Royal Shirt Factory vs Co, G.R. No.

L-6313

Facts:

An action for the recovery of money by Royal Shirt Factory from Co Bon Tic the sum of P1,422 to
represent the balance of the price of 350 pairs of “Balleteenas” shoes at P7 a pair with interest at 12%
per annum

Issue:

Whether it was an outright sale or a sale merely on consignment? Municipal court held that it was a sale
on consignment while CFI held that it was an outright sale.

Held:

It was an outright sale. In Exhibit A, an order slip contained a condition in the sale. According to the
testimony of Mr. Chebat it means that Co could either consider the sale as 1) one on consignment, sell
as many shoes as he could for any price and pay for it at P8 a pair and at the end of 9 days, return the
shoes unsold; or 2) an absolute sale at P7 a pair. Since he was not able to return any of the shoes at the
end of nine days, he must have chosen the second alternative. But since this was self-serving evidence,
it was not admitted.

The court looked at the conduct of the parties. Exhibit B was an invoice of the same 350 shoes including
sales tax listed as P2,450. It was noted down in his own handwriting the different partial payments of
P500, P528 and lastly the P420 by check. It was obvious that he accepted the outright sale since in
making the partial payments, he made no mention of the number of shoes sold by him
and the number of shoes remaining unsold which he should have done if the sale was on
consignment.
The Overseas Bank of Manila vs Cordero, G.R. No. L-33582

Facts:

Cordero opened a one-year time deposit with Overseas Bank of Manila in the amount of P80K with
interest at the rate of 6% per annum. Due to the distressed financial condition of the bank, it was unable
to pay Cordero his said time deposit and its interest. Cordero instituted an action at the CFI. The bank
raised as special defense its state of insolvency. CFI rules in favor of Cordero. CA affirms. There were
certain supervening events regarding the principal amount. It turns out that Cordero’s brother and atty-
in-fact, already received P10K from PDIC. Also, the brother already received the sum of P73,840. So the
principal claim of respondent was already satisfied. The only issue remaining was the interest

Issue:

Is the respondent entitled to the interest on his time deposit during the period that petitioner was
closed?

HELD:

No. A bank should pay stipulated interest on money deposited if it was able to generate funds to cover
the payment of such interest. But this obligation to pay interest on the deposit ceases from the moment
the operation of the bank is completely suspended by the Central Bank.
Ramos vs Central Bank, G.R. No. L-29352

Facts:

This is a resolution only so the facts are limited.

There was a MR filed by Central Bank regarding the Court’s Resolution applying the Tapia ruling
reaffirmed by the court in cases such as OBM vs Cordero (previous case) that the bank is not liable for
interest on the Central Bank loans and advances during the period of its closure.

Issue: Payment of interest

The payment of interest should not be made.