PHILIPPINE NATIONAL BANK, Petitioner, vs. HON. PRES. JUDGE BENITO C.

SE, JR., RTC, BR. 45, MANILA; NOAHS ARK SUGAR REFINERY; ALBERTO
T. LOOYUKO, JIMMY T. GO and WILSON T. GO, Respondent.

FACTS:

Respondent Noahs Ark Sugar Refinery issued on several dates, five (5) Warehouse Receipts/quedans
covering sugar deposited by certain Rosa Sy and Therese Merchandising, Two quedans were negotiated
and endorsed to Luis T. Ramos, and the rest to Cresencia K. zoleta. Both used the receipts as security for
loans worth 1.6 and 23.5 million, respectively. They failed to pay their loans.

Petitioner PNB wrote the refinery (Noah’s) to demand delivery of the sugar stocks covered by the receipts
which Noahs refused to comply alleging their ownership. Bank filed with RTC Mnaila a complaint ("Specific
Performance with Damages and Application for Writ of Attachment") against the refinery, its proprietors
and officers.

Repondent Judge Se, denied the application for preliminary attachment. Reconsideration was also denied.
Respondent Noah’s filed a counterclaim for their ownership of the subject receipts/quedans and the
sugar covered therein since when they sold the sugar to a certain Rosa Sy, the check issued by Sy were
dishonored by the bank because of stopped payment and insufficient funds causing Noah’s refusal to
deliver the sugar covered by the receipts. Since the vendees did not acquire ownership over the said
receipts, the subsequent endorsers (Ramos and Zoleta) did not acquire a better right of ownership over
the subject.

Proprietors (Looyuko and Go) incorporated a Third party complaint against Sy and prayed the delivery or
return of the quedans (which was endorsed to PNB) and pay damages. Sy claimed that they are not liable
for any damage claims.

PNB favored the plaintiff and filed a Motion for Summary Judgment which the court denied. PNB filed for
certiorari. CA nullified the order of the RTC and ordered the issuance of summary judgment in favor of
PNB.

RTC dismissed plaintiffs (proprietors) complaint against Sy for lack of cause of action and the respondents
(Sy) counterclaims against PNB and Third Party complaint (proprietors). RTC denied PNBs Motion for
reconsideration. PNB appealed to SC which ruled in favor of PNB. Respondents (Noahs’s) moved for
reconsideration and clarification of the decision which were both denied.

Noah’s filed for Omnibus Motion (deferment of proceedings until reception of evidence) – granted. PNB
filed for writ of execution – ordered deferred. RTC issued an order in favor of Noah’s – ordered stayed and
precluded. PNB moved to nullify the RTC’s order.

Issues:

Legality of orders issued by the RTC judge, since SC already denied with finality the claim of respondents
that PNB cannot compel them to deliver the stocks covered by the quedans or pay the value.

Ruling.

SC ruled in favor of respondents.

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Earlier decision (CA - SC favoring PNB) did not carry the denial of the warehousemans lien over the sugar
stocks covered by the subject Warehouse Receipts, but the decision is only to resolve and upheld the
issuance of summary judgment which was then assailed by private respondents.

There was no point in taking up the issue of warehousemans lien since the matter of ownership was as
yet being determined. Neither could storage fees be due then while no one has been declared the owner
of the sugar stocks in question. But there is no question in the subject Warehouse Receipts provision,
storage fees are chargeable and petitioner PNB is legally bound to stand by the express terms and
conditions on the face of the Warehouse Receipts as to the payment of storage fees as the receipts were
negotiated by Ramos and Zoleta for a loan. Law and equity dictate the payment of the warehouseman’s
lien pursuant provisions of the Warehouse Receipts Law

Considering that petitioner does not deny the existence, validity and genuineness of the Warehouse
Receipts on which it anchors its claim for payment against private respondents, it cannot disclaim liability
for the payment of the storage fees stipulated therein

