G.R. No. 14747. January 28, 1961
LEONARDO C. PADILLA, PETITIONER, VS. RIZAL SURETY & INSURANCE CO., RESPONDENT.
LABRADOR, J.:
by a petition for certiorari to review the decision of the Court of
Appeals in CA-G. R. No. 20018-R, entitled “Rizal Surety and Insurance
Company, plaintiff-appellant vs. Evaristo Zulueta and Leonardo
C. Padilla, defendants, Leonardo C. Padilla, defendant-appellant,”
claiming that said decision is erroneous insofar as it dismissed his
appeal on the judgment for P1,500, and is an abuse of discretion
insofar as it orders the return of the case to the Court of First
Instance for a trial of the claim for damages collectible against his
redelivery bond.
The facts before the Court of Appeals are
as follows: On March 19, 1948, the Rizal Surety and Insurance Company
executed a promissory note as indorser-guarantor-joint maker for and
with Zulueta in favor of the Philippine National Bank for P4,000, with
interest at 6% per annum, in consideration of the obligation assumed by
it as guarantor of a loan of P4,000 granted to Zulueta by the
Philippine National Bank. Zulueta in turn signed an indemnity agreement
whereby he bound himself to indemnify the plaintiff against any and all
damages, losses, penalties, charges and expenses which plaintiff may
sustain or incur by virtue of the execution of the promissory note.
Zulueta also executed a chattel mortgage covering the Oldsmobile car
that he had purchased with the P4,000 borrowed from the Philippine
National Bank. This chattel mortgage was registered on June 1, 1948 in
the Office of the Register of Deeds of Manila. This chattel mortgage
was not reported to the Motor Vehicle Office until April 25, 1952.
On June 16, 1948, Zulueta sold the car to Filemon M. Salcedo and the
corresponding certificate of registration was issued in favor of the
latter. On February 1, 1949, Salcedo in turn sold the car to defendant
Leonardo C. Padilla and certificate of registration under the Motor
Vehicle Law was issued in favor of Leonardo C. Padilla.
The
action was presented by the Rizal Surety & Insurance Company on May
24, 1952 in the Court of First Instance of Manila. In its first cause
of action plaintiff prays that defendant Evaristo Zulueta be ordered to
pay plaintiff the amount of the promissory note that it had executed
jointly with Zulueta in favor of the Philippine National Bank. In the
second cause of action the execution of the chattel mortgage over the
Oldsmobile car is alleged, and it is prayed that during the pendency of
the action the sheriff take the car into custody and thereafter dispose
of it in accordance with Section 14 of the Chattel Mortgage Law,
applying the proceeds of the sale to the satisfaction of the judgment.
The surety bond in favor of the plaintiff and the chattel mortgage are
attached to the complaint. Defendant’s answer contains denials for lack
of knowledge and information sufficient to form a belief as to the
truth of material averments made in the complaint, and, the defense
that notice of the chattel mortgage covering the Oldsmobile car was not
given to the Motor Vehicles Office until April 25, 1952.
On
May 24, 1952, the Court of First Instance issued an order to the
sheriff to take delivery of the Oldsmobile car, then detained by
Evaristo Zulueta, and on May 29, 1952, Leonardo C. Padilla filed a
third-party claim thereto. On June 9, 1952, Zulueta presented a motion
to suspend the delivery of the automobile to the plaintiff; on June 19,
1952, he presented the redelivery bond under Section 5 of Rule 62 and
asked that the order to the sheriff to take the Oldsmobile into custody
be suspended, and that Padilla be allowed to retain the same. This bond
was signed jointly by Leonardo C. Padilla and the Manila Surety &
Insurance Company. By virtue of this bond the court set aside the order
for the sheriff to take the automobile into custody and allowed the
defendant Padilla to retain possession thereof.
Trial having
been held, the judge of the Court of First Instance rendered judgment
on September 13, 1956, (1) sentencing Evaristo Zulueta to pay plaintiff
P4,018.45 with interest at 10% per annum, etc., (2) ordering defendant
Leonardo C. Padilla to deliver to the plaintiff the Oldsmobile car in
10 days from the receipt of the decision; in case Padilla fails to
deliver the car he shall pay to the plaintiff the sum of P1,500.00 with
legal interest from May 24, 1952, the date of the filing of the
complaint; (3) reserving to the plaintiff the right to proceed against
Leonardo C. Padilla and the latter’s surety, the Manila Surety &
Fidelity Company, Inc., on the counterbond; and (4) reserving the right
of Leonardo C. Padilla to proceed against the estate of Filemon M.
Salcedo.
Defendant-appellant and plaintiff-appellee received
copies of the decision on September 14, 1956. On October 22, 1956,
plaintiff presented a motion for leave to prove the damages on the
counterbond as reserved to him in the decision of the trial court.
