74 Ledesma V Court of Appeals

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G.R. No. 86051 September 1, 1992 - JAIME LEDESMA v. COURT OF APPEALS, ET AL. : SEPTEMBER 1992 - PHILIPPINE SUPREME COURT JURIS
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THIRDDIVISION
[G.R.No.86051.September1,1992.]
JAIMELEDESMA,Petitioner,v.THEHONORABLECOURTOFAPPEALSandCITIWIDEMOTORS,
INC.,Respondents.
Ledesma,Saludo&AssociatesforPetitioner.
MagtanggolC.GunigundoforPrivateRespondent.
SYLLABUS
DebtKollectCompany,Inc.
1. CIVIL LAW POSSESSION REQUISITES TO MAKE POSSESSION OF MOVABLE PROPERTY

EQUIVALENTTOTITLE.Itisquiteclearthatapartywho(a)haslostanymovableor(b)hasbeen
unlawfully deprived thereof can recover the same from the present possessor even if the latter
acquired it in good faith and has, therefore, title thereto for under the first sentence of Article 559,
suchmannerofacquisitionisequivalenttoatitle.Therearethree(3)requisitestomakepossession
of movable property equivalent to title, namely: (a) the possession should be in good faith (b) the
ownervoluntarilypartedwiththepossessionofthethingand(c)thepossessionisintheconceptof
owner. (TOLENTINO, A.M., Civil Code of the Philippines, Vol. II, 1983 ed., 275276, citing 2II Colin
and Capitant 942 De Buen: Ibid., 1009, 2 Salvat 165 4 Manresa 339). Undoubtedly, one who has
lost a movable or who has been unlawfully deprived of it cannot be said to have voluntarily parted
with the possession thereof. This is the justification for the exceptions found under the second
sentenceofArticle559oftheCivilCode.
2. CIVIL LAW SPECIAL CONTRACTS CONTRACT OF SALE ABSENCE OF CONSIDERATION EFFECT
THEREOF. There was a perfected unconditional contract of sale between private respondent and
theoriginalvendee.Theformervoluntarilycausedthetransferofthecertificateofregistrationofthe
vehicleinthenameofthefirstvendeeevenifthesaidvendeewasrepresentedbysomeonewho
usedafictitiousnameandlikewisevoluntarilydeliveredthecarsandthecertificateofregistration
to the vendees alleged representative Title thereto was forthwith transferred to the vendee. The
subsequent dishonor of the check because of the alteration merely amounted to a failure of
considerationwhichdoesnotrenderthecontractofsalevoid,butmerelyallowstheprejudicedparty
tosueforspecificperformanceorrescissionofthecontract,andtoprosecutetheimpostorforestafa
underArticle315oftheRevisedPenalCode.
DECISION
DAVIDE,JR.,J.:
ChanRoblesIntellectualProperty
Division
PetitionerimpugnstheDecisionof22September1988ofrespondentCourtofAppeals1inC.A.G.R.
CVNo.059552reversingthedecisionofthenBranchXVIIIB(QuezonCity)ofthethenCourtofFirst
Instance (now Regional Trial Court) of Rizal in a replevin case, Civil Case No. Q24200, the
dispositiveportionofwhichreads:
chanroblesvirtualawlibrary
"Accordingly, the Court orders the plaintiff to return the repossessed Isuzu Gemini, 1977 Model
vehicle, subject of this case to the defendant Ledesma. The incidental claim (sic) for damages
professed by the plaintiff are dismissed for lack of merit. On defendants counterclaim, Court (sic)
makesnopronouncementastoanyformofdamages,particularly,moral,exemplaryandnominalin
viewofthefactthatCitiwidehasaperfectrighttolitigateitsclaim,albeitbythispronouncement,it
didnotsucceed."3
which was supplemented by a Final Order dated 26 June 1980, the dispositive portion of which
reads:
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"INVIEWOFTHEFOREGOING,theCourtgrantsdefendantLedesmathesumofP35,000.00bywayof
actual damages recoverable upon plaintiffs replevin bond. Plaintiff and its surety, the Rizal Surety
and Insurance Co., are hereby ordered jointly and severally to pay defendant Jaime Ledesma the
sumofP10,000.00asdamagesforthewrongfulissueofthewritofseizure,inlinewithRule57,Sec.
20,incorporatedinRule60,Sec.10.
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Inconformitywiththerulesadvertedto,thisfinalordershallformpartofthejudgmentofthisCourt
onSeptember5,1979.
The motion for reconsideration of the judgment filed by the plaintiff is hereby DENIED for lack of
merit.Nocostsatthisinstance."4
