1. Catholic Vicar v. CA (G.R. Nos.

80294-95, March 23, 1990, 165 SCRA 515)

2. Republic v. Bagtas (G.R. No. L-17474, October 25, 1962, 6 SCRA 262)

3. Siga-an v. Villanueva (G.R. No. 173227, January 20, 2009, 576 SCRA 697)

4. Guingona v. City Fiscal (G.R. No. L-60033, April 4, 1984, 128 SCRA 577)

5. New Sampaguita Builders v. PNB (G.R. No. 148325, September 3, 2007, 435 SCRA 265)

6. PNBv.Noah’sArkSugarRefinery(G.R.No.107243,September1,1993,

226 RA 36)

7. PNBv.Se(G.R.No.119231,April18,1996,256SCRA380)

8. PNBv.Sayo(G.R.No.129918,July9,1998,292SCRA202)

9. Makati Shangri-La v. Harper (G.R. No. 189998, August 29, 2012, 679 SCRA 445)

10. YHT Realty v. CA (G.R. No. 126780, February 17, 2005, 451 SCRA 638)

11. Malayan Insurance Co. v. Salas (G.R. No. L-48820, May 25, 1979, 90 SCRA 252)

12. Diño v. CA (G.R. No. 89775, November 26, 1992, 216 SCRA 9)

13. Willex Plastic Industries v. CA (G.R. No. 103066, April 25, 1996, 256 SCRA 479)

14. South City Homes v. BA Finance Corporation (G.R. No. 135462 - December 7,

2001, 371 SCRA 603)

15. Sps.Sombilonv.Atty.GarayandPNB(G.R.No.179914,June16,2014,726 SCRA 397)

16. Palileov.Cosio(G.R.No.L-7667,November28,1955,97Phil.919)

17. DBP v. NLRC (G.R. Nos. 100264-81, January 29, 1993, 236 SCRA 117)

18. Republic v. Peralta (G.R. No. L-56568, May 20, 1987, 150 SCRA 37)

19. Philippine Savings Bank v. Lantin (G.R. No. L-33929. September 2, 1983, 209 Phil. 382)

20. AFP General Insurance v. Molino (G.R. No. 151133, June 30, 2008, 556 SCRA 630)

CATHOLIC VICAR VS. CA

CATHOLIC VICAR APOSTOLIC OF THE MOUNTAIN PROVINCE, petitioner, 

COURT OF APPEALS, HEIRS OF EGMIDIO OCTAVIANO AND JUAN VALDEZ, respondents
G.R. No. 80294-95 September 21, 1988
Nature: Review on certiorari
Keywords: Recovery of possession, commodatum, adverse possession
Summary: -
- Catholic Vicar Apostolic of the Mountain Province (VICAR for brevity) filed an application for registration of title over
Lots 1, 2, 3, and 4, said Lots being the sites of the Catholic Church building, convents, high school building, school
gymnasium, school dormitories, social hall, stonewalls, etc.
- The Heirs of Juan Valdez and the Heirs of Egmidio Octaviano filed their Answer/Opposition on Lots Nos. 2 and 3,
respectively, asserting ownership and title thereto since their predecessors’ house was borrowed by petitioner Vicar
after the church and the convent were destroyed..
- After trial on the merits, the land registration court promulgated its Decision confirming the registrable title of VICAR
to Lots 1, 2, 3, and 4. The Heirs of Juan Valdez appealed the decision of the land registration court to the then Court of
Appeals, The Court of Appeals reversed the decision. Thereupon, the VICAR filed with the Supreme Court a petition
for review on certiorari of the decision of the Court of Appeals dismissing his application for registration of Lots 2 and
3.

GANCAYCO, J.

Facts:

-  1962: Catholic Vicar Apostolic of the Mountain Province (Vicar), petitioner, filed with the court an application for the
registration of title over lots 1, 2, 3 and 4 situated in Poblacion Central, Benguet, said lots being used as sites of the Catholic
Church, building, convents, high school building, school gymnasium, dormitories, social hall and stonewalls.

