Philippine Supreme Court Jurisprudence


Philippine Supreme Court Jurisprudence > Year 1960 > July 1960 Decisions > G.R. No. L-13373 July 26, 1960 - LUNETA MOTOR CO. v. MAXIMINO SALVADOR, ET AL.

108 Phil 1037:




PHILIPPINE SUPREME COURT DECISIONS

SECOND DIVISION

[G.R. No. L-13373. July 26, 1960.]

LUNETA MOTOR COMPANY, Plaintiff-Appellant, v. MAXIMINO SALVADOR, ANGEL DIMAGIBA and JOHN DOE, Defendants. ANGEL DIMAGIBA, Defendant-Appellee.

Jose Agbulos for Appellant.

Mary Concepcion-Bautista for Appellee.


SYLLABUS


1. SALE OF PERSONAL PROPERTY ON INSTALLMENT; REMEDIES OF VENDOR ALTERNATIVE; FORECLOSURE OF THE CHATTEL MORTGAGE RENOUNCES ACTION ON THE PROMISSORY NOTE; PROMISSOR AND GUARANTOR RELEASED. — Paragraph 3 of the above-quoted provision is clear that foreclosure of the chattel mortgage and recovery of the unpaid balance of the price are alternative remedies and may not be pursued conjunctively. It appearing in the case at bar that the vendor had already foreclosed the chattel mortgage constituted on the property and had taken possession thereof, the lower court acted rightly in dismissing the complaint filed for the purpose of recovering the unpaid balance of the purchase price, because by seizing the truck and foreclosing the mortgage at the progress of the suit, the plaintiff renounced whatever claim it may have had under the promissory note, and consequently, he has no more cause of action against the promissor and the guarantor.

2. ID.; FORECLOSURE OF CHATTEL MORTGAGE; WHEN MORTGAGEE’S RIGHT TO POSSESSION AND OWNERSHIP OF CHATTEL MORTGAGE BEYOND QUESTION. — When the fact of foreclosure is not denied and when the very mortgagee itself bought the chattel at the auction sale, the latter’s right to the possession and ownership of the said property is beyond question.


D E C I S I O N


GUTIERREZ DAVID, J.:


This is an appeal from an order of dismissal.

On May 11, 1955, the Luneta Motor Company sold a Reo Truck, for P16,995.00, on installment basis, to Maximino Salvador. Five days later, after having made a down payment of P1,001.00, the purchaser, jointly and severally with one Angel Dimagiba, executed in favor of the seller a promissory for P15,984.00 to cover the balance of the purchase price, payable in eighteen (18) monthly installments, with interest at the rate of 12% per annum. On the same day, the purchaser also executed in favor of the seller a chattel mortgage on the property to secure payment of the said balance.

For alleged failure on the part of the purchaser to pay the installments, the Luneta Motor Company, on September 9, 1955, filed with the Court of First Instance of Manila a complaint against the vendee Maximino Salvador, Angel Dimagiba and John Doe, praying for the seizure of the truck, for the confirmation of the company’s possession and ownership thereto, and that defendants be ordered to pay the unpaid balance of the purchase price, plus interests, attorney’s fees and costs.

Only the defendant Dimagiba answered the complaint. And so upon plaintiff’s motion, the defendant Maximino Salvador was declared in default.

By virtue of a writ of seizure, the truck subject of the action was, on behalf of the plaintiff, seized on December 19, 1955. But upon payment by the defendant Salvador of a substantial amount and a promise on his part to settle the balance of the obligation, the truck was released. Later, however, as no further payments were made, the plaintiff petitioned for the issuance of an alias writ of seizure, which was accordingly issued on February 1, 1956. The writ was returned uncomplied with, because, according to the sheriff’s return, the truck could not be located.

By virtue of another court order, a special sheriff was appointed again for the seizure of the property in question, and on January 2, 1957, the said sheriff made his return on that second alias writ of seizure, stating that on December 24, 1956, he took possession of the property from defendant Maximino Salvador, and the latter having failed to file a counterbond, the seized property was turned over to the plaintiff.