(Record on Appeal, pp. 145-152). On November 24, 1956, the court issued
an order sentencing Leonardo C. Padilla and the Manila Surety &
Fidelity Co., Inc. (1) to pay plaintiff P1,500.00 with interest at the
legal rate from May 24, 1952, and (2) to pay jointly and severally to
plaintiff actual damages in the minimum sum of P3,000.00 (Record on
Appeal, pp. 166-167). The defendant Leonardo C. Padilla presented an
objection to the claim for damages alleging, among others, that the
motion for leave to file claim has the effect of amending the decision
which has become final. The Court of Appeals found that there was no
hearing on this motion and neither do we find any record of such
hearing to support the damages of P3,000.00 awarded in the order of
November 24, 1956.
Against the order, a motion for
reconsideration was filed by Leonardo C. Padilla on December 15, 1956.
This was denied on the same day. On January 25, 1957, defendant
Leonardo C. Padilla filed a notice “that he appeals to the Court of
Appeals from the decision of this Honorable Court in the above entitled
case promulgated on September 13, 1956 and modified by its order of
November 24, 1956, for the said modified decision is not supported by
the evidence on record and is contrary to law and jurisprudence”
(Record on Appeal, p. 193).
In the Court of Appeals, the following errors were assigned:
I
The lower court erred in holding that it is not necessary to report to
the Motor Vehicles Office a chattel mortgage of a motor vehicle in
order to bind a third person.
II
The lower court erred in holding that the registration of a chattel
mortgage of a motor vehicle in the chattel mortgage registry of the
office of the register of deeds is sufficient to make said chattel
mortgage effective against a third person.III
The lower court erred in not holding that appellant Leonardo C. Padilla
is the absolute and sole owner of the Oldsmobile car in question which
he acquired by purchase for value and in good faith from the owner
thereof, Filemon M. Salcedo.IV
The lower court erred in sentencing appellant Leonardo C. Padilla and
his surety, The Manila Surety & Fidelity Co., Inc., to pay jointly
and severally to plaintiff-appellee the value for the Oldsmobile car in
question in the amount of P1,500.00 with legal rate of interest of 6%
from the filing of the complaint, May 24, 1952.V
The lower court erred in sentencing appellant Leonardo C. Padilla and
his surety, the Manila Surety & Fidelity Co., Inc., to pay jointly
and severally the plaintiff-appellee the sum of P3,000.00 as actual
damages with absolutely no evidence proving that appellee suffered
actual damages.VI
The lower court erred in dismissing the counterclaim of appellant
against the appellee in the amount of P3,000.00 as expenses of
litigation and attorney’s fees.”
The Court of Appeals held that the four assignments of error, relating
to the exemption of a buyer in good faith of an automobile which is
mortgaged when the mortgage has not been registered with the Motor
Vehicles Office, cannot be considered because the decision of the Court
of First Instance of September 13, 1956 had become final and
unappealable as to the appellant Leonardo C. Padilla. It held that as
he received the copy of the decision on September 14, 1956, it became
final as to him on October 14, 1956. The Court of Appeals further held
that the claim for damages filed on October 22, 1956 is not a motion
for reconsideration which may be considered as modifying the decision.
However, it found that there was no trial or hearing on the claim for
damages due on the redelivery bond and, therefore, it set aside the
order of the court granting the said damages, remanding the case to the
court below for the determination of the said damages.
The first four assignments of error were not considered by the Court of
Appeals on the ground that Leonardo C. Padilla did not appeal against
the decision dated September 13, 1956 (copy of which was received by
him the following day) within the thirty-day period provided in the
rules. From the time that Padilla received copy of the decision, no
action was taken by him either in the form of a motion for
reconsideration or otherwise, to indicate his desire to appeal from the
same until January 25, 1957. On this date the period for filing a
notice of appeal against the decision had long expired and the decision
had become final and executory against him. On this appeal his counsel
argues that the order of the court of November 24, 1956 fixing the
damages due on the redelivery bond at P3,000.00 operated to amend the
decision in the main case in such a way that the decision in the main
case could still be appealed from within the period of 30 days from the
date of said order of November 24, 1956.
