Union Refinery Corporation v · G.R. 155653

Petitioner: Union Refinery Corporation
Respondent: Reynaldo C. Tolentino, Sr.
Citation: G.R. No. 155653
Court: Supreme Court
Division: Second Division
Ponente: Puno, J.
Decided: September 30, 2005

Summary

Union Refinery Corporation sued Roland B. Tolentino and his family members for collection of unpaid debt arising from a dealership agreement for Unioil products. The trial court dismissed the case and awarded damages to defendants. The Court of Appeals reversed, ordering Roland to pay P1,541,211.51 with 6% interest, applying the principle of relativity of contracts to hold only Roland liable. The Supreme Court partially granted Union Refinery's petition, increasing the debt to P1,905,675.90 with contractual liquidated interests of 25% and special liquidated interest of 10%. The Court rejected Roland's claims of unrecorded payments, applied the burden of proof principle, and removed damage awards finding no bad faith in impleading family members. The decision emphasizes contractual obligations in commercial dealership relationships and the binding effect of stipulated interests and liquidated damages in business agreements.

Statutes applied

Civil Code, Art. 1311

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By the Intellegal Editorial Board · September 30, 2005

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