On May 10, 1957, the plaintiff sold the truck at public auction and itself bought the truck. As a consequence, the defendant Dimagiba on November 20, 1957 filed a motion to dismiss the complaint on the ground that the plaintiff has no more case against him, the said plaintiff having already foreclosed the chattel mortgage upon the property. The plaintiff opposed the motion and the defendant Dimagiba filed a reply. Sustaining Dimagiba, the court dismissed the complaint.

Motion for reconsideration of the order of dismissal having been denied, the plaintiff interposed this appeal raising only questions of law.

Here is a situation where the vendor in a sale of personal property in installments, upon failure of the vendee to pay his obligations, had commenced, through court action, to recover the unpaid balance of the purchase price, but later, at the progress of the said action, foreclosed the chattel mortgage constituted on the property. The question that arises is whether the complaint may be dismissed upon the foreclosure of the mortgage.

Section 1484 of the New Civil Code provides:jgc:chanrobles.com.ph

"In a contract of sale of personal property the price of which is payable in installments, the vendor may exercise any of the following remedies:jgc:chanrobles.com.ph

"(1) Exact fulfillment of the obligation, should the vendee fail to pay;

"(2) Cancel the sale, should the vendee’s failure to pay cover two or more installments;

"(3) Foreclose the chattel mortgage on the thing sold, if one has been constituted, should the vendee’s failure to pay cover two or more installments. In this case, he shall have no further action against the purchaser to recover any unpaid balance of the price. Any agreement to the contrary shall be void."cralaw virtua1aw library

Paragraph 3 of the above-quoted provision is clear that foreclosure of the chattel mortgage and recovery of the unpaid balance of the price are alternative remedies and may not be pursued conjunctively. It appearing in the case at bar that the vendor had already foreclosed the chattel mortgage constituted on the property and had taken possession thereof, the lower court acted rightly in dismissing the complaint filed for the purpose of recovering the unpaid balance of the purchase price. By seizing the truck and foreclosing the mortgage at the progress of the suit, the plaintiff renounced whatever claim it may have had under the promissory note, and consequently, it has no more cause of action against the promissor and the guarantor. And it has no more right either to the costs and attorney’s fees that would go with the suit.

Plaintiff-appellant’s principal theory in maintaining that the action must continue is that the foreclosure of the chattel mortgage must be established in court and its possession and ownership of the truck must be judicially confirmed. We do not think there would still be necessity for the lower court to pass upon the fact of foreclosure for this had not been denied by the plaintiff-appellant. As a matter of fact, the latter has admitted in his brief that it had sold the truck at public auction. And it appearing that the plaintiff itself bought the truck at the auction sale, its right to the possession and ownership of the said property is beyond question.

To further bolster its claim for further proceedings in the court below, the plaintiff-appellant makes mention of a supplemental complaint filed to recover indemnify for the value of some parts of the truck which are alleged to be missing. This Court, however, has no proper basis upon which to delve into that point for nowhere in the record, except, of course, in plaintiff-appellant’s brief and in its opposition to the motion to dismiss filed with the lower court, does it appear that there has ever been a supplemental complaint filed against the defendants.

There being no valid grounds to reopen the dismissed action, the order of dismissal is hereby affirmed. Costs against the plaintiff-appellant.

Montemayor, Bautista Angelo, Labrador, Concepcion, Reyes, J.B.L., Endencia and Barrera, JJ., concur.




Back to Home | Back to Main




















chanrobles.com





ChanRobles On-Line Bar Review

ChanRobles Internet Bar Review : www.chanroblesbar.com

ChanRobles MCLE On-line

ChanRobles Lawnet Inc. - ChanRobles MCLE On-line : www.chanroblesmcleonline.com






July-1960 Jurisprudence                 

  • G.R. No. L-12998 July 25, 1960 - BIENVENIDA JOCSON, ET AL. v. MANUEL P. SILOS

    108 Phil 923

  • G.R. No. L-13299 July 25, 1960 - PERFECTO ADRID, ET AL. v. ROSARIO MORGA, ETC.