Thedecisionofthetrialcourtisanchoredonitsfindingsthat(a)theproofonrecordisnotpersuasive
enoughtoshowthatdefendant,petitionerherein,knewthatthevehicleinquestionwastheobjectof
a fraud and a swindle 5 and (b) that plaintiff, private respondent herein, did not rebut or contradict
Ledesmasevidencethatvaluableconsiderationwaspaidforit.
TheantecedentfactsassummarizedbytherespondentCourtofAppealsareasfollows:
"OnSeptember27,1977,apersonrepresentinghimselftobeJojoConsunji,purchasedpurportedly
forhisfather,acertainRusticoT.Consunji,two(2)brandnewmotorvehiclesfromplaintiffappellant
CitiwideMotors,Inc.,moreparticularlydescribedasfollows:
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a)One(1)1977IsuzuGemini,2doorModelPF50ZIK,withEngineNo.751214valuedatP42,200.00
and
b)One(1)1977HoldenPremierModel8V41XwithEngineNo.1981251493,valuedatP58,800.00.
SaidpurchasesareevidencedbyInvoicesNos.3054and3055,respectively.(SeeAnnexesAandB).
On September 28, 1977, plaintiffappellant delivered the twoabove described motor vehicles to the
personwhorepresentedhimselfasJojoConsunji,allegedlythesonofthepurportedbuyersRustico
T. Consunji, and said person in turn issued to plaintiffappellant Managers Check No. 0661100638
of the Philippine Commercial and Industrial Bank dated September 28, 1977 for the amount of
P101,000.00asfullpaymentofthevalueofthetwo(2)motorvehicles.
However, when plaintiffappellant deposited the said check, it was dishonored by the bank on the
groundthatitwastamperedwith,thecorrectamountofP101.00havingbeenraisedtoP101,000.00
perthebanksnoticeofdishonor(AnnexesFandG).
On September 30, 1977, plaintiffappellant reported to the Philippine Constabulary the criminal act
perpetrated by the person who misrepresented himself as Jojo Consunji and in the course of the
investigation, plaintiffappellant learned that the real identity of the wrongdoer/impostor is Armando
Suarezwhohasalonglineofcriminalcasesagainsthimforestafausingthissimilarmodusoperandi.
On October 17, 1977, plaintiffappellant was able to recover the Holden Premier vehicle which was
foundabandonedsomewhereinQuezonCity.
On the other hand, plaintiffappellant learned that the 1977 Isuzu Gemini was transferred by
Armando Suarez to third persona and was in the possession of one Jaime Ledesma at the time
plaintiffappellantinstitutedthisactionforreplevinonNovember16,1977.
Inhisdefense,JaimeLedesmaclaimsthathepurchases(sic)andpaidforthesubjectvehicleingood
faith from its registered owner, one Pedro Neyra, as evidenced by the Land Transportation
CommissionRegistrationCertificateNo.RCO1427249.
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After posting the necessary bond in the amount double the value of the subject motor vehicle,
plaintiffappellant was able to recover possession of the 1977 Isuzu Gemini as evidenced by the
SheriffsReturndatedJanuary23,1978."6
After trial on the merits, the lower court rendered the decision and subsequently issued the Final
Orderbothearlieradvertedto,whichplaintiff(privaterespondentherein)appealedtotherespondent
CourtofAppealsitsubmittedthefollowingassignmentoferrors:
"Thetrialcourterred.
I
INHOLDINGTHATTHEDEFENDANTISENTITLEDTOTHEPOSSESSIONOFTHECAR
September-1992 Jurisprudence
A.M. No. RTJ8822 September 1, 1992 JOEL
GARGANERAv.ENRIQUEJOCSON
G.R.No.32075September1,1992SIAOTIAOHONG
v.COMMISSIONEROFINTERNALREVENUE
G.R.No.32657September1,1992PEOPLEOFTHE
PHIL.v.JOSES.RODRIGUEZ,ETAL.
II
INHOLDINGTHATTHEDEFENDANTISANINNOCENTPURCHASERINGOODFAITHANDFORVALUE
III
INRULINGTHATTHEPLAINTIFFSHOULDRETURNTHECARTODEFENDANT,DISMISSINGITSCLAIM
FOR DAMAGES, AND GRANTING DEFENDANT P35,000.00 DAMAGES RECOVERABLE AGAINST THE
REPLEVINBONDANDP101,000.00DAMAGESFORALLEGEDWRONGFULSEIZURE
G.R.Nos.7074647September1,1992BIENVENIDO
O.MARCOSv.FERNANDOS.RUIZ,ETAL.
IV
G.R.No.86051September1,1992JAIMELEDESMA
v.COURTOFAPPEALS,ETAL.
IN RENDERING THE DECISION DATED SEPTEMBER 3, 1979 AND THE FINAL ORDER DATED JUNE 26,
1980."7
G.R.No.86844September1,1992SPOUSESCESAR
DERAMOS,ETAL.v.COURTOFAPPEALS,ETAL.
In support of its first and second assigned errors, private respondent cites Article 559 of the Civil
Codewhichprovides:
A.M. No. 928027SC September 2, 1992 RE:

