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EDCA PUBLISHING v. SPS. LEONOR

FACTS:

The petitioner sold books to an impostor who later sold them to the private respondents. The ownership of the books was recognized by the Municipal Trial Court and affirmed by the Regional Trial Court and the Court of Appeals. However, the petitioner argues that the private respondents did not establish ownership since they failed to produce a receipt. But Article 559 of the Civil Code states that possession of movable property acquired in good faith is equivalent to a title, eliminating the need for further proof. The lower courts also determined that the private respondents acquired the books in good faith, a finding that the Supreme Court agrees with. The main issue is whether the petitioner was unlawfully deprived of the books due to the dishonored check used for payment. The petitioner argues that there was a failure of consideration that nullifies the contract of sale. However, the Court points out that it has yet to be determined if the petitioner was unlawfully deprived of the books. The Court clarifies that a contract of sale is perfected when there is a meeting of minds on the subject matter and price.

ISSUES:

  1. When can a person be deemed to have been "unlawfully deprived" of movable property in the hands of another?

  2. Can the private respondents be considered as owners of the disputed books acquired in good faith?

  3. Was the petitioner unlawfully deprived of the books due to the dishonored payment check?

RULING:

  1. A person may be deemed to have been "unlawfully deprived" of movable property in the hands of another when the property was acquired through illegal means or the owner was unlawfully deprived of possession.

  2. Yes, the private respondents can be considered as owners of the disputed books acquired in good faith. The possession of movable property acquired in good faith is equivalent to a title, as provided in Article 559 of the Civil Code.

  3. The court has yet to establish whether the petitioner has been unlawfully deprived of the books. The dishonor of the payment check does not automatically nullify the contract of sale, as the contract is perfected at the moment there is a meeting of minds between the parties on the subject matter and the price.

PRINCIPLES:

  • Possession of movable property acquired in good faith is equivalent to a title (Article 559, Civil Code).

  • The contract of sale is consensual and is perfected at the moment there is a meeting of minds upon the thing which is the object of the contract and upon the price (Article 1475, Civil Code).