Case Digest (G.R. No. 25950)
Facts:
E. A. Wad v. Filma Mercantile Co., Inc., G.R. No. 25950, December 24, 1926, the Supreme Court En Banc, Ostrand, J., writing for the Court. The appellant-plaintiff, doing business as E. Awad & Co., delivered merchandise with an invoice value of P11,140 to Chua Lioc (a merchant trading as Hang Chuan Co.) in early September 1924, to be sold on commission. Claiming ownership, Chua Lioc sold the goods on September 8–9, 1924 to the defendant, Filma Mercantile Co., Inc., for P12,155.60. From that price Filma deducted two debts owed by Chua Lioc — P3,480 to the Philippine Manufacturing Co. and P2,017.98 to Filma itself — leaving a balance of P6,657.52, which Filma agreed to pay Chua Lioc by October 9, 1924.After the goods were delivered and offered for sale by Filma, D. J. Awad (the plaintiff’s local representative) learned of the transaction, secured authorization from Chua Lioc to collect, and on September 15 wrote Filma asserting that the merchandise belonged to E. Awad & Co. Filma replied on September 18 refusing to pay plaintiff directly, stating it had bought the goods “in the ordinary course of business” and that it still owed Chua Lioc P6,657.52 due October 9, 1924.
On September 18 the Philippine Trust Company sued Chua Lioc (Civil Case No. 26934) and obtained a writ of attachment garnishing the balance due Chua Lioc from Filma. On October 7 E. Awad sued Chua Lioc (Civil Case No. 27016) and also obtained a writ of attachment, serving notice of garnishment upon Filma. Thereafter, on November 26, 1924, the plaintiff filed the present action against Filma demanding payment of P11,140.
Filma answered that it had purchased the goods in good faith without knowledge of any defect in Chua Lioc’s title, that it therefore acquired title, and that the balance of P6,657.52 was already attached in the two suits and held subject to court orders. The trial court dismissed the present action without costs, holding that plaintiff was enti...(Subscriber-Only)
Issues:
- Did Filma Mercantile Co., Inc. acquire title to the merchandise purchased from Chua Lioc so as to defeat E. Awad & Co.'s claim?
- Did the appellant prove that Filma had knowledge of Chua Lioc’s lack of title or otherwise purchased in bad faith, thus overcoming the presum...(Subscriber-Only)
Ruling:
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Ratio:
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Doctrine:
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