Philippine Supreme Court Jurisprudence

Philippine Supreme Court Jurisprudence > Year 1922 > September 1922 Decisions > G.R. No. 18700 September 26, 1922 - PAUL STROCHECKER v. ILDEFONSO RAMIREZ, ET AL.

044 Phil 933:



[G.R. No. 18700. September 26, 1922. ]


Lim & Lim for Appellant.

Ross & Lawrence and Antonio T. Carrasco, jr., for the Fidelity & surety Co.


1. CHATTEL MORTGAGE; INTEREST IN A BUSINESS. — An interest in a business may be the subject of mortgage, for it is a personal property, being capable of appropriation, and not included among the real properties enumerated in article 335 of the Civil Code.

2. ID., ID., DESCRIPTION; SUFFICIENCY OF. — Where the description of the chattel mortgaged is such as to enable the parties to the mortgage or any other person to identify the same after a reasonable investigation or inquiry, the description is sufficient. Thus if the drug business known as Antigua Botica Ramirez (owned by a certain person therein named and the mortgagor) located at Nos. 123 and 125, Calle Real, District of Intramuros, Manila, P.I., the description meets the requirements of the law.

3. ID.; PREFERENCE; PURCHASE PRICE; POSSESSION. — The vendor of a chattel, who is a creditor for the purchase price, has no preference over a creditor holding a mortgage on that chattel where the vendor is not in possession of the thing mortgaged.

4. ID., ID.; RETROACTIVITY; PERSONAL SECURITY. — A junior mortgage can have no preference over a senior mortgage by the mere fact that prior to said junior mortgage a personal security had been stipulated between the junior mortgagee and the debtor, because the second mortgage cannot be given effect as of the date the personal security was stipulated.



The question at issue in this appeal is, which of the two mortgages here in question must be given preference? Is it the one in favor of the Fidelity & Surety Co., or that in favor of Ildefonso Ramirez. The first was declared by the trial court to be entitled to preference.

In the lower court there were three mortgages each of whom claimed preference. They were the two above mentioned and Concepcion Ayala. The latter’s claim was rejected by the trial court, and that ruling she did not appeal.

There is no question as to the priority in time of the mortgage in favor of the Fidelity & Surety Co. which was executed on March 10, 1919, and registered in due time in the registry of the property, that in favor of the appellant being dated September 22, 1919, and registered also in the registry.

The appellant claims preference on these grounds: (a) That the first mortgage above-mentioned is not valid because the property which is the subject-matter thereof is not capable of being mortgaged, and the description of said property is not sufficient; and (b) that the amount due the appellant is a purchase price, citing article 1922 of the Civil Code in support thereof, and that his mortgage is but a modification of the security given by the debtor on February 15, 1919, that is, prior to the mortgage executed in favor of the Fidelity & Surety Co.

As the first ground, the thing that was mortgaged to this corporation is described in the document as

". . . his half interest in the drug business known as Antigua Botica Ramirez (owned by Srta. Dolores del Rosario and the mortgagor herein referred to as the partnership), located at Calle Real Nos. 123 and 125, District of Intramuros, Manila Philippine Islands."cralaw virtua1aw library

With regard to the nature of the property thus mortgaged which is one-half interest in the business above described, such interest is a personal property capable of appropriation and not included in the enumeration of real properties in articles 335 of the Civil Code, and may be the subject of mortgage. All personal property may be mortgage. (Sec. 7, Act No. 1508.)

The description contained in the document is sufficient. The law (sec. 7, Act No. 1508) requires only a description of the following

"The description of the mortgaged property shall be such as to enable the parties to the mortgage, or any other person, after reasonable inquiry and investigation, to identify the same."cralaw virtua1aw library

Turning to the second error assigned, numbers 1, 2, and 3 of the article 1922 of the Civil Code invoked by the appellant are not applicable. Neither the debtor, nor the himself, is in possession of the property mortgaged, which is, and since the registration of the mortgage has been, legally in possession of the Fidelity Surety Co. (Sec. 4, Act. No. 1508; Meyers v. Thein, 15 Phil., 303)

In no way can the mortgage executed in the favor of the appellant on September 22, 1919, be given effect as of February 15, 1919, the date of the sale of the drug store in question. On the 15th of February of that year, there was a stipulation about personal security, but not a mortgage upon property, and much less upon the property in question.

Moreover, the appellant cannot deny the preferential character of the mortgage in favor of the Fidelity & Surety Co. because in his mortgage was second mortgage, subordinate to the one made in favor of the Fidelity Surety Co.

The judgment appealed from is affirmed with costs against the appellant. So ordered

Araullo, C.J., Street, Malcolm, Avanceña, Villamor, Ostrand, and Johns, JJ., concur.

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