Court Opinion

ID: 8534376
Source: CourtListenerOpinion
Date Created: 2022-11-23 11:04:50.661355+00
Date Added: 2024-06-11T16:51:56.608400
License: Public Domain

ON MOTION POR REHEARING
May 27, 1942.
Mr. Justice Todd, Jr.,
delivered the opinion of the court.
The plaintiffs-appellees have filed a lengthy motion for reconsideration of the judgment rendered in this appeal. We do not deem it necessary to go into a consideration of the numerous questions raised by them, as their main contention is that the attachment levied on Miguel Francisco by Felipe Licha in favor of Rafael Arenas was not void and that, therefore, José Salgado could set up any defense in regard to the public sale, especially due to the fact that *292upon the automobile being removed from Cagnas to San Juan by the debtor Licha, the latter had failed to.record the mortgage in the Registry of San Juan.
Regarding this last point it will suffice to say that in United Porto Rican Bank v. Ruiz, 43 P.R.R. 506 and United Porto Rican Bank v. González, 46 P.R.R. 755, it was held, to quote from the syllabus of the latter case, the following :
“The registration of a chattel mortgage in the district where the debtor resides and the chattels are located is a notice to everyone— whether he resides in said district or not — of the lien constituted on the property. It is only necessary to record the mortgage anew in the registry of the district to which the chattels are transferred, where said transfer is made with the consent of the creditor.”
And in the case at bar, although it is true that the debtor Licha removed the automobile to San Juan, it does not appear that the creditor Arenas had granted his consent to such removal. The recording of the mortgage in the Registry of Caguas was a notice of the existence of that lien to Miguel Francisco as well as to José Salgado Jiménez.
In establishing the requisite of a prior deposit of the mortgage, provided in §10 of the Chattel Mortgage Act (No. 19, Laws of 1927, p. 490), as amended by Act No. 71 of 1930 (Laws of 1930, p. 448), the Legislature had no other purpose than to render clearer its intention that the rights of the mortgagee should be more effectively protected than formerly.
In the case of United Porto Rican Bunk v. González, supra, this court held that an attachment levied on mortgaged cattle before Act No. 71 of 1930 went into effect, without subjection to the interest acquired by the mortgagee in said cattle, was void.
The obligation to deposit the amount of the mortgage which is imposed on the attached creditor, is mandatory. If before such requisite existed an attachment levied without subjection to the interest held by the mortgagee was void, *293there can he no donbt that an attachment levied without a compliance with that requisite nor with the mandatory one imposed by the amendment to §10, is likewise void. Moreover, in the instant case no deposit was made, either before or after the levy, if a belated deposit conld have been made: a question which we are not deciding.
The requisite of a prior deposit is in harmony with the intrinsic nature of a chattel mortgage, under which the mortgagee becomes to a certain extent the owner of the mortgaged property. In this connection, citation was made in United Porto Rican Bank v. González, supra, of the following excerpt taken from the case of Bachrach v. Mantel, 25 Phil. Rep. 410, decided by the Philippine Supreme Court:
“Under the Chattel Mortgage Law the mortgagee becomes the owner of the property in the sense that he has the legal title, the mortgagor having the right to retain possession, to have the beneficial use, and to defeat the title of the mortgagee by compliance with the terms of the mortgage. In a sense, the mortgagee is the legal, the mortgagor the equitable owner.”
Since the mortgagee, Arenas, held the legal title to the automobile, Francisco acquired no legal title to the same which he in turn might transfer to other persons, he having failed to deposit the amount of the mortgage.
If to what has been stated above is added the fact established before this court by the documents incorporated in the record by counsel for the appellants, that first José Salgado and then his heirs have been mere nominal parties without any interest in this case, since Salgado long before he died had secured from Miguel Francisco the return of the automobile purchased at the foreclosure sale (incidentally for a lesser sum than the amount of the mortgage credit), and that said counsel admit that their real client in this case has always been Miguel Francisco, it can readily be seen that the plaintiffs were never entitled to demand compensation for damages which they have not suffered.
The motion for rehearing must be denied.