Pacific Commercial Company… · G.R. 46985

Citation: G.R. No. 46985
Court: Supreme Court En Banc
Division: En Banc
Decided: February 7, 1940

Summary

This case involves Pacific Commercial Company's claim for preferential rights over merchandise it sold on credit to Lee Keh. When Lee Keh defaulted on payment of P1,164.88, his goods were attached in separate litigation (Lee Kep vs. Lee Keh) and sold at public auction. Pacific Commercial Company filed a third-party claim asserting its rights as an unpaid seller. The Supreme Court En Banc ruled in favor of Pacific Commercial Company, applying Article 1922 of the Civil Code to establish the company's preferential rights over the merchandise as an unpaid creditor. The court ordered Lee Keh to pay the remaining balance directly and held Lee Kep and Far Eastern Surety jointly liable for the value of goods sold at auction, recognizing the commercial nature of the credit relationship and the surety obligations undertaken to facilitate the attachment proceedings.

Statutes applied

Civil Code, Art. 1922

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By the Intellegal Editorial Board · February 7, 1940

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