7/28/2019 PHILIPPINE REPORTS ANNOTATED VOLUME 105

[No. L-11648. April 22, 1959]

THE DIRECTOR OF LANDS, petitioner, vs. LOPE ALBA, ET AL.,

claimants. ELIGIO CATALAN, movant and appellee, vs. RAMON
GATCHALIAN, oppositor and appellant.

Appeal from the order of the Court of First Instance of Tacloban

City. It appears that Eligio Catalan and Ramon Gatchalian, as
partners, mortgaged to Dr. Dionisio Marave two lots in Tacloban
City, including the improvements thereon, all belonging to the
partnership, to secure the payment of a loan. The partnership
failed to pay the loan; the mortgage was foreclosed and the
properties were sold at public auction to Dr. Marave. Before the
expiration of the one year period of redemption, Catalan, on his
own behalf, redeemed the properties with his private funds. The
Sheriff issued the corresponding certificate of redemption in
favor of Catalan. Upon Catalan's petition, the lower court
ordered the cancellation of the title in the name of the
partnership and to issue in its stead another in the name of
Catalan. Held: The theory of Catalan, accepted by the trial court,
that he became the absolute owner of the properties in question
upon
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making the redemption because he was subrogated to the rights of

Dr. Marave who made the purchase at public auction, is untenable.
Under general principles of law, a partner is an agent of the
partnership. (Art. 1818, new Civil Code). Furthermore, every
partner becomes a trustee for his copartner with regard to any
benefits or profits derived from his act as partner (Art. 1807, new
Civil Code). Consequently, when Catalan redeemed the properties
in question, he became a trustee and held the same in trust for his
copartner Gatchalian, subject to his right to demand from the latter
his contribution to the amount of redemption. The principle of
subrogation cannot be applied because at the time Catalan
redeemed the property, Dr. Marave, the purchaser at public
auction, had not yet become the absolute owner of said properties.
He never received the definite and formal certificate of sale
constituting muniment of title, for the reason that redemption was
made. Consequently, there was no title to the properties which he
could convey to Catalan as redemptioner.

Judgment reversed. Montemayor, J., ponente.

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