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    Arrieta Vs Natl Rice and Corn Corp

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    khayis_bels
    This case summary involves a contract dispute between Paz Arrieta and the National Rice and Corn Corporation (NARIC) over the supply of 20,000 metric tons of Burmese rice. Arrieta won the public bidding and contract to supply the rice at $203 per metric ton. However, NARIC failed to timely open a letter of credit as required by the contract, resulting in Arrieta's supplier in Burma cancelling the allocation and forfeiting her 5% deposit of approximately $200,000. The court ruled that NARIC was liable for damages, as one who assumes a contractual obligation and fails to perform due to inability to meet conditions, like opening a letter of credit, that they

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    Arrieta Vs Natl Rice and Corn Corp

    Uploaded by

    khayis_bels
    1K views1 page
    This case summary involves a contract dispute between Paz Arrieta and the National Rice and Corn Corporation (NARIC) over the supply of 20,000 metric tons of Burmese rice. Arrieta won the public bidding and contract to supply the rice at $203 per metric ton. However, NARIC failed to timely open a letter of credit as required by the contract, resulting in Arrieta's supplier in Burma cancelling the allocation and forfeiting her 5% deposit of approximately $200,000. The court ruled that NARIC was liable for damages, as one who assumes a contractual obligation and fails to perform due to inability to meet conditions, like opening a letter of credit, that they

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    ObliCon Case Digest

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    Arrieta vs Natl Rice and Corn Corp

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    This case summary involves a contract dispute between Paz Arrieta and the National Rice and Corn Corporation (NARIC) over the supply of 20,000 metric tons of Burmese rice. Arrieta won the public bidding and contract to supply the rice at $203 per metric ton. However, NARIC failed to timely open a letter of credit as required by the contract, resulting in Arrieta's supplier in Burma cancelling the allocation and forfeiting her 5% deposit of approximately $200,000. The court ruled that NARIC was liable for damages, as one who assumes a contractual obligation and fails to perform due to inability to meet conditions, like opening a letter of credit, that they

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    1K views1 page

    Arrieta Vs Natl Rice and Corn Corp

    Uploaded by

    khayis_bels
    This case summary involves a contract dispute between Paz Arrieta and the National Rice and Corn Corporation (NARIC) over the supply of 20,000 metric tons of Burmese rice. Arrieta won the public bidding and contract to supply the rice at $203 per metric ton. However, NARIC failed to timely open a letter of credit as required by the contract, resulting in Arrieta's supplier in Burma cancelling the allocation and forfeiting her 5% deposit of approximately $200,000. The court ruled that NARIC was liable for damages, as one who assumes a contractual obligation and fails to perform due to inability to meet conditions, like opening a letter of credit, that they

    Copyright:

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

    ARRIETA VS.

    NATIONAL RICE AND CORN CORPORATION


    GR L-15645 January 31, 1964
    Regala, J.:

    FACTS:

    On May 19, 1952, plaintiff-appellee Mrs. Paz Arrieta participated in a public bidding
    called by NARIC for the supply of 20,000 metric tons of Burmese rice. As her bid of
    $203.00 per metric ton was the lowest, she was awarded he contract for the same. On
    July 1, 1952,Arrieta and NARIC entered into Contract of Sale of Rice under the term
    of which the former obligated herself to deliver to the latter 20,000 metric tons of
    Burmese rice at $203.00 per metric ton. In turn, NARIC committed itself to pay for
    the imported rice by means of an irrevocable,confirmed and assignable letter of
    credit in US currency in favor of Arrieta and/or supplier in Burma, immediately.
    However, it was only on July 30, 1952 that NARIC took the first step to open a letter
    of credit by forwarding to the PNB its application for Commercial Letter of Credit.On
    the same day, Arrieta, thru counsel, advised NARIC ofthe extreme necessity for the
    opening of the letter of credit since she had by then made a tender to her supplier in
    Rangoon, Burma equivalent to 5% of the F.O.B. price of 20, 000 tons at $180.70 and
    in compliance with the regulations in Rangoon, this 5% will be confiscated if the
    required letter of credit is not received by them before August 4, 1952.On August 4,
    PNB informed NARIC that its application for a letter of credit has been approved by
    the Board of Directors with the condition that 50% marginal cash deposit be paid and
    that drafts to be paid upon presentment. It turned out that NARIC was not in financial
    position to meet the condition. As a result of the delay, the allocation of Arrietas
    supplier in Rangoon was cancelled and the 5% deposit amounting to 524 kyats or
    approximately P200,000 was forfeited.

    ISSUE: Was NARIC liable for damages?

    RULING:

    Yes. One who assumes a contractual obligation and fails to perform the same on
    account of his inability to meet certain bank which inability he knew and was aware
    of when he entered into contract, should be held liable indamages for breach of
    contract.Under Article 1170 of the Civil Code, not only debtors guilty of fraud,
    negligence or default but also debtor of every, in general, who fails in the performance
    of his obligations is bound to indemnify for the losses and damages caused thereby.

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