People vs Wong Szu Tung 50 OG 4876 PAREDES; March 26, 1954 SUBJECT: Bulk Sales Law FACTS: Accused

Tung (Chinese) was the owner of the Kim Tay Seng Foundry Shop in Caloocan, Rizal, built on the land of Ocampo. Tung owed Ocampo over P2,000 for rental of the lands, which he failed to pay, despite demands. Ocampo threatened to sue Wong, and ordered the closing of the shop. Lim Guan offered to buy the shop and Ocampo had his lawyer prepare the deed of sale, which Wong signed. Ocampo received the P2,500 from the sale and applied it as payment for the rentals in arrears. However, Wong was also indebted to Shurdut Mills Supply Co., Inc., for P1,591.25. A complaint was filed to recover that amount, and judgment was obtained against Wong. When a representative of the Company went to the shop to demand payment, the shop had already been sold to Lim Guan. Wong is charged of violating Section 3 of the Bulk Sales Law, declaring that he willfully and voluntarily sold his shop, and that he received the purchase price thereof, without delivering to Guan a written statement containing the names and addresses of his creditors and the amounts of indebtedness due and owing them, as required by law. Bulk Sales Law (Act No 3952) Section 3: It shall be the duty of every person who shall sell, mortgage, transfer, or assign any stock of goods, wares, merchandise, provisions or materials in bulk, for cash or on credit, before receiving from the vendee, mortgagee, or his, or its agent or representative any part of the purchase price thereof, or any promissory note, memorandum, or other evidence therefore, to deliver to such vendee, mortgagee, or agent, or if the vendee, mortgagee, or agent be a corporation, then to the president, vice-president, treasurer, secretary or manager of said corporation, or, if such vendee or mortgagee be a partnership firm, then to a member thereafter provided, of the names and addresses of all creditors to whom said vendor or mortgagor may be indebted, together with the amount of indebtedness due or owing, or to become due or owing by said vendor or mortgagor to each of said creditors, which statement shall be verified by an oath to the ISSUE: Whether or not Wong violated Section 3 of the Bulk Sales Law when he sold his Shop without HELD

No. Wong was pressed to sign the deed of sale by his creditor Ocampo. With threats of closing the shop and court action for eviction, the accused was practically forced into signing the deed of sale. BUT, even if he hadnt been forced to sign the deed, he still would not be criminally liable. Act No. 3925 is penal in nature and should be construed strictly against the State. The object of sale was not covered by the provision. What was sold was the shop itself, together with the goodwill, credits, equipments, tools, machineries, which are not the stock of merchandise, goods, wares, provisions or materials in bulk contemplated in the provision. Meaning of merchandise according to a couple of American cases: Something that is sold everyday, and is constantly going out of the store and being replaced by other goods; must be construed to mean such things as are usually bought and sold in trade by merchants Meaning of stock: The common use of the term stock when applied to goods in a mercantile house refers to those which are kept for sale. A foundry shop, which does not sell merchandise, is not included in said law. Disposition We are of the opinion that the guilt of the appellant Wong Szu Tung has not been proven beyond reasonable doubt; consequently, the judgment appealed from is reversed, and the said appellant acquitted, with costs de officio