FACTS OF THE CASE: On December 22, 1989, Octagon Realty Development entered into a contract with Casino Wood

Parquet and Sanding Services (operated and owned by Bienvenido M. Casino Jr.) for the installation by the latter of narra wood parquet (kiln dried) to the Manila Luxury Condominium Project by the former. This is a total consideration of P1,158,487 with the amount ofP463,394.50 representing 40% of the total contract price serving as downpayment, and was paid by the respondent. This is for a total area of 60,973 square feet. The petitioner having delivered 26,727.02 square feet of wood incurred in delay for the remaining materials of 34,245.98 square feet of wood parquet. In order to minimize losses, the respondent contracted Hilvano Wood Parquet & Sanding Services. The respondent filed a case against Mr. Casino in the Pasig Regional Trial Court for the rescission of contract plus damages. For the actual damages, reimbursement of amount paid to Hilvano, moral damages and attorneys fees plus a fee per appearance and other expenses for the suit. But the petitioner answered the complaint with his counter claims stating the respondent failed to provide safe & secure area for materials, failing to pay second & third billings for deliveries and the filing of case is premature, it has no cause of action and pleaded counterclaims of rescission of contract & payment by the respondent of P597,392.90 with legal interest from the filing of complaint, or in the alternative payment of cost of the billings for plus interest, actual & compensatory damages, moral damages & attorneys fees, litigation expenses & costs of the suit. The Pasig Regional Trial Court holds the rescission of contract effected by respondent valid and orders the petitioner payment of P2,111,061.69 as actual and compensatory damages and P50, 000 as attorneys fees. The petitioners appeal to the Court of Appeals reduces the amount of damages awarded by affirming the decision of the Trial Court but modifying the amount with only P1,622,003.80 with legal interest as of January 21, 1997. The petitioner and the respondent filed their respective Motion for Reconsideration and Motion for Partial Reconsideration. In its resolution on May 20, 1998, the Court of Appeals (CA) amended its original decision by affirming in toto the decision of the Trial Court, thus petitioners appeal is dismissed. ISSUES: 1. Whether or not holding the petitioner liable for Breach of Contract is in contrary to or in violation of Article 1191 of the New Civil Code. 2. Whether or not the damages of P,162,003.80 with legal interest awarded to the respondent is legally justified, or proven with reasonable degree of certainty.

3. Whether or not the damages awarded to the respondent was issued with grave abuse of discretion amounting from lack of or in excess of jurisdiction, and/or contrary to the facts, evidence, jurisprudence and law. RULINGS: 1. Yes. The petitioner could be held liable for Breach of Contract and it is not in violation of Article 1191 of the New Civil Code stating that: The power to rescind obligation is implied in reciprocal ones, in case one of the obligors should not comply with what is incumbent upon him. That the injured party may choose between the fulfilment & the rescission of the obligation, with the payment of damages in either case. He may also seek rescission even after he has chosen fulfilment, if the latter should become impossible. 2.

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INSIGHT: We realize how long it takes for a case to be resolved and how much money there is at stake, including all the legal fees. We also learned that its difficult to prepare defenses in a case because of the extensiveness of the articles and their interpretations. We highly agree with the decision of the Supreme Court because the ultimate judgement is given to them and it must be followed. Bringing the case in the Supreme Court will also increase risk, especially when you lose in the lower court. The Supreme Court does not change facts but