FIRST DIVISION
G.R. No. 239644, February 03, 2021
SPOUSES MARIO AND JULIA GASPAR, Petitioners, v. HERMINIO ANGEL E. DISINI, JR., JOSEPH YU, DOING BUSINESS UNDER THE NAME AND STYLE LEGACY LENDING INVESTOR AND DIANA SALITA, Respondents.
D E C I S I O N
CAGUIOA, J.:[**]
The property subject of [the] litigation is a year 2000 model, white Mitsubishi Pajero with plate number WVC-555. The subject vehicle, registered in the name of a certain Artemio Marquez (Marquez), was mortgaged by the latter as security for a loan obtained from Legacy Lending Investor (Legacy). Legacy is owned by x x x Joseph Yu (Yu). Marquez failed to pay his loan, leading Legacy to seize the Pajero. To facilitate the disposal of the Pajero, Marquez executed and signed a Deed of Sale in blank[,] that is, without the name and details of the buyer.After trial, the RTC rendered a Decision directing: (i) Spouses Gaspar to refund the amount of P760,000.00 with legal interest in favor of Disini, and pay the latter attorney's fees in the amount of P50,000.00; (ii) Yu to reimburse Spouses Gaspar the amount of P850,000.00 with legal interest, and to pay the latter attorney's fees also in the amount of P50,000.00.6
[Spouses Gaspar] who are engaged in the business of buying and selling second-hand vehicles, purchased the subject Pajero from Legacy for the price of [P1,000,000.00], as shown by a manager's check for said amount, and a receipt therefor signed by x x x Diana Salita [(Salita), Yu's employee], dated [July 12, 2002.]
xxx Rocky Gaspar (Rocky), son of the Spouses Gaspar, offered the Pajero for sale to [Disini], who agreed to buy it for the total purchase price of [P]1,160,000.00. On [July 22, 2002], Disini gave a downpayment of [P50,000.00] duly received by Rocky. On [July 23, 2002], Disini filled in his details and signed the Deed of Sale previously executed by [Marquez]. On [July 30, 2002], Disini paid the balance of [P]1,110,000.00, after the Spouses Gaspar obtained a Motor Vehicle Clearance Certificate, dated [July 26, 2002], and registered the subject Pajero in the name of Disini on [August 6, 2002.]
About a year later, on [June 30, 2003], the police apprehended the subject Pajero while it was illegally parked in Makati. Further police investigation revealed that the vehicle had been stolen from the Office of the President. It appears that the chassis number had been overlaid with another number through welding in order to avoid identification.
Disini immediately informed the Spouses Gaspar about the confiscation of the subject Pajero, and the latter promised to return the full purchase price that he had paid to them. In turn, the Spouses Gaspar sought reimbursement from [Yu] and Legacy, and the latter gave back [P150,000.00]. The Spouses Gaspar turned over the [P150,000.00] to Disini on [July 22, 2003.] On [August 5, 2003], the Spouses Gaspai paid further [P200,000.00] to Disini, and finally [P50,000.00] on [December 3, 2003] for a total reimbursement of [P400,000,00] and leaving an unpaid balance of [P760,000.00.]
Apart from the [P150,000.00] initially returned by [Yu] to the Spouses Gaspar, [Yu] failed to reimburse the balance of the purchase price paid by the Spouses Gaspar for the subject Pajero in the amount of [P850,000.00.]
When written demand failed, Disini filed [a complaint for sum of money with prayer for preliminary attachment (Complaint)] against Rocky and the Spouses Gaspar to collect the unpaid reimbursement of what he paid for the subject Pajero.
In turn, the [Spouses Gaspar] filed a third-party complaint against [Yu] and his employee [Salita] for the unpaid reimbursement of P850.000.00.5 (Emphasis supplied; emphasis in the original omitted; italics in the original)
WHEREFORE, the x x x Decision dated [April 13, 2016] of the [RTC], Branch 18, Manila, in Civil Case No. 06-115408, for Sum of Money with Prayer for Preliminary Attachment, (1) ordering original defendants [Spouses] Gaspar to refund the amount of [P760,000.00] with legal interest to plaintiff Disini, as well as pay [P50,000.00] as attorney's fees; and (2) ordering third-party defendant [Yu] to reimburse defendants [Spouses] Gaspar the amount of [P850,000.00] with legal interest, and to pay [P50,000.00] as attorney's fees is AFFIRMED with MODIFICATION in that the award of attorney's fees to Disini is DELETED. Further, the third-party complaint against [Yu] and [Salita] is DISMISSED for having been filed out of time. All orders not inconsistent with the foregoing are affirmed.Foremost, the CA noted that during the course of trial, it was established that Spouses Gaspar promised to return Disini's money in case the title of the subject Pajero is found to be defective. Spouses Gaspar followed through with this promise when they partially returned Disini's payment. However, Spouses Gaspar failed to return the purchase price in full due to lack of funds.11 The CA found that these circumstances show that Spouses Gaspar did not act in bad faith.12
SO ORDERED.10 (Additional emphasis supplied; italics in the original)
- Whether the CA erred in dismissing the third-party complaint filed by Spouses Gaspar against Yu and Salita; and
- Whether the CA erred in holding that Yu and Salita are not liable to pay Spouses Gaspar attorney's fees.
