Taylor vs Uy Tieng piao Case Digest

Taylor vs Uy Tieng piao

G.R. No. L-16109
October 2, 1922

FACTS

 Taylor contracted his services to Tan Liuan & Co as superintendent of an oil factory which the latter contemplated
establishing
 The contract extended over 2 years and the salary was P600/month during the first year and P700/month during the
second with electric, light and water for domestic consumption or in lieu thereof, P60/month
 At this time, the machinery for contemplated factory had not been acquired, though ten expellers had been ordered
from the US
 It was understood that should the machinery to be installed fail, for any reason, to arrive in Manila within the period of
6 months, the contract may be cancelled by the party of the second part at its option, such cancellation not to occur
before the expiration of such 6 months

 The machinery did not arrive in Manila within the 6 months; the reason does not appear, but a preponderance of
evidence show that the defendants seeing that oil business no longer promised large returns, either cancelled the
order for machinery from choice or were unable to supply the capital necessary to finance the project.
 Defendants communicated to Taylor that they had decided to rescind the contract.
 Taylor instituted this action to recover damages in the amount of P13k, covering salary and perks due and to become
due

ISSUE

WON in a contract for the prestation of service, it is lawful for the parties to insert a provision giving the employer the
power to cancel the contract in contingency which may be dominated by himself

HELD

 YES. One of the consequences of the stipulation was that the employers were left in a position where they could
dominate the contingency, and the result was about the same as if they had been given an unqualified option to
dispense with the services of Taylor at the end of 6 months. But this circumstance does not make the stipulation
illegal.
 A condition at once facultative and resolutory may be valid even though the condition is made to depend upon the
will of the obligor.
 If it were apparent, or could be demonstrated that the defendants were under positive obligation to cause the
machinery to arrive in Manila, they would of course be liable, in the absence of affirmative proof showing that the non-
arrival of the machinery was due to some cause not having its origin in their own act or will.
 The contract, however, expresses no such positive obligation, and its existence cannot be implied in the face of the
stipulation, defining the conditions under which the defendants can cancel the contract.
 CFI no error in rejecting Taylor’s claim in so far as damages are sought for the period subsequent to the expiration of
6 months, but in assessing the damages due for the six-month period, the trial judge overlooked the item of P60
(commutation of house rent) This amount Taylor is entitled to recover in addition to P300 awarded by CFI.