|Section 1. The short title of this Act shall be "The Chattel
Sec. 2. All personal property shall be subject to
mortgage, agreeably to the provisions of this Act, and a mortgage
executed in pursuance thereof shall be termed chattel mortgage.
Sec. 3. Chattel mortgage defined. — A chattel
mortgage is a conditional sale of personal property as security for the
payment of a debt, or the performance of some other obligation
specified therein, the condition being that the sale shall be void upon
the seller paying to the purchaser a sum of money or doing some other
act named. If the condition is performed according to its terms the
mortgage and sale immediately become void, and the mortgagee is thereby
divested of his title.
Sec. 4. Validity. — A chattel mortgage shall not
be valid against any person except the mortgagor, his executors or
administrators, unless the possession of the property is delivered to
and retained by the mortgagee or unless the mortgage is recorded in the
office of the register of deeds of the province in which the mortgagor
resides at the time of making the same, or, if he resides without the
Philippine Islands, in the province in which the property is situated:
Provided, however, That if the property is situated in a different
province from that in which the mortgagor resides, the mortgage shall
be recorded in the office of the register of deeds of both the province
in which the mortgagor resides and that in which the property is
situated, and for the purposes of this Act the city of Manila shall be
deemed to be a province.
Sec. 5. Form. — A chattel mortgage shall be deemed
to be sufficient when made substantially in accordance with the
following form, and shall be signed by the person or persons executing
the same, in the presence of two witnesses, who shall sign the mortgage
as witnesses to the execution thereof, and each mortgagor and
mortgagee, or, in the absence of the mortgagee, his agent or attorney,
shall make and subscribe an affidavit in substance as hereinafter set
forth, which affidavit, signed by the parties to the mortgage as above
stated, and the certificate of the oath signed by the authority
administering the same, shall be appended to such mortgage and recorded
FORM OF CHATTEL MORTGAGE AND
"This mortgage made this ____ day
of ______19____ by _______________, a resident of the municipality of
______________, Province of ____________, Philippine Islands mortgagor,
to ____________, a resident of the municipality of ___________,
Province of ______________, Philippine Islands, mortgagee, witnesseth:
"That the said mortgagor hereby conveys and mortgages to the said
mortgagee all of the following-described personal property situated in
the municipality of ______________, Province of ____________ and now in
the possession of said mortgagor, to wit:
(Here insert specific description of the property mortgaged.)
"This mortgage is given as security for the payment to the said ______,
mortgagee, of promissory notes for the sum of ____________ pesos, with
(or without, as the case may be) interest thereon at the rate of
___________ per centum per annum, according to the terms of __________,
certain promissory notes, dated _________, and in the words and figures
following (here insert copy of the note or notes secured).
"(If the mortgage is given for the performance of some other obligation
aside from the payment of promissory notes, describe correctly but
concisely the obligation to be performed.)
"The conditions of this
obligation are such that if the mortgagor, his heirs, executors, or
administrators shall well and truly perform the full obligation (or
obligations) above stated according to the terms thereof, then this
obligation shall be null and void.
"Executed at the municipality of _________, in the Province of
________, this _____ day of 19_____
(Signature of mortgagor.)
"In the presence of
(Two witnesses sign here.)
FORM OF OATH.
"We severally swear that the foregoing mortgage is made for the purpose
of securing the obligation specified in the conditions thereof, and for
no other purpose, and that the same is a just and valid obligation, and
one not entered into for the purpose of fraud."
FORM OF CERTIFICATE OF OATH.
"At ___________, in the Province of _________, personally appeared
____________, the parties who signed the foregoing affidavit and made
oath to the truth thereof before me.
(Notary public, justice of the peace, 1 or other officer, as the case
Sec. 6. Corporations. — When a corporation is a
party to such mortgage the affidavit required may be made and
subscribed by a director, trustee, cashier, treasurer, or manager
thereof, or by a person authorized on the part of such corporation to
make or to receive such mortgage. When a partnership is a party to the
mortgage the affidavit may be made and subscribed by one member thereof.
Sec. 7. Descriptions of property. — The
description of the mortgaged property shall be such as to enable the
parties to the mortgage, or any other person, after reasonable inquiry
and investigation, to identify the same.
If the property mortgaged be large cattle," as defined by section one
of Act Numbered Eleven and forty-seven, 2 and the amendments thereof,
the description of said property in the mortgage shall contain the
brands, class, sex, age, knots of radiated hair commonly known as
remolinos, or cowlicks, and other marks of ownership as described and
set forth in the certificate of ownership of said animal or animals,
together with the number and place of issue of such certificates of
If growing crops be mortgaged the mortgage may contain an agreement
stipulating that the mortgagor binds himself properly to tend, care for
and protect the crop while growing, and faithfully and without delay to
harvest the same, and that in default of the performance of such duties
the mortgage may enter upon the premises, take all the necessary
measures for the protection of said crop, and retain possession thereof
and sell the same, and from the proceeds of such sale pay all expenses
incurred in caring for, harvesting, and selling the crop and the amount
of the indebtedness or obligation secured by the mortgage, and the
surplus thereof, if any shall be paid to the mortgagor or those
entitled to the same.
