FACTS
The plaintiff, Manuel Perez y Gomez, a native inhabitant qualified to hold title to a vessel for coastwise trade, purchased the steamer Alfred for 58,000 pesos from Smith, Bell & Co. The purchase price was paid by a check from the defendant, Antonio Herranz, who was a Spaniard and legally disqualified from holding such title. The title was placed in the plaintiff’s name to circumvent coastwise trading laws. It was later revealed that the defendant retained a 48,000 peso interest, while the plaintiff contributed 10,000 pesos. On March 16, 1903, the plaintiff and defendant entered into an agreement declaring themselves owners in common of the vessel through a “sociedad por cuentas en participacion,” with the defendant having a 48/58 interest and the plaintiff a 10/58 interest. This agreement was made after enabling legislation (Act No. 520) became effective, which allowed foreign-owned vessels to engage in coastwise trade.

ISSUE
Can the plaintiff recover exclusive possession of the steamer Alfred from the defendant, and is he entitled to a share of its earnings?

RULING
The plaintiff cannot recover exclusive possession of the steamer Alfred because the agreement of March 16, 1903, established a valid co-ownership between the parties, making the defendant a part owner. Such an arrangement, post-Act No. 520, was legal. However, the plaintiff is entitled to an accounting and payment of his share (10/58) of the net earnings from March 16, 1904, to the date of the accounting, with interest. The judgment of the lower court is reversed, declaring the plaintiff a 10/58 owner and the defendant a 48/58 owner. The case is remitted for accounting.