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G.R. No. 16530 March 31, 1922

MAMERTO LAUDICO and FRED M. ARDEN, plaintiffs-appellants,vs.MANUEL ARIA! RODRIGUE", ET AL., defendants-appellants.

Crossfield and O'Brien for plaintiff-appellants.Fisher and DeWitt for defendants-appellants.

A#ANCE$A, J.:

On February 5, 1919, the defendant, Vicente Arias, who, with his codefendants, owned the buildingos. !"5 to !!1 on #arriedo $treet, on his behalf and that of his coowners, wrote a letter to the plaintiff,%a&erto 'audico, giving hi& an option to lease the building to a third person, and trans&itting to hi& for that purpose a tentative contract in writing containing the conditions upon which the proposed leaseshould be &ade. 'ater %r. 'audico presented his coplaintiff, %r. Fred. %. (arden, as the party desiringto lease the building. On one hand, other conditions were added to those originally contained in thetentative contract, and, on the other, counter-propositions were &ade and e)planations re*uested oncertain points in order to &a+e the& clear. hese negotiations were carried on by correspondence andverbally at interviews held with %r. Vicente Arias, no definite agree&ent having been arrived at until theplaintiff, %r. 'audico, finally wrote a letter to %r. Arias on %arch , 1919, advising hi& that all hispropositions, as a&ended and supple&ented, were accepted. t is ad&itted that this letter was receivedby %r. Arias by special delivery at !.5/ p.&. of that day. On that sa&e day, at 11.!5 in the &orning, %r.

 Arias had, in turn, written a letter to the plaintiff, %r. 'audico, withdrawing the offer to lease the building.

he chief prayer of the plaintiff in this action is that the defendants be co&pelled to e)ecute the contractof lease of the building in *uestion. t thus results that when Arias sent his letter of withdrawal to'audico, he had not yet received the letter of acceptance, and when it reached hi&, he had already senthis letter of withdrawal. 0nder these facts we believe that no contract was perfected between theplaintiffs and the defendants.

he parties agree that the circu&stances under which that offer was &ade were such that the offer could be withdrawn at any ti&e before acceptance.

0nder article 1!!, paragraph !, of the #ivil #ode, an acceptance by letter does not have any effectuntil it co&es to the +nowledge of the offerer. herefore, before he learns of the acceptance, the latter isnot yet bound by it and can still withdraw the offer. #onse*uently, when %r. Arias wrote %r. 'audico,withdrawing the offer, he had the right to do so, inas&uch as he had not yet receive notice of theacceptance. And when the notice of the acceptance was received by %r. Arias, it no longer had anyeffect, as the offer was not then in e)istence, the sa&e having already been withdrawn. here was no&eeting of the &inds, through offer and acceptance, which is the essence of the contract. hile therewas an offer, there was no acceptance, and when the latter was &ade and could have a binding effect,the offer was then lac+ing. hough both the offer and the acceptance e)isted, they did not &eet to give

birth to a contract.

Our attention has been called to a doctrine laid down in so&e decisions to the effect that ordinarilynotice of the revocation of an offer &ust be given to avoid an acceptance which &ay convert in into abinding contract, and that no such notice can be dee&ed to have been given to the person to who& theoffer was &ade unless the revocation was in fact brought ho&e to his +nowledge.

his, however, has no application in the instant case, because when Arias received the letter of acceptance, his letter of revocation had already been received. he latter was sent through a&essenger at 11.!5 in the &orning directly to the office of 'audico and should have been receivedi&&ediately on that sa&e &orning, or at least, before Arias received the letter of acceptance. On thispoint we do not give any credence to the testi&ony of 'audico that he received this letter of revocation

at /./" in the afternoon of that day. 'audico is interested in destroying the effect of this revocation sothat the acceptance &ay be valid, which is the principal ground of his co&plaint.

2ut even supposing 'audico3s testi&ony to be true, still the doctrine invo+ed has no application here.ith regard to contracts between absent persons there are two principal theories, to wit, one holdingthat an acceptance by letter of an offer has no effect until it co&es to the +nowledge of the offerer, andthe other &aintaining that it is effective fro& the ti&e the letter is sent.

he #ivil #ode, in paragraph ! of article 1!!, has adopted the first theory and, according to its &oste&inent co&&entators, it &eans that, before the acceptance is +nown, the offer can be revo+ed, it notbeing necessary, in order for the revocation to have the effect of i&peding the perfection of the contract,that it be +nown by the acceptant. 4. %ucius $caevola says apropros 6o our &ind, the power to

revo+e is i&plied in the criterion that no contract e)ists until the acceptance is +nown. As the tie or bondsprings fro& the &eeting or concurrence of the &inds, since up to that &o&ent there e)ists only aunilateral act, it is evident that he who &a+es it &ust have the power to revo+e it by withdrawing hisproposition, although with the obligation to pay such da&ages as &ay have been sustained by theperson or persons to who& the offer was &ade and by who& it was accepted, if he in turn failed to give

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the& notice of the withdrawal of the offer. his view is confir&ed by the provision of article 1!57,paragraph !, concerning the case where a stipulation is &ade in favor of a third person, which provisionauthori8es the contracting parties to revo+e the stipulation before the notice of its acceptance. hat caseis *uite si&ilar to that under co&&ent, as said stipulation in favor of a third person who, for the veryreason of being a third person, is not a contracting party: is tanta&ount to an offer &ade by the &a+ersof the contract which &ay or &ay not be accepted by hi&, and which does not have any effect until theobligor is notified, and &ay, before it is accepted, be revo+ed by those who have &ade it; therefore, the

case being si&ilar, the sa&e rule applies.6

0nder the second theory, the doctrine invo+ed by the plaintiffs is sound, because if the sending of theletter of acceptance in itself really perfects the contract, the revocation of the offer, in order to prevent it,&ust be +nown to the acceptor. 2ut this consideration has no place in the first theory under which theforwarding of the letter of acceptance, in itself, does not have any effect until the acceptance is +nownby the person who has &ade the offer.

he