Emilio Punsalan v. C. Boon Liat

Summary

Twenty-two Moros cooperatively caught a whale and extracted valuable ambergris, agreeing to common ownership with no sales without unanimous consent. Despite this agreement, two unauthorized sales occurred: Tamsi's group sold to Chinese merchants Cheong Tong and Lim Chiat for P12,000, and co-owner Ahamad separately sold the same ambergris to Henry E. Teck and others for P7,500 under pressure during a fraudulent customs operation. Twenty-one Moros plus the Chinese purchasers sued for recovery of the ambergris or its P60,000 value. The Supreme Court ruled that both sales were invalid as unauthorized by co-owners, except for each seller's proportional share. The Court held that co-owners can sue fellow co-owners who act as exclusive owners, and that the defendants did not purchase in good faith. The decision affirmed co-ownership principles under the Civil Code and protected the rights of the community against individual members' unauthorized acts.