Facts:

• The case involves an appeal by defendants Enrique T. Yu Chengco and The Yek Tong Lin Fire & Marine Insurance Co., Ltd. from an order of the Court of First Instance of Manila.
• The defendants argue that they were not given notice and that the order was void.
• The case revolves around the administration and mortgage of the vessel Y. Sontua.
• The vessel Y. Sontua was mortgaged by its owner, Yu Biao Sontua y Cia., to Enrique T. Yu Chengco for P50,000.
• Yu Biao Sontua y Cia. later mortgaged the vessel again to W. S. Price for the same amount, with the consent of Yu Chengco.
• Price filed a complaint against Yu Biao Sontua y Cia. and others, seeking the attachment of the vessel due to the debtor's failure to comply with the mortgage conditions.
• Price filed a bond of P100,000 to answer for the prosecution of the action, return of the property, and payment of any sums recovered against him.
• Yu Chengco assigned his mortgage rights to Pelagio Yu Singco, who was later substituted as plaintiff in place of Price.
• This assignment was not recorded in the case record.
• Price also assigned his rights as a first mortgage creditor to Yu Singco.
• The trial court entered a judgment in favor of Yu Singco and ordered the payment of certain sums by Yu Biao Sontua y Cia.
• The vessel Y. Sontua was administered by Price and Yu Singco during the case.
• Price filed a motion to be relieved from liability and for the cancellation of his bond, stating that Yu Singco continued to administer the vessel and had purchased all his rights and responsibilities.
• Yu Singco rendered an accounting of his administration, showing a profit.
• The court granted Price's motion and canceled his bond.

Issue:

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Ruling:

The Supreme Court affirmed the order of the trial court, finding ...(Unlock)

Ratio:

1. The failure to serve notice of a motion upon a defendant, whose rights have been transferred to the plaintiff without recording the tra...continue reading