G.R. No. L-58469 - Makati Leasing and Fice Corp. vs. Wearever Textile Mills, Inc.

Wearever Textile Mills, Inc. (“private respondent”) obtained financial accommodations from Makati Leasing and Finance Corporation (“petitioner”) by discounting and assigning several receivables under a Receivable Purchase Agreement.
To secure payment, private respondent executed a chattel mortgage over:

Upon private respondent’s default, petitioner filed an extrajudicial foreclosure petition; the Deputy Sheriff could not gain entry to seize the machinery.
Petitioner then filed a judicial foreclosure suit (Civil Case No. 36040) and obtained a writ of seizure. Private respondent secured a temporary restraining order via motions for reconsideration.
On February 11, 1981, the trial court lifted the restraining order and authorized breaking into private respondent’s premises to enforce the writ.

On July 13, 1981, the sheriff removed the main drive motor of the Artos Aero Dryer.
Private respondent filed certiorari and prohibition in the Court of Appeals, which set aside the trial court’s orders, ruled the machinery was real property (Art. 415, NCC), and ordered the return of the motor.
Petitioner returned the motor drive, expressly reserving its right to move for reconsideration and to question the appellate decision’s propriety.
Petitioner then elevated the case to the Supreme Court by petition for certiorari.

Whether the petition is moot and academic due to the return of the seized motor drive.
Whether the subject machinery is real or personal property for purposes of a chattel mortgage, affecting the validity of the security.