Crismina Garments v. CA

G.R. No. 128721, March 9, 1999, 304 SCRA 356

FACTS:

During the period from February 1979 to April 1979, Crismina Garments, Inc. contracted the services of D’Wilmar Garments, for the sewing of 20,762 pieces of assorted girls denims for P76,410. At first, the respondent was told that the sewing of some of the pants were defective. She offered to take them back, but then she was later told by the petitioner’s representative that it was good already and asked her to return for her check of P76,410. However, the petitioner failed to pay her the aforesaid amount. This prompted her to hire the services of counsel who, on November 12, 1979, wrote a letter to the petitioner demanding payment of the aforesaid amount within ten days from receipt thereof.

On February 7, 1990, the petitioner’s vice-president-comptroller, wrote a letter to respondent’s counsel, averring, inter alia, that the pairs of jeans sewn by her, numbering 6,164 pairs, were defective and that she was liable to the petitioner for the amount of P49,925.51 which was the value of the damaged pairs of denim pants and demanded refund of the aforesaid amount.

On January 8, 1981, the respondent filed a complaint against the petitioner with the trial court. The RTC rendered judgment in favor of the respondent, ordering the petitioner to pay the sum of P76,140 with 12% interest per annum. CA affirmed.

ISSUE:

Whether or not it is proper to impose 12% interest rate per annum for an obligation that does not involve a loan or forbearance of money in the absence of stipulation of the parties.

RULING:

No. The amount due in this case arose from a contract for a piece of work, not from a loan or forbearance of money. Hence, the legal rate of interest shall be 6% per annum, computed from the time of the filing of the Complaint in the trial court until the finality of the judgment. If the adjudged principal and the interest (or any part thereof) remain unpaid thereafter, the interest rate shall be 12% per annum computed from the time the judgment becomes final and executory until it is fully satisfied.

 * Case digest by Jason Olasiman, LLB-1, Andres Bonifacio Law School, SY 2017-2018

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