Toyota Shaw v CA| May 23, 1995| Davide, J  June 17 at 9:30 Bernardo informed Sosa’s son that pick-up
rnardo informed Sosa’s son that pick-up time
 Private-respondent Sosa wanted to buy a Toyota Lite Ace but
encountered difficulties finding a car dealer with an available
unit
o Toyota Shaw branch informed him that they have one
in stock.
o Sosa emphasized to Bernardo, the sales rep, that he
needed that car no later than June 17 1989
 He planned to use the car to go to Marinduque
with a balikbayan on the 18th to celebrate his
birthday on the 19th
 Expressed worry that if he did not have a new
car he would be a ‘laughing stock’ in his town
 June 4, 1989, Bernardo assured Sosa regarding promptness of
delivery and “Agreement between Mr. Sosa & Bernardo of
Toyota Shaw” (exhibit A) was executed containing:
o Signed by Sosa’s son on the former’s behalf and
Bernardo
o Downpayent of 100k to be paid on 15th June
o Yellow Toyota Lite Ace will be ready for pick up on the
17th of June at 10am
 Downpayment was paid on the 15th and a Vehicle Sales
Proposal (VSP) was issued by Bernardo containing ff:
o That it was signed by Sosa’s son under the subheading
“CONFRME”
o “Delivery terms” left blank
o Initial cash outlay broken down as follows
 Downpayment = 53.148K, Insurance
=13.97k, Other fees = 33.282k
o Rest of balance of 274k to be financed by B.A.
Finance
o “Conditions of sale”
 Sale is subject to an available unit
 Price is subject to change w/o notice
 Price prevailing and in effect at the time of
selling will apply
o Checked and approved by Quirante, Sales Supervisor
for the car is moved from 10am to 2pm
 Sosa went to Toyota Shaw at 2pm waited an hour and was later
told by Bernardo that the unit would not be arriving
o Bernardo explains that “nasulot ang unit ng ibang
malakas”
 Toyota then gave Sosa the option to pay full price in cash
o Sosa refused asked for refund of the downpayment
 Toyota obliged and issued Far East Bank
check for the full amount
 Sosa indicated on the check voucher that
acceptance was w/o prejudice to our future
claims for damages
 Sosa then sent 2 letters on June 27 and Nov 4
o Demanding the refund of the downpayment w/
interest to be paid in 5 day or else legal action
o Demanding 1mil representing interest and damages to
be paid in 3 days or else legal action
 Nov 20, Sosa filed a claim for damages under Art 19 and 21 at
RTC Marinduque
o Toyota claims no sale was made
o Bernardo was acting in his personal capacity and
had no authority to sign Exhibit A
o VSP indicated no date of delivery
o B.A. financing disapproved the credit agreement
w/Sosa hence no delivery could be made
 RTC and CA ruled in favor of Sosa
o Exhibit A was a valid and perfected contract
o Toyota estopped from claiming that Bernardo was not
authorize due to manifestations that he was acting as
its agent
W/N Exhibit A was a valid contract – NO
 There was no obligation for Toyota to deliver a determinate
thing nor a correlative obligation for Sosa to pay a price certain
 The only price indicated in Exhibit A was the downpayment
o If it was intended for a sale it could only refer to a sale
on installment basis
  But nothing was mentioned about the full o Such was aborted due to the not approval of the credit
purchase price o Therefore the VSP created no demandable right in
 Nor anything mentioned on the manner of favor of Sosa
the installment  Therefore the non-delivery did not cause a
o Definiteness of the manner of payment and the legally indemnifiable injury
price itself are essential elements for a valid  Claim is but a misplaced sense of pride and ego
contract of sale o He should not have announce his plan to buy a car if he
 Failure to agree on mode of payment is knew he would not be able to pay the full purchase
tantamount to a failure to agree on price price
 No meeting of the minds between Sosa and Toyota
o Sosa didn’t even sign it, it was his son HELD: RTC and CA REVERSED
o Clear from the title that he was dealing with Bernardo
from Toyota Shaw and not Toyota Shaw itself
 No misrepresentation on the part of Bernardo
that he had authority to sell
 Sosa knew that Bernardo was a mere sale rep
and therefore a mere agent of Toyota
o It was incumbent on Sosa to act w/ ordinary diligence
to know the exact extent of Bernardo’s authority
 A person dealing w/ an agent is put upon
inquiry and must discover upon his peril the
authority of the agent
 At most Exhibit A may be considered as a part of the initial
phase of negotiation
o The second part of the negotiation phase was the VSP
 The VSP however indicated a downpayement
of 53k and the rest of the balance to be
financed by B.A. Finance
o In a sale on installment basis financed by a financing
company, the financing company is a party to the sale
as it subrogates the seller w/r to the payment of the
installment buyer
 Since B.A. Finance did not approve the
credit of Sosa there was no meeting of the
minds on the sale on installment basis
 Bernardo’s explanation for the non-release of
the vehicle - that “may mas malakas” - does
not inspire belief
 VSP was a mere proposal