GR L 11754; (October, 1917)

EN BANC

G.R. No. L-11754      October 8, 1917

AQUILINO CALVO, as sheriff of Pangasinan, plainitff-appellee,

vs.
CO CANG & CO., ET AL., defendants.
CO CANG & CO., appellant.

Chicote and Arnaiz and Pascual B. Azanza for appellant.
No appearance for appellee.

JOHNSON, J.:

The plaintiff brought the present action as sheriff of the Province of Pangasinan for the purpose of having determined who were entitled to the proceeds of a certain sale under several executions, of the property of Lim Kian and Lim Tiang Teng. The action was instituted by virtue of the provisions of section 120 of Act No. 190. The record shows that the property in question was sold under said executions to Simon Jangaon, a representative of the defendant and appellant Co Cang & Co., for the sum of P685; that the costs incurred in said sale amounted to P207.05. The question is, Who is entitled to the balance of P477.95 among the several defendants?

To the petition the various defendants answered each laying claim to the proceeds of said sale. Co Cang & Co. answered the petition and alleged that they had obtained a judgment against the said Lim Kian and Lim Tiang Teng in the Court of First Instance of the City of Manila on the 29th day of September, 1914, for the sum of P878.08; that said sum (P878.08) represented the price of goods, wares and merchandise sold to the defendants; that the goods attached under the said execution and sold were the same goods sold by them to the defendants Lim Kian and Lim Tiang Teng.

The defendants So Yengco, Doroteo Soratos, Jose S. Yok Peng, Dy Heng Chong, Co Chiongco, Yu Tivo & Sons, Ong Pung, and Tan Yangco answered the petition and admitted all of the facts therein stated, except paragraph 10. Said paragraph 10 of the petition simply alleged that the costs of the sheriff amounted to P207.05. Said defendants further alleged in their answer that each of them had obtained a judgment against the said Lim Kian and Lim Tiang Teng, while the other defendant Co Cang & Co. had only obtained an attachment of the goods of said Lim Kian and Lim Tiang Teng. Said defendants further alleged that, by virtue of their having obtained a judgment against the said Lim Kian and Lim Tiang Teng, they had thereby obtained a preference over said Co Cang & Co. by virtue of the provisions of article 1924 of the Civil Code, and cited a number of decisions in support of that contention in their answer.

Upon the issue thus presented the Hon. Julio Llorente rendered a judgment in which he ordered that the proceeds of said sale be divided among the defendants Jose S. Yok Peng, So Yengco and Doroteo Soratos, prorata, without any finding as to costs. From that decision the defendant Co Cang & Co., appealed.

The pertinent facts necessary for a solution of the question presented may be stated as follows:

1. That a judgment was rendered in favor of So Yengco vs. Lim Tiang Teng for the sum P409.12, with interest and costs, on the 11th day of May, 1914, by the justice of the peace of the municipality of Tayug of the Province of Pangasinan. 2. That a judgment was rendered in favor of Doroteo Soratos vs. Lim Tiang Teng for the sum of P489.52, with interest and costs, on the 11th day of May, 1914, by the justice of the peace of the municipality of Tayug of the Province of Pangasinan.

3. That a judgment was rendered in favor of Dy He Chong vs. Lim Tiang Teng by the justice of the peace of the City of Manila for the sum of P606.12, with interest and costs, on the 19th day of May, 1914.

4. That a judgment was rendered in favor of Co Chiongco vs. Lim Tiang Teng by the justice of the peace of the City of Manila on the 19th day of May, 1914, for the sum of P604.12.

5. That a judgment was rendered in favor of Yu Tivo & Sons vs. Lim Tiang Teng by the justice of the peace of the City of Manila on the 19th day of May, 1914, for the sum of P507.12, with interest and costs.

6. That another judgment was rendered in favor of Co Chiongco vs. Lim Tiang Teng by the justice of the peace of the City of Manila on the 19th day of May, 1914, for the sum of P605.12, with interest and costs.

7. That a judgment was rendered in favor of Ong Pun vs. Lim Tiang Teng by the justice of the peace of the City of Manila on the 19th day of May, 1914, for the sum of P486.14, with interest and costs.

8. That a judgment was rendered in favor of Tan Yangco vs. Lim Tiang Teng in the court of the justice of the peace of the City of Manila on the 19th day of May, 1914, for the sum of P599.16, together with interest and costs.

9. That another judgment was rendered in favor of Yu Tivo & Sons vs. Lim Tiang Teng in the court of the justice of the peace of the City of Manila on the 19th day of May, 1914, the sum of P564.32, together with interest and costs.

10. That a judgment was rendered in favor of Jose S. Yok Peng vs. Lim Tiang Teng in the court of the justice of the peace of the municipality of Tayug of the Province of Pangasinan on the 11th day of May, 1914, for the sum of P443.91, together with interest and costs.

11. That Co Cang & Co., commenced an action in the Court of First Instance of the City of Manila on the 4th day of May, 1914, against the said Lim Kian and Lim Tiang Teng for the purpose of recovering the balance of an account amounting to P878.08; that an attachment was issued after the commencement of said action on the 7th or 8th day of May, 1914, and the goods, wares and merchandise of the defendants were duly attached and held until the 17th day of September, 1914; and that a judgment was finally rendered in said action on the 29th day of September., 1914, for the sum of P878.08, with interests and costs.