- 1963: Heirs of Juan Valdez and Heirs of Egmidio Octaviano claimed that they have ownership over lots 1, 2 and 3. (2 separate
civil cases)

- 1965: The land registration court confirmed the registrable title of Vicar to lots 1 , 2, 3 and 4. Upon appeal by the private
respondents (heirs), the decision of the lower court was reversed. Title for lots 2 and 3 were cancelled.

- VICAR filed with the Supreme Court a petition for review on certiorari of the decision of the Court of Appeals dismissing his 
application for registration of Lots 2 and 3.

- During trial, the Heirs of Octaviano presented one (1) witness, who testified on the alleged ownership of the land in question
(Lot 3) by their predecessor-in-interest, Egmidio Octaviano; his written demand to Vicar for the return of the land to them; and
the reasonable rentals for the use of the land at P10,000 per month. On the other hand, Vicar presented the Register of Deeds
for the Province of Benguet, Atty. Sison, who testified that the land in question is not covered by any title in the name of
Egmidio Octaviano or any of the heirs. Vicar dispensed with the testimony of Mons. Brasseur when the heirs admitted that the
witness if called to the witness stand, would testify that Vicar has been in possession of Lot 3, for 75 years continuously and
peacefully and has constructed permanent structures thereon.

Issue:

1. WON Vicar had been in possession of lots 2 and 3 merely as bailee borrower in commodatum, a gratuitous loan for use.

2. Whether or not the failure to return the subject matter of commodatum constitutes an adverse possession on the part of the
owner

Held:
1. YES. Private respondents were able to prove that their predecessors' house was borrowed by petitioner Vicar after the
church and the convent were destroyed. They never asked for the return of the house, but when they allowed its free use, they
became bailors in commodatum and the petitioner the bailee.

2. No. The bailees’ failure to return the subject matter of commodatum to the bailor did not mean adverse possession on the
part of the borrower. The bailee held in trust the property subject matter of commodatum.

Petitioner repudiated the trust by declaring the properties in its name for taxation purposes.
Ratio: The Court of Appeals found that petitioner Vicar did not meet the requirement of 30 years possession for acquisitive
prescription over Lots 2 and 3. Neither did it satisfy the requirement of 10 years possession for ordinary acquisitive
prescription because of the absence of just title.  The appellate court did not believe the findings of the trial court that Lot 2
was acquired from Juan Valdez by purchase and Lot 3 was acquired also by purchase from Egmidio Octaviano by petitioner
Vicar because there was absolutely no documentary evidence to support the same and the alleged purchases were never
mentioned in the application for registration.

Ruling: WHEREFORE AND BY REASON OF THE FOREGOING, this petition is DENIED for lack of merit, the Decision dated Aug. 31,
1987 in CA-G.R. Nos. 05148 and 05149, by respondent Court of Appeals is AFFIRMED, with costs against petitioner

REPUBLIC VS BAGTAS 
[G.R. No. L-17474  October 25, 1962] 
PADILLA, J.

FACTS:
 Jose Bagtas borrowed from the Bureau of Animal Industry three bulls for a period of one year for breeding
purposes subject to a government charge of breeding fee of 10% of the book value of the books.
 Upon the expiration of the contract, Bagtas asked for a renewal for another one year, however, the Secretary of
Agriculture and Natural Resources approved only the renewal for one bull and other two bulls be returned.
 Bagtas then wrote a letter to the Director of  Animal Industry that he would pay the value of the three bulls with a
deduction of yearly depreciation. The Director advised him that the value cannot be depreciated and asked Bagtas to either
return the bulls or pay their book value.
 Bagtas neither paid nor returned the bulls. The Republic then commenced an action against Bagtas ordering him
to return the bulls or pay their book value.
 After hearing, the trial Court ruled in favor of the Republic, as such, the Republic moved ex parte for a writ of
execution which the court granted.
 Felicidad Bagtas, the surviving spouse and administrator of Bagtas’ estate, returned the two bulls and filed a
motion to quash the writ of execution since one bull cannot be returned for it was killed by gunshot during a Huk raid. The
Court denied her motion hence, this appeal certified by the Court of Appeals because only questions of law are raised.

