Warehouse

Receipts Law
(Act 2137)
Definitions
Warehouse: building or place
where goods are deposited
and stored for profit.

Warehouseman:

person
lawfully engaged in the
business of storing goods for
profit.

 Warehouse

receipt: . A
written acknowledgment by
the warehouseman that he
has
received and holds
certain
goods
therein
described in his warehouse
for the person to whom the
document is issued. The
warehouse receipt has two-
fold functions, that is, it is a
contract
and
a
receipt.
(Telengtan Bros. & Sons v. CA,
G.R. No. L-110581, Sept 21,
1994)

Purpose and
Coverage

Regulation

Protection
Convertibility
As documents of title.
Greater liability on
the warehouseman.

How to Set up a
Deposit in a
Warehouse

Pay the fee to the

warehouseman.
Deliver the goods to
be deposited.

Issuance of
warehouse receipt.
Store and care of
goods.
Return goods.

1. Pay the fee to

the
warehouseman.

For compensation
What is the effect if
deposits were made
free?

What is the effect if

the depositor fails to
pay
the
warehouseman?

2. Deliver the
goods
to be deposited.

Real Contract

What is the effect if

there was no delivery
and
a
warehouse
receipt was issued?

3. Issuance of
warehouse receipt.
Form? No particular form but
must be in writing.

Contents:

Location of warehouse

Date of issue

Consecutive number of
receipt,

Indication if receipt is
negotiable or not (Statement
whether goods will be delivered
to BEARER, SPECIFIED PERSON,
or to DEPOSITOR)

Rate of storage charges

Description of goods and

packages containing items

Signature of warehouseman
or his agent

Fact of ownership of the

warehouseman if any,

Advances made by
warehouseman which he claims
as lien.

Effect of omission/additional
terms

Kinds of Receipts
Issued by a
Warehouseman

4. Store and care

of goods.
Standard of Care: bonus

pater familias
Commingling:

Generally,
NO. Unless fungible goods.

Liabilities

compliance:

for

non-

 GR: Warehouseman liable

for ANY loss or injury to

the goods caused by his
failure to exercise the
proper standard of care
E: Not liable if could not

have been avoided with

ordinary diligence
E

to E: Stipulated in
contract for a higher
degree of diligence

5. Return goods.
When?

 GR:

Demand
is
NECESSARY in order for
a
warehouseman
to
make the delivery

E: Demand is evidently

useless, as when the

warehouseman
has
rendered it beyond his
power to deliver
E: Lawful excuses for

the warehouseman not

to deliver

Duties of a
Warehouseman
To deliver goods upon

demand
with:

accompanied

An offer to satisfy the

warehouseman's lien;

An offer to surrender
the
receipt,
if
negotiable, with such
indorsements as would
be necessary for the
negotiation
of
the
receipt; and

A
readiness
and
willingness to sign,
when the goods are
delivered,
an
acknowledgment
that
they
have
been
delivered,
if
such
signature is requested
by the warehouseman.

To Whom? In
General

 a)

The person lawfully

entitled to the possession of
the goods, or his agent;

(b) A person who is either

himself entitled to delivery
by the terms of a nonnegotiable receipt issued
for the goods, or who has
written authority from the
person so entitled either
indorsed upon the receipt
or written upon another
paper; or

 (c) A person in possession of

a negotiable receipt by the
terms of which the goods are
deliverable to him or order, or
to bearer, or which has been
indorsed to him or in blank by
the person to whom delivery
was promised by the terms of
the receipt or by his mediate
or immediate indorser.

5. Return goods.
To Whom?: Negotiable

Receipts

 To the HOLDER OF THE

RECEIPT or the PERSON

SPECIFIED
IN
THE
RECEIPT.
To

Whom?:
NonNegotiable Receipts

To

the DEPOSITOR OF
THE GOODS or the
PERSON SPECIFIED IN
THE RECEIPT

Nature and
Functions of a
Warehouse
Receipt

Proof
of
the
possession or control
of the goods described
therein; and

Authorizing
or
purporting to authorize
the possession of the
warehouse receipt to
transfer or receive,
either
by
endorsement or by
delivery,
of
the
goods
represented
by such receipt.

Assignment
/Negotiation of
Warehouse Receipt
GR: Transfer of Title

E: Equitable Mortgage

Non-negotiable
Receipt

Negotiable To Order
Warehouse Receipt

Negotiable Bearer
Warehouse Receipt

Deliver to Mr. X
1,000 sacks of
first grade sugar.
Sgd. B.
Deliver to Mr. X or
order 1,000 sacks
of
first
grade
sugar. Sgd. B

Deliver to Mr. X or
bearer
1,000
sacks
of
first
grade sugar. Sgd.
B
Duties of a
Warehouseman

To deliver goods upon

demand

Liable for misdelivery

 Cancel/mark

when
delivered
Liable

receipt
goods
are

for
altered
receipts/lost
or
destroyed
receipts/duplicate
receipts/non-existence
or
misdescription
of
goods/loss or injury of
goods/non separation of
goods/fungible
goods/commingled
goods

Warehouseman's
Lien
GR: Warehouseman cannot
set up title or right to
the possession of the
goods deposited.
E: Lien on the goods
deposited or the proceeds
for all lawful charges and
fees.
Remedies available:
Refusal to deliver

 Sell

the goods and apply

the proceeds to the value
of the lien.

Other remedies (ordinary

action): creditor against

debtor
and
for
enforcement
of
lien
against personal property.

 Q: X was issued by a

warehouseman
a
negotiable receipt for
safekeeping by the
latter of his goods.
Can
the
judgment
creditor of X levy by
execution the goods
covered
by
the
negotiable receipt?

 A:

The goods cannot,

while in the possession
of the warehouseman,
be
attached
by
garnishment
or
otherwise, or be levied
upon under an execution
unless the receipt be
first surrendered to the
warehouseman, or its
negotiation enjoined.

 Q: X was issued by a
warehouseman
a
negotiable receipt for
safekeeping
by
the
latter of his goods. X
indorsed and delivered
the receipt to Y who
paid for value and in
good faith. Suppose Z,
went
to
the
warehouseman
and
claimed that the goods
deposited were stolen
from him. To whom
should
the
warehouseman deliver
the goods?

 A: Neither, since the title or

ownership over the goods
is
in
question
or
is
disputed, the safe course
of action is to file a
complaint in interpleader
against the two claimants
in order to compel them to
litigate against each other.

Criminal Offenses
Issuing receipt for goods

not received.
Issuing receipt containing

false statements.

 Issuing a duplicate not so

marked.
Issuing a receipt

warehousemans interest
in the goods if applicable.
Delivering goods without

obtaining the receipt

covering them.
Depositing goods for one

who has no title or

covered by mortgage or
lien and negotiating the
receipts received without
proper disclosure.