G.R.
No. 177874 September 29, 2008
Petitioner: Jaime D. Ang
Respondent: Court of Appeals and Bruno Soledad
FACTS: Under a “car-swapping” scheme, respondent Soledad sold his Mitsubishi GSR sedan 1982 model to petitioner Ang by Deed of Absolute Sale dated July 28, 1992. Ang later offered the Mitsubishi GSR for sale through Far Eastern Motors, a second-hand auto display center. The vehicle was eventually sold to a certain Paul Bugash. Before the deed could be registered in Bugash’s name, however, the vehicle was seized by virtue of a writ of replevin on account of the alleged failure of Ronaldo Panes, the owner of the vehicle prior to Soledad, to pay the mortgage debt constituted thereon.
To secure the release of
the vehicle, Ang paid BA Finance the amount of P62,038.47. Soledad refused to reimburse the said amount, despite repeated
demands, drawing Ang to charge him for Estafa with abuse of confidence. It was dismissed later for insufficiency
of evidence. Ang filed the first complaint for damages against Soledad. It was dismissed for failure to submit the controversy to barangay conciliation.
Ang thereafter secured a certification to file action and again filed a
complaint for damages which was dismissed on the ground that the amount
involved is not within its jurisdiction.
Ang thereupon filed with
the Municipal Trial Court in Cities (MTCC) a complaint the subject of the
instant petition. After trial, the MTCC dismissed the complaint on the ground
of prescription pursuant to Article 1571.
Ang appealed to the RTC
which affirmed the dismissal of the complaint, albeit it rendered judgment in
favor of Ang “for the sake of justice and equity, and in consonance with the
salutary principle of non-enrichment at another’s expense.” Soledad’s Motion for Reconsideration was denied. He elevated the
case to the Court of Appeals. The appellate court accordingly reversed the RTC
decision and denied Ang’s motion for reconsideration.
ISSUE: Whether Ang’s cause of action has prescribed
RULING: The
resolution of the sole issue of whether the complaint had prescribed hinges on
a determination of what kind of warranty is provided in the Deed of Absolute
Sale subject of the present case. Art.
1546 of the Civil Code defines express warranty. Among the implied
warranty provisions of the Civil Code are: as to the seller’s title (Art. 1548),
against hidden defects and encumbrances (Art. 1561), as to fitness or
merchantability (Art. 1562), and against eviction (Art. 1548). The earlier
cited ruling in Engineering
& Machinery Corp. states
that “the prescriptive period for instituting actions based on a breach of express warranty is that specified in the
contract, and in the absence of such period, the general rule on rescission of
contract, which is four years (Article 1389, Civil Code).” For actions based on breach of implied warranty, the prescriptive period
is, under Art. 1571 (warranty against
hidden defects of or encumbrances upon the thing sold) and Art. 1548
(warranty against eviction),
six months from the date of delivery of the thing sold.
In declaring that he
owned and had clean title to the vehicle at the time the Deed of Absolute Sale
was forged, Soledad gave an implied warranty of title. In pledging that he “will defend the
same from all claims or any claim whatsoever [and] will save the vendee from
any suit by the government of the Republic of the Philippines,” Soledad gave a warranty against
eviction. Given Ang’s business of buying and selling used vehicles, he
could not have merely relied on Soledad’s affirmation that the
car was free from liens and encumbrances. He was expected to have thoroughly
verified the car’s registration and related documents.
Since what Soledad, as
seller, gave was an implied warranty, the prescriptive period to file a breach
thereof is six months after the delivery of the vehicle, following Art.
1571. But even if the date
of filing of the action is reckoned from the date petitioner instituted his
first complaint for damages on November 9, 1993, and not on July 15, 1996 when
he filed the complaint subject of the present petition, the action just the
same had prescribed, it having been filed 16 months after July 28, 1992, the
date of delivery of the vehicle.
