Navarro V Escobido

Navarro v.
Escobido
FACTS:
Private Respondent Karen Go (wife of Glen Go) of Karago Enterprises (buying/selling of motor vehicles), filed 2
complaints before the RTC for replevin and/or sum of money with damages against Petitioner Navarro.
1st cause of action- Navarro leased from Karen Go a motor vehicle (Fuso with mounted crane) under a “Lease
Agreement with Option to Purchase” on August 8, 1997. Navarro delivered 6 post-dated checks (P66,333.33 each),
however, the 5th and 6th checks ( amounting to P132,666.66) being dishonored. Plaintiff demanded payment of the
principal liability or to return the motor vehicle.
2nd cause of action- similar to the first complaint except that the lease agreement with option to purchase was dated
October 1, 1997 and involves motor vehicle with a different serial and motor number. Navarro delivered 3 post-dated
checks (P100,000 each) to Karen Go, 3rd check was dishonored.
On October 12, 1998 and October 14, 1998, the RTC issued writs of replevin for both cases; as a result, the Sheriff
seized the two vehicles and delivered them to the possession of Karen Go.
In his answer, Navarro alleged that the 2 complaints has no cause of action since Karen Go was not a party to the
lease agreements.
RTC dismissed the case due to the lack of cause of action but reversed it in another order ruling that the leasing
business is a conjugal property of the spouses. It is also ordered the inclusion of Glen Go as a co-plaintiff.
CA affirmed RTC order.
ISSUE:
WON the case lacks a cause of action since Karen Go was not a party to the lease agreements.
HELD:
No. Karen Go is the real party-in-interest. As the registered owner of Kargo Enterprises, Karen Go is the party who
will directly benefit from or be injured by a judgment in this case.
Kargo Enterprises is a sole proprietorship, which is neither a natural person, nor a juridical person, as defined by
Article 44 of the Civil Code. Hence it cannot be a party to a civil action. Thus, contrary to Navarro's contention, Karen
Go is the real party-in-interest being a registered owner, and it is legally incorrect to say that her Complaint does not
state a cause of action because her name did not appear in the Lease Agreement.
Kargo Enterprises is a conjugal property. Article 124 of the Family Code, allows either Karen or Glenn Go to speak
and act with authority in managing their conjugal property. No need exists for one of them to obtain the consent of the
other before performing an act of administration or any act that does not dispose of or encumber their conjugal
property.
Article 108 of the FC further provides that conjugal partnership is governed by rules on the contract of partnership. In
the case at bar, Article 1811 of the CC is applicable which stipulates that a partner as a co-owner has an equal right
with his partners to possess specific partnership property. Since Glenn and Karen Go are effectively co-owners of
Kargo Enterprises and the properties registered under this name, both have an equal right to seek possession of
these properties.
Moreover, Article 487 of the Civil Code that allows any of the co-owners to bring an action in ejectment with respect
to the co-owned property. Any one of them may bring an action, any kind of action, for the recovery of co-owned
properties. In this case, only one of the co-owners, namely the co-owner who filed the suit for the recovery of the co-
owned property, is an indispensable party thereto. Hence, either of the spouses Go may bring an action against
Navarro to recover possession of the Kargo Enterprises-leased vehicles which they co-own.
Since Glenn Go is not strictly an indispensable party in the action to recover possession of the leased vehicles, he
only needs to be impleaded as a pro-forma party to the suit. Misjoinder or non-joinder of indispensable parties in a
complaint is not a ground for dismissal of action. The RTC Order requiring plaintiff Karen Go to join her husband as a
party plaintiff is fully in order.

Navarro V Escobido

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Navarro v.

CA affirmed RTC order.

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