Bataan Hardwood Corp. v. Dy Pac & Co.
REITERATIONFacts
1. The Antecedents: Bataan Hardwood Corporation (BHC) and Dy Pac & Company entered into a contract on January 21, 1960, for Dy Pac to advance funds for logs BHC would sell. BHC became indebted to Dy Pac for P21,000.00. A superseding contract on July 6, 1960, stipulated monthly payments of P1,500.00 until December 30, 1960, and thereafter P1,000.00 weekly payments deducted from log purchases. As security, BHC and Mauro B. Ganzon mortgaged a vessel, the "Batman ex LCT 1282," to Dy Pac. Domingo B. Sanchez also had a prior mortgage on the vessel. BHC failed to insure the vessel as agreed and made irregular payments. Dy Pac sent demand letters, but BHC's payments were insufficient, leaving a balance of P17,250.00. Dy Pac incurred P2,131.56 for insurance premiums. 2. Procedural History: Dy Pac filed a complaint on August 28, 1961, in the Court of First Instance of Manila, seeking possession of the vessel, payment of the outstanding balance, interest, penalties, attorney's fees, and insurance premiums. The trial court ruled in favor of Dy Pac, ordering BHC, Ganzon, and Sanchez to pay P17,250.00 with interest, P2,131.56 with legal interest, P300.00 in attorney's fees, and costs. The trial court denied Dy Pac's motion for reconsideration regarding possession, 25% attorney's fees, and the daily penalty. Both parties appealed to the Court of Appeals. BHC's appeal was dismissed for failure to file a brief. The Court of Appeals modified the trial court's decision, awarding P2,000.00 in attorney's fees and P2,000.00 in liquidated damages, and declared Dy Pac entitled to possession of the vessel for extrajudicial foreclosure. Upon BHC's motion for reconsideration, the Court of Appeals reduced the attorney's fees to P800.00. 3. The Petition: Bataan Hardwood Corporation, et al. (petitioners) filed a petition for certiorari with this Court, raising a single question of law: whether the Court of Appeals committed a grave error by rendering judgment providing separate reliefs on two causes of action arising from a single cause of action. Petitioners contend that Dy Pac had only one cause of action (breach of contract due to non-payment) and therefore could only be granted one relief, either replevin or recovery of the sum of money, but not both. They argue that the Court of Appeals erred in affirming the trial court's award for the sum of money and also granting the delivery of the property for foreclosure, asserting that granting one relief should waive the other. The petition is filed under Rule 45 of the Rules of Court.
Issue(s)
Whether the Court of Appeals committed a grave error of law in rendering judgment providing separate reliefs on two causes of action arising out of a single cause of action. Whether the respondent was entitled to both replevin and recovery of a sum of money for the same breach of contract.
Ruling
The petition is manifestly without merit. The Supreme Court affirmed the judgment of the Court of Appeals with the modification that petitioners are ordered to pay additional attorney's fees of P1,200.00 and treble costs.
Ratio Decidendi
On the issue of whether the Court of Appeals committed a grave error of law in rendering judgment providing separate reliefs on two causes of action arising out of a single cause of action: The Supreme Court held that the petitioners' contention is tenuous. It is elementary that the violation of a single right may give rise to more than one relief. In other words, for a single cause of action or violation of a right, the plaintiff may be entitled to several reliefs. It is the filing of separate complaints for these several reliefs that constitutes splitting up of the cause of action, which is prohibited by the rules. The Court cited the late Chief Justice Moran, who explained that a cause of action is the delict or wrong by which the rights of the plaintiff are violated by the defendant. Where there is only one delict or wrong, there is but a single cause of action regardless of the number of rights that may have been violated belonging to one person. All such rights should be alleged in a single complaint, otherwise, those not included cannot be the subject of subsequent complaints, for they are barred forever. For instance, when one's property is taken through violence, a single delict or wrong is committed, but this entitles the plaintiff to two claims: one for recovery of property and another for damages for its detention. Under the rule, the plaintiff may file only one complaint embracing both claims, but not two separate complaints. On the issue of whether the respondent was entitled to both replevin and recovery of a sum of money for the same breach of contract: The appellate court committed no error in ruling that the respondent's complaint was principally for replevin. The respondent correctly filed the complaint for replevin because the appellees refused to deliver possession of the mortgaged vessel so that the appellant could proceed to foreclose it extrajudicially. The Supreme Court cited the old case of Bacharach Motor Co. vs. Summer, holding that preliminary to the sale provided for in the Chattel Mortgage Law, the mortgagee must secure possession of the mortgaged chattel, and if possession is refused, he may institute an action for replevin or for judicial foreclosure. A judicial proceeding is unnecessary because the mortgagee can foreclose extrajudicially by causing the mortgaged property to be seized by the sheriff and sold at public auction. As respondent maintained, its action was for replevin under Rule 62 of the old Rules of Court, supported by the required affidavit, and the principal prayer was for an order to take possession of the vessel for delivery to the plaintiff. Furthermore, the respondent correctly maintained that without the amount or liability of the mortgaged vessel determined by the court, the sheriff conducting the auction sale would not have the authority to determine how much to pay the mortgagee, potentially leading to multiplicity of suits. Therefore, the determination of the amount due was procedurally correct to avoid further court proceedings. Rule 60 (formerly Rule 62) of the Revised Rules of Court, in Section 9, expressly provides that the court in a replevin suit shall render judgment in the alternative for the delivery of the property or for its value in case delivery cannot be made, and also for such damages as either party may prove.
Main Doctrine
A single cause of action may give rise to several reliefs, and the filing of separate complaints for these reliefs constitutes splitting a cause of action, which is prohibited. A plaintiff may be entitled to multiple reliefs for a single delict or wrong, and all such rights should be alleged in a single complaint.