Pastor Ago v Court of Appeals
GR No. 17898 (1962)

Facts:

  • Pastor Ago bought saw mill machineries and equipment from Grace Park Engineering, executing a chattel mortgage to pay for the unpaid balance
  • The parties arrived at a compromise agreement after Ago defaulted in his payment. With both parties in attendance, Judge Montano Ortiz dictated a decision in open court.
  • Ago defaulted in his payment anew. Grace Park motioned for execution and was later granted a writ of execution.
  • Provincial Sheriff of Siargao acted on the Writ of Execution, levied upon and ordered the sale of machineries and equipment in question
  • Machineries and equipment were now owned by Golden Pacific Sawmill after Ago sold it to them, a day after court decision but before levying of property)

Issues:

  • WoN the decision made in open court constitutes a notice of final judgment
  • WoN the sale of the Provincial Sheriff was valid without prior publication

Ruling:

  • Issue #1: No, it does not constitute a notice of final judgment.
    • Section 1 of Rule 35 states:
      • How judgment rendered. — All judgments determining the merits of cases shall be in writing personally and directly prepared by the judge, and signed by him, stating clearly and distinctly the facts and the law on which it is based, filed with the clerk of the court.
    • Section 7 of Rule 27 states:
      • Service of final orders or judgments. — Final orders or judgments shall be served either personally or by registered mail.
  • Issue #2: No, it is not valid.
    • Requisites of a valid publication as provided by Section 16 of Rule 39 of the Rules of Court:
      • Posted for 20 days
      • Displayed in 3 public places where property is situated and sold
      • If property is > Php 400, publish a copy of the notice once a week, in some newspaper of general circulation in the province.
    • Machineries and equipment became necessary parts of the building or real estate.
      • Ago assigned the machinery and equipment to Golden Pacific Sawmill after acquiring it from Grace Park
      • Golden installed the machinery and equipment on the property they owned

Art. 415 makes machinery and equipment real property because it was installed by the owner of the property and it is essential to the industry.

Disclaimer: All case digests posted in this blog are my own. If you think I missed important points raised in the case, feel free to let me know and I will credit you for corrections and/or suggestions you may have. Hope this helps!

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