ISSUE: WON the contract was commodatum;thus, Bagtas be held liable for its loss due to force majeure. 

RULING:
 A contract of commodatum is essentially gratuitous. Supreme Court held that Bagtas was liable for the loss of the
bull even though it was caused by a fortuitous event.
 If the contract was one of lease, then the 10% breeding charge is compensation (rent) for the use of the bull and
Bagtas, as lessee, is subject to the responsibilities of a possessor. He is also in bad faith because he continued to possess the
bull even though the term of the contract has already expired.
 If the contract was one of commodatum, he is still liable because:
(1) he kept the bull longer than the period stipulated; and
(2) the thing loaned has been delivered with appraisal of its value (10%). No stipulation that in case of loss of the bull due
to fortuitous event the late husband of the appellant would be exempt from liability.
 The original period of the loan was from 8 May 1948 to 7 May 1949. The loan of one bull was renewed for
another period of one year to end on 8 May 1950. But the appellant kept and used the bull until November 1953 when
during a Huk raid it was killed by stray bullets. 
 Furthermore, when lent and delivered to the deceased husband of the appellant the bulls had each an appraised
book value, to with: the Sindhi, at P1,176.46, the Bhagnari at P1,320.56 and the Sahiniwal at P744.46. It was not stipulated
that in case of loss of the bull due to fortuitous event the late husband of the appellant would be exempt from liability.
Case Digest: G.R. No. 173227. January 20, 2009
Sebastian Siga-an, petitioner, vs. Alicia Villanueva, respondent.

Facts:
- Respondent filed a complaint for sum of money against petitioner. Respondent claimed that petitioner approached
her inside the PNO and offered to loan her the amount of P540,000.00 of which the loan agreement was not reduced
in writing and there was no stipulation as to the payment of interest for the loan.
- Respondent issued a check worth P500,000.00 to petitioner as partial payment of the loan.  She then issued another
check in the amount of P200,000.00 to petitioner as payment of the remaining balance of the loan of which the
excess amount of P160,000.00 would be applied as interest for the loan. 
- Not satisfied with the amount applied as interest, petitioner pestered her to pay additional interest and threatened to
block or disapprove her transactions with the PNO if she would not comply with his demand. Thus, she paid additional
amounts in cash and checks as interests for the loan.  She asked petitioner for receipt for the payments but was told
that it was not necessary as there was mutual trust and confidence between them. According to her computation, the
total amount she paid to petitioner for the loan and interest accumulated to P1,200,000.00.

The RTC rendered a Decision holding that respondent made an overpayment of her loan obligation to petitioner and
that the latter should refund the excess amount to the former.  It ratiocinated that respondent’s obligation was only
to pay the loaned amount of P540,000.00, and that the alleged interests due should not be included in the
computation of respondent’s total monetary debt because there was no agreement between them regarding
payment of interest
- It concluded that since respondent made an excess payment to petitioner in the amount of P660,000.00 through
mistake, petitioner should return the said amount to respondent pursuant to the principle of  solutio indebiti. Also,
petitioner should pay moral damages for the sleepless nights and wounded feelings experienced by respondent. 
Further, petitioner should pay exemplary damages by way of example or correction for the public good, plus
attorney’s fees and costs of suit. 

Issue: (1) Whether or not interest was due to petitioner; and (2)  whether the principle of solutio indebiti applies to
the case at bar. 