SEC. 11. Third, (fourth, etc.)-party complaint. — A third (fourth, etc.)-party complaint is a claim that a defending party may, with leave of court, file against a person not a party to the action, called the third (fourth, etc.)-party defendant, for contribution, indemnity, subrogation or any other relief, in respect of his opponent's claim.In Firestone Tire and Rubber Company of the Philippines v. Tempongko,33 the Court expounded on the nature of a third-party complaint:chanroblesvirtualawlibrary
The third-party complaint, is therefore, a procedural device whereby a "third party" who is neither a party nor privy to the act or deed complained of by the plaintiff, may be brought into the case with leave of court, by the defendant, who acts as third-party plaintiff to enforce against such third-party defendant a right for contribution, indemnity, subrogation or any other relief, in respect of the plaintiffs claim. The third-party complaint is actually independent of and separate and distinct from the plaintiffs complaint. Were it not for this provision of the Rules of Court, it would have to be filed independently and separately from the original complaint by the defendant against the third-party. But the Rules permit defendant to bring in a third-party defendant or so to speak, to litigate his separate cause of action in respect of plaintiffs claim against a third party in the original and principal case with the object of avoiding circuitry of action and unnecessary proliferation of lawsuits and of disposing expeditiously in one litigation the entire subject matter arising from one particular set of facts, xxx When leave to file the third-party complaint is properly granted, the Court renders in effect two judgments in the same case, one on the plaintiffs complaint and the other on the third-party complaint. When he finds favorably on both complaints, as in this case, he renders judgment on the principal complaint in favor of plaintiff against defendant and renders another judgment on the third-party complaint in favor of defendant as third-party plaintiff, ordering the third-party defendant to reimburse the defendant whatever amount said defendant is ordered to pay plaintiff in the case xxx.34 (Emphasis supplied)Here, Spouses Gaspar filed the third-party complaint to ultimately pass on the liability arising from Disini's claim to Yu and Salita by seeking reimbursement from the latter. Specifically, Spouses Gaspar insist that Yu and Salita should be ordered to reimburse P850,G00.00 with legal interest, representing the balance of the price they paid to the latter for the subject Pajero, as well as attorney's fees.
Received from Mrs. Julia Gaspar the amount of ([P] 1,000,000.00) One Million Pesos only[;] [Check No.] 000006319. [Manager's Check] BP1 Family Bank x x x, as full payment for 2000 [Mitsubishi] Pajero [with] Motor no. MAA0821, Serial No. PAEV46WGNXB000326, Plate No. WVC-555.38chanRoblesvirtualLawlibraryWhile this COS is more akin to a receipt and leaves much to be desired, it ostensibly reflects all the elements of a perfected contract of sale, which are: (i) the consent of the contracting parties; (ii) object certain which is the subject matter of the contract (that is, the subject Pajero); and (iii) the cause of the obligation which is established, (that is, the payment of the specified price of P1,000,000.00).39
ART. 1409. The following contracts are inexistent and void from the beginning:By filing a third-party complaint against Yu for the purpose of seeking reimbursement of the purchase price they had paid for the subject Pajero, Spouses Gaspar effectively sought to declare the COS null and void ab initio and recover what they had given on account of said void COS. The third-party complaint thus assumes the nature of an action to declare the inexistence of a contract which does not prescribe.44
(1) Those whose cause, object or purpose is contrary to law, morals, good customs, public order or public policy;
x x x
These contracts cannot be ratified. Neither can the right to set up the defense of illegality be waived.
3. It bears emphasis that the seller is responsible for warranty against the hidden defects which the thing sold may have. A hidden defect is one which is unknown or could not have been known to the vendee. Verily, the vendee cannot be made answerable for obvious defects or those which may be visible, or for those which are not visible if the vendee is an expert who, by reason of his trade or profession, should have known them.Clearly, Salita transacted with Spouses Gaspar solely upon the direction and on behalf of Yu, her employer. Accordingly, Salita must be absolved from liability in this case.
