
RTC rendered a decision in favor of Cabildo and found the petitioners, as well
as Velasco, defendant before the RTC, jointly and severally liable to Cabildo
for: (1) P27,332.60 as actual damages; (2) P300,000.00 as
indemnification for unrealized profit; (3) P100,000.00 as moral damages;
(4) P50,000.00 as exemplary damages; (5) P30,000.00 as attorney’s
fees; and (5) costs of suit.
On
appeal, the CA affirmed with modification the RTC’s ruling. The appellate court
excluded Velasco from liability for the foregoing damages.
Hence,
this appeal by the petitioners positing the following issues:
WHETHER [OR NOT] THERE IS BREACH OF CONTRACT AS BASIS FOR AWARD OF DAMAGES AND ATTORNEY’S FEES[?]
WHETHER [OR NOT] THE COUNTERCLAIM OF PETITIONERS SHOULD BE GRANTED[?][9]
We deny the petition. We see no need
to disturb the findings of the trial and appellate courts on the petitioners’
liability for breach of the subject Contract of Work.
It is a well-entrenched doctrine that
factual findings of the trial court, especially when affirmed by the appellate
court, are accorded the highest degree of respect and are conclusive between
the parties and even on this Court.[10]
Nonetheless, jurisprudence recognizes highly meritorious exceptions, such as:
(1) when the findings of a trial court are grounded entirely on speculations,
surmises or conjectures; (2) when a lower court’s inference from its factual
findings is manifestly mistaken, absurd or impossible; (3) when there is grave
abuse of discretion in the appreciation of facts; (4) when the findings of the
appellate court go beyond the issues of the case or fail to notice certain relevant
facts which, if properly considered, will justify a different conclusion; (5)
when there is a misappreciation of facts; and (6) when the findings of fact are
conclusions without mention of the specific evidence on which they are based,
are premised on the absence of evidence, or are contradicted by evidence on
record.[11] It
is noteworthy that none of these exceptions which would warrant a reversal of
the assailed decision obtains herein.
The petitioners insist that the CA
erred in awarding Cabildo damages because his Contract of Work with Benguet
Corporation only covered painting of the exterior of the
We cannot agree with the petitioners’
obviously strained reasoning. The Contract of Work with Cabildo did not
distinguish between the exterior and interior painting of the Mill Buildings.
It simply stated that Cabildo “shall paint the
To bolster their position, the
petitioners contend that there is an apparent conflict between the wording of
the contract and the actual intention of the parties on the specific object of
the painting job. The petitioners argue
that Cabildo knew of Benguet Corporation’s practice to have only the exterior
of buildings painted and was, therefore, aware that the Contract of Work referred
only to the exterior painting of the Mill Buildings, excluding the interior
portion thereof. Thus, the petitioners submit that when there is a conflict as
regards the interpretation of a contract, the obvious intention of the parties
must prevail.
We reject the petitioners’ flawed
contention. Apart from the petitioners’ self-serving assertion, nothing in the
record points to the parties’ intention different from that reflected in the
Contract of Work. To the contrary, the records reveal an unequivocal intention
to have both the exterior and interior of the Mill Buildings painted.
Article 1370 of the Civil Code sets
forth the first rule in the interpretation of contracts. The article reads:
Art. 1370. If the terms of a contract are clear and leave no doubt upon the intention of the contracting parties, the literal meaning of its stipulations shall control.
If the words appear to be contrary to the evident intention of the parties, the latter shall prevail over the former.
In
the recent case of Abad v. Goldloop
Properties, Inc.,[12]
we explained, thus:
The
cardinal rule in the interpretation of contracts is embodied in the first
paragraph of Article 1370 of the Civil Code: “[i]f the terms of a contract are clear and leave no doubt upon the
intention of the contracting parties, the literal meaning of its stipulations
shall control.” This provision is
akin to the “plain meaning rule” applied by
In
our jurisdiction, the rule is thoroughly discussed in Bautista v. Court of Appeals:
The
rule is that where the language of a contract is plain and unambiguous, its
meaning should be determined without reference to extrinsic facts or aids. The intention of the parties must be gathered
from that language, and from that language alone. Stated differently, where the language of a written
contract is clear and unambiguous, the contract must be taken to mean that
which, on its face, it purports to mean, unless some good reason can be assigned
to show that the words should be understood in a different sense. Courts cannot make for the parties better or
more equitable agreements than they themselves have been satisfied to make, or
rewrite contracts because they operate harshly or inequitably as to one of the
parties, or alter them for the benefit of one party and to the detriment of the
other, or by construction, relieve one of the parties from the terms which he
voluntarily consented to, or impose on him those which he did not.
In
the case at bench, the Contract of Work leaves no room for equivocation or
interpretation as to the exact intention of the parties. We also note that
Benguet Corporation’s counsel drafted and prepared the contract. Undoubtedly,
the petitioners’ claimed ambiguity in the wordings of the contract, if such an
ambiguity truly exists, cannot give rise to an interpretation favorable to
Benguet Corporation. Article 1377 of the Civil Code provides:
Art. 1377. The interpretation of obscure words or stipulations in a contract shall not favor the party who caused the obscurity.