    108 Phil 927

  • G.R. No. L-14934 July 25, 1960 - PEOPLE OF THE PHIL. v. BUENAVENTURA BULAN, ET AL.

    108 Phil 932

  • G.R. No. L-11241 July 26, 1960 - VALENTIN ILO, ET AL. v. COURT OF APPEALS, ET AL.

    108 Phil 938

  • G.R. No. L-11834 July 26, 1960 - DIRECTOR OF LANDS v. GREGORIO ABIERA, ET AL.

    108 Phil 943

  • G.R. No. L-11840 July 26, 1960 - ANTONIO C. GOQUIOLAY, ET AL. v. WASHINGTON Z. SYCIP, ET AL.

    108 Phil 947

  • G.R. No. L-11994 July 26, 1960 - LUISA A. VDA. DE DEL CASTILLO v. RAFAEL P. GUERRERO

    108 Phil 989

  • G.R. No. L-12495 July 26, 1960 - PEOPLE OF THE PHIL. v. DIONISIO LIDRES

    108 Phil 995

  • G.R. No. L-12628 July 26, 1960 - IN RE: YU KAY GUAN v. REPUBLIC OF THE PHIL.

    108 Phil 1001

  • G.R. No. L-12984 July 26, 1960 - WARNER, BARNES & CO., LTD. v. EDMUNDO YASAY, ET AL.

    108 Phil 1005

  • G.R. No. L-12999 July 26, 1960 - PAFLU v. HON. JUAN P. ENRIQUEZ, ET AL.

    108 Phil 1010

  • G.R. No. L-13267 July 26, 1960 - SALVADOR CRESPO v. MARIA BOLANDOS, ET AL.

    108 Phil 1023

  • G.R. No. L-13364 July 26, 1960 - HIND SUGAR CO., INC. v. HON. COURT OF INDUSTRIAL RELATIONS, ET AL.

    108 Phil 1026

  • G.R. No. L-13373 July 26, 1960 - LUNETA MOTOR CO. v. MAXIMINO SALVADOR, ET AL.

    108 Phil 1037

  • G.R. No. L-13646 July 26, 1960 - BENITO MANALANSAN v. LUIS MANALANG, ET AL.

    108 Phil 1041

  • G.R. No. L-13684 July 26, 1960 - REPUBLIC OF THE PHIL. v. FRANCISCO YAPTINCHAY, ET AL.

    108 Phil 1046

  • G.R. No. L-13953 July 26, 1960 - MONS. CARLOS INQUIMBOY v. MARIA CONCEPCION PAEZ VDA. DE CRUZ

    108 Phil 1054

  • G.R. No. L-14096 July 26, 1960 - CITY OF MANILA v. FORTUNE ENTERPRISES, INC.

    108 Phil 1058

  • G.R. No. L-14229 July 26, 1960 - CEBU PORTLAND CEMENT CO. v. CITY OF MANILA, ET AL.

    108 Phil 1063

  • G.R. No. L-14258 July 26, 1960 - NATIONAL DEV’T CO. v. JUAN ARALAR, ET AL.

    108 Phil 1068

  • G.R. No. L-14313 July 26, 1960 - DIONISIO ESGUERRA v. PEOPLE OF THE PHIL.

    108 Phil 1078

  • G.R. No. L-14428 July 26, 1960 - AGATON SEGARRA v. FELIX MARONILLA, JR.

    108 Phil 1086

  • G.R. No. L-14432 July 26, 1960 - PEOPLE OF THE PHIL. v. LEONCIO LIM

    108 Phil 1091

  • G.R. No. L-14505 July 26, 1960 - MIGUEL KAIRUZ v. ELENA S. PACIO, ET AL.

