In  May  1954, Manila Motor  Company  filed in  the Municipal Court of Manila a complaint to recover from Manuel T.  Flores the  amount of P1,047.98  as  chattel mortgage installments which  fell due in September 1941. Defendant pleaded prescription: 1941 to 1954.  The complaint was dismissed.  On  appeal, the  Court  of First Instance saw differently, sustaining plaintiff's contention that the moratorium  laws had interrupted the running of the prescriptive  period, and that deducting  the time during which said laws were  in  operation three  years and eight months^[1] the ten-year term had not yet elapsed when complainant sued for collection in May  1954.  Wherefore said court  ordered  the return of the case to the municipal judge  for trial on the merits.

Defendant appealed, arguing principally that the moratorium laws did  not have the effect of suspending the period of limitations, because they were  unconstitutional, as declared by this court in  Rutter vs. Esteban, 49 Off.  Gaz. (5) 1807.   He cites  jurisprudence holding that  when a statute is adjudged unconstitutional it is as inoperative as if it had never been passed, and no  rights  can  be  built upon it.^[2]

Some members expressed doubts as to whether the order of the  lower  court  was  appealable  in  nature;  but  we agreed not to discuss the point, inasmuch as the  question submitted  by  appellant  could  speedily  be  disposed  of. In Montilla vs. Pacific Commercial ^[3] we held  that  the moratorium laws  suspended the period of prescription.   That was rendered after the Rutter-Esteban decision.  It should be stated  however,  in  fairness to  appellant, that the Montilla decision  came down after he had submitted his brief.   And in answer to  his  main  contention,  the following portion is quoted from a resolution of this Court ^[4]

 "2. Rutter vs.  Esteban  (93 Phil.,  68) may be  construed to mean that at the time  of the decision the Moratorium law could  no longer be validly applied because of the prevailing  circumstances. At any rate, although the general rule is that an unconstitutional  statute  

'confers  no right,  creates  no office, affords no protection and justifies no acts performed under it.'   (11 Am.  Jur.,  pp. 828,  829.) 

 there are several instances wherein courts, out of  equity, have relaxed its operation  (cf.  notes in Cooley's Constitutional Limitations 8th ed.,  p.  383  and Notes  53 A. L. R., 273) or  qualified  its effects  'since the actual existence  of a  statute  prior  to such declaration is an operative fact, and may have  consequences which cannot justly be ignored (Chicot County vs. Baster, 308 U. S., 371) and a realistic approach is eroding the general doctrine  (Warring vs. Colpoys, 136 Am. Law Rep., 1025, 1030)."

Judgment affirmed, without costs.

Paras, C. J.,  Padilla,  Montemayor, Bautista  Angelo, Labrador, Concepcion, Reyes, J. B. L., Endencia, and Felix, JJ., concur.
   
 

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^[1] See Alcantara vs. Chico, 49 Off. Gaz. No. 1, p. 150.
^[2] Norton vs. Shelby, 118 U.S., 425-454; Am. Jur. Vol. 11, p. 827.
^[3] 98 Phil., 133
^[4] Araneta vs. Hill, 93 Phil., 1002.