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[No. 18700. September 26, 1922]

INVOLUNTARY INSOLVENCY OF PAUL

STROCHECKER, appellee, vs. ILDEFONSO RAMIREZ,
creditor and appellant. WILLIAM EDMONDS, assignee.

1. CHATTEL MORTGAGE; INTEREST IN A BUSINESS.—

An interest in a business may be the subject of mortgage,
for it is a personal property, being capable of
appropriation, and not included among the real properties
enumerated in article 335 of the Civil Code.

2. ID.; ID.; DESCRIPTION; SUFFICIENCY OF.—Where the

description of the chattel mortgaged is such as to enable
the .parties to the mortgage or any other person to identify
the same after a reasonable investigation or inquiry, the
description is sufficient. Thus, if the thing is described as
the half interest of the debtor in the drug business known
as Antigua Botica Ramirez (owned by a certain person
therein named and the mortgagor) located at Nos. 123 and
125, Calle Real, District of Intramuros, Manila, P. I., the
description meets the requirements of the law.

3. ID.; PREFERENCE; PURCHASE PRICE; POSSESSION.

—The vendor of a chattel, who is a creditor for the
purchase price, has no preference over a creditor holding a
mortgage on that chattel where the vendor is not in
possession of the thing mortgaged.

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Involuntary Insolvency of Strochecker vs. Ramirez

4. ID.; ID.; RETROACTIVITY; PERSONAL SECURITY.—A

junior mortgage can have no preference over a senior
mortgage by the mere fact that prior to said junior
mortgage a personal security had been stipulated between
the junior mortgagee and the debtor, because the second

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mortgage cannot be given effect as of the date the personal

security was stipulated.

APPEAL from a judgment of the Court of First Instance of

Manila. Concepcion, J.
The facts are stated in the opinion of the court.
Lim & Lim f or -appellant.
Ross & Lawrence and Antonio T. Carrascoso, jr., for the
Fidelity & Surety Co.

ROMUALDEZ, J.:

The question at issue in this appeal is, which of the two

mortgages here in question must be given preference? Is it
the one in favor of the Fidelity & Surety Co., or that in
favor of Ildefonso Ramirez. The first was declared by the
trial court to be entitled to preference.
In the lower court there were three mortgagees each of
whom claimed pref erence. They were the two above
mentioned and Concepcion Ayala. The latter's claim was
rejected by the trial court, and from that ruling she did not
appeal.
There is no question as to the priority in time of the
mortgage in favor of the Fidelity & Surety Co. which was
executed on March 10, 1919, and registered in due time in
the registry of property, that in favor of the appellant being
dated September 22, 1919, and registered also in the
registry.
The appellant claims preference on these grounds: (a)
That the first mortgage above-mentioned is not valid
because the property which is the subject-matter thereof is
not capable of being mortgaged, and the description of said
property is not sufficient; and (b) that the amount due the
appellant is a purchase price, citing article 1922 of the
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VOL. 44, SEPTEMBER 26, 1922 935

Involuntary Insolvency of Strochecker vs. Ramirez

Civil Code in support thereof, and that his mortgage is but

a modification of the security given by the debtor on
February 15, 1919, that is, prior to the mortgage executed
in favor of the Fidelity & Surety Co.
As to the first ground, the thing that was mortgaged to
this corporation is described in the document as follows:
" * * * his half interest in the drug business known as
Antigua Botica Ramirez (owned by Srta. Dolores del

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Rosario and the mortgagor herein referred to as the

partnership), located at Calle Real Nos. 123 and 125,
District of Intramuros, Manila, Philippine Islands."
With regard to the nature of the property thus
mortgaged, which is one-half interest in the business above
described, such interest is a personal property capable of
appropriation and not included in the enumeration of real
properties in article 335 of the Civil Code, and may be the
subject of mortgage. All personal property may be
mortgaged. (Sec. 2, Act No. 1508.)
The description contained in the document is sufficient.
The law (sec. 7, Act No. 1508) requires only a description of
the following nature:
"The description of the mortgaged property shall be such
as to enable the parties to the mortgage, or any other
person, after reasonable inquiry and investigation, to
identify the same."
Turning to the second error assigned, numbers 1, 2, and
3 of article 1922 of the Civil Code invoked by the appellant
are not applicable. Neither he, as debtor, nor the debtor
himself, is in possession of the property mortgaged, which
is, and since the registration of the mortgage has been,
legally in possession of the Fidelity & Surety Co. (Sec. 4,
Act No. 1508; Meyers vs. Thein, 15 Phil., 303.)
In no way can the mortgage executed in favor of the
appellant on September 22, 1919, be given effect as of
February 15, 1919, the date of the sale of the drug store in
question. On the 15th of February of that year, there was

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Involuntary Insolvency of Strochecker vs. Ramirez

a stipulation about a personal security, but not a mortgage

upon any property, and much less upon the property in
question.
Moreover, the appellant cannot deny the preferential
character of the mortgage in favor of the Fidelity & Surety
Co. because in the very document executed in his favor it
was stated that his mortgage was a second mortgage,
subordinate to the one made in favor of the Fidelity &
Surety Co.
The judgment appealed from is affirmed with costs
against the appellant. So ordered.

Araullo, C. J., Street, Malcolm, Avanceña, Villamor,

Ostrand, and Johns, JJ., concur.
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Judgment affirmed.

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VOL. 44, AUGUST 17, 2006 937

Jurisprudence on Reconveyance

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