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Davao Vs Castillo

- Davao Saw Mill Co. leased land from another to conduct its sawmill business and erected buildings housing machinery. The lease contract stated improvements would pass to the landowner but not machinery. - In a case where Davao Light & Power Co. won a judgment against Davao Saw Mill, machinery was levied as personal property. No third party claimed the machinery. - Davao Saw Mill had also treated machinery as personal property by executing chattel mortgages. The issue was whether machinery was personal property. The Supreme Court affirmed the lower court ruling that the machinery was personal in nature.

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Edward Kenneth Kung
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79 views1 page

Davao Vs Castillo

- Davao Saw Mill Co. leased land from another to conduct its sawmill business and erected buildings housing machinery. The lease contract stated improvements would pass to the landowner but not machinery. - In a case where Davao Light & Power Co. won a judgment against Davao Saw Mill, machinery was levied as personal property. No third party claimed the machinery. - Davao Saw Mill had also treated machinery as personal property by executing chattel mortgages. The issue was whether machinery was personal property. The Supreme Court affirmed the lower court ruling that the machinery was personal in nature.

Uploaded by

Edward Kenneth Kung
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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DAVAO SAW MILL vs. APRONIANO G. CASTILLO and DAVAO LIGHT & POWER CO., INC. G.R. No.

L-40411 August 7, 1935 Facts: Davao Saw Mill Co., Inc., is the holder of a lumber concession from the Government of the Philippine Islands. However, the land upon which the business was conducted belonged to another person. On the land the sawmill company erected a building which housed the machinery used by it. Some of the implements thus used were clearly personal property, the conflict concerning machines which were placed and mounted on foundations of cement. In the contract of lease between the sawmill company and the owner of the land there appeared the following provision: That on the expiration of the period agreed upon, all the improvements and buildings introduced and erected by the party of the second part shall pass to the exclusive ownership of the lessor without any obligation on its part to pay any amount for said improvements and buildings; which do not include the machineries and accessories in the improvements. In another action wherein the Davao Light & Power Co., Inc., was the plaintiff and the Davao, Saw, Mill Co., Inc., was the defendant, a judgment was rendered in favor of the plaintiff in that action against the defendant; a writ of execution issued thereon, and the properties now in question were levied upon as personalty by the sheriff. No third party claim was filed for such properties at the time of the sales thereof as is borne out by the record made by the plaintiff herein It must be noted also that on number of occasion, Davao Sawmill treated the machinery as personal property by executing chattel mortgages in favor of third persons. One of such is the appellee by assignment from the original mortgages. The lower court rendered decision in favor of the defendants herein. Hence, this instant appeal. Issue: whether or not the machineries and equipment were personal in nature. Ruling/ Rationale: Yes. The Supreme Court affirmed the decision of the lower court. Machinery which is movable in its nature only becomes immobilized when placed in a plant by the owner of the property or plant, but not when so placed by a tenant, a usufructuary, or any person having only a temporary right, unless such person acted as the agent of the owner.

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