G.R. No. 109087 - RODZSSEN SUPPLY CO. INC., VS. FAR EAST BANK & TRUST CO.. D E C I S I O N - Supreme Court E-Library

Ruling

WHEREFORE, the decision under appeal should be, as it is hereby affirmed in all its aspects, except for the deletion of paragraph 2 of its dispositive portion, which paragraph shall be replaced by a new paragraph which shall read as follows: '2. ordering the defendant to pay the plaintiff the sum equivalent to 10% of the total amount due and collectible, as attorney's fees; and' "No pronouncement as to costs." [4] On the other hand, the trial court had rendered this judgment: "1. Ordering the defendant to pay the plaintiff the sum of P76,000.00, representing the principal amount being claimed in this action, plus interest thereon at the rate of 12% per annum counted from October 1979 until fully paid; "2. Ordering the defendant to pay the plaintiff the sum equivalent to 25% of the total amount due and collectible; and "3. Ordering the defendant to pay the costs of the suit." [5] The Facts The factual and procedural antecedents of the case are summarized by the Court of Appeals as follows: "In the complaint from which the present proceedings originated, it is alleged that on January 15, 1979, defendant Rodzssen Supply, Inc. opened with plaintiff Far East Bank and Trust Co. a 30-day domestic letter of credit, LC No. 52/0428/79-D, in the amount of P190,000.00 in favor of Ekman and Company, Inc. (Ekman) for the purchase from the latter of five units of hydraulic loaders, to expire on February 15, 1979; that subsequent amendments extended the validity of said LC up to October 16, 1979; that on March 16, 1979, three units of the hydraulic loaders were delivered to defendant for which plaintiff on March 26, 1979, paid Ekman the sum of P114,000.00, which amount defendant paid plaintiff before the expiry date of the LC; that the shipment of the remaining two units of hydraulic loaders valued at P76,000.00 sent by Ekman was 'readily received by the defendant' before the expiry date [of] subject LC; that upon Ekman's presentation of the documents for the P76,000.00 'representing final negotiation' on the LC before the expiry date, and 'after a series of negotiations', plaintiff paid to Ekman the amount of P76,000.00; and that upon plaintiff's demand on defendant to pay for said amount (P76,000.00), defendant' refused to pay ... without any valid reason'. Plaintiff prays for judgment ordering defendant to pay the abovementioned P76,000.00 plus due interest thereon, plus 25% of the amount of the award as attorney's fees. "In the Answer, defendant interposed, inter alia , by way of special and affirmative defenses that plaintiff ha[d] no cause of action against defendant; that there was a breach of contract by plaintiff who in bad faith paid Ekman, knowing that the two units of hydraulic loaders had been delivered to defendant after the expiry date of subject LC; and that in view of the breach of contract, defendant offered to return to plaintiff the two units of hydraulic loaders, 'presently still with the defendant' but plaintiff refused to take possession t