10/1/2018 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
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10/1/2018 PHILIPPINE REPORTS ANNOTATED VOLUME 105

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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