Ruling: (1) No. Compensatory interest is not chargeable in the instant case because it was not duly proven that
respondent defaulted in paying the loan and no interest was due on the loan because there was no written
agreement as regards payment of interest. Article 1956 of the Civil Code, which refers to monetary interest,
specifically mandates that no interest shall be due unless it has been expressly stipulated in writing. 
- As can be gleaned from the foregoing provision, payment of monetary interest is allowed only if:
- (1) there was an express stipulation for the payment of interest; and
- (2) the agreement for the payment of interest was reduced in writing.  The concurrence of the two conditions is
required for the payment of monetary interest.  Thus, we have held that collection of interest without any stipulation
therefor in writing is prohibited by law.   

(2)  Petitioner cannot be compelled to return the alleged excess amount paid by respondent as interest. Under Article
1960 of the Civil Code, if the borrower of loan pays interest when there has been no stipulation therefor, the
provisions of the Civil Code concerning solutio indebiti shall be applied.  Article 2154 of the Civil Code explains the
principle of solutio indebiti.  Said provision provides that if something is received when there is no right to demand it,
and it was unduly delivered through mistake, the obligation to return it arises.   In such a case, a creditor-debtor
relationship is created under a quasi-contract whereby the payor becomes the creditor who then has the right to
demand the return of payment made by mistake, and the person who has no right to receive such payment becomes
obligated to return the same.  The quasi-contract of solutio indebiti harks back to the ancient principle that no one
shall enrich himself unjustly at the expense of another.  The principle of solutio indebiti applies where (1) a payment
is made when there exists no binding relation between the payor, who has no duty to pay, and the person who
 received the payment; and (2) the payment is made through mistake, and not through liberality or some other
cause.  We have held that the principle of solutio indebiti applies in case of erroneous payment of undue interest.  

Article 2232 of the Civil Code states that in a quasi-contract, such as solutio indebiti, exemplary damages may be
imposed if the defendant acted in an oppressive manner.  Petitioner acted oppressively when he pestered
respondent to pay interest and threatened to block her transactions with the PNO if she would not pay interest.   This
forced respondent to pay interest despite lack of agreement thereto.  Thus, the award of exemplary damages is
appropriate so as to deter petitioner and other lenders from committing similar and other serious wrongdoings.

GUINGONA VS CITY FISCAL

G.R. No. L-60033 April 4, 1984

TEOFISTO GUINGONA, JR., ANTONIO I. MARTIN, and TERESITA SANTOS, petitioners, 
THE CITY FISCAL OF MANILA, HON. JOSE B. FLAMINIANO, ASST. CITY FISCAL FELIZARDO N. LOTA and CLEMENT
DAVID, respondents.

Nature: Petition for prohibition and injunction with a prayer for the immediate issuance of restraining order and/or writ of
preliminary injunction seeking  to prohibit the public respondent which is the City Fiscal of Manila  from proceeding with the
preliminary investigation, in which they were charged by private respondent Clement David
Keywords: Bank deposits are loans, mutuum, estafa, criminal charge, civil case, thrift bank, NSLA
Summary: 
- From March 1979 to March 1981, Clement David made several investments with the National Savings and Loan
Association (NSLA). On March 21, 1981, the Bangko Sentral placed the bank under receivership.
- Upon David’s request, petitioners Guingona and Martin issued a joint promissory note, absorbing the obligations of
the bank.
- On July 17, 1981, they divided the indebtedness.
- David filed a complaint for estafa and violation of Central Bank Circular No. 364 and related regulations regarding
foreign exchange transactions before the Office of the City Fiscal of Manila.
- Petitioners filed the herein petition for prohibition and injunction with a prayer for immediate issuance of restraining
order and/or writ of preliminary injunction to enjoin the public respondents to proceed with the
preliminary investigation on the ground that the petitioners’ obligation is civil in nature.

MAKASIAR, Actg. C.J.