Petitioner is in estoppel in disclaiming liability for the payment of storage fees due the private
respondents as warehouseman while claiming to be entitled to the sugar stocks covered by the subject
Warehouse Receipts on the basis of which it anchors its claim for payment or delivery of the sugar stocks.
The unconditional presentment of the receipts by the petitioner for payment against private respondents
carried with it the admission of the existence and validity of the terms, including the unqualified
recognition of the payment of warehousemans lien for storage fees and preservation expenses. Petitioner
may not now retrieve the sugar stocks without paying the lien due private respondents as warehouseman

While the PNB is entitled to the stocks of sugar as the endorsee of the quedans, delivery to it shall be
effected only upon payment of the storage. Imperative is the right of the warehouseman to demand
payment of his lien at this juncture. The lien may be lost where the warehouseman surrenders the
possession of the goods without requiring payment of his lien, because a warehousemans lien is
possessory in nature

We, therefore, uphold and sustain the validity of the assailed orders of public respondent.
WHEREFORE, the petition should be, as it is, hereby dismissed for lack of merit. The questioned orders
issued by public respondent judge are affirmed

RAMON GONZALES, plaintiff-appellee, vs.

GO TIONG and LUZON SURETY CO., INC., defendants-appellants.

FACTS:
Go Tiong owned a rice mill and warehouse, located at Mabini, Urdaneta, Pangasinan. He obtained a
license of a bonded businessman with Luzon Surety Co., with conditions he failed to fulfill. The warehouse
and palay deposited therein were insured with the Alliance Surety and Insurance Company.

Ramon Gonzales deposited palay to Go Tiong even before he got the license who later demanded the
value of his deposits. But Go Tiong failed to give him his value until fire burned down the warehouse, with
sacks in excess of that was authorized under his license. The receipts issued to Gonzales were ordinary
receipts and not the warehouse receipts as defined by Warehouse receipts act.

Plaintiff filed their claims with the Bureau of Commerce and wt hthe proceeds of the insurance policy,
BOC paid off some claims. Plaintiff’s counsel withdrew the claims, because according to court othing came
from plaintiff's efforts to have his claim paid, inconsistent with what Go Tiong claimed that it was denied.

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Gonzales filed claims both against Gonzales and Luzon Surety, and renewed his claim with BOC. Gonzales
and Go Tiong entered into a contract of amicable settlement to the effect that upon the settlement of all
accounts, but upon failure to comply, Gonzales prosecuted his court action. Court ruled in favor of
Gonzales. Hence this appeal.

ISSUE:
Is the plaintiff’s claim covered by the Civil Law, and not Bonded Warehouse Act for the reason that, Go
Tiong issued to plaintiff were ordinary receipts, not the warehouse receipts contemplated by the
Warehouse Receipts Law, and because the deposits of palay of plaintiff were gratuitous?

RULING:
Consequently, any deposit made with him as a bonded warehouseman must necessarily be governed by
the provisions of Act No. 3893. Though it is desirable that receipts issued by a bonded warehouseman
should conform to the provisions of the Warehouse Receipts Law, said provisions are not mandatory and
indispensable in the sense that if they fell short of the requirements of the Warehouse Receipts Act, then
the commodities delivered for storage become ordinary deposits and will not be governed by the
provisions of the Bonded Warehouse Act.

As the trial court well observed, as far as Go Tiong was concerned, the fact that the receipts issued by him
were not "quedans" is no valid ground for defense because he was the principal obligor. Furthermore, as
found by the trial court, Go Tiong had repeatedly promised plaintiff to issue to him "quedans" and had
assured him that he should not worry; and that Go Tiong was in the habit of issuing ordinary receipts (not
"quedans") to his depositors.

Considering the fact, as already stated, that prior to the burning of the warehouse, plaintiff demanded the
payment of the value of his palay from Go Tiong on two occasions but was put off without any valid
reason, it is illogical and unreasonable to hold that the presumption of negligence in case of this kind is
rebutted by the bailee by simply proving that the property bailed was destroyed by an ordinary fire which
broke out on the bailee's own premises, without regard to the care exercised by the latter to prevent the
fire, or to save the property after the commencement of the fire.

Besides, as observed by the trial court, the defendant violated the terms of his license by accepting for
deposit palay in excess of the limit authorized by his license, which fact must have increased the risk.

Appealed decision affirmed.

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