JOSEFINAV.PALON
G.R. No. 43747 September 2, 1992 REPUBLIC OF
THEPHIL.v.COURTOFFIRSTINSTANCEOFMANILA,ET
AL.
G.R. No. 46025 September 2, 1992 FLORITA T.
BAUTISTAv.COURTOFAPPEALS,ETAL.
G.R. No. 50618 September 2, 1992 LEOPOLDO
FACINAL,ETAL.v.AGAPITOI.CRUZ,ETAL.
G.R. No. 51289 September 2, 1992 RODOLFO
ENCARNACION v. DYNASTY AMUSEMENT CENTER
CORPORATION,ETAL.
G.R.No.56865September2,1992IRENEOTOBIAS,
"ARTICLE 559. The possession of movable property acquired in good faith is equivalent to a title.
Nevertheless,onewhohaslostanymovableorhasbeenunlawfullydeprivedthereof,mayrecoverit
fromthepersoninpossessionofthesame.
Ifthepossessorofamovablelostorofwhichtheownerhasbeenunlawfullydeprived,hasacquired
itingoodfaithatapublicsale,theownercannotobtainitsreturnwithoutreimbursingthepricepaid
therefor."
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Withoutinanywayreversingthefindingsofthetrialcourtthathereinpetitionerwasabuyeringood
faithandforvaluableconsideration,therespondentCourtruledthat:
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"UnderArticle559,CivilCode,theruleistotheeffectthatiftheownerhaslostathing,orifhehas
beenunlawfullydeprivedofit,hehasarighttorecoveritnotonlyfromthefinder,thieforrobber,
butalsofromthirdpersonswhomayhaveacquireditingoodfaithfromsuchfinder,thieforrobber.
The said article establishes two (2) exceptions to the general rule of irrevendicability (sic), to wit:
when the owner (1) has lost the thing, or (2) has been unlawfully deprived thereof. In these cases,
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the possessor cannot retain the thing as against the owner who may recover it without paying any
indemnity, except when the possessor acquired it in a public sale. (Aznar v. Yapdiangco, 13 SCRA
486).
ETAL.v.TEMISTOCLESB.DIEZ
G.R. No. 61043 September 2, 1992 DELTA MOTOR
SALESCORPORATIONv.NIUKIMDUAN,ETAL.
Putdifferently,wheretheownerhaslostthethingorhasbeenunlawfullydeprivedthereof,thegood
faith of the possessor is not a bar to recovery of the movable unless the possessor acquired it in a
publicsaleofwhichthereisnopretenseinthiscase.Contrarytothecourtaassumption,theissueis
notprimarilythegoodfaithofLedesmaforevenifthisweretrue,thismaynotbeinvokedasavalid
defense,ifitbeshownthatCitiwidewasunlawfullydeprivedofthevehicle.
G.R. Nos. 6255455 September 2, 1992 REPUBLIC

BANKv.COURTOFTAXAPPEALS,ETAL.
G.R. No. 70120 September 2, 1992 CIVIL
AERONAUTICS
ADMINISTRATION,
ET
AL.
v.
INTERMEDIATEAPPELLATECOURT,ETAL.
InthecaseofDizonv.Suntay,47SCRA160,theSupremeCourthadoccasiontodefinethephrase
unlawfullydeprived,towit:
G.R. No. 73198 September 2, 1992 PRIVATE

DEVELOPMENT CORPORATION OF THE PHIL. v.
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. . . it extends to all cases where there has been no valid transmission of ownership including
depositary or lessee who has sold the same. It is believed that the owner in such a case is
undoubtedlyunlawfullydeprivedofhispropertyandmayrecoverthesamefromapossessoringood
faith.
G.R.No.74618September2,1992ANALIMKALAW
v.INTERMEDIATEAPPELLATECOURT,ETAL.
G.R. No. 75242 September 2, 1992 MANILA
RESOURCE DEVELOPMENT CORP. v. NATIONAL LABOR
RELATIONSCOMMISSION,ETAL.
xxx
In the case at bar, the person who misrepresented himself to be the son of the purported buyer,
RusticoT.Consunji,paidforthetwo(2)vehiclesusingacheckwhoseamounthasbeenalteredfrom
P101.00 to P101,000.00. There is here a case of estafa. Plaintiff was unlawfully deprived of the
vehicle by false pretenses executed simultaneously with the commission of fraud (Art. 315 2(a)
R.P.C.). Clearly, Citiwide would not have parted with the two (2) vehicles were it not for the false
representationthatthecheckissuedinpaymentthereupon(sic)isintheamountofP101,000.00,the
actualvalueofthetwo(2)vehicles."8
G.R.No.78777September2,1992MERLINP.CAIA
v.PEOPLEOFTHEPHIL.,ETAL.
G.R. No. 80812 September 2, 1992 LUZ E. TAN v.
COURTOFAPPEALS,ETAL.
G.R. No. 84256 September 2, 1992 ALEJANDRA
RIVERAOLAC,ETAL.v.COURTOFAPPEALS,ETAL.
PHIL.v.JAIMEG.SERDAN
In short, said buyer never acquired title to the property hence, the Court rejected the claim of
hereinpetitionerthatatleast,ArmandoSuarezhadavoidabletitletotheproperty.
PHIL.v.EDUARDOL.DEJESUS,ETAL.
His motion for reconsideration having been denied in the resolution of the respondent Court of 12
December1988,9petitionerfiledthispetitionallegingthereinthat:
G.R. No. 92461 September 2, 1992 ESTATE