4. From the above discussion, it is clear that Respondent Joseph Yu ("Respondent Yu"), who facilitated the sale of the subject vehicle can be held responsible only for hidden defects. Verily, Respondent Yu cannot be made answerable for obvious defects or those which may be visible, or for those which are not visible if the vendee, such as Petitioner Spouses Mario and Julia Gaspar ("Petitioners"), x x x who, by reason of their trade or profession, should have known them.
x x x
13. x x x An immediate review of the pleadings filed by the Petitioners reveals that their cause of action is anchored on the implied warranty found in their contract of sale with [Respondent Yu).
x x x
53. Respondent Yu is a seller in good faith. It must be remembered that good faith is always presumed and upon him who alleges bad faith rests the burden of proof.48 (Emphasis supplied)
Article 2208 of the Civil Code specifies the instances when attorney's fees may be awarded, thus:To recall, Spouses Gaspar reimbursed Disini the total amount of P400,000.00 upon the latter's demand. This amount consisted of the P150,000.00 which Yu reimbursed to Spouses Gaspar, and P250,000.00 from the latter's own funds.49
ART. 2208. In the absence of stipulation, attorney's fees and expenses of litigation, other than judicial costs, cannot be recovered, except:
(1) When exemplary damages are awarded;
(2) When the defendant's act or omission has compelled the plaintiff to litigate with third persons or to incur expenses to protect his interest;
(3) In criminal cases of malicious prosecution against the plaintiff;
(4) In case of a clearly unfounded civil action or proceeding against the plaintiff;
(5) Where the defendant acted in gross and evident bad faith in refusing to satisfy the plaintiffs plainly valid, just and demandable claim;
(6) In actions for legal support;
(7) In actions for the recovery of wages of household helpers, laborers and skilled workers;
(8) In actions for indemnity under workmen's compensation and employer's liability laws;
(9) In a separate civil action to recover civil liability arising from a crime;
(10) When at least double judicial costs are awarded;
(11) In any other case where the court deems it just and equitable that attorney's fees and expenses of litigation should be recovered.
In all cases, the attorney's fees and expenses of litigation must be reasonable. (Emphasis supplied)
The dismissal of the third-party complaint filed by petitioners Spouses Gaspar against respondent DIANA SALITA is AFFIRMED.
(i) Petitioners Spouses Mario and Julia Gaspar (Spouses Gaspar) to pay respondent Herminio Angel E. Disini, Jr. (Disini) the amount of P760,000.00 with legal interest at the rate of six percent (6%) per annum, computed from the date of filing of Disini's Complaint for Sum of Money40 until full payment; (ii) Respondent Joseph Yu (Yu) to pay petitioners Spouses Gaspar the amount of P850,000.00 with legal interest at the rate of six percent (6%) per annum, computed from the date of filing of the latter's third-party complaint on October 9, 2006 until full payment; and (iii) Respondent Yu to pay petitioners Spouses Gaspar attorney's fees in the amount of P50,000.00 with legal interest at the rate of six percent (6%) per annum from finality of this Decision until full payment.
Endnotes:
1Rollo, pp. 11-32, excluding Annexes.
2 Id. at 33-39. Penned by Associate Justice Ricardo R. Rosario (now a Member of the Court), with the concurrence of Associate Justices Eduardo B. Peralta, Jr. and Maria Elisa Sempio Diy.
3 Id. at 41-42.
4 Special Fifteenth Division and Former Special Fifteenth Division.
5Rollo, pp. 34-35.
6 As stated in the assailed Decision, rollo, pp. 33-34 and 38-39.
7 Id. at 34.
8 See id. at 35.
9 Id. at 35-36.
10 Id. at 38-39.
11 Id. at 36.
12 See id.
13 Id. at 38.
14 Id.
15 Id.
16 Id. at 41-42.
17 Id. at 13, 45.
18 Id. at 45-50.
19 Id. at 45-46.
20 Id. at 11.
21 Id. at 83-99.
22 See id. at 83, 95.
23 Id. at 72-76.
24 Id. at 73.
25 Id. at 117-118.
26 Id. at 126-133.
27 Id. at 126, 131-132.
28 Id. at 19-20.
29 See id. at 21.
30 Id. at 22.
31 Id. at 23.
32 Id.
33 No. L-24399, March 28, 1969,27 SCRA 418.
34 Id. at 422-424.
35 See rollo, p. 22
36 Id. at 84.
37 Id. at 85.
38 Id. at 52.
39 See Firme v. Bukal Enterprises and Development Corporation, G.R. No. 146608, October 23, 2003, 414 SCRA 190, 206.
40 See Civil Code, Art. 1458.
41Manongsong v. Estimo, G.R. No. 136773, June 25, 2003, 404 SCRA 683, 695.
42 See CIVIL CODE, Art. 1459 in relation to Art. 1409.
43 See id., Art. 559.
44 See id., Art. 1410.
45Rollo, p. 86.
46Batalla v. Prudential Bank, G.R. No. 200676, March 25, 2019, 898 SCRA 193, 205.
47 See Power Commercial and Industrial Corp. v. Court of Appeals, G.R. No. 119745, June 20, 1997, 274 SCRA 597, 611.
48Rollo, pp. 84, 86 and 94.
49 Id. at 34-35.
50 Date of filing cannot be ascertained from the records.
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