
    Kuinlan v. Meléndez.
    Appeal from the District Court of Arecibo.
    No. 31.
    Decided May 6, 1904.
    Promissory Note — Evidence—Allegations.—Pacts admitted in the complaint or answer by the party to be injured thereby are considered as fully established, and it is not necessary to admit evidence as to the existence thereof.
    Id. — Witnesses.—The testimony of witnesses taken without the requirements and formalities prescribed by the Law of Civil Procedure is of no force or effeet.
    Prescription — Commercial Promissory Notes. — Actions arising from commercial promissory notes are barred at the end of three years from the maturity thereof, whether protested or not.
    Id. — Commercial Loans. — Where one of the contracting parties is a merchant, and the things given as a loan are intended for commercial transactions, the loan will be reputed to be one of a commercial character.
    
      Id. — Obligations Payable Annually or in Shorter 'Periods. — Actions originating in obligations payable annually or in shorter periods prescribe at the end of five years.
    Id. — Personal Actions. — Personal actions for which no special period of prescription has been fixed are barred in fifteen years.
    Id.- — -According to the Code of Commerce of 1829, no action for the collection or reimbursement of drafts or commercial promissory notes could be instituted after the expiration of four years from their maturity.
    Id. — When prescription had begun to run prior to the publication of the Civil Code of 1889, it was governed by the laws antecedent thereto; but if, after it went into force, all the time required by said Code to constitute prescription had elapsed, the same would be given effect, even though a greater lapse of time may have been required by prior laws.
    STATEMENT OF THE CASE.
    This is an action brought in the District Court of Arecibo by Gregorio Kninlan, plaintiff, against Gumersindo Meléndez, defendant, for the recovery of a debt; which case is pending before us on appeal in cassation for error of law, now ordinary appeal, taken by Kninlan from the judgment rendered by said court. The party appellant was represented in this Supreme Court by Attorney Rafael López Landrón, the respondent having failed to appear.
    The aforesaid judgment reads as follows:
    “Judgment No. 16. — In the city of Arecibo, March 25, 1902. A hearing before this district court was held of the declaratory action brought by Gregorio Kuinlan, a resident of this city, represented by Attorney Manuel C. Figueroa, against Gumersindo Meléndez, a resident of Barros, represented by Attorney Ramón Nadal Santa Coloma for the recovery of a debt.
    “On October 8, 1903, Attorney Manuel 0. Figueroa brought in this court, on behalf of Gregorio Kuinlan, a declaratory action against Gumersindo Meléndez, as partner and successor of the commercial firm which formerly did business in the town of Manatí under the name and style of Meléndez Hermanos. He filed with the complaint a promissory note, executed in Manatí under date of May 30, 1885, by Meléndez Hermanos, in favor of Antonia Delgado, for tbe sum of one thousand pesos of tbe money tben in circulation, and indorsed by said Delgado to tbe order of Gregorio Kuinlan, in wbicb said note Antonia Delgado acknowledges tbe receipt of two hundred pesos on account thereof on tbe 31st of July of that year. The facts alleged are: That by a private document executed May 30, 1885, in the town of Manatí, the mercantile firm known as Meléndez Hermanos agreed to pay Antonia Delgado, of the same locality, or to her order, on May 30, 1886, the sum of one thousand pesos of the money then current, it being stipulated that the debt was to be extinguished by monthly payments of one hundred pesos, with interest at one per cent, until final settlement within the period fixed therefor; that on July 31, 1885,. Mrs. Delgado received from the debtor firm on account of said debt,, the sum of two hundred pesos of the same money, receipt whereof was: indorsed at the foot of said note at her request by the late José A.. Espinóla, formerly internal revenue collector for Manatí, and she continued to receive the monthly interest at one per cent, as agreed upon on the remaining eight hundred pesos of the note to which the debt had been reduced, up to May 31, 1887; that on June 30 of said year the creditor Delgado indorsed to the order of her representative Kuinlan the note for eight hundred pesos, with interest accrued from said month of June against the firm of Meléndez Hermanos, said in-dorsement being signed at her request by aforesaid José A. Espinóla, and that José Elias Meléndez, a partner of the debtor firm, having died, the other partner, Gumersindo Meléndez, became the successor to the assets and liabilities of the copartnership, but so far he has failed to take up the note made by said firm in favor of Mrs. Delgado, and now the property of Gregorio Kuinlan, nor has he even paid the interest agreed upon. As legal grounds of action he cited articles 1170, 1108 and 112 of the Civil Code, 461, 533 and 127- of the Code of Commerce; paragraph 5 of article 459, and the first rule of article 62 of the Law of Civil Procedure, and section 63 of General Order No. 118. He closed with the prayer that final judgment be rendered adjudging Gumer-sindo Meléndez, as successor of the copartnership of Mélendez Herma-nos, to pay his client Gregorio Kuinlan, indorsee of accompanying promissory note, within the period of three days, the sum of $1,240.32 United States currency, and principal and monthly interest agreed upon at one per cent, up to September 30 of last year, besides interest on the interest accrued from the date of the commencement of the action until final payment, and costs. By supplementary prayer he requested that, owing to the advanced age and delicate health of Mrs. Delgado, whose infirmities endangered her life, she he examined in her own home as to the receipt by her of two hundred, pesos on account of the promissory note and her indorsement of the balance of the latter and the interest thereon, in favor of the plaintiff, as provided for by article 501 of the Law of Civil Procedure.
    “The complaint having been admitted, the municipal judge of Manatí was commissioned to take the testimony of Mrs. Delgado, and notice of said complaint was served upon the defendant Gumersindo Meléndez, who was summoned to appear within the period prescribed by law. He answered the same through Attorney Ramón Nadal Santa Coloma, alleging the following facts: That 'the business copart-nership which existed in Manatí until November, 1885, was indebted to Salvador Calaf, a resident of said town, in the sum of one thousand and thirty-three pesos, Mexican money, proceeding from a loan made to said firm by Calaf, under the guarantee of Antonia Delgado, a resident of the same town. The latter paid Calaf the money that was due him, whereby she became a creditor of Meléndez Hermanos for the sum of one thousand pesos of said money; that on August 21,1885, the death of José Elias Meléndez, managing partner of said firm, occurred, and the day after his burial, José Lorenzo Casalduc, recording clerk of this town, appeared on the premises of said business concern, accompanied by a constable, and levied an attachment on the property thereof for account of S. Melón & Co., of San Juan, to secure a debt of five hundred and seventy-seven pesos and seventy-two centavos; that by reason of said'attachment, the firm of Meléndez Hermanos was compelled to call a meeting of its creditors, looking to a friendly settlement of its liabilities, and having failed to reach an agreement, the firm declared itself in a state of bankruptcy, whereupon all the stock, assets and liabilities of the concern were taken charge of by the court of first