DEVELOPERSANDINVESTORSCORPORATIONv.COURT
OFAPPEALS,ETAL.
"A
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THEHONORABLECOURTOFAPPEALSERREDINAPPLYINGARTICLE559OFTHENEWCIVILCODETO
THE INSTANT CASE DESPITE THE FACT THAT PRIVATE RESPONDENT CITIWIDE MOTORS, INC. WAS
NOT UNLAWFULLY DEPRIVED OF THE SUBJECT CAR, AS IN FACT CITIWIDE VOLUNTARILY PARTED
WITHTHETITLEANDPOSSESSIONOR(sic)THESAMEINFAVOROFITSIMMEDIATETRANSFEREE.
G.R. No. 92789 September 2, 1992 SILLIMAN

UNIVERSITY v. NATIONAL LABOR RELATIONS
COMMISSION,ETAL.
G.R. No. 9279596 September 2, 1992 PEOPLE OF

THEPHIL.v.FREDDIEB.TANTIADO
THEFACTUALMILIEUOFTHEINSTANTCASEFALLSWITHINTHEOPERATIVEEFFECTSOFARTICLES
1505AND1506OFTHENEWCIVILCODECONSIDERINGTHATTHEIMMEDIATETRANSFEREEOFTHE
PRIVATE RESPONDENT CITIWIDE MOTORS, INC., ACQUIRED A VOIDABLE TITLE OVER THE CAR IN
QUESTION WHICH TITLE WAS NOT DECLARED VOID BY A COMPETENT COURT PRIOR TO THE
ACQUISITION BY THE PETITIONER OF THE SUBJECT CAR AND ALSO BECAUSE PRIVATE
RESPONDENT, BY ITS OWN CONDUCT, IS NOW PRECLUDED FROM ASSAILING THE TITLE AND
POSSESSIONBYTHEPETITIONEROFTHESAIDCAR."10
PHILv.ESTANISLAOGENERALAO,JR.
PHIL.v.MASALIMCASIM
G.R. No. 94918 September 2, 1992 DANILO I.
SUAREZ,ETAL.v.COURTOFAPPEALS,ETAL.
Thereismeritinthepetition.Theassaileddecisionmustbereversed.
G.R. No. 95249 September 2, 1992 REPUBLIC