Facts: David invested several deposits with the Nation Savings and Loan Association [NSLA]. He said that he was induced into
making said investments by an Australian national who was a close associate of the petitioners [NSLA officials]. On March
1981, NSLA was placed under receivership by the Central Bank, so David filed claims for his and his sister’s investments.

On June 1981, Guingona and Martin, upon David’s request, assumed the bank’s obligation to David by executing a joint
promissory note. On July 1981, David received a report that only a portion of his investments was entered in the NSLA records.

On December 1981, David filed I.S. No. 81-31938 in the Office of the City Fiscal, which case was assigned to Asst. City Fiscal Lota
for preliminary investigation. David charged petitioners with estafa and violation of Central Bank Circular No. 364 and related
regulations on foreign exchange transactions.

Petitioners moved to dismiss the charges against them for lack of jurisdiction because David's claims allegedly comprised a
purely civil obligation, but the motion was denied. After the presentation of David's principal witness, petitioners filed this
petition for prohibition and injunction because:

a. The production of various documents showed that the transactions between David and NSLA were simple loans (civil
obligations which were novated when Guingona and Martin assumed them)
b. David's principal witness testified that the duplicate originals of the instruments of indebtedness were all on file with NSLA.

A TRO was issued ordering the respondents to refrain from proceeding with the preliminary investigation in I.S. No. 81-31938.

Petitioners’ liability is civil in nature, so respondents have no jurisdiction over the estafa charge. TRO CORRECTLY ISSUED.

Issue:
1. Whether the contract between NSLA and David is a contract of depositor or a contract of loan, which answer determines
whether the City Fiscal has the jurisdiction to file a case for estafa

2. Whether there was a violation of Central Bank Circular No. 364

Held:
1.  When David invested his money on time and savings deposits with NSLA, the contract that was perfected was a contract of
simple loan or mutuum and not a contract of deposit. Hence, the relationship between David and NSLA is that of creditor
and debtor, consequently, the ownership of the amount deposited was transmitted to the Bank upon the perfection of the
contract and it can make use of the amount deposited for its banking operations, such as to pay interests on deposits and to
pay withdrawals..

While the Bank has the obligation to return the amount deposited,  it has no obligation to return or deliver the same money
that was deposited. NSLA’s failure to return the amount deposited will not constitute estafa through misappropriation
punishable under Article 315, par. L (b) of the Revised Penal Code, but it will only give rise to civil liability over which the
public respondents have no jurisdiction.

Considering that petitioners’ liability is purely civil in nature and that there is no clear showing that they engaged in foreign
exchange transactions, public respondents acted without jurisdiction when they investigated the charges against the
petitioners. Public respondents should be restrained from further proceeding with the criminal case for to allow the case to
continue would work great injustice to petitioners and would render meaningless the proper administration of justice.

Even granting that NSLA’s failure to pay the time and savings deposits would constitute a violation of RPC 315, paragraph 1(b),
any incipient criminal liability was deemed avoided. When NSLA was placed under receivership, Guingona and Martin
assumed the obligation to David, thereby resulting in the novation of the original contractual obligation. The original trust
relation between NSLA and David was converted into an ordinary debtor-creditor relation between the petitioners and David.
While it is true that novation does not extinguish criminal liability, it may prevent the rise of criminal liability as long as it occurs
prior to the filing of the criminal information in court.

2. Petitioner Guingona merely accommodated the request of the Nation Savings and loan Association in order to clear the bank
draft through his dollar account because the bank did not have a dollar account. Immediately after the bank draft was cleared,
petitioner Guingona authorized Nation Savings and Loan Association to withdraw the same in order to be utilized by the bank
for its operations. It is safe to assume that the U.S. dollars were converted first into Philippine pesos before they were accepted
and deposited in Nation Savings and Loan Association, because the bank is presumed to have followed the ordinary course of
the business which is to accept deposits in Philippine currency only, and that the transaction was regular and fair, in the
absence of a clear and convincing evidence to the contrary.

