GR No.

L-9865

VERGO D. TUFEXIS, vs. FRANCISCO OLAGUERA and THE MUNICIPAL COUNCIL OF

GUINOBATAN, 

On September 30, 1911, plaintiff acquired a piece of property situated in Guinobatan at a public
sale. Such property was held in execution of a judgment against Ricardo Pardo y Pujol, son of
Ricardo Pardo y Cabañas. The property consists of a frame building of strong materials.

The said building was constructed through a concession granted by the former spanish
government to Ricardo Pardo y Cabañas. Ricardo renounced the right to redeem the property
and conveyed the property to the plaintiff. The building was destroyed due to accidental fire on
January 2, 1912.

After the incident, Municipal Council of Guinobatan negotiated the plaintiff for purchase of his
rights in the concession. Defendant municipal council authorizes Francisco Olaguera to
unlawfully take possession of all land without plaintiff’s consent. Aside from taking possession of
the land, Olaguera occupied it for unlawful gain by the said buildings. Plaintiff had plans to
construct another public market building in the same land, but the defendant prevented and
refused to recognize the plaintiff's right. Plaintiff prayed before the Court of Instance that he is
the lawful owner and defendant shall remove obstructions in the said land. Defendants, through
counsel, rebutted to absolve the complaint as plaintiff lacks personality to file an action and facts
are in no sufficiency.

Court of First Instance sustained the demurrer filed by the defendant and allowed the plaintiff to
amend his complaint. Plaintiff sustained not to amend his complaint. Court of First instance
dismissed the complaint filed by the plaintiff on the ground of not amending his complaint.

Issues:

1.    Whether or not a building of strong materials, built on a land owned by the defendant by
concession, be served as payment of debt owed by Ricardo Pardo y Pujol to a third person.

2.    Whether or not an attachment would lie of the special right counted from the date of the
granting of the right.

3.    Whether or not Plaintiff has right to reconstruct the burned building on the land where it
stood.

Held:

1.    No.

The subject land of the concession belongs to the Municipality of Guinobatan. The property was
temporarily transferred to grantee for forty years. After the period, such concession ceases. The
building and the land erected could not be attached or sold in payment of a debt to Ricardo
Pardo y Pujol.
Ricardo Pardo y Pujol, as successor of Ricardo Pardo y Cabañas, bound to pay the latter’s
debts. Only personal privilege of usufruct of public market building in Guinobatan cannot be
attached. A person contracted with a state or government authority would be substituted,
causing another person, citizens, who took part in the contract, will take injury to the state and
public interest. The building and land in question should not be attached or sold at public
auction to satisfy the debt of Pardo uy Pujol. The sale are illegal, null and void and plaintiff
confers no right based on the concession.

2.    No.

A grantee not allowed to be substituted by another. The attachment of the right to usufruct and
collecting revenue from the floor space of the public market of Guinobatan was illegal. The
purpose of its illegality is a third person might exercise right as in personal sense rather than
grantee contractor.

Highest court considered concession is somewhat a nature of a franchise, but not applicable to
Sections 56 to 61 of Act No. 1459. In the case of Ricardo y Pujol, the creditor, as the grantee of
the usufruct, could have applied to the courts for an attachment of revenues or proceeds
collected by debtor by virtue of concession. Attach and selling the rights granted by the public
administration is not proper. 

The usufruct of the floor space of the public market of Guinobatan was not subject to
attachment due to its public character. Only remedy of Ricardo Pardo y Pujol’s creditor could
have applied writ of execution and laid attachment on the proceeds obtained from operation of
the market, which income is collected by a receiver and intervenor.

3.    No

The creditor's petition to the public market building, which was not the debtor's property, was
attached and sold. Plaintiff unable to acquire any right. The property was considered illegally
sold and illegally acquired at the public auction. Such failed acquisition right gives no right to
reconstruct as the owner of the land, defendant, can reconstruct.

Highest court affirms the order of dismissal.