PLANTERSBANKv.COURTOFAPPEALS,ETAL.
G.R. No. 95843 September 2, 1992 EDILBERTO C.
ABARQUEZ,ETAL.v.COURTOFAPPEALS,ETAL.
G.R. No. 95921 September 2, 1992 SPOUSES
ROBERTDINO,ETAL.v.COURTOFAPPEALS,ETAL.
G.R.No.96333September2,1992EDUARDOC.DE
VERAv.ERNESTOL.PINEDA
G.R. Nos. 9695256 September 2, 1992 SMI FISH
INDUSTRIES, INC., ET AL. v. NATIONAL LABOR
G.R.Nos.9740809September2,1992PEOPLEOF
THEPHIL.v.TOMASMORENO,JR.
G.R. No. 97805 September 2, 1992 NILO H.
RAYMUNDOv.COURTOFAPPEALS,ETAL.
PHIL.v.CONWAYB.OMAWENG
G.R. No. 99359 September 2, 1992 ORLANDO M.
ESCAREAL
v.
NATIONAL
LABOR
RELATIONS
COMMISSION,ETAL.
G.R. No. 100970 September 2, 1992 FINMAN
GENERAL ASSURANCE CORPORATION v. COURT OF
APPEALS,ETAL.
PHIL.v.REYNALDOVALIENTE
A.M. No. P90418 September 3, 1992 EDILBERTO
NATIVIDADv.ALFONSOB.MELGAR
G.R. No. 86695 September 3, 1992 MARIA ELENA
MALAGA,ETAL.v.MANUELR.PENACHOS,JR.,ETAL.
G.R. No. 90693 September 3, 1992 SPARTAN
SECURITY & DETECTIVE AGENCY, INC. v. NATIONAL
LABORRELATIONSCOMMISSION,ETAL.
PHIL.v.PEPITOT.PEERO
G.R.No.92310September3, 1992 AGRICULTURAL
ANDHOMEEXTENSIONDEVELOPMENTGROUPv.COURT
OFAPPEALS,ETAL.
Thepetitionersuccessfullyprovedthatheacquiredthecarinquestionfromhisvendoringoodfaith
andforvaluableconsideration.Accordingtothetrialcourt,theprivaterespondentsevidencewasnot
persuasiveenoughtoestablishthatpetitionerhadknowledgethatthecarwastheobjectofafraud
and a swindle and that it did not rebut or contradict petitioners evidence of acquisition for valuable
consideration. The respondent Court concedes to such findings but postulates that the issue here is
not whether petitioner acquired the vehicle in that concept but rather, whether private respondent
wasunlawfullydeprivedofitsoastomakeArticle559oftheCivilCodeapply.
It is quite clear that a party who (a) has lost any movable or (b) has been unlawfully deprived
thereofcanrecoverthesamefromthepresentpossessorevenifthelatteracquireditingoodfaith
andhas,therefore,titletheretoforunderthefirstsentenceofArticle559,suchmannerofacquisition
is equivalent to a title. There are three (3) requisites to make possession of movable property
equivalent to title, namely: (a) the possession should be in good faith (b) the owner voluntarily
partedwiththepossessionofthethingand(c)thepossessionisintheconceptofowner.11
Undoubtedly,onewhohaslostamovableorwhohasbeenunlawfullydeprivedofitcannotbesaidto
havevoluntarilypartedwiththepossessionthereof.Thisisthejustificationfortheexceptionsfound
underthesecondsentenceofArticle559oftheCivilCode.
The basic issue then in this case is whether private respondent was unlawfully deprived of the cars
when it sold the same to Rustico Consunji, through a person who claimed to be Jojo Consunji,
allegedly the latters son, but who nevertheless turned out to be Armando Suarez, on the faith of a
ManagersCheckwithafacevalueofP101,000.00,dishonoredforbeingaltered,thecorrectamount
beingonlyP101.00.
chanroblesvirtuallawlibrary
Under this factual milieu, the respondent Court was of the opinion, and thus held, that private
respondentwasunlawfullydeprivedofthecarbyfalsepretenses.
We disagree. There was a perfected unconditional contract of sale between private respondent and
theoriginalvendee.Theformervoluntarilycausedthetransferofthecertificateofregistrationofthe
vehicleinthenameofthefirstvendeeevenifthesaidvendeewasrepresentedbysomeonewho
usedafictitiousnameandlikewisevoluntarilydeliveredthecarsandthecertificateofregistration
to the vendees alleged representative Title thereto was forthwith transferred to the vendee. The
subsequent dishonor of the check because of the alteration merely amounted to a failure of
considerationwhichdoesnotrenderthecontractofsalevoid,butmerelyallowstheprejudicedparty
tosueforspecificperformanceorrescissionofthecontract,andtoprosecutetheimpostorforestafa
under Article 315 of the Revised Penal Code. This is the rule enunciated in EDCA Publishing and
Distributing Corp. v. Santos, 12 the facts of which do not materially and substantially differ from
thoseobtainingintheinstantcase.Insaidcase,apersonidentifyinghimselfasProfessorJoseCruz,
deanoftheDelaSalleCollege,placedanorderbytelephonewithpetitionerfor406books,payable
upon delivery. Petitioner agreed, prepared the corresponding invoice and delivered the books as
ordered, for which Cruz issued a personal check covering the purchase price. Two (2) days later,
Cruzsold120bookstoprivaterespondentLeonorSantoswho,afterverifyingthesellersownership
fromtheinvoicetheformerhadshownher,paidthepurchasepriceofP1,700.00.Petitionerbecame
suspicious over a second order placed by Cruz even before his first check had cleared, hence, it
madeinquirieswiththeDelaSalleCollege.ThelatterinformedthepetitionerthatCruzwasnotinits
employ.FurtherverificationrevealedthatCruzhadnomoreaccountordepositwiththebankagainst
which he drew the check. Petitioner sought the assistance of the police which then set a trap and
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PHIL.v.AMADEOABUYEN
G.R. No. 83995 September 4, 1992 BENJAMIN
EDAOv.COURTOFAPPEALS
G.R. No. 88788 September 4, 1992 RESTITUTO DE
LEONv.COURTOFAPPEALS,ETAL.
PHIL.v.FERNANDITOS.SICAT
arrested Cruz. Investigation disclosed his real name, Tomas de la Pea, and his sale of 120 of the
books to Leonor Santos. On the night of the arrest the policemen whose assistance the petitioner
sought,forcedtheirwayintothestoreofLeonorandherhusband,threatenedherwithprosecution
forthebuyingofstolenproperty,seizedthe120bookswithoutawarrantandthereafterturnedsaid
booksovertothepetitioner.TheSantosesthensuedforrecoveryofthebooksintheMunicipalTrial
Court which decided in their favor this decision was subsequently affirmed by the Regional Trial
Court and sustained by the Court of Appeals. Hence, the petitioner came to this Court by way of a
petitionforreviewwhereinitinsiststhatitwasunlawfullydeprivedofthebooksbecauseasthecheck
bounced for lack of funds, there was failure of consideration that nullified the contract of sale
betweenitandtheimpostorwhothenacquirednotitleoverthebooks.Werejectedsaidclaiminthis
wise:
PHIL.v.SOTEROA.CRUZ
G.R.No.94825September4,1992PHIL.FISHERIES
DEVELOPMENT AUTHORITY v. NATIONAL LABOR
THEPHIL.v.MONICAP.PADILLA
"Thecontractofsaleisconsensualandisperfectedonceagreementisreachedbetweentheparties
onthesubjectmatterandtheconsideration.AccordingtotheCivilCode:
ART. 1475. The contract of sale is perfected at the moment there is a meeting of minds upon the
thingwhichistheobjectofthecontractandupontheprice.
From that moment, the parties may reciprocally demand performance, subject to the provisions of
thelawgoverningtheformofcontracts.
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G.R. No. 101469 September 4, 1992 MALAYAN