We
do not agree to the above contention. The decision of September 13,
1956, contains two parts with respect to defendant-appellant Padilla:
the first ordering him to return the Oldsmobile car, or upon failure to
make such delivery, to pay plaintiff its value of P1,500.00, with legal
interest; and the second, reserving to the plaintiff the right to
proceed against Padilla and his surety, the Manila Surety &
Fidelity Co., Inc., on their counterbond, under Section 10, Rule 62 of
the Rules of Court (Record on Appeal, pp. 144-145). No motion for
reconsideration of the judgment for the return of the automobile was
presented by, Padilla and no notice of appeal from this part of the
judgment was made by him until January 25, 1957. The order of the court
dated November 24, 1956, fixed the damages recoverable on the
redelivery bond and was issued in pursuance of the second part of the
original judgment. The award of damages does not modify or change that
part of the decision ordering Padilla to return the automobile or pay
its value. This award of damages can not be considered as a
modification of the original decision, ordering the return of the
automobile or the payment of its value.
It
is true that in the said order of November 24, 1956, the court ordered
him to pay P1,500.00, jointly and severally with the Manila Surety
& Fidelity Co., Inc. But this order, the validity of which shall
not now be discussed has nothing to do with the first part of the
judgment against Padilla alone ordering the return of the automobile or
the payment of its value of P1,500.00. This order, making Padilla and
his surety jointly and severally responsible was rendered by virtue of
the motion for damages on the redelivery bond, and the same was entered
in compliance with the reservation made in the original decision. It
has nothing to do with the order for Padilla to return the automobile
or pay P1,500.00. The order to return the automobile was contained in
the original decision, said order to return is against Padilla alone,
but the order contained in the order of November 24, 1956 is against
Padilla and his surety, jointly and severally, to pay P1,500.00. This
is the award made by virtue of the reservation contained in the
original decision. This can be seen from the wording of the order of
November 24, 1956, which says:
“Upon
consideration of plaintiff’s motion for leave to file claim for
damages, plaintiff’s claim for damages on bond of defendants Leonardo
C. Padilla and Manila Surety & Fidelity Co., Inc., the opposition
thereto of Leonardo C. Padilla and plaintiff’s reply to said
opposition, the court holds that the claim for damages on the bond of
Leonardo C. Padilla and Manila Surety & Fidelity Co., Inc., is
meritorious.In fact whereof, order is hereby issued.
(1) Sentencing defendant Leonardo C. Padilla and Manila Surety &
Fidelity Co., Inc., to pay jointly and severally to plaintiff the sum
of P1,500.00 with interest thereon at the legal rate of 6% from May 24,
1952, the date of the filing of the complaint, until the sum be fully
paid; and(2) Sentencing defendant
Leonardo C. Padilla and the Manila Surety & Fidelity Co., Inc., to
pay jointly and severally to plaintiff actual damages in the minimum
sum of P3,000.00.”
Resuming
what We have stated hereinbefore, We hold that the order of November
24, 1956, is not a modification of the original decision insofar as it
orders Padilla to return the automobile or pay its value of P1,500.00,
so that this latter part of the decision was already final and
executory as against Padilla when he presented his notice of appeal
dated January 25, 1957. We, therefore, affirm the holding of the Court
of Appeals that Padilla can not question the first part of the
decision, because he has not appealed therefrom in due time. For this
reason also, the first three assignments of error contained in the
brief of appellant Padilla may not be considered in this appeal.
The fourth, fifth and sixth assignments of errors contained in the brief of appellant Padilla are as follows:
“Fourth Assignment of Error
That the Court of Appeals erred in holding that a decision in a
replevin suit can be appealed independently from the order granting or
denying a motion to claim for damages arising from the replevin suit.Fifth Assignment of Error
That the Court of Appeals erred in holding that the decision of the
trial court dated September 13, 1956, was not modified by the order of
the same court dated November 24, 1956.Sixth Assignment of Error
That the Court of Appeals erred in holding that petitioner agreed to
deliver the Oldmobile car in question to the respondent and that
petitioner admitted that the decision of September 13, 1956 was already
final.”
It will be noted
that the above quoted errors assigned are against the order of the
Court of First Instance of November 24, 1956. The Court of Appeals set
aside this order of the lower court and ordered the petition for
damages on the redelivery bond remanded to the trial court for the
submission of evidence, as the record does not show that any evidence
was submitted in support of or against the claim of P3,000.00 damages,
or against the part of the order for the payment by Padilla and his
bondsmen of the sum of P1,500.00. We do not fully agree with the
decision of the Court of Appeals in this respect because it does not
appear that plaintiff ever made an offer of any evidence to support the
claim for actual damages. However, We refuse to interfere with the
discretion of the Court of Appeals in ordering that the case be
remanded for the submission of evidence by both parties.
In view of our ruling on the first six errors, it becomes unnecessary to consider the last two.
Wherefore, the petition for certiorari is hereby denied, and the
decision of the Court of Appeals affirmed, with costs against the
petitioner.
Paras, C. J., Bengzon, Bautista Angelo, Concepcion, Reyes, J. B. L., Barrera, Paredes and Dizon, JJ., concur.