In conclusion, considering that the liability of the petitioners is purely civil in nature and that there is no clear showing that they
engaged in foreign exchange transactions, We hold that the public respondents acted without jurisdiction when they
investigated the charges against the petitioners. Consequently, public respondents should be restrained from further
proceeding with the criminal case for to allow the case to continue, even if the petitioners could have appealed to the Ministry
of Justice, would work great injustice to petitioners and would render meaningless the proper administration of justice

Ruling: WHEREFORE, THE PETITION IS HEREBY GRANTED; THE TEMPORARY RESTRAINING ORDER PREVIOUSLY ISSUED IS
MADE PERMANENT.

Note:

GENERAL RULE: Criminal prosecution may not be blocked by court prohibition or injunction.
EXCEPTIONS
1. For the orderly administration of justice
2. To prevent the use of the strong arm of the law in an oppressive and vindictive manner
3. To avoid multiplicity of actions
4. To afford adequate protection to constitutional rights
5. In proper cases, because the statute relied upon is unconstitutional or was held invalid

REYNALDO P. FLOIRENDO v. METROPOLITAN BANK, GR NO. 148325, 2007-09-03

Facts:

Reynaldo P. Floirendo, Jr., petitioner, is the president and chairman of the Board of Directors of Reymill Realty Corporation, a
domestic corporation engaged in real estate business. On March 20, 1996, he obtained a loan of P1,000,000.00 from the
Metropolitan Bank and Trust

Company, Cagayan de Oro City Branch, respondent, to infuse additional working capital for his company. As security for the
loan, petitioner executed a real estate mortgage in favor of respondent bank over his four (4) parcels of land, all situated at
Barangay Carmen, Cagayan de

Oro City.

The loan was renewed for another year secured by the same real estate mortgage. Petitioner signed a promissory note dated
March 14, 1997 fixing the rate of interest at "15.446% per annum for the first 30 days, subject to upward/downward
adjustment every 30 days... thereafter"; and a penalty charge of 18% per annum "based on any unpaid principal to be
computed from date of default until payment of the obligation."

On July 11, 1997, respondent bank started imposing higher interest rates on petitioner's loan which varied through the months,
in fact, as high as 30.244% in October 1997. As a result, petitioner could no longer pay the high interest rates charged by
respondent bank. Thus, he... negotiated for the renewal of his loan. Respondent bank agreed provided petitioner would pay the
arrears in interest amounting to the total sum of P163,138.33. Despite payment by petitioner, respondent bank, instead of
renewing the loan, filed with the Office of the Clerk of

Court and Provincial Sheriff, RTC, Cagayan de Oro City a petition for foreclosure of mortgage which was granted. On August 17,
1998, the auction sale was set.

Issues:

issue of the validity of the foreclosure of the real estate mortgage... whether the mortgage contract and the promissory note
express the true agreement between the parties herein.

Ruling:

We hold that the increases of interest rate unilaterally imposed by respondent bank without petitioner's assent are violative of
the principle of mutuality of contracts ordained in Article 1308 of the Civil Code[3] which provides:

Article 1308. The contract must bind both contracting parties; its validity or compliance cannot be left to the will of one of
them.

The provision in the promissory note authorizing respondent bank to increase, decrease or otherwise change from time to time
the rate of interest and/or bank charges "without advance notice" to petitioner, "in the event of change in the interest rate
prescribed by law or the
Monetary Board of the Central Bank of the Philippines," does not give respondent bank unrestrained freedom to charge any
rate other than that which was agreed upon. Here, the monthly upward/downward adjustment of interest rate is left to the will
of respondent bank alone.

 It violates the essence of mutuality of the contract.

In sum, we find that the requisites for reformation of the mortgage contract and promissory note are present in this case. There
has been meeting of minds of the parties upon these documents. However, these documents do not express the parties' true
agreement on interest rates.