INTEGRATEDINDUSTRIES,CORPORATIONv.COURTOF
APPEALS,ETAL.
xxx
G.R. No. 101539 September 4, 1992 CECILE DE

OCAMPO, ET AL. v. NATIONAL LABOR RELATIONS
COMMISSION,ETAL.
ART. 1477. The ownership of the thing sold shall be transferred to the vendee upon the actual or
constructivedeliverythereof.
G.R. No. 102397 September 4, 1992 BAGUIO

COUNTRY CLUB CORPORATION v. NATIONAL LABOR
G.R. No. 105120 September 4, 1992 SIMPLICIO C.
GRIO,ETAL.v.COMMISSIONONELECTIONS,ETAL.
G.R. No. 105346 September 4, 1992 RAUL H.
SESBREOv.COURTOFAPPEALS,ETAL.
G.R. No. 93842 September 7, 1992 ERNANDO C.
LAYNOv.PEOPLEOFTHEPHIL.,ETAL.
PHIL.v.IRENEOTIWAKEN
G.R.No.55741September11,1992LUZLATAGANv.
EMPLOYEESCOMPENSATIONCOMMISSION,ETAL.
PHIL.v.REYNALDOS.ALVAREZ
G.R.No.82586September 11, 1992 SALVADOR M.
MISON,ETAL.v.ELIG.C.NATIVIDAD,ETAL.
PHIL.v.LARRYA.FRANCISCO
G.R.No.91915September11,1992DIVINEWORD
UNIVERSITY OF TACLOBAN v. SECRETARY OF LABOR
ANDEMPLOYMENT,ETAL.
PHIL.v.DOMINGOCASINILLO
PHIL.v.REGOBERTOYBEAS
G.R. No. 103903 September 11, 1992 MELANIO D.
SAMPAYAN,ETAL.v.RAUL.A.DAZA,ETAL.
G.R. No. 57475 September 14, 1992 REPUBLIC OF
THEPHIL.v.RUFONERI,ETAL.
G.R. No. 74851 September 14, 1992 RIZAL
COMMERCIAL
BANKING
CORPORATION
v.
INTERMEDIATEAPPELLATECOURT
A.C. No. 3248 September 18, 1992 DOMINGO R.
MARCELOv.ADRIANOS.JAVIER,SR.
G.R. No. 70890 September 18, 1992 CRESENCIO
LIBI, ET AL. v. INTERMEDIATE APPELLATE COURT, ET
AL.
G.R. No. 73919 September 18, 1992 NATIONAL
IRRIGATION
ADMINISTRATION,
ET
AL.
v.
G.R.No.7591516September18,1992SPS.GOIT
BUN,ETAL.v.BALTAZARR.DIZON,ETAL.
PHIL.v.QUEROBENA.POLIZON
PHIL.v.ELSIEB.BAGISTA
PHIL.v.SILFERIOF.SILLO
G.R.No.9451113September18,1992PEOPLEOF
THEPHIL.v.ALEJANDROC.VALENCIA
ROMULODELACRUZ,ETAL.v.ASIANCONSUMERAND
INDUSTRIALFINANCECORP.,ETAL.
PHIL.v.MARIOA.BAEZ
ART.1478.Thepartiesmaystipulatethatownershipinthethingshallnotpasstothepurchaseruntil
hehasfullypaidtheprice.
Itisclearfromtheaboveprovisions,particularlythelastonequoted,thatownershipinthethingsold
shallnotpasstothebuyeruntilfullpaymentofthepurchasepriceonlyifthereisastipulationtothat
effect.Otherwise,theruleisthatsuchownershipshallpassfromthevendortothevendeeuponthe
actualorconstructivedeliveryofthethingsoldevenifthepurchasepricehasnotyetbeenpaid.
Nonpayment only creates a right to demand payment or to rescind the contract, or to criminal
prosecution in the case of bouncing checks. But absent the stipulation above noted, delivery of the
thingsoldwilleffectivelytransferownershiptothebuyerwhocaninturntransferittoanother."13
IntheearlycaseofChuaHaiv.Hon.Kapunan,14oneRobertoSotopurchasedfromtheYoungstown
Hardware, owned by private respondent, corrugated galvanized iron sheets and round iron bars for
P6,137.70, in payment thereof, he issued a check drawn against the Security Bank and Trust Co.
withoutinformingOngShuthathe(Soto)hadnosufficientfundsinsaidbanktoanswerforthesame.
In the meantime, however, Soto sold the sheets to, among others, petitioner Chua Hai. In the
criminal case filed against Soto, upon motion of the offended party, the respondent Judge ordered
petitioner to return the sheets which were purchased from Soto. Petitioners motion for
reconsideration having been denied, he came to this Court alleging grave abuse of discretion and
