Title
BA Fice Corp. vs. Court of Appeals
Case
G.R. No. 84294
Decision Date
Oct 16, 1989
Yanky Hardware defaulted on a loan secured by a chattel mortgage. BA Finance sought replevin; auction disputes arose over undelivered chattels. SC ruled the 1986 order interlocutory, allowing BA Finance’s appeal.
Font Size:

Case Digest (G.R. No. 84294)

Facts:

Background and Credit Accommodation
On 15 June 1986, Yanky Hardware Company, Inc. ("Yanky") obtained a credit accommodation from BA Finance Corporation ("BA Finance") in the form of a discounting line. This allowed Yanky to discount and assign its trade receivables to BA Finance. To secure the loans, Yanky executed a chattel mortgage over its stock-in-trade and merchandise inventory. Antonio Ngui Yek Siem, Yanky's President and General Manager, also executed a continuing suretyship agreement to guarantee the loans.

Default and Replevin Action
By 20 October 1981, Yanky had accumulated obligations amounting to P559,565.00. BA Finance demanded payment or the delivery of the mortgaged chattels for extrajudicial foreclosure. When Yanky failed to comply, BA Finance filed a complaint for replevin with damages or, alternatively, payment of the loan amount plus interest. The Court of First Instance ("CFI") ordered the seizure of the mortgaged chattels on 26 October 1981.

Intervention and Auction Sale
Yanky and Antonio Ngui Yek Siem contested the action, arguing that not all obligations were due. Simultaneously, Yanky faced financial difficulties, leading to intervention by creditor banks (RCBC, China Bank, and InterBank). On 27 February 1984, during a pre-trial conference, the CFI ordered the public auction of the replevied chattels to prevent further depreciation. The auction was held on 31 April 1984, with Wilson Siy as the highest bidder at P60,000.00.

Dispute Over Auction Sale
BA Finance sought to cancel the auction, claiming it was denied the opportunity to bid properly. The trial court initially canceled the sale but later reconsidered after Siy posted a bond. Siy then sought the delivery of certain chattels allegedly sold but not delivered. BA Finance contested this, arguing that the undelivered chattels were not part of the inventory list provided to it before the auction.

Court Orders and Appeals
The trial court appointed commissioners to investigate the undelivered chattels. The second commissioner’s report, approved by the court, found that not all properties were delivered to Siy. BA Finance was ordered to deliver the chattels or their value. BA Finance filed a notice of appeal on 20 February 1986, but the trial court denied it as untimely. The Court of Appeals upheld the trial court’s decision, prompting BA Finance to seek review from the Supreme Court.

Issue:

  • (Unlock)

Ruling:

  • (Unlock)

Ratio:

  1. A final judgment is one that conclusively determines the rights of the parties, whereas an interlocutory order does not dispose of the case entirely. The 22 January 1986 order did not resolve the replevin case but only addressed the dispute over undelivered chattels, making it interlocutory.
  2. Under the Interim Rules and Guidelines, the thirty (30)-day reglementary period applies to cases where multiple appeals are allowed. Since the order did not fully dispose of the replevin case, it fell within this category.
  3. Equitable considerations also supported the ruling, as the order required BA Finance to deliver chattels valued at P2.3 million for a P60,000.00 bid, potentially resulting in a miscarriage of justice.


Jur is an AI-powered legal research platform in the Philippines for case digests, summaries, and jurisprudence. AI-generated content may contain inaccuracies; please verify independently.