And the failure of these documents to express their agreement on interest rates was due to respondent bank's inequitable
conduct.

PNB vs Noah’s Ark Sugar Refinery (gr 107243)

PHILIPPINE NATIONAL BANK v. NOAH'S ARK SUGAR REFINERY, ALBERTO T. LOOYUKO, JIMMY T. GO, WILSON T. GO
G.R. No. 107243, SECOND DIVISION, September 1, 1993, NARVASA, J If the quedans were negotiable in form and
duly indorsed to PNB (the creditor), the delivery of the quedans to PNB makes the PNB the owner of the property
covered by said quedans and on deposit with Noah, the warehouseman. PNB's right to enforce the obligation of
Noah as a warehouseman, to deliver the sugar stock to PNB as holder of the quedans, does not depend on the
outcome of the thirdparty complaint because the validity of the negotiation transferring title to the goods to PNB
as holder of the quedans is not affected by an act of RNS Merchandising and St. Therese Merchandising, in breach
of trust, fraud or conversion against Noah'sArk.

FACTS
- Noah's Ark Sugar Refinery issued on several dates warehouse receipts (quedans). Being negotiable, the
receipts covering sugar deposited by RNS Merchandising was negotiated and indorsed to Luis Ramos.
- Those covering sugar deposited by St. Therese Merchandising, RNS Merchandising and Rosa Sy were
indorsed and negotiated to Cresensiaand Zoleta.
- The two indorsees used the quedans as security for loans obtained by them from the PNB. Since both of
them defaulted, PNB demanded Noah’s Ark to deliver the sugar covered by the quedans. However, the
latter refused to comply.
- Noah and its co-defendants claimed that they are still the legal owners of the quedans and the sugar
represented thereon because:
1. The P63M check issued by Rosa Ng Sy of RNS and Teresita Ng of St. Therese Merchandising for the
quedans were dishonored by reason of "payment stopped" and" drawn against insufficient funds.
2. Since the vendees and first indorsers of quedans did not acquire ownership, the subsequent indorsers
and PNB did not acquire a better right of ownership than the original vendees/first indorsers.
3. That quedans are not negotiable instruments within the purview of the Warehouse Receipts Law but
simply an internal guarantee of defendants in the sale of their stocks of sugar.
- While Rosa Ng Sy and Teresita Ng claims that the transaction between them and Noah was "bogus and
simulated complex banking schemes and financial maneuvers and that it was to avoid payment of taxes
considering that Noah is under sequestration by the PCGG. PNB filed with the RTC a verified complaint for
"Specific Performance with Damages and Applicationfor Writ of Attachment" against Noah's Ark, Alberto
T. Looyuko, Jimmy T. Go, and Wilson T. Go, thelast three being identified as "the Sole Proprietor,
 Managing Partner and Executive Vice President ofNoah, respectively. RTC denied the application for
preliminary attachment.
- After Noah’s Ark filed its answer with counterclaim, PNB filed a motion for summary judgment, which was
denied. PNB filed a petition for certiorari with the CA. CA nullified RTC order and ordered "summary
judgment be rendered in favor of the PNB on the basis that "questions of law should be resolved after and
not before, the questions of fact.Noah moved for reconsideration, but their motion was denied by the CA.
RTC rendered judgment, but not in accordance with the decision of theCA since it dismissed
PNB’scomplaint for lack of cause of action.
ISSUES
1. Whether or not PNB as indorsee/ pledgee of quedans was entitled to delivery of sugar stocks from the
warehouseman, Noah's Ark.
2.Whether or not the non-payment of the purchase price for the quedans by the original vendees rendered invalid
the negotiation by vendees/first indorsers to indorsers and the subsequent negotiation of Ramos and Zoleta to
PNB.