excessofjurisdiction.Inanswertothepetition,itisclaimedthatinteralia,evenifthepropertywas
acquiredingoodfaith,theownerwhohasbeenunlawfullydeprivedthereofmayrecoveritfromthe
personinpossessionofthesameunlessthepropertywasacquiredingoodfaithatapublicsale.15
Resolving this specific issue, this Court ruled that Ong Shu was not illegally deprived of the
possessionoftheproperty:
"...ItisnotdeniedthatOngShudeliveredthesheetstoSotouponaperfectedcontractofsale,and
suchdeliverytransferredtitleorownershiptothepurchaser.SaysArt.1496:
Art.1496.Theownershipofthethingsoldisacquiredbythevendeefromthemomentitisdelivered
to him in any of the ways specified in articles 1497 to 1501, or in any other manner signifying an
agreementthatthepossessionistransferredfromthevendortothevendee.(C.C.)
Thefailureofthebuyertomakegoodthepricedoesnot,inlaw,causetheownershiptorevestinthe
seller until and unless the bilateral contract of sale is first rescinded or resolved pursuant to Article
1191ofthenewCivilCode.
chanrobleslawlibrary:rednad
And, assuming that the consent of Ong Shu to the sale in favor of Soto was obtained by the latter
through fraud or deceit, the contract was not thereby rendered void ab initio, but only voidable by
reasonofthefraud,andArticle1390expresslyprovidesthat:
ART.1390.Thefollowingcontractsarevoidableorannullable,eventhoughtheremayhavebeenno
damagetothecontractingparties:
(1)Thosewhereoneofthepartiesisincapableofgivingconsenttoacontract
(2)Thosewheretheconsentisvitiatedbymistake,violence,intimidation,undueinfluenceorfraud.
These contracts are binding, unless they are annulled by a proper action in court. They are
susceptibleofratification.
Agreeablytothisprovision,Article1506prescribes:
ARTICLE 1506. Where the seller of goods has a voidable title thereto, but his title has not been
avoidedatthetimeofthesale,thebuyeracquiresagoodtitletothegoods,providedhebuysthem
ingoodfaith,forvalue,andwithoutnoticeofthesellersdefectoftitle.(C.C.)
Hence,untilthecontractofOngShuwithSotoissetasidebyacompetentcourt(assumingthatthe
fraudisestablishedtoitssatisfaction),thevalidityofappellantsclaimtothepropertyinquestioncan
notbedisputed,andhisrighttothepossessionthereofshouldberespected."16
It was therefore erroneous for the respondent Court to declare that the private respondent was
illegally deprived of the car simply because the check in payment therefor was subsequently
dishonored said Court also erred when it divested the petitioner, a buyer in good faith who paid
valuableconsiderationtherefor,ofhispossessionthereof.
chanroblesvirtualawlibrarychanrobles.com:chanrobles.com.ph
WHEREFORE,thechallengeddecisionoftherespondentCourtofAppealsof22September1988and
its Resolution of 12 December 1988 in C.A.G.R. CV No. 05955 are hereby SET ASIDE and the
Decisionofthetrialcourtof3September1979anditsFinalOrderof26June1980inCivilCaseNo.
Q24200areherebyREINSTATED,withcostsagainstprivaterespondentCitiwideMotors,Inc.
SOORDERED.
Gutierrez,Jr.,BidinandRomero,JJ.,concur.
Feliciano,J.,isonleave.
4/6
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PHIL.v.ARCHIEQ.DISTRITO,ETAL.
G.R. No. 96255 September 18, 1992 HERCULES
INDUSTRIES,INC.v.SECRETARYOFLABOR,ETAL.
Endnotes:
G.R. No. 96329 September 18, 1992 MABUHAY

