On January 1, 1985, CONVIR and Associates, Inc., represented by its President, Dra. Cora J. Virata, and the petitioner, Home Development Mutual Fund (HDMF ), represented by its Senior Vice-President, Vicente Reventar III, entered into a CONSULTANCY AGREEMENT by virtue of which the former obligated itself to render medical services to the employees of HDMF. 

On December 16, 1985, Dra. Cora J. Virata wrote petitioner Marilou O. Adea-Proctor, then Deputy Chief Executive Officer and Officer-in-Charge of HDMF, to inform that she (Dra. Cora J. Virata) was assuming from their (petitioners‘) silence that subject Agreement was renewed for the succeeding period, from January 1, 1986 to December 31, 1986. 

In her Reply-letter, dated December 23, 1985, petitioner notified Dra. Cora J. Virata of the termination of the contract upon its expiration on December 31, 1985; informing Dra. Virata of the appointment by management of a full-time physician to the vacant plantilla position, such that her services would not be needed anymore. But such letter-reply was formally and actually received by the private respondents only on January 9, 1986.

In the Complaint filed on January 15, 1986 private respondents averred petitioners’ sudden and unexpected termination of the Consultancy Agreement, which requires a written notice thirty (30) days in advance, did not conform therewith. 

In their Answers sent in on January 14, 1986, petitioners Adea-Proctor and HDMF sought the dismissal of the Complaint; contending inter alia that the Complaint states no cause of action arising from the termination of the contract.

The trial court ruled against HDMF. On appeal, the aforesaid judgment was affirmed with modification by CA, deleting the award of compensatory damages for want of sufficient evidence to support the same. With the denial of their motion for reconsideration, petitioners found their way to this Court via the present Petition.


W/N petition should prosper



The pivot of inquiry is the correct construction or interpretation of subject Consultancy Agreement, particularly its, provision:

“That this agreement takes effect on January 1, 1985 to December 31, 1985; Provided, however, that either party who desires to terminate the contract may serve the other party a written notice at least thirty (30) days in advance.”

The first clause of the aforecited stipulation, which is the bone of petitioners’ stance, basically deals with the term of the contract; while the proviso, which is the core of private respondents’ action, prescribes the manner the service contract in question could be terminated.

It is petitioners’ submission that the first clause referred to is independent, distinct and separate from the said proviso, such that upon the expiration of the period stated in the first clause, the Consultancy Agreement ceased to have any binding effect between the contracting parties even though they (petitioners) did not give any written notice of termination at least thirty (30) days in advance.

We cannot fathom how contracting parties, who are sui juris, and knowledgeable of the purposes for which they solemnly put their Agreement into writing, could be so careless as to include inconsistent conditions in such a short and simple provision in their contract sued upon.

Time-honored is the rule that “In the construction of an instrument where there are several provisions or particulars, such a construction is, if possible, to be adopted as will give effect to all.” Article 1374 of the New Civil Code, on the other hand, requires that “The various stipulations of a contract shall be interpreted together, attributing to the doubtful ones that sense which may result from all of them taken jointly.” Conformably, to ascertain the true meaning or import of the controverted provision of subject Consultancy Agreement, its entirety must be considered; not merely the first clause. Consequently, petitioners’ interpretation solely based on the first clause, and which completely ignored the second clause under scrutiny, cannot be upheld.

The law mandates that “Obligations arising from contracts have the force of law between the contracting parties and should be complied with in good faith.”

In the second assigned error, petitioners theorize that the Court of Appeals erred in ruling that the medical services of private respondents were unreasonably terminated because the December 26, 1985 letter of termination “was served or mailed so close to the end of the year . . . “

We discern nothing reversible in such conclusion arrived at by public respondent. Ordinarily, what is reasonable time under the circumstances of a particular case is a mixed question of law and of fact, for determination by the trier of facts. This Court is not a trier of facts. Furthermore, well settled is the doctrine that “the findings of fact by the trial court are accorded great respect by appellate courts and should not be disturbed on appeal unless the trial court has overlooked, ignored, or disregarded some fact or circumstances of sufficient weight or significance which, if considered, would alter the situation.” The facts of the case, as stated by the trial court were adopted by the Court of Appeals. And a conscientious sifting of the records fails to bring to light any fact or circumstance militative against the correctness of the said findings of the trial court and the Court of Appeals.

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