A chattel mortgage shall be deemed to cover only the property described
therein and not like or substituted property thereafter acquired by the
mortgagor and placed in the same depository as the property originally
mortgaged, anything in the mortgage to the contrary notwithstanding.
Sec. 8. Failure of mortgagee to discharge the
mortgage. — If the mortgagee, assign, administrator, executor, or
either of them, after performance of the condition before or after the
breach thereof, or after tender of the performance of the condition, at
or after the time fixed for the performance, does not within ten days
after being requested thereto by any person entitled to redeem,
discharge the mortgage in the manner provided by law, the person
entitled to redeem may recover of the person whose duty it is to
discharge the same twenty pesos for his neglect and all damages
occasioned thereby in an action in any court having jurisdiction of the
Sec. 9-12. (inclusive) 3
Sec. 13. When the condition of a chattel mortgage
is broken, a mortgagor or person holding a subsequent mortgage, or a
subsequent attaching creditor may redeem the same by paying or
delivering to the mortgagee the amount due on such mortgage and the
reasonable costs and expenses incurred by such breach of condition
before the sale thereof. An attaching creditor who so redeems shall be
subrogated to the rights of the mortgagee and entitled to foreclose the
mortgage in the same manner that the mortgagee could foreclose it by
the terms of this Act.
Sec. 14. Sale of property at public auction;
Officer's return; Fees; Disposition of proceeds. — The mortgagee, his
executor, administrator, or assign, may, after thirty days from the
time of condition broken, cause the mortgaged property, or any part
thereof, to be sold at public auction by a public officer at a public
place in the municipality where the mortgagor resides, or where the
property is situated, provided at least ten days' notice of the time,
place, and purpose of such sale has been posted at two or more public
places in such municipality, and the mortgagee, his executor,
administrator, or assign, shall notify the mortgagor or person holding
under him and the persons holding subsequent mortgages of the time and
place of sale, either by notice in writing directed to him or left at
his abode, if within the municipality, or sent by mail if he does not
reside in such municipality, at least ten days previous to the sale.
The officer making the sale shall, within thirty days thereafter, make
in writing a return of his doings and file the same in the office of
the register of deeds where the mortgage is recorded, and the register
of deeds shall record the same. The fees of the officer for selling the
property shall be the same as in the case of sale on execution as
provided in Act Numbered One hundred and ninety, 4 and the amendments
thereto, and the fees of the register of deeds for registering
the officer's return shall be taxed as a part of the costs of sale,
which the officer shall pay to the register of deeds. The return shall
particularly describe the articles sold, and state the amount received
for each article, and shall operate as a discharge of the lien thereon
created by the mortgage. The proceeds of such sale shall be applied to
the payment, first, of the costs and expenses of keeping and sale, and
then to the payment of the demand or obligation secured by such
mortgage, and the residue shall be paid to persons holding subsequent
mortgages in their order, and the balance, after paying the mortgages,
shall be paid to the mortgagor or person holding under him on demand.
If the sale includes any "large cattle," a certificate of transfer as
required by section sixteen of Act Numbered Eleven hundred and
forty-seven 5 shall be issued by the treasurer of the municipality
where the sale was held to the purchaser thereof.
Sec. 15. 6, 6a
Sec. 16. This Act shall take effect on August
first, nineteen hundred and six.
Enacted, July 2, 1906.
1. Now Municipal judge.
2. Now section 511 of the Administrative Code.
3. Repealed by Act 3815, Article 367 approved
December 8, 1930.
4. Now Rule 141, section 7 of the Rules of
5. Now Section 523 of the Administrative Code.
6. Superseded by section 198 of the
Administrative Code. The following is the present text of section 198
as amended by RA 2711, approved June 18, 1960.
"SECTION 198. Registration of chattel mortgages and fees collectible in connection
therewith. — Every register of deeds shall keep a primary entry book
and a registration book for the chattel mortgages; shall certify on
each mortgage filed for record, as well as on its duplicate, the date,
hour, and minute when the same was by him received; and shall record in
such books any chattel mortgage, assignment, or discharge thereof, and
any other instruments relating to a recorded mortgage, and all such
instruments shall be presented to him in duplicate, the original to be
filed and the duplicate to be returned to the person concerned.
