2. Malbarosa v.

CA, 402 SCRA 168 (2003)

Article 1319, Topic-Must be manifested by Offer and Acceptance

Facts:
1. Salvador P. Malbarosa was the president and general manager of Philtectic
Corporation, and an officer of other corporations belonging to the S.E.A. Development
Corporation group of companies.
2. Louis Da Costa was the president of the S.E.A. Development Corporation and
Commonwealth Insurance Co., Inc., while ​Senen Valero was the Vice-Chairman of the
Board of Directors of SEADC.
3. S.E.A. Development Corporation assigned to Salvador one of its vehicles, ​a 1982 model
Mitsubishi Gallant Super Saloon​. He was also ​issued membership certificates in the
Architectural Center, Inc.
4. Sometime in the first week of January 1990, the petitioner intimated to Senen Valero his
desire from the SEADC group of companies and requested that his 1989 incentive
compensation as president of Philtectic Corporation be paid to him.
5. Thereafter, Salvador sent a letter to Senen Valero tendering his resignation, effective
February 28, 1990 from all his positions in the SEADC group of companies, and
reiterating therein his request for the payment of his incentive compensation for 1989.
6. Louis met with Salvador and informed him that he would be entitled to an incentive
compensation in the amount of around ​P395,000.
7. On March 14, 1990, SEADC, through Senen Valero, signed a letter-offer addressed to
Salvador stating therein that Salvadors resignation from all the positions in the SEADC
group of companies had been accepted by SEADC, and that he was entitled to an
incentive compensation in the amount of ​P251,057.67.
8. Said letter-offer stipulated that the 1982 Mitsubishi Super saloon car assigned to
Salvador by the company shall be transferred to him and that the membership share in
the Architectural Center, Inc. will be transferred to him.
9. SEADC required that if Salvador agreed to the offer, he had to affix his conformity on the
space provided therefor and the date thereof on the right bottom portion of the letter.
10. Louis handed to Salvador the letter-offer.​Salvador was dismayed when he read the
letter ​and learned that he was being offered an incentive ​compensation of only
P251,057.67. ​He believes that he is entitled to no less than P395,000. ​The petitioner
refused to sign the letter-offer on the space provided therefor.
11. On April 4, 1990, Philtectic Corporation, Philtectic Corporation wrote to Salvador
withdrawing March 14, 1990 letter-offer​. It demanded that Salvador return the car and
his membership certificate in the Architectural Center, Inc. within 24 hours from his
receipt therefor.
12. With the refusal of Salvador to return the vehicle, the respondent, as plaintiff, filed a
complaint against the petitioner.
13. Salvador argues that on March 29, 1990, the he called up the office of Louis Da Costa to
inform the latter of his acceptance of the letter-offer of the respondent. However, the
telephone receptionist informed him that Louis was out of office but romised to relay
the message to Louis Da Costa.
Art. 1319. Consent is manifested by the meeting of the offer and the acceptance upon the
thing and the cause which are to constitute the contract. The offer must be certain and the
acceptance absolute. A qualified acceptance constitutes a counter-offer.

Issue:
Whether ​or not there was an acceptance on the part of Salvador of the offer to accept the
amount of P251,057.67 offered by SEADC that would constitute consent to a contract

Ratio Decidendi:

NO. ​The Supreme Court well-explained Article 1319. Under Article 1319 of the New Civil Code,
the consent by a party is manifested by the meeting of the offer and the acceptance upon the
thing and the cause which are to constitute the contract. An offer may be reached at any time
until it is accepted. An offer that is not accepted does not give rise to a consent. The contract
does not come into existence. To produce a contract, there must be acceptance of the offer
which may be express or implied but must not qualify the terms of the offer. The acceptance
must be absolute, unconditional and without variance of any sort from the offer.

The acceptance of an offer must be made known to the offeror. Unless the offeror knows of the
acceptance, there is no meeting of the minds of the parties, no real concurrence of offer and
acceptance. The offeror may withdraw its offer and revoke the same before acceptance thereof
by the offeree. The contract is perfected only from the time an acceptance of an offer is made
known to the offeror.

In this case, the respondent made its offer through its Vice Chairman of the Board of Directors,
Senen Valero. On March 16, 1990, Da Costa handed over the original of the March 14, 1990
Letter-offer of the respondent to the petitioner. The respondent required the petitioner to
accept the offer by affixing his signature date of said acceptance, thus foreclosing an implied
acceptance or any other mode of acceptance by the petitioner. However, when the letter-offer
of the respondent
was delivered to the petitioner on March 16, 1990, he did not accept or reject the same for the
reason that he needed time to decide whether to reject or accept the same. There was no
contract perfected between the petitioner and the respondent corporation.

Although the petitioner claims that he had affixed his conformity to the letter-offer on March
28, 1990, the petitioner failed to transmit the said copy to the respondent. It was only on April
7, 1990 when the petitioner appended to his letter to the respondent a copy of the said March
14, 1990 Letter-offer bearing his conformity that he notified the respondent of his acceptance
to said offer. But then, the respondent, through Philtectic Corporation, had already withdrawn
its offer and had already notified the petitioner of said withdrawal via respondent’s letter dated
April 4, 1990 which was delivered to the petitioner on the same day. Indubitably, there was no
contract perfected by the parties on the March 14, 1990 Letter-offer of the respondent.