Facts:
On 8 May 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 8 May 1948 to 7 May 1949 for breeding purposes subject to a government
charge of breeding fee of 10% of the book value of the bulls. Upon the
expiration on 7 May 1949 of the contract, the borrower 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 for another year from 8
May 1949 to 7 May 1950 and requested the return of the other two. On 25 March
1950 Jose V. Bagtas wrote to the Director of Animal Industry that he would pay
the value of the three bulls. On 17 October 1950 he reiterated his desire to
buy them at a value with a deduction of yearly depreciation to be approved by
the Auditor General. On 19 October 1950 the Director of Animal Industry advised
him that the book value of the three bulls could not be reduced and that they
either be returned or their book value paid not later than 31 October 1950.
Jose V. Bagtas failed to pay the book value of the three bulls or to return
them. So, on 20 December 1950 in the Court of First Instance 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 in (civil No. 12818).
On 5 July 1951
Jose V. Bagtas, through counsel Navarro, Rosete and Manalo, answered that
because of the bad peace and order situation in Cagayan Valley, particularly in
the barrio of Baggao, and of the pending appeal he had taken to the Secretary
of Agriculture and Natural Resources and the President of the Philippines from
the refusal by the Director of Animal Industry to deduct from the book value of
the bulls corresponding yearly depreciation of 8% from the date of acquisition,
to which depreciation the Auditor General did not object, he could not return the
animals nor pay their value and prayed for the dismissal of the complaint.
On 26 June
1952 the two bull Sindhi and Bhagnari were returned to the Bureau Animal of
Industry and that sometime in November 1958 the third bull, the Sahiniwal, died
from gunshot wound inflicted during a Huk raid on Hacienda Felicidad Intal, and
praying that the writ of execution be quashed and that a writ of preliminary
injunction be issued.
Held:
The loan by
the appellee to the late defendant Jose V. Bagtas of the three bulls for
breeding purposes for a period of one year from 8 May 1948 to 7 May 1949, later
on renewed for another year as regards one bull, was subject to the payment by
the borrower of breeding fee of 10% of the book value of the bulls. The
appellant contends that the contract was commodatum and that, for that reason,
as the appellee retained ownership or title to the bull it should suffer its
loss due to force majeure. A contract of commodatum is essentially gratuitous.1
If the breeding fee be considered a compensation, then the contract would be a
lease of the bull. Under article 1671 of the Civil Code the lessee would be
subject to the responsibilities of a possessor in bad faith, because she had
continued possession of the bull after the expiry of the contract. And even if
the contract be commodatum, still the appellant is liable, 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:
(2) If he
keeps it longer than the period stipulated . . .
(3) 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;
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 the appellant
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 the deceased husband
of the appellant the bulls had each an appraised book value, to with: 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
the late husband of the appellant would be exempt from liability.
After a
party dies and the claim is not thereby extinguished, the court shall order,
upon proper notice, the legal representative of the deceased to appear and to
be substituted for the deceased, within a period of thirty (30) days, or within
such time as may be granted. . . . and after the defendant's death on 23
October 1951 his counsel failed to comply with section 16 of Rule 3 which
provides that — Whenever a party to a pending case dies . . . it shall be the
duty of his attorney to inform the court promptly of such death . . . and to
give the name and residence of the executory administrator, guardian, or other
legal representative of the deceased . . . .
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