Blossom v. Manila Gas Digest

BLOSSOM & CO. V. MANILA GAS CORPORATIONS Facts • Blossom & Co. (plaintiff) and Manila Gas Corporations (defendant) entered into a contract. The contract provided for the delivery to the plaintiff from month to month of specified amounts of water gas tar. 1 ton of gas was priced at Php65. It was agreed that the price would prevail only so long as the raw materials (coal and crude oil) used by the defendants in the manufacture of gas should cost the same price as that prevailing at the time of the contract. In the event of an increase or decrease in the cost of raw materials, there would be a corresponding increase or decrease in the price of tar. • The contract was later amended to extend the period for ten years. In consideration of the modification, the plaintiff agreed to purchase from the defendant a certain piece of land lying adjacent to its plant. The defendant sold and conveyed the land to the plaintiff which in turn executed a mortgage to secure the payment of the balance of the purchase price. • Around 4 years from the execution of the contract, plaintiff filed an action against the defendant to obtain specific performance and recovery of damages. Plaintiff alleged that the defendant breached the contract by ceasing to deliver any coal and water gas tar solely because of the increase in price of tar products and its desire to secure better prices than what the plaintiff paid. • CFI Manila ruled in favor of the plaintiff. The court granted the recovery for damages but refused to order the defendants to resume delivery but left it with its remedy for damages against the defendants for any subsequent breach of contract. • Later, plaintiff filed another action for damages on the ground that the defendant breached the contract once more after refusal to perform its obligation under the same contract. Issue Whether or not the plaintiff is barred from filing the second action for damages Ruling Yes, the plaintiff is barred from filing the second action for damages. Doctrine • Divisible contracts (as a general rule) - A contract to do several things at several times is divisible. A judgement for a single breach of a continuing contract is not a bar to a suit for a subsequent breach. • Entire contract (case at bar) - When the contract is indivisible and the breach is total, there can only be one action in which the plaintiff must recover all damages. The recovery of a judgement for damages by reason of a breach is a bar to another action on the same contract and on account of the continuous breach.

- The contract between the parties is an entire contract. - In the case at bar, the defendant terminated the continuing contract by absolute refusal. The claim for damages is an indivisible demand. Where a former final judgement was rendered, it is a bar to any damages which plaintiff may thereafter sustain.