October 25, 1962
Ponente: Padilla, J.
FACTS:
·
On May 8, 1948, Jose V. Bagtas borrowed from
the Republic of the Philippines through the Bureau of Animal Industry three
bulls: a Red Sindhi with a book value of P1,176.46, a Bhagnari, of P1,320.56
and a Sahiniwal, of P744.46, for a period of one year from May 8, 1948 to May
7, 1949 for breeding purposes subject to a government charge of breeding fee of
10% of the book value of the bulls.
·
Upon the expiry of the contract, Bagtas asked
for a renewal for another period of one year. However, the Secretary of
Agriculture and Natural Resources approved a renewal thereof of only one bull
(Sahiniwal) for another year from 8 May 1949 to 7 May 1950 and requested the
return of the other two. Despite this, Bagtas failed to return the two other
bulls.
·
In 1950, Bagtas wrote to the Director of
Animal Industry that he would pay the value of the three bulls. He was given
until October 1950 to either return the three bulls or pay for their book
value. Bagtas failed to pay the book value of the three bulls or to return
them. So, on 20 December 1950 in the CFI of Manila, the Republic of the
Philippines commenced an action against him praying that he be ordered to
return the three bulls loaned to him or to pay their book value in the total
sum of P3,241.45 and the unpaid breeding fee in the sum of P199.62, both with
interests, and costs; and that other just and equitable relief be granted.
·
Defense of Bagtas: He could not return the
three bulls because: (a) the peace and order situation in Cagayan Valley was
bad; and (b) he had a pending appeal re: to deduct from the book value of the
bulls corresponding yearly depreciation of 8% from the date of acquisition.
·
CFI Ruling: Bagtas was ordered to pay the sum
of P3,625.09 the total value of the three bulls plus the breeding fees in the
amount of P626.17 with interest on both sums of (at) the legal rate from the
filing of this complaint and costs.
·
Subsequently, the Republic moved ex parte for
a writ of execution. By this time, Bagtas had already passed away. His estate
was represented in court by his wife, Felicidad, who was also the
administratix.
·
Felicidad filed a motion alleging that in
1952, the two bulls Sindhi and Bhagnari were returned to the Bureau Animal of
Industry and that sometime in November 1958, the third bull, the Sahiniwal,
died by accident from a gunshot wound inflicted during a Huk raid on Hacienda
Felicidad Intal in Cagayan. As such, she prayed that the writ of execution be
quashed on the ground that the estate did not have liability over the two bulls
that have been returned and the loss of the third one, which had died due to
force majeure.
RULING:
Whether
the contract entered into by Bagtas and the Republic is a commodatum. – NO.
·
A contract of commodatum is essentially
gratuitous. In the present case, the use of the bulls for breeding purposes
came with a breeding fee of 10% of their book value. If the breeding fee be
considered a compensation, then the contract would be a lease of the bull.
Whether
Bagtas is liable for the loss of the third bull, which died due to a fortuitous
event. – YES.
·
Under Article 1671 of the Civil Code, the
lessee (Bagtas) would be subject to the responsibilities of a possessor in bad
faith, because he had continued possession of the bull even after the expiry of
the contract.
·
But even if we were to assume that the subject
contract was a commodatum, Bagtas would still be liable for the third bull,
because Article 1942 of the Civil Code provides that a bailee in a contract of
commodatum is liable for loss of the things, even if it should be through a
fortuitous event: (a) If he keeps it longer than the period stipulated; or (b)
If the thing loaned has been delivered with appraisal of its value, unless
there is a stipulation exempting the bailee from responsibility in case of a
fortuitous event.
·
In the present case, the original period of
the loan was from 8 May 1948 to 7 May 1949. The loan of one bull was renewed
for another period of one year to end on 8 May 1950. But Bagtas kept and used
the bull until November 1953 when during a Huk raid it was killed by stray
bullets.
·
Furthermore, when lent and delivered to
Bagtas, the bulls had each an appraised book value, to wit: the Sindhi, at
P1,176.46, the Bhagnari at P1,320.56 and the Sahiniwal at P744.46. It was not
stipulated that in case of loss of the bull due to fortuitous event Bagtas
would be exempt from liability.