"The recording of a mortgage
shall be effected by making an entry, which shall be given a
correlative number, setting forth the names of the mortgagee, and the
mortgagor, the sum or obligation guaranteed, date of the instrument,
name of the notary before whom it was sworn to or acknowledged, and a
note that the property mortgaged, as well as the terms and conditions
of the mortgage, is mentioned in detail in the instrument filed, giving
the proper file number thereof. The recording of other instruments
relating to a recorded mortgage shall be effected by way of annotations
on the space provided therefor in the registration book, after the same
shall have been entered in the primary entry book.
"The register of deeds shall also
certify the officer's return of sale upon any mortgage, making
reference upon the record of such officer's return to the volume and
page of the record of the mortgage, and a reference of such return on
the record of the mortgage itself, and give a certified copy thereof,
when requested, upon payment of the lawful fees for such copy; and
certify upon each mortgage officer's return of sale or discharge of
mortgage; and upon any other instrument relating to such a recorded
mortgage, both on the original and on the duplicate, the date, hour,
and minute when the same is received for record and record such
certificate with the return itself and keep an alphabetical index of
mortgagors and mortgagees, which record and index shall be open to
"Duly certified copies of such
records and of filed instruments shall be receivable as evidence in any
"The register of deeds shall
collect the following fees for services rendered by him under this
"(a) For entry or presentation of any document in the
primary entry book, one peso. Supporting papers presented together with
the principal document need not be charged any entry or presentation
fee unless the party in interest desires that they be likewise entered.
"(b) For filing and recording each chattel mortgage,
including the necessary certificates and affidavits, the fees
established in the following schedule shall be collected:
"1. When the amount of the
mortgage does not exceed six thousand pesos, three pesos and fifty
centavos for the first five hundred pesos or fractional part thereof,
and one peso and fifty centavos for each additional five hundred pesos
or fractional part thereof.
"2. When the amount of the
mortgage is more than six thousand pesos but does not exceed thirty
thousand pesos, twenty-four pesos for the initial amount not exceeding
eight thousand pesos, and four pesos for each additional two thousand
pesos or fractional part thereof.
"3. When the amount of the
mortgage is more than thirty thousand pesos but does not exceed one
hundred thousand pesos, seventy-five pesos for the initial amount not
exceeding thirty-five thousand pesos, and seven pesos for each
additional five thousand pesos or fractional part thereof.
"4. When the amount of the
mortgage is more than one hundred thousand pesos but does not exceed
five hundred thousand pesos, one hundred and seventy-six pesos for the
initial amount not exceeding one hundred ten thousand pesos, and ten
pesos for each additional ten thousand pesos or fractional part thereof.
"5. When the amount of the
mortgage is more than five hundred thousand pesos, five hundred
eighty-one pesos for the initial amount not exceeding five hundred
twenty thousand pesos, and fifteen pesos for each additional twenty
thousand pesos or fractional part thereof: Provided, however, That
registration of the mortgage in the province where the property is
situated shall be sufficient registration: And provided, further, That
if the mortgage is to be registered in more than one city or province,
the register of deeds of the city or province where the instrument is
first presented for registration shall collect the full amount of the
fees due in accordance with the schedule prescribed above, and the
register of deeds of the other city or province where the same
instrument is also to be registered shall collect only a sum equivalent
to twenty per centum of the amount of fees due and paid in the first
city or province, but in no case shall the fees payable in any registry
be less than the minimum fixed in said schedule.
"(c) For recording each instrument of sale,
conveyance, or transfer of the property which is subject of a recorded
mortgage, or of the assignment of mortgage credit, the fees established
in the preceding schedule shall be collected on the basis of ten per
centum of the amount of the mortgage or unpaid balance thereof:
Provided, That the latter is stated in the instrument.
"(d) For recording each notice of attachment,
including the necessary index and annotations, four pesos.
"(e) For recording each release of mortgage,
including the necessary index and references, the fees established in
the schedule under paragraph (b) above shall be collected on the basis
of five per centum of the amount of the mortgage.
"(f) For recording each release of attachment,
including the proper annotations, two pesos.
"(g) For recording each sheriff's return of sale,
including the index and references, three pesos.
"(h) For recording a power of attorney, appointment
of judicial guardian, administrator, or trustee, or any other
instrument in which a person is given power to act in behalf of another
in connection with a mortgage, three pesos.
"(i) For recording each instrument or order relating
to a recorded mortgage, including the necessary index and references,
for which no specific fee is provided above, two pesos.
"(j) For certified copies of records, such fees as
are allowed by law for copies kept by the register of deeds.
"(k) For issuing a certificate relative to, or
showing the existence or non-existence of, an entry in the registration
book, or a document on file, for each such certificate containing not
more than two hundred words, three pesos; if it exceeds that number, an
additional fee of fifty centavos shall be collected for every one
hundred words or fractional part thereof, in excess of the first two