July 22, 2024

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Terms of contract is the law between the parties

Terms of contract is the law between the parties

Dear PAO,

Jake and I signed a prepared arrangement that I will market his subdivided heaps and I will obtain a fee of 3 percent of the offering price of every great deal. I marketed various loads to distinct buyers but Jake refused to fork out my fee. He instructed me that he will be submitting a case in court docket so that my fee will be established to 1.5 {e538325c9cf657983df5f7d849dafd1e35f75768f2b9bd53b354eb0ae408bb3c} of the marketing price of the lots marketed. Can I nevertheless accumulate the fee which we beforehand agreed on?


Pricey Zeelaine,

Standard is the rule that “the contracting parties may perhaps create this kind of stipulations, clauses, terms and conditions as they might deem convenient, offered they are not contrary to legislation, morals, good customs, general public purchase, or public policy (Report 1306, New Civil Code of the Philippines).” Correlative thereto, Write-up 1370 of the New Civil Code also offers that: “if the terms of a agreement are crystal clear and leave no doubt on the intention of the contracting get-togethers, the literal this means of its stipulations shall control. If the terms surface to be contrary to the obvious intention of the events, the latter shall prevail over the former.”

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The terms of the published settlement that you signed with Jake, especially, the 3 p.c commission based mostly on the marketing price of ton really should be upheld as this is the regulation involving you and him. Jake has no freedom to unilaterally change what you agreed upon and this finds support in the scenario of Malate Design and Improvement Company and Olivares vs. Extraordinary Realty Brokers & Brokers Cooperative, GR 243765, Jan. 5, 2022, exactly where the Supreme Court speaking as a result of Associate Justice Samuel Gaerlan said that:

“It is settled that a agreement is the law among the events and the courts must enforce the deal as very long as it is not contrary to law, morals, superior customs or public coverage. Courts can not stipulate for the get-togethers or amend their settlement, for to do so would transgress their liberty of agreement and change their actual intention.

“In Iine with this, Post 1370 of the Civil Code mandates that “[i]f the conditions of a agreement are distinct and go away no doubt upon the intention of the contracting functions, the literal indicating of its stipulations shall manage.” So, the court have to conduct a preliminary inquiry as to no matter whether the contract is certainly ambiguous, or if its provisions are susceptible of two reasonable substitute interpretations. Soon after all, its supreme goal in inspecting a deal is to interpret the parties’ intent, as objectively manifested by them. Notably, if the language of the contract is simple and unambiguous, its indicating really should be established devoid of reference to extrinsic information or aids. The parties’ intention ought to be established solely from the language of their contract. The deal ought to be taken to indicate that which, on its deal with, it purports to signify, except some excellent reason can be assigned to show that the text really should be comprehended in a distinctive sense. Courts can not make far better or much more equitable agreements than the events themselves have been content to make or rewrite contracts because they run harshly or inequitably towards a person of the parties or change them for the benefit of 1 and to the detriment of the other or alleviate a occasion from a tern he/she voluntarily consented to or impose on him/her a situation which he/she did not concur to.”

Making use of the foregoing, it appears that the phrases of your published settlement with Jake are clear and unambiguous. Similarly, there is no sign that it is contrary to regulation, morals, superior customs, or general public plan. Consequently, your arrangement with Jake must be highly regarded. Jake’s stubborn refusal to pay you a 3 p.c fee would represent a breach for which ideal actions might be submitted.

We hope that we had been in a position to respond to your queries. This suggestions is based mostly exclusively on the specifics you have narrated and our appreciation of the similar. Our impression could vary when other specifics are transformed or elaborated.

Editor’s take note: Dear PAO is a day by day column of the Community Attorney’s Office environment. Questions for Chief Acosta may perhaps be despatched to [email protected]