4.) G.R. No. 164326 October 17, 2008 SEAOIL PETROLEUM CORPORATION, petitioners, vs.

RODRIGUEZ issued 12 postdated checks in favor of AUTOCORP but since he was

AUTOCORP GROUP and PAUL Y.RODRIGUEZ, respondents. the director of said company which prohibits the acceptance of check issued by its
own directors, he asked YU to issue the same and it would be funded by 12 monte
PARTIES INVOLVED: piedad postdated checks issued by RODRIGUEZ.
SEAOIL said that RODRIGUEZ ordered to stop the payment of monte piedad
1. SEAOIL CORPORATION (BUYER)
checks which prompted SEAOIL to order a stop payment on the PBCOM CHECKS
2. FOCUS INC
(issued by YU IN BEHALF OF SEAOIL).
3. FRANCIS YU, PRESIDENT AND STOCKHOLDER OF SEAOIL AND OWNER OF FOCUS
4. AUTOCORP (SELLER) RTC:
5. UNILINE ASIA
6. PAUL RODRIGUEZ, STOCKHOLDER AND DIRECTOR OF AUTOCORP AND OWNER OF THE TRIAL COURT RULED IN FAVOR OF AUTOCORP
UNILINE
FACTS: The transaction between AUTOCORP AND SEAOIL WAS A SIMPLE CONTRACT OF
SALE payable in installments. The obligation to pay autocorp the remainder of the
SEAOIL purchased one unit of ROBEX 200 LC EXCAVATOR from AUTOCORP. The original purchase price, 2,389,179.23, of excavator solely devolves on seaoild and paul rodriguez
cost is 2,500,000 but increased to 3,112,519.94 because it was paid in 12monthly could not be held liable, not being a party to the sale of the same. The third party
installments. complaint against paul is hereby dismissed.

The sale agreement was embodied in the VEHICLE SALES INVOICE AND VEHICLE SALES SEAOIL FILED A PETITION FOR REVIEW BEFORE THE CA
CONFIRMATION and signed by FRANCIS YU (president of seaoil) on behalf of the
corporation. CA RULING:

The sales invoice states that UNTIL AFTER THE VEHICLE IS FULLY PAID INCLUSIVE OF AFFIRMED RTCS DECISION
BANK CLEARING TIME, IT REMAINS THE PROPERTY OF AUTOCORP WHICH RESERVES THE
Transaction alleged by seaoil between YU AND RODRIGUEZ wa merely verbal. This cannot
RIGHT OF POSSESSION OF SAID VEHICLE AT ANY TIME AND PLACE WITHOUT PRIOR
alter the sales contract between SEAOIL AND AUTOCORP as this will counter to the PAROL
NOTICE
EVIDENCE RULE which prohibits the introduction of oral evidence to modify the contract.
SEAOIL contractor, ROMEO VALERA, issued 12 postdated checks but AUTOCORP
The claim that it is within the exceptions to the parol evidence rule has not been
refused to accept because they were not under SEAOILs name hence YU signed and
sufficiently proven.
issued 12 postdated checks amounting to 259,376.62 each and name AUTOCORP as
payee. The doctrine of piercing the veil of corporate fiction is not applicable since they failed to
show that autocorp is an alter-ego of uniline or that it was used to perpetrate fraud. The
The excavator was delivered by AUTOCORP and was received by SEAOIL in its depot in
dismissal of third party complaint was proper since the claim is based on 2 different
batangas. The first check bounced but was remedied when SEAOIL replaced it with a
transactions.
good check. However the remaining 10 checks were not honored by the bank because
SEAOIL requested that the payment be stopped. HENCE THIS PETITION FOR REVIEW BEFORE THE SUPREME COURT
Despite demands, SEAOIL refused to pay the remaining 2,593,766.20, AUTOCORP now ISSUE: ERRED IN APPLYING THE PAROL EVIDENCE RULE TO PROVE THE TERMS
filed before the RTC a complaint for recovery of personal property and damages and CONTAINED IN THE DOCUMENT
replevin against SEAOIL AND PAUL RODRIGUEZ
SUPREME COURTS RULING:
SEAOIL contended that the transactions is not as described as it is. They claim that
autocorp and seaoil were only utilized to settle the obligation in another transaction. PETITION IS WITHOUT MERIT, SUSTAINED THE RULING OF CA

