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    Woodhouse vs. Halili Digest

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    Jotmu Solis
    The plaintiff and defendant entered an agreement to establish a partnership to bottle and distribute soft drinks. The plaintiff was supposed to secure an exclusive franchise but only obtained a temporary 30-day franchise. The defendant later refused to execute the partnership agreement. The issues are: (1) whether the plaintiff's misrepresentation about having an exclusive franchise invalidates the contract; and (2) whether the court can compel the defendant to execute the partnership contract. The court held that the plaintiff's fraud was not serious enough to invalidate the contract, but the plaintiff is liable for damages. It also held that it cannot compel the defendant to enter into a partnership agreement against their will. The 15% payment ordered by the lower court is

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    Woodhouse vs. Halili Digest

    Uploaded by

    Jotmu Solis
    431 views1 page
    The plaintiff and defendant entered an agreement to establish a partnership to bottle and distribute soft drinks. The plaintiff was supposed to secure an exclusive franchise but only obtained a temporary 30-day franchise. The defendant later refused to execute the partnership agreement. The issues are: (1) whether the plaintiff's misrepresentation about having an exclusive franchise invalidates the contract; and (2) whether the court can compel the defendant to execute the partnership contract. The court held that the plaintiff's fraud was not serious enough to invalidate the contract, but the plaintiff is liable for damages. It also held that it cannot compel the defendant to enter into a partnership agreement against their will. The 15% payment ordered by the lower court is

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    Obligations and contracts woodhouse vs. Halili digest

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    The plaintiff and defendant entered an agreement to establish a partnership to bottle and distribute soft drinks. The plaintiff was supposed to secure an exclusive franchise but only obtained a temporary 30-day franchise. The defendant later refused to execute the partnership agreement. The issues are: (1) whether the plaintiff's misrepresentation about having an exclusive franchise invalidates the contract; and (2) whether the court can compel the defendant to execute the partnership contract. The court held that the plaintiff's fraud was not serious enough to invalidate the contract, but the plaintiff is liable for damages. It also held that it cannot compel the defendant to enter into a partnership agreement against their will. The 15% payment ordered by the lower court is

    Copyright:

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

    Woodhouse vs. Halili Digest

    Uploaded by

    Jotmu Solis
    The plaintiff and defendant entered an agreement to establish a partnership to bottle and distribute soft drinks. The plaintiff was supposed to secure an exclusive franchise but only obtained a temporary 30-day franchise. The defendant later refused to execute the partnership agreement. The issues are: (1) whether the plaintiff's misrepresentation about having an exclusive franchise invalidates the contract; and (2) whether the court can compel the defendant to execute the partnership contract. The court held that the plaintiff's fraud was not serious enough to invalidate the contract, but the plaintiff is liable for damages. It also held that it cannot compel the defendant to enter into a partnership agreement against their will. The 15% payment ordered by the lower court is

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    of 1

    Art. 1167.

    If a person obliged to do something fails to do


    it, the same shall be executed at his cost.

    (2) Whether the court may compel the defendant to execute the
    contract of partnership between the parties

    WOODHOUSE VS. HALILI

    (3) What will be the amount of damages to be paid to the


    plaintiff?

    Facts: The Plaintiff entered into an agreement with the defendant


    for the establishment of a partnership for bottling and distribution
    of Mission soft drinks. Before the partnership was actually
    established the defendant required the plaintiff to secure an
    exclusive franchise for the said venture. In behalf of the said
    partnership and upon obtaining the said exclusive franchise the
    defendant stipulated to pay the plaintiff 30% of the profits. The
    plaintiff sought to obtain the said exclusive franchise but was only
    given a temporary one, subject only to 30 days. The parties then
    proceeded with the signing of the agreement. The partnership
    was still not initiated, only the agreement to work with each
    other, with the plaintiff as manager and the defendant as
    financer, was established.

    Together the two parties went to the US to formally sign the


    contract of franchise with Mission Dry Corporation. The
    defendant then found out about the temporary franchise right
    given to the plaintiff, different from the exclusive franchise rights
    they stipulated in their contract.

    When the operations of the business began he was paid P 2,000


    and was allowed the use of a car. But in the next month, the pay
    was decreased to P 1,000 and the car was withdrawn from him.

    The plaintiff demanded the execution of the partnership, but the


    defendant excused himself, saying that there was no hurry to do
    so. The Court of First Instance ordered the defendant to render an
    accounting of the profits and to pay the plaintiff 15% of such
    amount. It also held that execution of the contract of partnership
    cannot be enforced upon the defendant and that fraud as alleged
    by the defendant was also not proved. Hence the present action.

    Issues:

    (1) Whether the representation of the plaintiff in saying that he


    had exclusive franchise rights rather than the actual temporary
    right he possessed invalidated the contract

    Held: The Decision of the Court of First Instance is affirmed with


    modification.

    Fraud was undoubtedly employed by the plaintiff to secure the


    consent of the defendant to enter into the contract with him by
    representing himself as holder of exclusive franchise rights when
    in fact he only holds a temporary franchise right good for 30 days.
    The fraud employed was not such as to render the contract null
    and void but only such as to hold the plaintiff liable for damages.
    Such fraud is merely incidental (dolo incidental) and not the
    causal fraud (dolo causante) that is detrimental to a contract. It
    does not invalidate the contract since fraud was only employed to
    secure the 30% stipulated share from the partnership.

    The parties cannot be compelled to enter into a contract of


    partnership. The law recognizes the liberty of an individual to do
    or not to do an act. The action falls within Acto Personalisimo (a
    very personal act) which courts may not compel compliance.

    The 15% that the Trial court ordered the defendant to pay the
    plaintiff is deemed to be the appropriate and reasonable. Such
    amount was the spontaneous reaction of the defendant upon
    knowledge of the misrepresentation of the plaintiff and amounts
    to the virtual modification of their contract.

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