G.R. No. 104609 June 30, 1993
PHILIP LEE GO and SPECIFIQUE GARMENTS MANUFACTURING, INC., petitioners, vs. COURT OF APPEALS and CLOVER MANUFACTURING CORP., respondents.

FACTS

Clover Manufacturing Corporation delivered denim materials in five transactions to Philip Go, president and general manager of Specifique Garments, at the latter’s address. The delivery receipts and packing lists indicated Go as the “customer” and were acknowledged by his employees. The total purchase price was P949,783.22, but only P146,109.50 for the first delivery was paid. Clover demanded payment for the balance from Go and Specifique, but they failed to pay. Clover filed a complaint in the Regional Trial Court of Quezon City against the petitioners for the balance. A writ of preliminary attachment was issued but later lifted after the defendants filed a counterbond. In their answer, the defendants denied transacting with Clover. Go claimed he bought the materials from William Lim, to whom he had made full payment—cash for the first delivery and checks for the next four, which were encashed. William Lim was not impleaded in a third-party complaint but testified for the defendants, stating he bought the materials on credit from Clover and sold them to Go, and that he failed to pay Clover. He claimed that through his brother, he entered into an agreement with Joseph Lim, president of Clover, transferring his and his family’s shares in Consolidated Aggregates to Clover in payment of his debt. The trial court ruled in favor of Clover, finding the delivery receipts and packing lists showed Go as the customer and were accepted by his employees, and that there was no evidence the checks were for the denim materials. The Court of Appeals affirmed the decision.

ISSUE

Whether Philip Lee Go or William Lim directly purchased the denim materials from Clover Manufacturing Corporation.

RULING

The Supreme Court denied the petition, affirming the lower courts’ decisions. The Court held that the issue was factual, and the findings of the trial and appellate courts are generally conclusive. It found no arbitrariness or grave abuse of discretion in their conclusion that Go directly purchased the materials from Clover. The Court noted that Go did not file a third-party complaint against Lim, which he could have done for protection. It also found it illogical for Go to buy through Lim at a higher price when he could have purchased directly from Clover, given his ability to pay. The delivery receipts and packing lists identified Go as the customer and were accepted by his employees without protest. The agreement between Lim and Clover was deemed a pledge violating Article 2088 of the Civil Code and did not prove Go’s payment to Clover. Proof of payment to Lim was not proof of payment to Clover, as Go’s obligation was directly to Clover. The claim for damages was rejected, and the issuance of the preliminary attachment was sustained.