GR L 11908; (February, 1918) (Digest)
G.R. No. L-11908; February 4, 1918
ANTONIO M.A. BARRETTO, plaintiff-appellant, vs. JOSE SANTA MARINA and “LA INSULAR,” defendants-appellees.
FACTS:
This case is a sequel to Barretto v. Santa Marina (26 Phil. 200, December 2, 1913). In the prior case, the Supreme Court ruled against plaintiff Antonio M.A. Barretto regarding the sale of his participacion (share) in a tobacco factory business. In the present action, Barretto claims legal interest on the purchase price of his share from July 1, 1909, to November 22, 1910 (the date the payment was turned over to him). The Court previously held that the sale was consummated on May 3, 1910, when a valuation committee determined the cash value of his share, inclusive of profits up to that date. The committee’s report, dated November 14, 1910, fixed the value at P280,025.16, which was promptly paid by defendant Jose Santa Marina to Barretto on November 22, 1910. Barretto executed a deed of sale acknowledging receipt of the payment.
ISSUE:
Whether plaintiff-appellant is entitled to legal interest on the purchase price of his participacion for the periods: (1) from July 1, 1909, to May 3, 1910; and (2) from May 3, 1910, to November 22, 1910.
RULING:
The Supreme Court DENIED the claim for interest and AFFIRMED the trial court’s dismissal of the complaint.
2. Interest from May 3, 1910, to November 22, 1910: The Court found no basis for awarding interest for this period. Under the sale agreement of May 3, 1910, the defendant only obligated himself to pay the amount fixed by the valuation committee in cash immediately upon the committee’s award. There was no express or implied contract to pay interest pending the committee’s report. The defendant complied punctually by paying the awarded amount promptly after the report was submitted on November 14, 1910. Since there was no delay (demora) in payment, interest by way of damages does not apply.
The right to interest arises either from contract or as damages for delay in payment. Neither condition existed here. Accordingly, the complaint was correctly dismissed.
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