instance, the stock being awared at public sale to the firm of P. Benero & Co., of Manatí, for three thousand pesos; that by reason of the failure the firm of Meléndez Hermanos, of which the defendant was also a managing partner, ceased to exist; that from said date, when all the properties of the bankrupt firm were attached on behalf of the creditors thereof, his client has not again engaged in business; that not a single one of the creditors of Meléndez Hermanos has ever from that day to the present moment presented any claim against his client, much less Antonia Delgado or the plaintiff Gregorio K'ninla.n; and that his client owes nothing either to Mrs. Delgado or to Kninlan; nor is he, as the iormer managing partner of the firm of Mélendez Hermanos, responsible for the debt sought to be recovered from the time said firm was declared in a state of bankruptcy and its property seized, sold at auction and delivered to its creditors; and even were it not so, said firm being no longer in existence, whatever action its creditors had or might have had has already prescribed. As-legal grounds he cited articles 874, 875, 883, 884, 311, 942, 944, 949 and 950 of the Code of Commerce; and closed praying that the complaint be dismissed, with costs against the plaintiff.
    ‘‘The parties having been summoned to appear on the third day of December last for the submission of evidence, this proceeding was suspended at the request of the parties, and the 24th of -January of the current year was again set for the purpose, when they again failed to appear, although cited in due form, whereupon the court, pursuant to the provision of rule 54 of General Order No. 118, set February 26 for the public hearing, the plaintiff requesting that the defendant be cited to appear on said day for the purpose of answering interrogatories; but. as both parties, by common consent, then asked that the hearing be adjourned, the 19th instant was again set therefor.
    “The plaintiff having requested that at the hearing the defendant be again summoned to answer interrogatories, the court, in an order of the 12th instant, denied the admission of said evidence because it had not been proposed in due time, upon which order the plaintiff requested a rehearing and three days’ notice was given to the opposite party on the 18th instant.
    “The hearing was had on the day set therefor, the parties being present, when the plaintiff stated that inasmuch as he had requested a reconsideration of the order of0the 12th instant, notice whereof had been given to the adverse party, he asked that the latter make, then and there, such -declarations as might be necessary for the decision of said matter. The right to speak was granted Attorney Nadal, who opposed the motion on the ground that said evidence was inadmissible, according to General Order No. 118; and the court, after deliberating, disallowed the reconsideration prayed for. The right to speak was again granted to counsel for both parties, who argued in behalf of their respective clients and the protest made by counsel for he plaintiff on the ground of the non-admission of the proof of confession in court having been entered, the hearing was closed. Yesterday having been set for the voting of the judgment, the same was unanimously-rendered by the judges in open court, none of the parties being present.
    “AR the legal provisions have been observed at the hearing of this ease.
    “Judge Juan José Perea y Baster prepared the opinion of the court.
    “This action was brought for the recovery of the sum of $1240.32 United States currency, as principal and interest due on eight hundred pesos, Mexican money. In support of said action there was filed with it a promissory note signed by Melendez Hermanos, at Manatí, May 30, 1885, in favor of Antonia Delgado, for one thousand pesos of said money, payable March 30, 1886, with the stipulation that said debt was to be extinguished by monthly payments of one hundred pesos, with interest at one per cent., until the expiration of the term agreed upon therein, which note was indorsed by the creditor in favor of Gregorio Kuinlan, on June 30, 1887.
    “Although the defendant, in his answer to the complaint, acknowledged the existence of the debt, for which reason no further evidence is required upon this point, since the law considers as fully proved the facts admitted in the complaint and answer by the party injured thereby, said defendant set up in his answer the exception of prescription.
    “The action arising from the promissory note presented for the purpose of recovering the amount thereof has prescribed by reason of the lapse of time specified by law, computed from the date when the same could have been instituted, whether it be considered in the nature of a mercantile or a civil action.
    “Actions arising from promissory notes of commerce are extinguished three years after the maturity thereof, whether protested or not.
    “The promissory note presented herein must be considered as commercial paper, because a loan is reputed to be commercial when one of the contracting parties is a merchant and when the things loaned are intended for commercial transactions.
    “The loans involved in this case were commercial, and Meléndez Hermanos, as a commercial entity, had no existence nor objects to be accomplished outside of its mercantile life, and only to the needs of this character arising from its business could it have applied the money received.
    “Even on the supposition (not admissible, but urged by the plaintiff at the trial), that the promissory note was in the nature of a civil instrument, the action to recover the amount thereof would also have prescribed, because actions to enforce payments which should have been made annually or for shorter periods prescribe in five years, and the payment demanded was to be malde in ten months, at the rate of one hundred pesos per month with interest thereon, until the expiration of the stipulated term, namely, on March 30, 1886.
    “Even should we apply'to this case the legal provisions regarding the prescription of personal actions for which no special term is fixed, it would likewise have prescribed, because from March 30, 1886, to October 8, 1901, when the complaint was filed, more than fifteen years have elapsed.
    ‘ ‘ It has not been shown that, subsequently to the date of maturity, March 30, 1886, any payment on account of principal or interest was made by the debtors; for the credit of two hundred pesos recorded in a (memorandum affixed to the promissory note was made prior to said date, and Antonia Delgado, in her deposition, makes no mention of her having received any sums on account of interest, subsequently thereto; nor would said deposition, coming, as it does, from the debtor and indorser, be sufficient evidence (even in ease of its producing any effect, which it cannot do), because the examination of said witness was not made in accordance with the provisions of the Law of Civil Procedure, that is to say, after due citation of the parties and with the other formalities and'requisites specified by said Law.
    “Costs shall always be paid by the litigant who loses his case on all points.
    “In view of articles 1961, 1964, paragraph 3 of article 1966, and article 1969 of the Civil Code, articles 311 and 950 of the Code of Commerce, articles 501, 564 and 569 of the Law of Civil Procedure, •and rules 54, 59 and 63 of General Order No. 118, we adjudge that we should release and do release Gumersindo Meléndez, as copartner and successor of the mercantile firm of Meléndez Hermanos, from the action brought against him in this case by Gregorio Kuinlan, upon whom we impose the costs hereof. Thus, finally adjudging, do we pronounce, order and sign. Felipe Cuchí, Juan J. Perea, Otto Scho enrich.”
    