UNILINE chartered MV ASIA PROPERTY belonging to FOCUS in the amount of 1. Petitioner does not question the validity of the sales invoice but merely argues that the
$315,711.71 however the former failed to pay. same did not reflect the true intention of the parties.
UNILINE through PAUL RODRIGUEZ, OWNER, proposed to pay the same
But petitioner only had its bare testimony to back up the said oral agreement and
through a conveyance of vehicles and heavy equipment. The excavator in
transaction between rodriguez and yu.
controversy was one of the vehicles conveyed to focus.
 Rodriguez denies having such agreement. Monte piedad checks could not in any
way establish the link between the 2 transcations (sale between autocorp and
seaoil and the indebtedness of uniline to focus)
UNSUNSTANTIATED TESTIMONY, OFFERED AS PROOF OF VERBAL AGREEMENTS WHICH
TENDS TO VARY THE TERMS OF A WRITTEN AGREEMENT, IS INADMISSIBLE UNDER THE
PAROL EVIDENCE RULE.
UNDER RULE 130, SECTION 9:
SEC. 9. Evidence of written agreements.When the terms of an agreement have been
reduced to writing, it is considered as containing all the terms agreed upon and there can
be, between the parties and their successors-in-interest, no evidence of such terms other
than the contents of the written agreement.
However, a party may present evidence to modify, explain or add to the terms of the
written agreement if he puts in issue in his pleading:
(a) An intrinsic ambiguity, mistake or imperfection in the written agreement;
(b) The failure of the written agreement to express the true intent and agreement of the
parties thereto;
(c) The validity of the written agreement; or
(d) The existence of other terms agreed to by the parties or their successors-in-interest
after the execution of the written agreement.
The term "agreement" includes wills.
The parol evidence rule forbids any addition to, or contradiction of, the terms of a written
agreement by testimony of other evidence varying the written contract.
The argument that it fails to express the parties true agreement is untenable.
Although parol evidence is admissible to explain the meaning of a contract, it cannot serve
the purpose of incorporating into the contract additional contemporaneous conditions
which are not mentioned at all in the writing unless there has been fraud or mistake.
The Vehicle Sales Invoice is the best evidence of the transaction, they serve as an
acknowledgment that a business transaction has in fact transpired. These documents are
not mere scraps of paper bereft of probative value, but vital pieces of evidence of
commercial transactions. They are written memorials of the details of the consummation
of contracts.
The terms of the subject sales invoice are clear. They show that Autocorp sold to Seaoil
one unit Robex 200 LC Excavator. The moment a party affixes his or her signature thereon,
he or she is bound by all the terms stipulated therein and is subject to all the legal
obligations that may arise from their breach. Oral testimony on the alleged conditions,
coming from a party who has an interest in the outcome of the case, depending
exclusively on human memory, is not as reliable as written or documentary evidence
The exception obtains only where "the written contract is so ambiguous or obscure in
terms that the contractual intention of the parties cannot be understood from a mere
reading of the instrument. In such a case, extrinsic evidence of the subject matter of the
contract, of the relations of the parties to each other, and of the facts and circumstances
surrounding them when they entered into the contract may be received to enable the court
to make a proper interpretation of the instrument.
2. DISMISSAL OF THE THIRD PARTY COMPLAINT AGAINST RODRIGUEZ
As pointed out by the CA, Rodriguez is a person separate and independent from Autocorp.
Whatever obligations Rodriguez contracted cannot be attributed to Autocorp and vice
versa. In fact, the obligation that petitioner proffers as its defense under the Lease
Purchase Agreement was not even incurred by Rodriguez or by Autocorp but by Uniline.
The Lease Purchase Agreement clearly shows that the parties thereto are two
corporations not parties to this case: Focus Point and Uniline. Under this Lease Purchase
Agreement, it is Uniline, as lessee/purchaser, and not Rodriguez, that incurred the debt to
Focus Point. THE OBLIGATION OF UNILINE TO FOCUS POINT AROSE OUT OF A
TRANSACTION COMPLETELY DIFFERENT FROM THE SUBJECT OF THE INSTANT
CASE. It is settled that a corporation has a personality separate and distinct from its
individual stockholders or members, and is not affected by the personal rights, obligations
and transactions of the latter. The corporation may not be held liable for the obligations of
the persons composing it, and neither can its stockholders be held liable for its obligation.
3. SEAOIL CLAIMED THAT "THE OWNERSHIP OF THE SUBJECT EXCAVATOR, HAVING BEEN
LEGALLY AND COMPLETELY TRANSFERRED TO FOCUS POINT INTERNATIONAL, INC.,
CANNOT BE SUBJECT OF REPLEVIN AND AUTOCORP IS NOT LEGALLY ENTITLED TO ANY
WRIT OF REPLEVIN."
The claim is negated by the sales invoice which clearly states that "[u]ntil after the vehicle
is fully paid inclusive of bank clearing time, it remains the property of Autocorp Group
which reserves the right to take possession of said vehicle at any time and place without
prior notice."