VINYL CORP. v. NATIONAL LABOR RELATIONS
COMMISSION,ETAL.
PHIL.v.VICTORE.JAPSAY
THEPHIL.v.WILFREDOSABORNIDO
G.R. No. 105227 September 18, 1992 LEANDRO I.
VERCELESv.COMMISSIONONELECTIONS,ETAL.
G.R. No. 61218 September 23, 1992 LIBERTAD
SANTOS,ETAL.v.COURTOFAPPEALS,ETAL.
G.R. No. 81883 September 23, 1992 KNITJOY
MANUFACTURING, INC. v. PURA FERRERCALLEJA, ET
AL.
G.R. No. 83580 September 23, 1992 ENRICO SY v.
ARTUROA.ROMERO
G.R. Nos. 8540306 September 23, 1992 ANTONIO
T.TIONGSONv.COURTOFAPPEALS,ETAL.
G.R. No. 101706 September 23, 1992
CONSOLIDATED PLYWOOD INDUSTRIES INC., ET AL. v.
AGOSTOMUOZ,ETAL.v.COURTOFAPPEALS,ETAL.
G.R.No.85086September24,1991
ARSENIO P. BUENAVENTURA ENTERPRISES
NATIONALLABORRELATIONSCOMMISSION,ETAL.
1. Per Associate Justice Oscar M. Herrera, concurred in by Associate Justices Jorge S.

ImperialandFernandoA.Santiago.
2. Entitled Citiwide Motors, Inc., PlaintiffAppellant, v. Jaime Ledesma, Et Al.,
DefendantsAppellees.
3.Annex"A"ofPetitionRollo,2338,atp.28.
4.Id.,3340.
5.Id.,27.
6.Rollo,4243.
7.Rollo,4142.
8.Rollo,4546.
9.Annex"E"ofPetitionRollo,5960.
10.Id.,78.
11.TOLENTINO,A.M.,CivilCodeofthePhilippines,Vol.II,1983ed.,275276,citing2
IIColinandCapitant942DeBuenIbid.,1009,2Salvat1654Manresa,339.
12.184SCRA614[1990].
13.184SCRA618[1990].
14.104Phil.110[1958].
15.Article559,CivilCode.
v.
16.104Phil.116117[1958].
PHIL.v.CARLOSC.FLORIDA
CourtLaws Decisions
VSGR
TheftLaw
LawCases LawAct
CivilLaw LaborLaw
AppealLawCourtCases FraudLaw LawLaw
G.R. No. 97765 September 24, 1992 KHOSROW

MINUCHERv.COURTOFAPPEALS,ETAL.
G.R. No. L44936 September 25, 1992 PHILIPPINE
AIRLINES,INC.v.COURTOFAPPEALS,ETAL.
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G.R. No. 91114 September 25, 1992 NELLY LIM v.

QUICKSEARCH
G.R. No. 91359 September 25, 1992 VETERANS

MANPOWERANDPROTECTIVESERVICES,INC.v.COURT
OFAPPEALS,ETAL.
G.R. No. 58027 September 28, 1992 GOLDEN
COUNTRYFARMS,INC.v.SANVARDEVELOPMENTCORP.
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G.R. No. 99046 September 28, 1992 AQUALYN

CORPORATIONv.COURTOFAPPEALS,ETAL.
G.R.No.100574September28,1992SPS.MARINO
SAPUGAY,ETAL.v.COURTOFAPPEALS,ETAL.
THEPHIL.v.EDGARDOH.LOPEZ
G.R.No.53630September30,1992ENRIQUEKHO,
ETAL.v.COURTOFAPPEALS,ETAL.
G.R. No. 82531 September 30, 1992 DOMINGO T.
MENDOZAv.MARIAMENDOZANAVARETTE,ETAL.
G.R.No.82630September30,1992MARIAGULANG
v.GENOVEVANADAYAG,ETAL.
2012
G.R.
No.
94461
September
30,
1992
INTERNATIONALCORPORATEBANK,INC.v.COURTOF
APPEALS,ETAL.
G.R. No. 97356 September 30, 1992 ARTURO C.
CORONAv.COURTOFAPPEALS,ETAL.
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PhilippineSupremeCourtJurisprudence>Year1992>September1992Decisions>G.R. No. 86051 September

1. CIVIL LAW POSSESSION REQUISITES TO MAKE POSSESSION OF MOVABLE PROPERTY

A.M. No. 928027SC September 2, 1992 RE:

G.R. Nos. 6255455 September 2, 1992 REPUBLIC

G.R. No. 73198 September 2, 1992 PRIVATE

G.R. No. 92461 September 2, 1992 ESTATE

G.R. No. 92789 September 2, 1992 SILLIMAN

G.R. No. 9279596 September 2, 1992 PEOPLE OF

G.R. No. 95249 September 2, 1992 REPUBLIC

G.R. No. 101469 September 4, 1992 MALAYAN

G.R. No. 101539 September 4, 1992 CECILE DE

G.R. No. 102397 September 4, 1992 BAGUIO

G.R. No. 96329 September 18, 1992 MABUHAY

1. Per Associate Justice Oscar M. Herrera, concurred in by Associate Justices Jorge S.

G.R. No. 97765 September 24, 1992 KHOSROW

G.R. No. 91114 September 25, 1992 NELLY LIM v.

G.R. No. 91359 September 25, 1992 VETERANS

G.R. No. 99046 September 28, 1992 AQUALYN

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