      From this judgment counsel for Gregorio Kuinlan took an appeal in cassation for breach of form and error of law. The former was disallowed by a decision of November 3,1902, and the latter conducted as an ordinary appeal. The parties were given an opportunity to examine the record, the appellant through his counsel, and the respondent by service in the court room, after which a day was 'set for the hearing, -Which took place, counsel for Gregorio Kninlan being present.
    
      Mr. López Landrón, for appellant.
    The respondent did not appear.
   Me. JtrsTicE HeRNÁNdez,

after making the above statement of facts, delivered the opinion of the court.

The findings of fact and conclusions of law, as contained in the judgment appealed from, are accepted.

Even should we apply, in the decision of this case, the Code of Commerce of 1829, which was in force at the time the promissory note in question was made by the firm of Meléndez Hermanos, the right of action would have prescribed under article 569 of said Code, according t-o which no action can be maintained for the payment or reimbursement of drafts and commercial promissory notes- after the lapse of four years from their maturity; and should the common law be applied, theire would still be prescription as a means of extinguishing the obligation arising from aforesaid document, for, according to article 1939 of the Civil Code of 1899, prescription which began to run before the publication of said Code was to be governed by the prior laws; but if, after it became operative, all the time required therein for prescription had elapsed, it was to be effectual, even if according to said prior laws a longer period of time might be required.

In view of the legal provisions hereinbefore cited and those that are cited in the judgment, we adjudge that we should affirm and do affirm the judgment rendered by the District Court of Arecibo, March 25, 1902, 'with costs of the appeal also ag’ainst the appellant. The record is ordered to be returned to aforesaid court, together with the proper certificate.

Chief Justice Quiñones and Justices Figueras and Mac-Leary concurred.

Mr. Justice Sulzbacher did not sit at the hearing of this case.  