Case Digest (G.R. No. 223637)
Facts:
Asia Banking Corporation v. Fred J. Elser, G.R. No. 30266, March 25, 1929, the Supreme Court En Banc, Villa‑Real, J., writing for the Court.The plaintiff‑appellee Asia Banking Corporation obtained a money judgment against Yangco, Rosenstock & Co., Inc. on September 20, 1923, and, on execution, caused the sheriff to levy upon the corporation’s assets, including a credit said to represent an unpaid subscription of 589 shares (par P100 each) originally subscribed by Luis R. Yangco and thereafter alleged to have been assumed by Henry W. Elser; by agreement the attached property was sold in a lump at public auction and knocked down to Asia Banking for P50,000 on October 30, 1923.
The unpaid subscription debt arose from a written contract dated February 25, 1922 (Exhibit B), by which Luis R. Yangco sold 935 shares to Henry W. Elser for P45,000 and Elser undertook, among other obligations, to assume Yangco’s liability of P58,900 for the unpaid subscription on 589 shares. The corporation’s directors, aware of the arrangement, elected Elser president and director in place of Yangco on March 1, 1922. Elser later became mentally deranged; C. W. Rosenstock acted as guardian and paid certain installments on Elser’s account, filed and had approved guardians’ accounts and inventories that listed the unpaid subscription as both an asset and a liability of Elser.
Elser died June 18, 1923; Rosenstock was appointed special administrator and later executor of his estate. After Asia Banking’s execution sale of Yangco, Rosenstock & Co.’s assets, Asia Banking presented to the estate’s committee of claims a claim for P58,900 as assignee of the corporation’s credit against Elser. The decedent’s widow (mother of appellant Fred J. Elser) opposed allowance on the sole ground that Elser was incompetent when he purportedly acquired the stocks. The committee allowed the claim; the claim was litigated in the Court of First Instance of Manila which rendered judgment in favor of Asia Banking for the s...(Subscriber-Only)
Issues:
- Was the substitution of Henry W. Elser for Luis R. Yangco as debtor for the P58,900 unpaid stock subscription valid under the rule on novation (i.e., did the creditor’s consent exist)?
- Could the judgment creditor (Asia Banking Corporation) acquire the credit against Elser by sheriff’s sale of Yangco, Rosenstock & Co., Inc.’s assets and validly present that claim to the committee of claims, notwithstanding that Elser’s property was in custodia legis and procedural notice requirements for levy?
- Did the acquiescence of Yangco, Rosenstock & Co., Inc., in selling its attached proper...(Subscriber-Only)
Ruling:
- (Subscriber-Only)
Ratio:
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Doctrine:
- (Subscriber-Only)