The upon said various judgments execution were issued. The writs of execution in favor of So Yengco and the said Doroteo Soratos were received by the sheriff of the Province of Pangasinan on the 16th day of August, 1914, and the property of Lim Tiang Teng was attached. The writs of execution issued in favor of Dy He Chong, Co Chiongco, Yu Tivo & Sons, Ong Pung and Tan Yangco were received by the sheriff of the Province of Pangasinan on the 14th day of September, 1914. The writ of execution which had been issued in favor of Jose S. Yok Peng was received by the sheriff of the Province of Pangasinan on the 17th day of September, 1914. All of said writs of execution had been received by the said sheriff, except the one in favor of Jose S. Yok Peng, before the time of the sale of the property in question. The property under said executions was sold upon the 14th day of September, 1914, to Simon Jangaon, a representative of Co Cang & Co. for the sum of P685.

During the trial of the present case Co Cang, of the firm of Co Cang & Co., declared as a witness and swore positively that the goods, wares and merchandise attached and sold by the sheriff of the Province of Pangasinan under the said various executions were the goods, wares and merchandise which his firm had sold to the said defendants in the said various actions mentioned above, and that they had not been paid for; and presented in substantiation of his declaration Exhibits C, A-4, and 2. The lower court divided the proceeds among Jose S. Yok Peng, So Yengco and Doroteo Soratos, upon the theory that because their judgments (11th day of May, 1914) antedated the judgments in favor of the other defendants, they had a preference over the other judgment creditors in accordance with article 1924 of the Civil Code.

The appellant Co Cang & Co., alleges that the lower court committed an error in deciding that the right of preference among the various defendants depended upon the dates of their respective judgments, and that article 1924 of the Civil Code did not apply; that the court should have applied paragraph 1 of article 1922 of the Civil Code, for the reason that the goods, wares and merchandise attached on the various executions were the same goods, wares and merchandise which the appellants Co Cang & Co. had sold to the common debtors Lim Kian and Lim Tiang Teng.

It will be remembered that Co Cang & Co., as early as the 4th day of May, 1914, commenced an action in the Court of First Instance of the City of Manila, and, in order to protect their rights, had all the goods in question attached on the 7th or 8th day of May, 1914; that the goods were held under said attachment until the time they were sold under the various executions above enumerated. While, perhaps, the attachment issued in favor nor give them a preferred right over the other creditors, the fact that the goods so attached were the same good which had been sold by the appellant to the common debtors and had not been paid for, said paragraph 1 of article 1922, gave them a preferred right.

Article 1922 provides, so far as it is applicable to the present case, that: “With respect to the specified personal property of the debtor, the following are preferred: 1. Credits for the construction, repair, preservation, or for the amount of the sale or personal property which may be in the possession of the debtor to the extent of the value of such property. . . .” 1awphil.net

The record shows “that the amount of the personal property” was less than the amount still due Co Cang & Co.; that the same property which had been sold by Co Cang & Co. to the common debtors was found in the latters’ possession and identified by Co Cang at the time of the execution sale. (Torres vs. Genato, 7 Phil. Rep., 204; Banco Español Filipino vs. Peterson, 7 Phil. Rep., 409; Fidelity & Deposit Co. of Maryland vs. Wilson, 8 Phil. Rep., 51; Rubert & Guamis vs. Luengco & Martinez, 8 Phil. Rep., 554; C. Heinszen & Co. vs. Peterson and First National Bank of Hawaii, 10 Phil. Rep., 339; International Banking Corporation vs. Corrales, 10 Phil. Rep., 435; McMicking vs. Tremoya, 14 Phil. Rep., 25; McMicking vs. Nubla Co Piaco, 24 Phil. Rep., 439.)

The proof shows clearly (a) that the money claimed by Co Cang & Co. was due from the alleged debtors as the selling price of the property in question; (b) that the property was identified by Co Cang as the same property which had been sold to the debtor, and to recover the price of which the action had been brought; and (c) that the identical property had been found in the possession of the debtor.

The evidence adduced during the trial of the cause clearly establishes the right of preference on the part of Co Cang & Co. over the other defendants to the net proceeds of said sale of P477.95.

Therefore, the judgment of the lower court is hereby revoked; and it is hereby ordered and decreed that a judgment be entered in favor of the appellant Co Cang & Co. and against the plaintiff for the sum of P477.95; and without any finding as to costs. So ordered.

Arellano, C.J., Araullo, Street and Malcolm, JJ., concur.

Separate Opinions

CARSON, J., concurring:

I concur. But I think it well to indicate that if the attachment of Co Cang & Co. was valid, it in itself was sufficient to secure them in their claim to the proceeds of the sale of the attached property. In the case of Kuenzle & Streiff vs. Villanueva; Ed. A. Keller & Co. vs. Villanueva (14 Off. Gaz., 2201), we said:

Attachment; Levy; Priorities Between Attachments and Other Liens or Claims. — The issuance and levy of an attachment on specific property, real or personal, gives to the attaching creditor a lien, or a right to a preference in the nature of a lien with relation to such property, subject to all liens or statutory preferences by which such property is affected at the date of the levy, but superior to all liens and statutory preferences by which the property may be affected subsequent to the date of levy.

But it is unnecessary to discuss any question as to the validity of the attachment, since Co Cang & Co. would recover under article 1922 of the Code in any event.

Batas Pinas