G.R. No. L-20851. September 03, 1966
JESUS AGUIRRE, PETITIONER, VS. VICTOR S. PHENG, IN HIS CAPACITY AS GENERAL MANAGER OF THE LEONORA & COMPANY, AND NATIONAL SHIPYARDS AND STEEL CORPORATION, RESPONDENTS.
BARRERA, J.:
V. Aldaba sold to Jesus Aguirre a circular bolted steel tank with a
capacity of 5,000 gallons, for the sum of P900.00, for which the latter
delivered to the sellers, duly endorsed, Security Bank & Trust
Company check No. 281912, in the amount of P900.00. Aguirre, however,
failed to take physical possession of the tank, having been prevented
from doing so by the municipal authorities of Los Baños, Laguna (where
the tank was located), in view of the claim of ownership being made by
the Bureau of Public Highways. It appears, however, that Vicente and
Teresa Aldaba again sold the same tank on December 2, 1954 to Zosimo
Gabriel, for P900.00. Gabriel, in turn, sold it to the Leonora &
Company on December 5, 1954, for P2,500.00. After some alterations and
improvements made on the tank, Leonora & Company was able to sell
the tank to National Shipyards & Steel Corporation (Nassco), for
P14,500.00. [1]
Aguirre immediately filed with Nassco a formal notice of his claim
of ownership of the tank, as a consequence of which, payment of the
purchase price to Leonora & Company was suspended. Then, Aguirre
instituted Civil Case No. 24914 in the Court of First Instance of
Manila, against Leonora & Company and the Aldabas, for delivery to
him of the tank, with damages. On the other hand, because of the
suspension of payment of the purchase price, Leonora & Company
filed Civil Case No. 27988, against the Nassco, praying for the
delivery of the purchase price of P14,500.00, or the reimbursement of
the sum of P12,299.00 allegedly representing the actual investment and
expenses made and incurred to put the tank in usable condition. Jesus
Aguirre intervened in this proceeding. These two cases were jointly
heard by the trial court.
Thereafter, decision was rendered in Civil Case No. 24914, the dispositive portion of which reads as follows:
“IN VIEW OF THE FOREGOING, the Court hereby declares
Jesus Aguirre the absolute owner of the property described in his
complaint. The subsequent sale made by defendants Aldaba to Zosimo
Gabriel, the sale made by Zosimo Gabriel to defendant Leonora and Co.;
and the sale made by defendant Leonora and Co. to the National
Shipyards and Steel Corporation, are hereby declared null and void and
of no effect. Defendants Aldaba and Leonora and Co. and the National
Shipyards and Steel Corporation, are hereby ordered to deliver to
plaintiff Jesus Aguirre the tank in question. Failure to make such
delivery, defendant National Shipyards and Steel Corporation, in whose
possession the tank is at present, shall pay to the said Jesus Aguirre
the original purchase price of the tank in the amount of P900.00.”
No appeal having been perfected on time, this decision became final.
In Civil Case No. 27988, the court rendered decision based on a
stipulation of facts by the parties, wherein the existence of Civil
Case No. 24914 was admitted, the dispositive portion of which provides:
“IN VIEW OF THE FOREGOING AGREEMENT, judgment is hereby rendered as follows:
“Intervenor
Jesus Aguirre, as we have already, declared in Civil Case No. 24914, is
hereby adjudged owner of the oil tank in question. Defendant National
Shipyards and Steel Corporation is hereby ordered to deliver to the
said Jesus Aguirre such tank, but in the event that delivery is not
possible, to pay to Aguirre the purchase price of P900.00, and to
Leonora and Co. the amount of P11,299.00 which represents the costs of
the improvements made by the said Leonora & Co.“In the
event that the National Shipyards and Steel Corporation shall deliver
the oil tank to Jesus Aguirre as it is, the latter shall pay to Leonora
and Co. the amount of P11,299.00 which, as already stated, was spent by
Leonora and Co. for the improvement of the tank.”
From this decision, Aguirre perfected an appeal to the Court of Appeals.
The present case.– On January 9, 1963, the Court of Appeals
rendered decision affirming the judgment of the lower court in Civil
Case No. 27988, to return to intervenor Aguirre the sum of P900.00 in
case delivery of the tank to him will not be possible —
“because this was all the amount that Aguirre had
parted with when he purchased said tank. It was Leonora & Co. who
had spent the sum of P11,299.00 for the rehabilitation of said tank and
against this amount Aguirre has no rightful claim whatsoever. Of
course, in the event of delivery of the tank to Aguirre as improved, it
would be just for him to reimburse Leonora & Co. the sum of
P11,299.00. The trial court, therefore, acted properly in denying
Aguirre’s claim to be paid the fair and reasonable value of the tank as
improved in case the same could no longer be delivered to him.”
Aguirre filed the present petition for review, alleging that the
judgment of the Court of Appeals, ordering the return to him of the sum
of P900.00 (when the value of the property is at least P14,500.00),
nullifies the declaration of his ownership of the tank. He contends
that under Article 440 of the Civil Code, his ownership of the property
entitles him to everything that is produced thereby, or is incorporated
or attached thereto, either naturally or artificially. Thus, he
reiterates the claim to the fair and reasonable value of the tank at
the time of its delivery to Nassco, which is P14,500.00.
It is clear that we have here a case of accession by specification:
Leonora and Company, as purchaser acting in good faith, spending
P11,299.00 for the reconditioning of the tank which is later adjudged
to belong to petitioner Aguirre. There is no showing that without the
works made by Leonora & Company, the tank in its original condition
when Aguirre paid P900.00 therefor, would command the price of P14,500
which Nassco was willing to pay. Although ordinarily, therefore,
Aguirre, as owner of the tank, would be entitled to any accession
thereto, the rule is different where the works or improvements or the
accession was made on the property by one who acted in good faith. [2]
And it is not contended that the making of the improvements and
incurring of expenses amounting to P11,299.00 by Leonora & Company
was done in bad faith. Furthermore, to uphold petitioner’s contention
that he is entitled to the sum of P14,500.00, the price of the tank in
its present condition, would be to allow him to enrich himself at the
expense of another. The lower courts, therefore, acted correctly in
ordering the reimbursement to Leonora & Company of the expenses it
made on the tank.
It must also be remembered that the judgment in Civil Case No. 24914
of the Court of First Instance of Manila, wherein Nassco was directed
to pay to Aguirre the sum of P900.00, in case delivery of the same tank
is no longer possible, has already become final. This ruling cannot be
disregarded in the present proceeding which involves the same parties
and practically the same issue, arising from the same set of facts.
Nassco cannot also be compelled to pay more than P14,500.00 for the
tank, the bid offered by Leonora & Company and accepted by this
buyer, and which must be the actual market value of the property at the
time of its delivery to the latter. It has nothing to do at all with
the various transactions or sales and the deprivation of Aguirre’s
right to possession of the tank, which culminated in this legal suit.
WHEREFORE, finding no error in the decision of the Court of
Appeals under review, the present petition is hereby dismissed, with
costs against the petitioner.
SO ORDERED.
Concepcion, C.J., Reyes, Dizon, Makalintal, Bengzon, Zaldivar, Sanchez, and Castro, JJ., concur.
Regala, J., on leave, no part.3
[1] The sale made to Nassco was the result of a public bidding won by Leonora & Company.
[2] “ART. 466. Whenever
two movable things belonging to different owners are, without bad
faith, united in such a way that they form a single object, the owner
of the principal thing acquires the accessory, indemnifying the former
owner thereof for its value.” (new Civil Code), which provision is
applicable to all modes of accession.