Palma vs. Court of Appeals

In a sale of personal property payable in installments, the vendor's filing of an action for collection of the unpaid balance constitutes an election of the first remedy under Article 1484(1) of the Civil Code (exact fulfillment), and does not preclude the vendor from subsequently attaching the sold property or executing upon the vendee's other assets to satisfy the judgment. The vendor is not required to credit the value of the attached property against the judgment debt absent proof of its valuation or a foreclosure sale.

Reynaldo S. Palma and petitioner Zenaida M. Palma purchased two Hino Diesel Trucks from Products, Inc. (private respondent) for a total of P104,112.00, payable in installments. They executed promissory notes and constituted a chattel mortgage over the trucks. After defaulting on payments despite demands, the private respondent filed a collection suit with a prayer for preliminary attachment. The trial court issued a writ of attachment, and one truck and the dismantled parts of the other were seized. The Palmas were later declared in default for failure to file an answer, and judgment was rendered against them for the unpaid balance plus interest and fees. A writ of execution was issued, and their real property in Kawit, Cavite, which had been attached, was sold at public auction to the private respondent after the Palmas failed to redeem it.

• Nature of the Transaction: Reynaldo S. Palma and petitioner Zenaida M. Palma purchased two trucks from Products, Inc. on installment, executing promissory notes and a chattel mortgage over the vehicles.
• Default and Collection Suit: After the Palmas made only an initial payment and defaulted on subsequent installments, Products, Inc. filed a complaint for collection of the unpaid balance with a prayer for preliminary attachment.
• Attachment and Service: A writ of attachment was issued. Summons, the order of attachment, and the attachment bond were served at the Palmas' residence on a person named Bella Samson, who refused to sign the receipt. One truck and parts of another were subsequently attached.
• Default Judgment: For failure to file an answer, the Palmas were declared in default. The trial court rendered judgment ordering them to pay the unpaid balance (P99,931.71) with 12% interest, the attachment bond premium, and attorney's fees.
• Post-Judgment Proceedings: The Palmas filed a Petition for Relief from Judgment, claiming they never received the complaint. The trial court denied the petition. Their real property, which had been attached, was sold at public auction to Products, Inc. after they failed to redeem it.
• Appeal: The Court of Appeals affirmed the trial court's decision. The instant petition was filed solely by Zenaida M. Palma following the death of her husband.

• Defective Service of Summons: Petitioner maintained that the trial court never acquired jurisdiction over her person because the summons was served on a third party (Bella Samson) who failed to deliver the documents to her, violating her right to due process.
• Misapplication of Article 1484: Petitioner argued that by attaching the trucks, the private respondent effectively chose the remedy of foreclosure under Article 1484(3) of the Civil Code, which would bar any further action to recover the unpaid balance. Therefore, the judgment for the full purchase price was erroneous.
• Invalid Execution: Petitioner contended that the execution sale and confirmation of the sale of her real property were invalid because the property had already been sold to third parties (the Cresinis) prior to the auction, depriving them of due process.

• Voluntary Submission to Jurisdiction: Respondent countered that the petitioner voluntarily submitted to the trial court's jurisdiction by filing a Petition for Relief from Judgment, which sought affirmative relief (a new trial) beyond a mere objection to jurisdiction.
• Election of Remedy - Collection: Respondent argued that it elected the first remedy under Article 1484(1) by filing an action for collection of the unpaid balance. The attachment of the trucks was merely a provisional remedy to secure the judgment, not an election of the foreclosure remedy.
• Finality of Judgment: Respondent asserted that the trial court's decision had become final and executory because the petitioner failed to appeal it within the reglementary period. The issuance of a writ of execution was therefore a ministerial duty of the court.

• Jurisdiction Over the Person: Whether the trial court acquired jurisdiction over the petitioner despite alleged defective service of summons.
• Remedies Under Article 1484: Whether the private respondent, by filing an action for collection and attaching the trucks, elected the remedy of foreclosure under Article 1484(3), thereby extinguishing its right to recover the unpaid balance.
• Validity of Execution Sale: Whether the execution sale and confirmation of the sale of the petitioner's real property were valid, considering the prior sale of the property to third parties.

