Chattel Mortgage

Art. 319.
Removal, sale or pledge of mortgagee or his executors, administrators, or

mortgaged property. — The penalty or assigns.
arresto mayor or a fine amounting to twice
2. By selling or pledging personal property
the value of the property shall be imposed
already pledged, or any part thereof, under
upon:
the terms of the Chattel Mortgage Law,
1. Any person who shall knowingly remove without the consent of the mortgagee written
any personal property mortgaged under the on the back of the mortgage and noted on the
Chattel Mortgage Law to any province or record thereof in the office of the register of
city other than the one in which it was deeds of the province where such property is
located at the time of the execution of the located.
mortgage, without the written consent of
Valid and subsisting
the mortgagee, or his executors,
administrators or assigns. - There must be a valid and subsisting
chattel mortgage.
2. Any mortgagor who shall sell or pledge
- If the chattel mortgage does not contain
personal property already pledged, or any
an affidavit of good faith, and is not
part thereof, under the terms of the
registered, it is void and cannot be the
Chattel Mortgage Law, without the consent
basis of a criminal prosecution under
of the mortgagee written on the back of the
Art. 319.
mortgage and noted on the record hereof in
the office of the Register of Deeds of the Elements of knowingly removing
province where such property is located. mortgaged personal property:
1. That personal property is mortgaged under
the Chattel Mortgage Law.
Object of Article 319
2. That the offender knows that such property
- To give necessary sanction to the
is so mortgaged.
provision of the statute in the interest
of the public at large, so in all cases, 3. That he removes such mortgaged personal
wherein loans are made and secured property to any province or city other than one
under the terms of the statute, the in which it was located at the time of the
mortgage debtors may be deterred from execution of the mortgage.
the violation of its provisions and the
mortgage creditors may be protected 4. That the removal is permanent
against loss or inconvenience resulting 5. That there is no written consent of the
from the wrongful removal or sale of the mortgagee or his executors, administrators, or
mortgaged property. assigns to such removal.
Purpose of paragraph no. 1 Is the third person who removed the
- Protection of the mortgagee who should property to another province with
be able to have a ready access to, and knowledge that it has been mortgaged
easy reach of, the property subject of under this article liable?
the mortgage. - Yes. The offender is any person who
Acts Punishable under Art. 319 knowingly remove the mortgaged
personal property to another province
1. Knowingly removing any personal property or city without the written consent of
mortgaged under the Chattel Mortgage Law to the mortgagee.
any province or city other than one in which it
was located at the time of the extension of the The removal of mortgaged personal
mortgage, without the written consent of the property must be coupled with intent to
fraud.
- Otherwise, there is no violation of the - In both offenses there is selling of a
law. mortgaged property.
- In estafa, under Art. 316 (2) the
Elements of selling or pledging personal
property is a real property; in the sale of
property already pledged
mortgaged property, it is personal
1. That personal property is already pledged property.
under the terms of the Chattel Mortgage law. - To constitute the crime of estafa, it is
sufficient that the real property
2. That the offender, who is the mortgagor of mortgaged be sold as free, even though
such property, sells or pledges the same or the vendor may have obtained the
any part thereof. consent of the mortgagee in writing.
3. That there is no consent of the mortgagee - Selling or pledging of personal property
written on the back of the mortgage and noted already pledged or mortgaged is
on the record thereof in the office of the committed by the mere failure to obtain
register of deeds. the consent of the mortgagee in writing,
even if the offender should inform the
House may be subject of chattel mortgage purchases that the thing sold is
by agreement of the parties mortgaged.
- The purpose of the law in Art. 319 is to
- Although a house is generally
protect the mortgagee; in Article 316,
considered an immovable property,
the purpose is to protect the purchaser,
therefore being a subject of the real
whether the first of the second.
estate mortgage, the agreement of the
parties, registering the same under
Chattel Mortgage Law will not preclude
the prosecution under Article 319.
Second Chattel mortgage
- Article 319 penalizes the mortgagor
who sells or pledges a mortgaged
property without the consent of the
mortgagee.
- Spanish text uses: “hipoteca”
Consent of the mortagee:
1. In writing,
2. Back of the mortgage
3. Noted on the record thereof in the office of
the register of deeds.
- If placed on a separate piece of paper, the
pledge by the mortgagor is a violation of
Article 319.
Damage is not necessary
- Damage to the mortgagee is not
essential.
Distinguished from estafa (316) by
disposing of encumbered property.

Chattel Mortgage

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Art. 319.

Removal, sale or pledge of mortgagee or his executors, administrators, or

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