C.W. Rosenstock (administrator of the estate of H.W.

Elser) vs Edwin Burke

September 26, 1924 | AVANCEÑA, J.
Essential Requisites: Consent (Requisites) Art. 1319
DOCTRINE: The usage of the phrase: “I am in position and am willing to entertain the purchase” does not constitute a
definite offer. There is no consent since the offer must be certain and not merely open for discussion.
SUMMARY: Plaintiff wanted to purchase a yacht that is owned by the defendant. In order to advertise the yacht to prospective
buyers, the Plaintiff wanted to take the yacht to a voyage but there was a need for repairs. The repairs were paid for by the
plaintiff since the defendant cannot do so. After the voyage, the plaintiff stated that there was a need to get a new engine
and in order to do so he needs to secure a loan from Mr. Avery. Plaintiff made a letter stating the he is in a position to entertain
the purchase. Plaintiff said that he would only buy the yacht for 70k but was renegotiated to 80k. Plaintiff was not able to
obtain the loan hence he did not want to push through with the purchase. Defendant demanded the performance of the
obligation, but the Plaintiff demanded the payment of the repairs. The Lower Court ruled that the defendant must pay the
plaintiff, but the plaintiff must still purchase the yacht. The SC reversed the decision and stated that the term “entertain the
purchase” does not constitute a definite offer to buy the yacht. The SC also said that the plaintiff must be the one to pay the
repairs since it would be strange for the defendant to assume the liability since the extent of the repairs was left entirely to
the plaintiff.
FACTS:
• Defendant Edwin Burke owned a yacht known as Bronzewing, which he acquired in Australia in 1920 for the purpose
of selling it and it was purely for recreation
• Nobody wanted to buy the yacht until Plaintiff H.W. Elser began negotiations with Burke in 1922.
• At that time, the yacht was mortgaged to the Asia Banking Corporation to secure the payment of a debt of Php 100k
which was due and unpaid since 1 year prior, contracted by Burke in favor of said bank of which Mr. Avery was the
manager.
• Plaintiff wanted to organize a yacht club and sell the yacht afterwards for 120k with 20k as commission and 100k to
be paid to Burke
• On Feb. 12, 1922, Burke obtained from Plaintiff an option in writing that plaintiff confirms his verbal offer to Burke of
the yacht at a price of Php 120k.
• First, the plaintiff wanted to make a voyage on board the yacht to the south with businessmen for the purpose of
advertising the vessel. But the yacht needed some repairs in order for it to be seaworthy.
• The defendant did not have funds to make the repairs hence, the plaintiff paid almost all the amount, the repairs cost
6,972 and 1730 due to Cooper Company.
• Once the repairs were done, the voyage commenced from March 6, 1922 to March 23, 1922. After the voyage, the
plaintiff believed that the engine should be replaced which would cost 20k. The plaintiff then negotiated another loan
with Mr. Avery of 20k to purchase the new engine.
• On March 31, Plaintiff wrote a letter to Burke stating that he tried to obtain a loan from Mr. Avery for the purchase
of the new engine and that he was not disposed to purchase the vessel for more than 70k, Mr. Avery told him that
he was not in position to give one cent more
• The defendant had arrived at an agreement with Mr. Avery about the sale of the yacht to plaintiff for 80k payable
5k/month for the first 6 months then 10k thereafter until full payment.
• On April 1, Plaintiff informed the defendant that he was not inclined to accept this proposition. On April 3, the Plaintiff
met with the Defendant and wrote a letter addressed to the defendant that:
o “In connection with the yacht Bronzewing, I am in position and am willing to entertain the purchase of it…”
• Defendant and Mr. Avery signed at the bottom of the letter of Plaintiff. But on April 5, the Plaintiff sent defendant a
letter that in view of the attitude of Mr. Avery regarding the 20k loan, it was impossible for him to take charge of the
boat and he made delivery thereof to the defendant
• On April 8, Defendant demanded on plaintiff for the performance because he had accepted the offer for the purchase
of the yacht by the plaintiff.
• Plaintiff brings an action against defendant to recover Php 6k for the repairs made on the yacht which he paid for.
• Defendant alleges as a defense that the repairs will be paid for by plaintiff in exchange of the gratuitous use of the
yacht for the voyage to the south. He also made a counterclaim and to compel plaintiff to comply with the terms of
the contract.
• The Cooper Company was admitted to intervene for the unpaid repairs made on the yacht amounting to 1,730.
• Trial Court: sentenced defendant to pay plaintiff 6k and to pay Cooper Company 1.7k. The Plaintiff was also sentenced
to comply in all its parts with the contract for the purchase of the yacht.
 • Both parties appeal the decision: for the Plaintiff argues that the letter was not a definite offer to purchase while the
defendant raised the question as to who must pay the repairs made on the yacht.
ISSUE: W/N the statement “willing to entertain the purchase of it” is considered as a definite offer to purchase – NO
HELD:
THERE WAS NO DEFINITE OFFER TO PURCHASE
• To convey the idea of a resolution to purchase, a man of ordinary intelligence would use these clear and simple words:
I offer to purchase, I want to purchase, I am in position to purchase.
• But the plaintiff instead used the “willing to entertain” and the word “entertain” does not mean the resolution to
perform said act but simply a position to deliberate for deciding to perform or not to perform said act.
• It was a mere invitation to a proposal being made to him, which might be accepted by him or not.
• Also looking at the circumstance, it would show that the intention of the plaintiff was not to make a definite offer
since the purpose of acquiring the yacht was to sell it to another hence, he was not in a position to make a definite
offer unless he is sure to be able to resell it to another.
• It can also be seen that the plaintiff thought it was necessary to replace the engine of the yacht and the resolution of
the plaintiff to purchase the yacht depended on him being able to replace the engine which depended on successfully
obtaining the 20k loan hence, the plaintiff was not in a position to make a definite offer.
• But above all, the letter was written by his stenographer, Mr. Parkins, when the plaintiff met with the defendant to
talk about the purchase.
o The plaintiff stated that he was in a position to entertain the purchase, but the defendant wanted to eliminate
the word entertain and instead make it into a definite offer but after discussion with the defendant that
plaintiff was not in a position to make a definite offer, the word “entertain” was left in the letter.
• The Lower Court was wrong it stating that it was anomalous for the plaintiff to write the letter if his purpose was only
to indicate to the defendant that he wanted the latter to make a proposal which he might reject or accept.
• A proposition may be acceptable in itself, but its acceptance may depend on other circumstance. The acceptance of
the defendant of the letter has no other meaning than that of accepting the proposition to make this offer.
PLAINTIFF MUST PAY FOR THE REPAIRS
• Plaintiff: Agreement was that he had to advance only the amount of the repairs and that the defendant was at last
the one to pay therefor.
• Defendant: Agreement was that the plaintiff was to pay for these repairs in exchange for the use of the yacht
• The testimony of the plaintiff contradicted by that of the defendant, cannot be considered as a sufficient evidence to
establish defendant’s obligation.
• Nothing was agreed upon about the kind of the repairs to be made and there was no limit to said repairs. It is strange
that the defendant should accept liability for the amount of these repairs, leaving their extent entirely to the
discretion of the plaintiff.
DISPOSITION:
Judgment is REVERSED. DEFENDANT is ABSOLVED from the complaint. PLAINTIFF is sentenced to PAY to Cooper
Company and to the Defendant. The PLAINTIFF is DECLARED to be under NO OBLIGATION to Purchase the yacht.