Case Digest: Milan vs Rio y Olabarrieta, 45 Phil 718, G.R. No. 21087

Milan vs Rio y Olabarrieta, 45 Phil 718, G.R. No. 21087, February 23, 1924

Subject: Obligations and Contracts

FACTS

Jose Carpi y Sanz was the owner of the Turia, a vessel. After the death of Jose Carpi y Sanz, his widow, Julia Millan, qualified as administration and in the course of the administration of the estate it was found that the Turia had become of little practical value, owing to the fact that the engine with which it was equipped had ceased to function and was apparently worthless. Thus, Millan sold the undivided half interest of the said vessel to defendants as joint purchasers, with the agreement that the defendants assume the remaining mortgage and would buy a new motor for the vessel. The defendants have paid a down payment and an instalment payment.

At the time this sale was effected the Turia was off on a trip. Upon its return to Manila, Gutierrez, who had been agent for the vessel in behalf of the administratrix, informed the captain of the Turia that the management of the vessel had passed to Rio y Olabarrieta. The captain thereupon reported to this firm, who assumed control as agents of the boat for the owners.

As per agreement, Rio Y Olabarrieta ordered a new motor for the vessel and was scheduled to be delivered in December. Meanwhile, instead of keeping it idle, the vessel was dispatched to get some lumber which was there awaiting shipment. Long story short, the vessel was destroyed due to a typhoon whilst out on delivery.

 ISSUE

Whether or not the defendants are still liable to pay the remaining balance even with the loss or destruction of the object of the sale

RULING

Yes.

Under Art. 1266 of the NCC, the debtor in obligations to do shall also be released when the prestation becomes legally or physically impossible without the fault of the obligor.

In this case, even if there was loss of the object of the sale, the obligation of the defendants to pay the balance of the half-interest of the vessel remains. This is because the boat has already been delivered to the defendants before the fortuitous event that destroyed the vessel.