    108 Phil 1097

  • G.R. No. L-14519 July 26, 1960 - REPUBLIC OF THE PHILS. v. LUIS G. ABLAZA

    108 Phil 1105

  • G.R. No. L-14550 July 26, 1960 - IN RE: ONG KUE v. REPUBLIC OF THE PHILS.

    108 Phil 1109

  • G.R. No. L-14689 July 26, 1960 - GENERAL MARITIME STEVEDORES’ UNION OF THE PHILS, ET AL. v. SOUTH SEA SHIPPING LINE, ET AL.

    108 Phil 1112

  • G.R. No. L-14743 July 26, 1960 - GLORIA ABRERA v. LUDOLFO V. MUÑOZ

    108 Phil 1124

  • G.R. No. L-15544 July 26, 1960 - PHILIPPINE AIR LINES INC. v. PHILIPPINE AIR LINES EMPLOYEES ASSOCIATION

    108 Phil 1129

  • G.R. No. L-15743 July 26, 1960 - OMBE v. VICENTE DIGA

    108 Phil 1137

  • G.R. No. L-16011 July 26, 1960 - DOMINGO T. PARRAS v. LAND REGISTRATION COMMISSION

    108 Phil 1142

  • G.R. No. L-16263 July 26, 1960 - DR. JOSE CUYEGKENG v. DR. PEDRO M. CRUZ

    108 Phil 1147

  • G.R. No. L-16464 July 26, 1960 - VICENTE MALINAO v. MARCOS RAVELES

    108 Phil 1159

  • G.R. No. L-16835 July 26, 1960 - FILEMON SALCEDO, JR. v. COMMISSION ON ELECTIONS

    108 Phil 1164

  • G.R. No. L-13435 July 27, 1960 - EUSEBIO MANUEL v. EULOGIO RODRIGUEZ, SR., ET AL.

    109 Phil 1

  • G.R. No. L-13632 July 27, 1960 - FEDERICO DE LOS ANGELES, ET AL. v. HON. GUSTAVO VICTORIANO, ET AL.

    109 Phil 12

  • G.R. No. L-13851 July 27, 1960 - DEOGRACIAS F. MALONZO v. GREGORIA T. GALANG, ET AL.

    109 Phil 16

  • G.R. No. L-15853 July 27, 1960 - FERNANDO AQUINO v. CONCHITA DELIZO

    109 Phil 21

  • G.R. No. L-13369 July 28, 1960 - RICARDO PALMA v. HON. ENRIQUE A. FERNANDEZ, ETC.

    109 Phil 26

  • G.R. No. L-11151 July 30, 1960 - COLLECTOR OF INTERNAL REVENUE v. COMPAÑIA GENERAL DE TABACOS DE FILIPINAS, ET AL.

    109 Phil 32

  • G.R. No. L-12747 July 30, 1960 - RIZAL CEMENT CO., INC. v. RIZAL CEMENT WORKERS’ UNION (FFW), ET AL.

    109 Phil 34

  • G.R. No. L-13268 July 30, 1960 - LUCIANA SASES, ET AL. v. HON. PASTOR P. REYES, ET AL.

    109 Phil 38

  • G.R. No. L-13760 July 30, 1960 - FILEMON MARIBAO v. LUCIO ORTIZ, ET AL.

    109 Phil 43

  • G.R. No. L-13767 July 30, 1960 - PEOPLE OF THE PHIL. v. PAQUITO PRIAS, ET AL.

    109 Phil 48

  • G.R. No. L-14806 July 30, 1960 - ZAMBOANGA COPRA PROCUREMENT CORP. v. CITY OF ZAMBOANGA

    109 Phil 58

  • G.R. No. L-14936 July 30, 1960 - GENERAL SHIPPING CO., INC. v. WORKMEN’S COMPENSATION COM., ET AL.

    109 Phil 60

  • G.R. No. L-14970 July 30, 1960 - MARIA B. CASTRO v. GERONIMO DE LOS REYES

    109 Phil 64

  • G.R. No. L-15093 July 30, 1960 - NARIC v. CELSO HENSON, ET AL.

    109 Phil 81