Facts:

On June 11, 1930, Esteban Icarangal, together with Jacinto Figueroa, executed a promissory note in favor of Bachrach Motor Co., Inc., in the amount of ₱1,614. To secure the payment of this debt, Icarangal established a real estate mortgage on a parcel of land located in Pangil, Laguna, which was officially registered in the registry of deeds on August 5, 1931. However, Icarangal and Figueroa defaulted on the payment of the agreed monthly installments. Consequently, Bachrach Motor Co., Inc. initiated a collection action against them in the Court of First Instance of Manila. The court ruled in favor of Bachrach Motor Co., Inc. and issued a writ of execution, allowing the provincial sheriff of Laguna to levy on the properties of Icarangal, which included the mortgaged property.

In a twist, Oriental Commercial Co., Inc., the second defendant in the case, raised a third-party claim. It asserted that the property had already been acquired by it through a public auction on May 12, 193

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Facts:

Execution of the Promissory Note and Mortgage

• On June 11, 1930, defendant Esteban Icarangal, together with Jacinto Figueroa, executed a promissory note for one thousand six hundred fourteen pesos (P 1,614) in favor of plaintiff Bachrach Motor Co., Inc.
• To secure the payment of the note, Esteban Icarangal also executed a real estate mortgage on a parcel of land located in Pangil, Laguna.
• The mortgage was duly registered on August 5, 1931, in the Registry of Deeds of the Province of Laguna.

Default and Initiation of Collection Proceedings

• The promissory note’s monthly installments were not paid by the promissors, leading plaintiff to initiate an action for collection against the defendant in the Court of First Instance of Manila.
• A judgment was rendered in favor of the plaintiff, establishing his right to recover the unpaid amount as indicated in the note.

Execution Proceedings and Third-Party Claim

• A writ of execution was issued based on the judgment, and the provincial sheriff of Laguna, acting on the plaintiff’s indication, levied on the properties of the defendants, including the mortgaged property.
• Oriental Commercial Co., Inc., the other defendant-appellee, interposed a third-party claim asserting that by virtue of a writ of execution from a separate civil case (No. 88253) in the municipal court of Manila, it had already acquired the mortgaged property at a public auction held on May 12, 1933.
• Due to this third-party claim, the sheriff refrained from selling the property, leaving the judgment unsatisfied.

Foreclosure Suit and Appeal

• Subsequent to the unsatisfied judgment, the plaintiff filed a foreclosure action to enforce the mortgage.
• The trial court dismissed the foreclosure complaint.
• Dissatisfied with the dismissal, the plaintiff appealed the decision, raising the central legal issue regarding the proper remedy available when a creditor has previously obtained a personal judgment on the note secured by the mortgage.

Issue:

Whether the plaintiff, by electing to file a personal action for the recovery of the debt represented by the promissory note, has thereby waived his right to foreclose on the real estate mortgage.

• Does the election of one remedy (personal action) preclude the simultaneous or successive pursuit of another remedy (foreclosure) on the same underlying obligation?
• Is the doctrine of splitting a single cause of action applicable in this context?

Whether the debt and the mortgage, though based on separate agreements, should be considered as constituting a single, indivisible cause of action for non-payment of the indebtedness.

• Can the creditor pursue both the personal remedy for the debt and the real remedy for the mortgage concurrently or successively?
• What are the procedural and doctrinal implications of permitting or disallowing dual remedies in such circumstances?

• The relevance and application of established cases and statutory provisions, including prior decisions (e.g., Hijos de I. de la Rama vs. Sajo and Matienzo vs. San Jose) as well as section 708 of the Code of Civil Procedure and similar provisions under the Insolvency Law, in framing the proper course of remedy.

Ruling:

• (Subscriber-Only)

Ratio:

• (Subscriber-Only)

Doctrine:

• (Subscriber-Only)