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    Tuason Vs Marquez

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    Sui
    The plaintiff Tuason sued the defendant Marquez seeking rescission of their contract for the sale of an electric light plant and franchise. Under the contract, Tuason purchased the plant for $14,400 but only paid the first installment of $2,400. The plant's franchise was later cancelled and the plant was sold to satisfy a debt. The lower court ruled in favor of Marquez, and the Supreme Court affirmed, finding that Marquez was not guilty of fraud or misrepresentation since Tuason operated the plant for over a year without questioning the franchise and only sued after the business failed.

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    Tuason Vs Marquez

    Uploaded by

    Sui
    225 views1 page
    The plaintiff Tuason sued the defendant Marquez seeking rescission of their contract for the sale of an electric light plant and franchise. Under the contract, Tuason purchased the plant for $14,400 but only paid the first installment of $2,400. The plant's franchise was later cancelled and the plant was sold to satisfy a debt. The lower court ruled in favor of Marquez, and the Supreme Court affirmed, finding that Marquez was not guilty of fraud or misrepresentation since Tuason operated the plant for over a year without questioning the franchise and only sued after the business failed.

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    Tuason vs Marquez

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    The plaintiff Tuason sued the defendant Marquez seeking rescission of their contract for the sale of an electric light plant and franchise. Under the contract, Tuason purchased the plant for $14,400 but only paid the first installment of $2,400. The plant's franchise was later cancelled and the plant was sold to satisfy a debt. The lower court ruled in favor of Marquez, and the Supreme Court affirmed, finding that Marquez was not guilty of fraud or misrepresentation since Tuason operated the plant for over a year without questioning the franchise and only sued after the business failed.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as DOC, PDF, TXT or read online from Scribd
    Download as doc, pdf, or txt
    225 views1 page

    Tuason Vs Marquez

    Uploaded by

    Sui
    The plaintiff Tuason sued the defendant Marquez seeking rescission of their contract for the sale of an electric light plant and franchise. Under the contract, Tuason purchased the plant for $14,400 but only paid the first installment of $2,400. The plant's franchise was later cancelled and the plant was sold to satisfy a debt. The lower court ruled in favor of Marquez, and the Supreme Court affirmed, finding that Marquez was not guilty of fraud or misrepresentation since Tuason operated the plant for over a year without questioning the franchise and only sued after the business failed.

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    MARIANO S. TUASON, plaintiff & appellant, vs.

    CRISANTO MARQUEZ,
    defendant & appellee [1923]

    ⇒ 1913/1914: Lucena Electric Company was granted a 35-yr franchise. Rts


    was passed on to Marquez on Sept. 10, 1919. However, the company
    never functioned efficiently, thus, Marquez gave up the franchise, w/c was
    subsequently cancelled by the Public Utility Commissioner on March 29,
    1921.
    ⇒ March 5, 1921: Marquez entered into an agreement w/Tuason wherein the
    latter purchased the plant for P14,400.00, P2,400 of w/c was payable w/in
    60 days from the signing of the agreement and the balance of P12k payable
    w/in a year. Only the first installment was paid. One pertinent clause in their
    agreement mentioned that the rt to franchise/tax exemption (not sure which
    of these 2 is the correct translation) is granted to the company to operate
    the industry for w/c it is dedicated. Despite lack of franchise, Tuason was
    still allowed to operate the company by means of a special license valid
    until he obtains a new franchise. New franchise was granted w/certain
    conditions w/c amounted to a renovation of the entire plant.
    ⇒ While in Tuason’s possession, the plant was ran by Consolidated Electric
    Company for about 16mos. However, it was later on sold under execution
    due to a judgment in the case of Levy Hermanos vs. Philippine Electric
    Light Company. Buyer was Gregorio Marquez, Crisanto’s brother, who
    bought it at P5,501.57.
    ⇒ Tuason then instituted an action against Crisanto for a rescission of the
    contract plus judgment amounting to P37,400.00. Crisanto asked for
    dismissal of the case & an allowance of a total of P12,654.50 from Tuason.
    ⇒ Lower court absolved Crisanto & allowed him to recover P12,240.00 w/legal
    interest (P12k – amount still due from the sale and P240.00 – rent).

    Issue & Ratio: WON Crisanto is guilty of fraud & misrepresentation in


    selling an electric light plant w/a franchise when it fact it had none, which
    should then be a ground for the rescission of the contract. – NO.
    1. The contract, in mentioning the electric light company merely renewed a
    previous inventory of the property. The franchise was not the determining
    cause of the purchase. During the sale, franchise was still in force & either
    party could have ascertained its status by simply applying at the Public
    Utility Commissioner’s office. Innocent non-disclosure of a fact doesn’t
    affect the formation of the contract or operate to discharge the parties from
    their agreement. Caveat emptor (buyer alone is responsible for assessing
    the quality of a purchase before buying) should be recalled.
    2. Tuason is in estoppel for delay in asserting his rights. He operated the plant
    for 16 mos w/o ques & he even paid the 1st payment. He only instituted the
    action after the venture proved to be disastrous & a 3rd party now owns the
    property.
    3. There was no proof of fraud on the part of Crisanto.

    Holding: Lower court decision affirmed.

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