Documenti di Didattica
Documenti di Professioni
Documenti di Cultura
IAC
(
220 SCRA 103; 1993)
Prime W hite Cement Corp. (through the President and Chairman of the Board) and Alejandro
Te, a director and auditor of the corporation, entered into a dealership agreementwhereby Te was
obligated to act as the corporation's exclusive dealer and/or distributor of itsc e m e n t p r o d u c t s i n t h e
e n t i r e M i n d a n a o a r e a f o r 5 y e a r s . A m o n g t h e c o n d i t i o n s i n t h e dealership agreement
were that the corporation would sell to and supply Te with 20,000 bagsof white cement per month, and
that Te would purchase the cement from the corporation at a price of P 9.70 per bag.Relying on the
conditions contained in the dealership agreement, Te entered
intow r i t t e n a g r e e m e n t s w i t h s e v e r a l h a r d w a r e s t o r e s w h i c h w o u l d e n a b l e h i m t o
s e l l h i s allocation of 20,000 bags per month. However, the Board of Directors subsequently
imposednew conditions, including the condition that only 8,000 bags of cement would be delivered per
month. Te made several demands on the corpora tion to comply with the
dealershipa g r e e m e n t . H o w e v e r , w h e n t h e c o r p o r a t i o n r e f u s e d t o c o m p l y w i t h t h e
same, Te wasconstrained to cancel his agreements with the
hardware stores. Notwithstanding thed e a l e r s h i p a g r e e m e n t w i t h T e , t h e c o
r p o r a t i o n e n t e r e d i n t o a n e x c l u s i v e d e a l e r s h i p agreement with a certain Napoleon
Co for marketing of corporation's products in Mindanao.The lower court held that Prime W hite was
liable to Te for actual and moral damages for having been in breach of the agreement which had
been validly entered into.On appeal, the Supreme Court held that the dealership agreement is
not valid andenforceable, for not having been fair and reasonable: the agreement
protected Te from anymarket increases in the price of cement, to the prejudice of the corporation. The
dealershipa g r e e m e n t w a s a n a t t e m p t o n t h e p a r t o f T e t o e n r i c h h i m s e l f a
t t h e e x p e n s e o f t h e corporation. Absent any showing that the stockholders had ratified the
dealership agreementor that they were fully aware of its provisions, the contract was not valid and Te
could not beallowed to reap the fruits of his disloyalty.
----------------
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