Still, the petitioners insist that
the parties’ intention was different, and that Cabildo knew of, and acquiesced
to, the actual agreement.
We remain unconvinced. Even if we
were to patronize the petitioners’ stretched logic, the supposed intention of
the parties is not borne out by the records.
Article 1371 of the same code states:
Art. 1371. In order to judge the intention of the contracting parties, their contemporaneous and subsequent acts shall be principally considered.
In stark contrast to the petitioners’
assertions are the following:
First, the procedure for work
accomplishments and payments followed by the parties required representatives
and/or employees of Benguet Corporation to closely monitor Cabildo’s
performance of the job. Notably, when Cabildo painted both the exterior and
interior of the Mill Buildings except for the interior of the refinery
buildings where gold is being minted, he was under the close supervision of
petitioners Reyes and Fider. If, as the petitioners claim, the intention was
only to paint the exterior of the Mill Buildings, then Reyes and Fider, or any
of Benguet Corporation’s representatives assigned to monitor the work of
Cabildo, should have, posthaste, stopped Cabildo from continuing the painting
of the interiors.
Moreover, the materials for the
painting work were provided by Benguet Corporation as listed and requested by
Cabildo. The petitioners had the opportunity to disapprove Cabildo’s requests
for materials needed to paint the interiors of the Mill Buildings, but they
failed to do so.
Second, although Cabildo concedes
that he knew of Benguet Corporation’s practice to have only the exteriors of
buildings painted, he refutes the petitioners’ claim that the aforesaid
practice extended to the painting of the Mill Buildings. Cabildo asseverates
that the practice of painting only the exterior of buildings was confined to
the Bunkhouses. Evidently, Cabildo’s knowledge of the claimed practice, as
qualified by Cabildo himself, does not translate to an inference that the
parties had intended something other than what is written in the Contract of
Work.
Lastly, a singular document, the Liquidation
Memo dated
From the foregoing, it is crystal
clear that the petitioners breached the Contract of Work with Cabildo by
awarding Velasco a contract covering the same subject matter, quite
understandably, because Velasco offered a price schedule lower than Cabildo’s.
We completely agree with the uniform findings of the lower courts that the
petitioners waylaid Cabildo and prevented him from performing his obligation
under the Contract of Work.
With respect to the painting of the
Bunkhouses, the petitioners claim that Cabildo was not allowed to paint them due
to the rainy season and because of the financial difficulties of Benguet
Corporation. Suffice it to state that the Contract of Work did not provide for
a suspension clause. Thus, Benguet Corporation cannot unilaterally suspend the
Contract of Work for reasons not stated therein.
Consequent to all these disquisitions,
we likewise affirm the lower courts’ dismissal of the petitioners’
counterclaim.
WHEREFORE,
premises considered, the petition is hereby DISMISSED. The Court of Appeals decision in CA-G.R. CV No. 37123 is
AFFIRMED. Costs against the
petitioners.
SO ORDERED.
ANTONIO
EDUARDO B. NACHURA
Associate
Justice
WE CONCUR:
CONSUELO YNARES-SANTIAGO
Associate
Justice
Chairperson
|
MA. ALICIA AUSTRIA-MARTINEZ Associate Justice |
MINITA V. CHICO-NAZARIO Associate Justice |
RUBEN T. REYES
Associate
Justice
A T T E S T A T I O N
I attest that the conclusions in the above Decision were
reached in consultation before the case was assigned to the writer of the
opinion of the Court’s Division.
CONSUELO
YNARES-SANTIAGO
Associate
Justice
Chairperson,
Third Division
C E R T I F I C A T I O
N
Pursuant to Section 13, Article
VIII of the Constitution and the Division Chairperson's Attestation, I certify
that the conclusions in the above Decision had been reached in consultation
before the case was assigned to the writer of the opinion of the Court’s
Division.
REYNATO
S. PUNO
Chief
Justice
[1] Penned by Associate Justice Marina L. Buzon, with Associate Justices Eubulo G. Verzola and Bienvenido L. Reyes, concurring; rollo, pp. 82-100.
[2] Penned by Judge Ruben C. Ayson, id. at 49-80.
[3] Vice-President and General Manager of Benguet Gold Operations of Benguet Corporation at the time material to the complaint before the RTC.
[4] Department Manager of the Construction Department.
[5] Division Manager of Technical Services.
[6] The petitioners, collectively.
[7] Annex “A,” records, pp. 6-9.
[8] Rollo, pp. 84-87.
[9] Petitioners’ Memorandum, p. 5; rollo, p. 194.
[10] Philippine
Health-care Providers, Inc. v. Estrada, G.R. No. 171052, January 28, 2008,
542 SCRA 616, 621.
[12] G.R. No. 168108,