GR L 8404; (October, 1913) (Digest)
Case Digest: Montilla v. La Corporacion de PP. Agustininos Calzados (G.R. No. L-8404, October 9, 1913)
Parties:
Plaintiff-Appellant: Agustin J. Montilla
Defendant-Appellant: La Corporacion de PP. Agustininos Calzados de la Provincia del Santisimo Nombre de Jesus de Filipinas (Augustinian Religious Corporation)
Ponente: Justice Torres
Facts:
1. On August 1, 1891, Montilla leased the Pasay estate from the Augustinian Corporation. The lease included authority for Montilla to collect pre-existing rental arrears from tenants for a 50% commission.
2. On February 15, 1896, the Corporation dispossessed Montilla from the estate.
3. Montilla sued for recovery of possession. The Court of First Instance of Binondo ruled in his favor on May 12, 1896, ordering his restitution and payment of damages and rents received by the Corporation. The Audiencia Territorial of Manila affirmed this decision on November 14, 1898.
4. The judgment for damages and rents was never executed. Montilla made extrajudicial demands in 1903 and 1904, but the Corporation failed to pay.
5. On December 15, 1911, Montilla filed a new complaint to enforce the monetary awards from the 1896/1898 judgments, claiming total damages of P24,149.34.
6. The Corporation raised defenses of prescription and a counterclaim for unpaid rent from Montilla.
7. The trial court rendered judgment on September 19, 1912, ordering the Corporation to pay Montilla P9,389 with 6% interest from November 14, 1898.
8. Both parties appealed.
Issues:
1. Prescription: Had Montilla’s right to enforce the 1898 judgment for damages prescribed?
3. Interest: From what date should legal interest on the awarded sum run?
4. Counterclaim/Compensation: Should the Corporation’s counterclaim for unpaid rent be offset against its debt to Montilla?
Ruling:
The Supreme Court modified the trial court’s decision.
1. On Prescription: The action had not prescribed. The Court held that the period for enforcing a judgment is 10 years from the time it becomes final (following Act No. 190 , the Code of Civil Procedure). The 1898 judgment became final in 1899. Montilla’s extrajudicial demands in 1903 and 1904 effectively interrupted the prescriptive period. His filing of the present suit in 1911 was therefore within the 10-year period.
2. On Computation of Damages: The Supreme Court recalculated the award.
It disallowed certain items claimed by Montilla (e.g., value of a house, furniture, costs of litigating with tenants, commission on uncollected arrears) due to lack of sufficient proof or because they were not proper items of damage flowing from the dispossession.
The Court focused on the net rents Montilla would have earned from the estate for the period he was unlawfully deprived of possession (from dispossession until the lease’s natural expiration).
The final computed amount awarded to Montilla was P8,765.
3. On Interest: Legal interest at 6% per annum should run from the date of the trial court’s judgment in this enforcement suit (September 19, 1912), not from the date of the original 1898 judgment. The Court reasoned that until the specific amount of damages was liquidated and declared in a final judgment (as was done in this 1912 case), the debtor could not be considered in delay for purposes of accruing interest on the unliquidated sum.
4. On Counterclaim/Compensation: The Corporation’s claim for offset (compensation) was improper and dismissed. The Court found that Montilla had already paid the rent claimed by the Corporation for the years 1895 and 1896. Furthermore, part of the rents collected by the Corporation during the dispossession and attached by court order in 1898 still remained in its possession, which sum belonged to Montilla.
Disposition:
The Augustinian Corporation was ordered to pay Agustin J. Montilla the sum of P8,765, with legal interest at 6% per annum from September 19, 1912, and the costs of the suit. Montilla retained the right to claim the remainder of the attached 1896 rents held by the Corporation. The Corporation’s counterclaim was dismissed.
Separate Opinions:
Justices Mapa and Johnson concurred.
Justice Carson concurred in the result.
Justices Moreland and Trent dissented.
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