NUTRIMIX FEEDS CORP V.

CA 441 SCRA 357 (2004)

FACTS: In 1993, private respondent spouses Evangelista procured various animal feeds from petitioner Nutrimix Feeds
Corp. the petitioner gave the respondents a credit period of 30-45 days to postdate checks to be issued as payment for
the feeds. The accommodation was made apparently because the companys president was a close friend of
Evangelista. The various animal feeds were paid and covered by checks with due dates from July 1993-September 1993.
1. Initially, the spouses were good paying customers. However, there were instances when they failed to issue
checks despite the delivery of goods. Consequently, the respondents incurred an aggregate unsettled account
with Nutrimix amounting to P766,151
2.

When the checks were deposited by the petitioner, the same were dishonored (closed account). Despite
several demands from the petitioner, the spouses refused to pay the remaining balance

3. Thereafter, Nutrimix filed a complaint against Evangelista for collection of money with damages.
4. The respondents admitted their unpaid obligation but impugned their liability. The nine checks issued were
made to guarantee the payment of the purchases, which was previously determined to be procured from the
expected proceeds in the sale of their broilers and hogs. They contended that inasmuch as the sudden and
massive death of their animals was caused by the contaminated products of the petitioner, the nonpayment
of their obligation was based on a just and legal ground.
5.

The respondents also lodged a complaint for damages against the petitioner, for the untimely and unforeseen
death of their animals supposedly effected by the adulterated animal feeds the petitioner sold to them.

6.

Nutrimix alleged that the death of the respondents animals was due to the widespread pestilence in their
farm. The petitioner, likewise, maintained that it received information that the respondents were in an
unstable financial condition and even sold their animals to settle their obligations from other enraged and
insistent creditors. It, moreover, theorized that it was the respondents who mixed poison to its feeds to make
it appear that the feeds were contaminated.

7. The trial court held in favor of petitioner on the ground that it cannot be held liable under Articles 1561 and
1566 of the Civil Code governing hidden defects of commodities sold. The trial court is predisposed to
believe that the subject feeds were contaminated sometime between their storage at the bodega of the
Evangelistas and their consumption by the poultry and hogs fed therewith, and that the contamination was
perpetrated by unidentified or unidentifiable ill-meaning mischief-maker(s) over whom Nutrimix had no
control in whichever way.
8.

CA modified the decision of the trial court, citing that respondents were not obligated to pay their
outstanding obligation to the petitioner in view of its breach of warranty against hidden defects. The CA
gave much credence to the testimony of Dr. Rodrigo Diaz, who attested that the sample feeds distributed to
the various governmental agencies for laboratory examination were taken from a sealed sack bearing the
brand name Nutrimix

ISSUE: WON Nutrimix is guilty of breach of warranty due to hidden defects

HELD: NO.
The provisions on warranty against hidden defects are found in Articles 1561 and 1566 of the New Civil Code of the
Philippines. A hidden defect is one which is unknown or could not have been known to the vendee. Under the law, the
requisites to recover on account of hidden defects are as follows:
a)

the defect must be hidden;

b)

the defect must exist at the time the sale was made;

c)

the defect must ordinarily have been excluded from the contract;

d)

the defect, must be important (renders thing UNFIT or considerably decreases FITNESS);

e)

the action must be instituted within the statute of limitations

In the sale of animal feeds, there is an implied warranty that it is reasonably fit and suitable to be used for the purpose
which both parties contemplated. To be able to prove liability on the basis of breach of implied warranty, three things
must be established by the respondents. The first is that they sustained injury because of the product; the second is
that the injury occurred because the product was defective or unreasonably unsafe; and finally, the defect existed when
the product left the hands of the petitioner. A manufacturer or seller of a product cannot be held liable for any damage
allegedly caused by the product in the absence of any proof that the product in question was defective. The defect must
be present upon the delivery or manufacture of the product; or when the product left the sellers or manufacturers
control; or when the product was sold to the purchaser; or the product must have reached the user or consumer without
substantial change in the condition it was sold. Tracing the defect to the petitioner requires some evidence that there
was no tampering with, or changing of the animal feeds. The nature of the animal feeds makes it necessarily difficult for
the respondents to prove that the defect was existing when the product left the premises of the petitioner
A review of the facts of the case would reveal that the petitioner delivered the animal feeds, allegedly containing rat
poison, on July 26, 1993; but it is astonishing that the respondents had the animal feeds examined only on October 20,
1993, or barely three months after their broilers and hogs had died. A difference of approximately three months enfeebles
the respondents theory that the petitioner is guilty of breach of warranty by virtue of hidden defects. In a span of three
months, the feeds could have already been contaminated by outside factors and subjected to many conditions
unquestionably beyond the control of the petitioner.
Even more surprising is the fact that during the meeting with Nutrimix President Mr. Bartolome, the respondents claimed
that their animals were plagued by disease, and that they needed more time to settle their obligations with the petitioner.
It was only after a few months that the respondents changed their justification for not paying their unsettled accounts,
claiming anew that their animals were poisoned with the animal feeds supplied by the petitioner.

