G.R. No. L-2808
August 31, 1951
JOSEFA SANTAMARIA, assist! "# $% $us"a&!, FRAN'IS'O SANTAMARIA, J%., plaintiff-appellee, vs. T(E (ONG)ONG AN* S(ANG(AI +AN)ING 'ORORATION a&! R. . TALIN, defendants-appellant.
FACTS:
Mrs. Josefa T. Santamaria bought 10,000 shares of the Batangas Minerals, Inc., through the offices of oo, !"-Tioco # $aftal", a stoc% bro%erage firm and pa" therefore the sum of &',0(1.)0. *ater on, Mrs. Santamaria placed an order for the purchase of 10,000 shares of the +ron Mines, Inc. ith .J. +ampos # +o., a bro%erage firm, and delivered +ertificate $o. 1/ to the latter as securit" therefor ith the understanding that said certificate ould be returned to her upon pa"ment of the 10,000 +ron Mines, Inc. shares. . J. +ampos # +o., Inc. bought for Mrs. Josefa Santamaria 10,000 shares of the +ron Mines, Inc. at .)) a share, or the total amount of &),)0. t the time of the deliver" of a stoc% +ertificate $o.pencil 1/ toon.J. +ampos # +o., Inc., her name as ritten in lead the upper right hand corner thereof as the certificate as in the name of oo, !"-Tioco # $aftal". Mrs. Santamaria ent to .J. +ampos # +o., Inc. to pa" for her order of 10,000 +ron Mines shares and to get bac% +ertificate $o. 1/. She as informed that her Stoc% certificate as in the possession of the ong%ong and Shanghai Ban%ing +orporation.
+ertificate $o. 1/ came into possession of the ong%ong and Shanghai Ban%ing +orporation because .J. +ampos # +o., Inc. had opened an overdraft account ith this ban%. It had e2ecuted a document of h"pothecation, b" the term of hich .J. +ampos # +o., Inc. pledged to the said ban% 3all stoc%s, shares and securities hich I4e ma" hereafter come into their possession of m"4our account and hether srcinall" deposited for safe custod" onl" or for an" other purpose hatever or hich ma" hereinafter be deposited b" me4us in lieu of or in addition to the Stoc%s Shares and Securities no deposited or for an" other purposes hatsoever.3 ong%ong # Shanghai Ban%ing +orporation re5uested that the certificate be cancelled and a ne certificate be issued in the name of .. Taplin as trustee and nominee of the ban%ing corporation. obert . Taplin as an officer of this institution in charge of the securities belonging to or claimed b" the ban%. The Batangas Minerals, Inc. issued +ertificate $o. /1 in the name of obert . Taplin as trustee and nominee of the ong%ong # Shanghai Ban%ing +orporation. Mrs. Santamaria made a claim to the ban% for her certificate. She informed Taplin that the certificate belonged to her, and she demanded that it be returned to her. Taplin then replied that the ban% did not %no an"thing about the transaction had beteen her and .J. +ampos # +o., Inc., and that he could not do an"thing until the case of the ban% ith +ampos shall have been terminated. .J. +ampos # +o., Inc. as declared insolvent, then the ong%ong # Shanghai Ban%ing +orporation as%ed permission in the insolvenc" court to sell the .J. +ampos # +o., Inc., securities listed in its motion b" virtue of the document of h"pothecation, the insolvenc" court granted this motion. 10,000 shares of Batangas Minerals, Inc. represented b" +ertificate $o. /1, ere sold to the same ban% b" the Sheriff for &600 at the foreclosure sale authori7ed b" said order.
.J. +ampos, the president of .J. +ampos # +o., Inc., as prosecuted for estafa and found guilt" and as sentenced b" the Manila +ourt of 8irst Instance to an imprisonment and to indemnif" the offended part", Mrs. Josefa Santamaria, in the amount of &',0(1.)0 representing the value of the 10,000 shares of Batangas Minerals, Inc. Mrs. Santamaria failed in her efforts to force the civil 9udgment rendered in her favor in the criminal case because the accused became insolvent, she filed her complaint in this case. ISS!:; 4$ the trial court erred in finding that the plaintiff-appellee as not chargeable ith negligence in the transaction hich gave rise to this case. !*I$<; =:S. Santamaria is estopped from claiming further title to or interest therein as against a bona fide pledge or transferee thereof, for it is a ell-%non rule that a bona fide pledgee or transferee of a stoc% from the apparent oner is not chargeable ith %noledge of the limitations placed on it b" the real oner, or of an" secret agreement relating to the use hich might be made of the stoc% b" the holder. It further held that hen a stoc% certificate is endorsed in blan% b" the oner thereof, it constitutes as street certificate, so that upon its face, the holder is entitled to demand its transfer into his name from the issuing corporation. Such certificate is deemed 5uasi negotiable and as such the transferee thereof is 9ustified in believing that it belongs to the holder and transferor. The court held that she could not recover the certificate since she could have as%ed the corporation that issued it to cancel and issue another in lieu thereof in her name. er negligence as the immediate cause of the
damage, since the certificate as endorsed b" her to constitute as a street certificate. !pon its face, the holder as entitled to demand its transfer to his name from the issuing corporation. The ban% is not obligated to loo% be"ond the certificate to ascertain the onership of the stoc% at the time he received it from +ampos, it having been given pursuant to aletter of h"pothecation.