• Jurisdiction Over the Person: The trial court validly acquired jurisdiction. The petitioner's act of filing a Petition for Relief from Judgment, which prayed for an injunction and a new trial on the merits, constituted a voluntary submission to the court's jurisdiction. A party cannot seek affirmative relief from a court while simultaneously challenging its jurisdiction.
• Remedies Under Article 1484: The private respondent validly elected the first remedy under Article 1484(1) — an action for specific performance (collection). The attachment of the trucks was a provisional measure to secure the claim and did not constitute an election of the foreclosure remedy under Article 1484(3). Since no foreclosure was undertaken, the bar against recovering the unpaid balance did not apply.
• Validity of Execution Sale: The execution sale was valid. The judgment had become final and executory, making the issuance of a writ of execution a matter of right. The attachment of the real property created a specific lien that took precedence over the subsequent sale to the Cresinis. The failure to redeem the property within the reglementary period vested title in the private respondent.

• Voluntary Submission to Jurisdiction — A defendant who files a motion or pleading seeking affirmative relief other than a challenge to the court's personal jurisdiction is deemed to have voluntarily submitted to that jurisdiction. This applies even if the pleading contains a general objection to jurisdiction.
• Exclusive Remedies under Article 1484 — In sales of personal property payable in installments, the vendor's remedies are alternative, not cumulative. Election of one remedy bars the others. An action for collection of the unpaid balance (Art. 1484[1]) is distinct from the remedy of foreclosure (Art. 1484[3]), which extinguishes the right to recover any deficiency.
• Attachment as a Provisional Remedy — The issuance of a writ of preliminary attachment to secure a claim in a personal action for collection does not, by itself, convert the action into a foreclosure or constitute an election of the foreclosure remedy under Article 1884(3).

• "When the appearance is by motion for the purpose of objecting to the jurisdiction of the court over the person, it must be for the sole and separate purpose of objecting to said jurisdiction. If the appearance is for any other purpose, the defendant is deemed to have submitted himself to the jurisdiction of the court." — Articulates the standard for voluntary appearance and submission to jurisdiction.
• "The mere fact that private respondent secured possession of the trucks through an attachment did not necessarily mean that it would resort to a foreclosure of the mortgage." — Clarifies that attachment as a provisional remedy is distinct from the substantive election of foreclosure under Article 1484.

• J.M. Tuason & Co., Inc. v. Estabillo, 62 SCRA 1 (1975) — Cited for the principle that filing a petition for relief from judgment constitutes voluntary submission to the court's jurisdiction.
• Flores v. Zurbito, 37 Phil. 746 (1918) — Cited for the rule that an appearance for any purpose other than to object to jurisdiction results in voluntary submission.
• Universal Motors Corporation v. Dy Hian Tat, 28 SCRA 161 (1969) — Cited to support the distinction between attachment as a provisional remedy and the substantive election of foreclosure under Article 1884.
• Adlawan v. Tomol, 184 SCRA 31 (1990) — Cited for the principle that a final judgment entitles the prevailing party to a writ of execution as a matter of right.

• Article 1484, Civil Code of the Philippines — Provides the three exclusive remedies available to a vendor in a sale of personal property payable in installments upon the vendee's default. The Court interpreted the filing of a collection suit as an election of the first remedy (exact fulfillment), not the third (foreclosure).
• Section 1, Rule 39, Revised Rules of Court — Governs execution upon final judgments. The Court applied this provision to hold that the issuance of a writ of execution was a ministerial duty after the judgment became final and executory.

• Justice Josue N. Bellosillo
• Justice Florenz D. Regalado (as Division Chairperson)
• Justice Camilo D. Quiason (ponente, as indicated by the signature)
• Justice Santiago M. Kapunan

N/A — No dissenting opinion is recorded in the provided text.