JERRY T. MOLES VS. INTERMEDIATE APPELLATE COURT AND MARIANO M. DIOLOSA

G.R. No. 73913, January 31, 1989
FACTS:
Jerry Moles(petitioner) bought from Mariano Diolosa owner of Diolosa Publishing House a linotype printing
machine(secondhand machine). Moles promised Diolosa that will pay the full amount after the loan from DBP worth
P50,000.00 will be released. Private respondent on return issued a certification wherein he warrated that the machine
was in A-1 condition, together with other express warranties. After the release of the of the money from DBP, Petitioner
required the Respondent to accomplish some of the requirements. On which the dependant complied the requirements
on the same day.
On November 29, 1977, petitioner wrote private respondent that the machine was not functioning properly. The
petitioner found out that the said machine was not in good condition as experts advised and it was worth lesser than the
purchase price. After several telephone calls regarding the defects in the machine, private respondent sent two
technicians to make necessary repairs but they failed to put the machine in running condition and since then the
petitioner wan unable to use the machine anymore.

ISSUE/S:
1.

Whether there is an implied warranty of its quality or fitness.

2. Whether the hidden defects in the machine is sufficient to warrant a rescission of the contract between the
parties.

FACTS:
1.

It is generally held that in the sale of a designated and specific article sold as secondhand, there is no implied
warranty as to its quality or fitness for the purpose intended, at least where it is subject to inspection at the time
of the sale. On the other hand, there is also authority to the effect that in a sale of secondhand articles there
may be, under some circumstances, an implied warranty of fitness for the ordinary purpose of the article sold or
for the particular purpose of the buyer.
Said general rule, however, is not without exceptions. Article 1562 of our Civil Code, which was taken from the
Uniform Sales Act, provides:
"Art. 1562. In a sale of goods, there is an implied warranty or condition as to the quality or fitness of the goods,
as follows:
(1) Where the buyer, expressly or by implication, makes known to the seller the particular purpose for which
the goods are acquired, and it appears that the buyer relies on the seller's skill or judgment (whether he be the
grower or manufacturer or not), there is an implied warranty that the goods shall be reasonably fit for such
purpose;"

2. We have to consider the rule on redhibitory defects contemplated in Article 1561 of the Civil Code. A
redhibitory defect must be an imperfection or defect of such nature as to engender a certain degree of
importance. An imperfection or defect of little consequence does not come within the category of being
redhibitory.

As already narrated, an expert witness for the petitioner categorically established that the machine required
major repairs before it could be used. This, plus the fact that petitioner never made appropriate use of the
machine from the time of purchase until an action was filed, attest to the major defects in said machine, by
reason of which the rescission of the contract of sale is sought. The factual finding, therefore, of the trial court
that the machine is not reasonably fit for the particular purpose for which it was intended must be upheld, there
being ample evidence to sustain the same.
At a belated stage of this appeal, private respondent came up for the first time with the contention that the
action for rescission is barred by prescription. While it is true that Article 1571 of the Civil Code provides for a
prescriptive period of six months for a redhibitory action, a cursory reading of the ten preceding articles to
which it refers will reveal that said rule may be applied only in case of implied warranties. The present case
involves one with an express warranty. Consequently, the general rule on rescission of contract, which is four
years shall apply. Considering that the original case for rescission was filed only one year after the delivery of
the subject machine, the same is well within the prescriptive period. This is aside from the doctrinal rule that
the defense of prescription is waived and cannot be considered on appeal if not raised in the trial court, and this
case does not have the features for an exception to said rule.