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  • Universal International Investment V Ray Burton Dev Corp

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    Emilio Pahina
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    UII bought condo units from RBDC but RBDC failed to deliver the title on time. [1] The property's mother title was foreclosed and UII could not take possession. [2] UII sued RBDC for damages including depreciation costs and expenses. [3] The court found RBDC liable for moderate damages of 15% of the investment due to the failure to perform their obligation, as well as exemplary damages and attorney's fees.

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    Case Digest - Damages

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    Universal International Investment v Ray Burton Dev Corp

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    UII bought condo units from RBDC but RBDC failed to deliver the title on time. [1] The property's mother title was foreclosed and UII could not take possession. [2] UII sued RBDC for damages including depreciation costs and expenses. [3] The court found RBDC liable for moderate damages of 15% of the investment due to the failure to perform their obligation, as well as exemplary damages and attorney's fees.

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    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
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    Download as pdf or txt
    62 views1 page

    Universal International Investment V Ray Burton Dev Corp

    Uploaded by

    Emilio Pahina
    UII bought condo units from RBDC but RBDC failed to deliver the title on time. [1] The property's mother title was foreclosed and UII could not take possession. [2] UII sued RBDC for damages including depreciation costs and expenses. [3] The court found RBDC liable for moderate damages of 15% of the investment due to the failure to perform their obligation, as well as exemplary damages and attorney's fees.

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    © All Rights Reserved
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    UNIVERSAL INTERNATIONAL INVESTMENT V RAY BURTON DEV CORP

    FACTS:
     UII bought 10 units from RBDC’s condo in Salcedo Village.
     UII wanted to cancel the contract since RBDC kept delaying delivery of title.
     RBDC ultimately failed and UII discovered the mother title to the lot was mortgaged and foreclosed to China
    Bank.
     UII asked HLURB to order RBDC or China Bank to deliver the paid up titles.
     HLURB first ruled in favor of UII, then reconsidered, but UII successfully appealed to OP which gave UII right
    to rescind.
     UII went to the CA saying that although they were able to recover the titles they are also entitled to P19M
    covering depreciation costs and expenses.
     CA denied.

    ISSUE: WON RBDC is liable to UII for damages?

    HELD: YES.

    Their contract explicitly provides that UII can cancel in case of force majeure or substantial delay. In this case however
    UII is not exercising this option, rather they are claiming for damages.

    But not to the depreciation of P19M. UII is claiming P19M under 2200 as depreciation. 2200 however covers lost
    profits and does not cover depreciation of value. Even assuming it’s lost profit UII does not present any evidence for
    it whether loss in marketing, lease, sale, etc. so no award.

    UII did not show that non-delivery of RBDC caused the depreciation. All UII did was show that property depreciated
    due to passage of time. UII had to show that RBDC’s breach caused depreciation.

    NO as to what UII paid to China Bank. UII actually fully paid up with RBDC. UII did not have to pay China Bank and
    should have just let the case run its course to recover. Since UII did not have to pay to begin with, neither should RBDC.

    YES to temperate damages. It is however not disputed that RBDC did actually fail to perform their obligation. UII paid
    up and was in their right to demand delivery, which RBDC failed to do so. RBDC tried to argue that UII did not pay
    transfer fees, but RBDC didn’t transfer so that’s dumb.

    While UII could not prove its actual damages the Court is empowered to award moderate damages considering RBDC
    did mess up. Court considers 1) investment 2) duration 3) urgent action to remedy. UII invested P52M, lease rate
    was 20-40k, suffered for 6 years, and RBDC could have just executed deed of absolute sale.

    With that in mind 15% or P7M is reasonable.

    Exemplary Damages (EXD) and attorney’s fees justified. RBDC’s excuse that UII did not pay transfer charges was
    really dumb. Even if the property was mortgaged they could have sold it as the law provides. 300k EXD, with 200k
    atty fees.

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