GR 91029; (February, 1991) (Digest)
G.R. No. 91029; February 7, 1991
NORKIS DISTRIBUTORS, INC., petitioner, vs. THE COURT OF APPEALS and ALBERTO NEPALES, respondents.
FACTS
Petitioner Norkis Distributors, Inc., a Yamaha motorcycle distributor, sold a brand new motorcycle to private respondent Alberto Nepales on September 20, 1979. The purchase price was to be paid through a loan from the Development Bank of the Philippines (DBP). A sales invoice was issued, and the motorcycle was registered with the Land Transportation Commission in Nepales’ name on November 6, 1979, to facilitate the DBP loan. The motorcycle, however, remained in Norkis’s possession. On January 22, 1980, the unit was allegedly delivered to a certain Julian Nepales, whom Alberto denied authorizing as his agent. The motorcycle was subsequently involved in an accident on February 3, 1980, driven by a Zacarias Payba, and was rendered a total wreck. DBP released the loan proceeds to Norkis on March 20, 1980, after which Nepales paid the balance and demanded delivery. Norkis refused, contending delivery had already been effected and the risk of loss had passed to Nepales.
ISSUE
Who shall bear the loss of the destroyed motorcycle?
RULING
The Supreme Court ruled that the loss must be borne by the seller, Norkis. The legal logic hinges on the principle of res perit domino—the owner bears the loss of the thing. Ownership of the determinate thing sold is transferred to the buyer only upon actual or constructive delivery. Here, there was no actual delivery, as the motorcycle never came into the buyer’s control. The alleged delivery to Julian Nepales was not proven to be authorized. The acts of issuing a sales invoice and registering the vehicle were not for the purpose of transferring dominion but were mere compliance with DBP’s loan requirements; thus, they did not constitute effective constructive delivery. Since ownership had not yet passed to Nepales at the time of the fortuitous event, the risk of loss remained with the owner-seller, Norkis, pursuant to Article 1496 of the Civil Code. The Court affirmed the appellate decision ordering Norkis to pay the value of the motorcycle or deliver a new unit of the same kind.