G.R. No. L-11108 - Chua Hai vs. Kapu, Jr.

Chua Hai — petitioner; purchaser of one hundred galvanized iron sheets from Roberto Soto and possessor in good faith.
Hon. Ruperto Kapunan, Jr. — respondent; Judge of the Court of First Instance of Manila who issued the order challenged by certiorari.
Ong Shu — respondent; owner of Youngstown Hardware, offended party in the criminal action seeking return of the goods.
Roberto Soto — accused in Criminal Case No. 34250, People v. Roberto Soto, charged with estafa; alleged vendor who purchased goods from Youngstown Hardware and issued a rubber check.
Manila Police Department — custodian of the 700 galvanized iron sheets and other hardware materials at the time of the proceedings.

On January 31, 1956, Roberto Soto purchased from Youngstown Hardware, owned by Ong Shu, seven hundred corrugated galvanized iron sheets and 249 pieces of round iron bar for P6,137.70 and paid with a check for P7,000.00 drawn on the Security Bank and Trust Company.
The check was dishonored for insufficiency of funds when presented for payment.
Roberto Soto thereafter sold one hundred sixty-five sheets in Pangasinan and five hundred thirty-five sheets in Calapan, Mindoro.
On February 1, 1956, Chua Hai purchased one hundred of the sheets sold in Pangasinan from Roberto Soto.
The property (seven hundred galvanized iron sheets) was deposited with the Manila Police Department and a criminal information for estafa was filed against Roberto Soto (Criminal Case No. 34250).
Roberto Soto was at large and an arrest was ordered by the court below on June 13, 1956, for failure to appear for trial.

Counsel for the complainant (Ong Shu) moved for the return of the seven hundred galvanized iron sheets from the Manila Police Department to the offended party.
Chua Hai opposed the motion with respect to the one hundred sheets he purchased, asserting a valid title by purchase from Roberto Soto and claiming the goods were deposited with the police under a contract of deposit.
The Court of First Instance of Manila, Hon. Ruperto Kapunan, Jr., ordered the return of the seven hundred sheets, except five to be retained for evidence, to Ong Shu, subject to the condition that Ong Shu post a bond equal to twice the value of the one hundred sheets in favor of Chua Hai, and without prejudice to Chua Hai to file civil actions concerning ownership.
Chua Hai filed a motion for reconsideration alleging violation of the contract of deposit, deprivation of property without due process, and misapplication of Article 105 of the Revised Penal Code while the criminal case was pending.
The court denied reconsideration. Chua Hai filed the present petition for certiorari in this Court alleging grave abuse of discretion and excess of jurisdiction by the respondent judge in ordering return of the goods.

(Subscriber-Only)

Whether the order by the Court of First Instance to return the seized galvanized iron sheets to Ong Shu while the criminal case against Roberto Soto was pending constituted a deprivation of Chua Hai's property without due process and an abuse of discretion or excess of jurisdiction.

Whether Article 105 of the Revised Penal Code authorizes the return of the thing itself to the offended party before the criminal liability of the accused is finally adjudicated.

Whether a possessor in good faith and for value (such as Chua Hai) is entitled to retain possession of chattels and be treated as owner until a competent court rules otherwise, notwithstanding a criminal action against the transferor.
Whether the posting of an indemnity or redelivery bond by the offended party suffices to justify disturbing the possession of the good-faith purchaser.