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September 16, 2014

Aznar vs. Yapdiangco

Facts:
  • Theodoro Santos advertised in the newspapers the sale of his Ford Fairlane 500. 
  • After the advertisement, a certain de Dios, claiming to be the nephew of Vicente Marella, went to the residence of Santos and expressed his uncle’s intent to purchase the car. 
  • Since Santos wasn't around, it was Irineo (son of Theodoro) who talked with de Dios. On being informed, Santos advised his son to see Marella, which the son did. 
  • Marella expressed his intention to purchase the car. A deed of sale was prepared and Irineo was instructed by his father not to part with the deed and the car without receiving the purchase price from Marella. 
  • Upon arriving at the house of Vicente Marella, he said that his money was short and  that he had to borrow from his sister. 
  • Marella then instructed de Dios and Irineo to go the supposed house of the sister to obtain the money with an unidentified person. 
  • He also asked Irineo to leave the deed to have his lawyer see it. Relying on the good faith of Marella, Irineo did as requested. 
  • Upon arriving at the house of Marella’s supposed to be sister, de Dios and the unidentified person then disappeared together with the car. Santos reported the incident to the authorities.
  • Thereafter, Marella was able to sell the land to Aznar. While in possession of the car, police authorities confiscated the same from him. 
  • Aznar filed an action for replevin (to recover the car). Claiming ownership of the vehicle, he prayed for its delivery to him. 
  • In the course of the litigation, however, Teodoro Santos moved and was allowed to intervene by the lower court.
  • Lower court ruled in favor of Teodoro Santos saying that he has been unlawfully deprived of his car and he retains ownership of the same.



Issue: Between Teodoro Santos and the plaintiff-appellant, Jose B. Aznar, who has a better right to the possession of the disputed automobile? Teodoro Santos

Held: 

Article 559 is applicable in this case and not Article 1506 which was cited by petitioner Aznar
ART. 1506. Where the seller of goods has a voidable title thereto, but his, title has not been voided at the time of the sale, the buyer acquires a good title to the goods, provided he buys them in good faith, for value, and without notice of the seller's defect of title.

The contention is clearly unmeritorious. Under the aforequoted provision, it is essential that the seller should have a voidable title at least. It is very clearly inapplicable where, as in this case, the seller (Marella) had no title at all.

Marella did not have a title over the car because it was never delivered to him
Vicente Marella sought ownership or acquisition of it by virtue of the contract. Vicente Marella could have acquired ownership or title to the subject matter thereof only by the delivery or tradition of the car to him.

Under Article 712 of the Civil Code, "ownership and other real rights over property are acquired and transmitted by law, by donation, by testate and intestate succession, and in consequence of certain contracts, by tradition." As interpreted by this Court in a host of cases, by this provision, ownership is not transferred by contract merely but by tradition or delivery. Contracts only constitute titles or rights to the transfer or acquisition of ownership, while delivery or tradition is the mode of accomplishing the same.

Delivery vs. Tradition
So long as property is not delivered, the ownership over it is not transferred by contract merely but by delivery. Contracts only constitute titles or rights to the transfer or acquisition of ownership, while delivery or tradition is the method of accomplishing the same, the title and the method of acquiring it being different in our law.

The car in question was never delivered to the vendee by the vendor as to complete or consummate the transfer of ownership by virtue of the contract 
It should be recalled that while there was indeed a contract of sale between Vicente Marella and Teodoro Santos, the former, as vendee, took possession of the subject matter thereof by stealing the same while it was in the custody of the latter's son.

There is no adequate evidence on record as to whether Irineo Santos voluntarily delivered the key to the car to the unidentified person who went with him and L. De Dios to the place on Azcarraga where a sister of Marella allegedly lived. But even if Irineo Santos did, it was not the delivery contemplated by Article 712 of the Civil Code. For then, it would be indisputable that he turned it over to the unidentified companion only so that he may drive Irineo Santos and De Dios to the said place on Azcarraga and not to vest the title to the said vehicle to him as agent of Vicente Marella. Article 712 above contemplates that the act be coupled with the intent of delivering the thing.

Article 559 was applicable in this case (Doctrine of irrevindicability)
The lower court was correct in applying Article 559 of the Civil Code to the case at bar, for under it, the rule is to the effect that if the owner has lost a thing, or if he has been unlawfully deprived of it, he has a right to recover it, not only from the finder, thief or robber, but also from third persons who may have acquired it in good faith from such finder, thief or robber. 

The said article establishes two exceptions to the general rule of irrevindicability, to wit, when the owner (1) has lost the thing, or (2) has been unlawfully deprived thereof. In these cases, the possessor cannot retain the thing as against the owner, who may recover it without paying any indemnity, except when the possessor acquired it in a public sale.

Aznar shall suffer the consequences
The common law principle that where one of two innocent persons must suffer by a fraud perpetrated by another, the law imposes the loss upon the party who, by his misplaced confidence, has enabled the fraud to be committed, cannot be applied in a case which is covered by an express provision of the new Civil Code, specifically Article 559. Between a common law principle and a statutory provision, the latter must prevail in this jurisdiction.

Reference:
G.R. No. L-18536 March 31, 1965 JOSE B. AZNAR, plaintiff-appellant, vs. RAFAEL YAPDIANGCO, defendant-appellee; TEODORO SANTOS, intervenor-appellee.

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