RULING 1. Yes. PNB is entitled to the delivery of the sugar covered by the quedans. PNB whose debtor was the
owner of the quedan shall be entitled to such aid from the court of appropriate jurisdiction attaching such
document or in satisfying the claim by means as is allowed by law or in equity in regard to property which cannot
be readily attached or levied upon by ordinary process. If the quedans were negotiable in form and duly indorsed
to PNB (the creditor), the delivery of the quedans to PNB makes the PNB the owner of the property covered by
said quedans and on deposit with Noah, the warehouseman. PNB's right to enforce the obligation of Noah as a
warehouseman, to deliver the sugar stock to PNB as holder of the quedans, does not depend on the outcome of
the third-party complaint because the validity of the negotiation transferring title to the goods to PNB as holder of
the quedans is not affected by an act of RNS Merchandising and St. Therese Merchandising, in breach of trust,
fraud or conversion against Noah's Ark.

2. No. The non-payment of the purchase price does not render the subsequent negotiation invalid. The validity of
the negotiation in favor of PNB cannot be impaired even if the negotiation between Noah and its first vendees was
in breach of faith on the part of the vendees or by the fact that Noah was deprived of the possession of the same
by fraud, mistake or conversion if PNB paid value in good faith without notice of such breach of duty, fraud,
mistake or conversion. (Article 1518, New Civil Code)

PHILIPPINE NATIONAL BANK v. PRES. JUDGE BENITO C. SE, GR No. 119231, 1996-04-18

Facts:

In accordance with Act No. 2137, the Warehouse Receipts Law, Noah's Ark Sugar Refinery issued on several dates, the following
Warehouse Receipts (Quedans):

(a) March 1, 1989, Receipt No. 18062, covering sugar deposited by Rosa Sy;

(b) March 7, 1989, Receipt No. 18080, covering... sugar deposited by RNS Merchandising (Rosa Ng Sy);

(c) March 21, 1989, Receipt No. 18081, covering sugar deposited by St. Therese Merchandising;

(d)March 31, 1989, Receipt No. 18086, covering sugar deposited by St. Therese Merchandising; and

(e) April 1, 1989, Receipt No. 18087,... covering sugar deposited by RNS Merchandising.

Subsequently, Warehouse Receipts Nos. 18080 and 18081 were negotiated and endorsed to Luis T. Ramos; and Receipts Nos.
18086, 18087 and 18062 were negotiated and endorsed to Cresencia K. Zoleta. Ramos and Zoleta then used the quedans as
security for two loan agreements - one for
P15.6 million and the other for P23.5 million - obtained by them from the Philippine National Bank. The aforementioned
quedans were endorsed by them to the Philippine National Bank.

Luis T. Ramos and Cresencia K. Zoleta failed to pay their loans upon maturity on January 9, 1990. Consequently, on March 16,
1990, the Philippine National Bank wrote to Noah's Ark Sugar Refinery demanding delivery of the sugar stocks covered by the
quedans endorsed to it by

Zoleta and Ramos. Noah's Ark Sugar Refinery refused to comply with the demand alleging ownership thereof... the Philippine
National Bank filed with the Regional Trial Court of Manila a verified complaint for "Specific Performance with Damages and
Application for

Writ of Attachment

On January 31, 1991, the Philippine National Bank filed a Motion for Summary Judgment

On May 2, 1991, the Regional Trial Court issued an order denying the Motion for Summary Judgment.

the Philippine National Bank filed a Petition for Certiorari with the Court of Appeals

On December 13, 1991, the Court of Appeals nullified and set aside the orders of May 2 and July 4, 1990 of the Regional Trial
Court and ordered the trial court to render summary judgment in favor of the PNB. On June 18, 1992, the trial court rendered
judgment dismissing... plaintiffs complaint against private respondents for lack of cause of action and likewise dismissed private
respondents' counterclaim against PNB and of the Third-Party Complaint and the Third-Party Defendant's Counterclaim. On
September 4, 1992, the trial court denied PNB's

Motion for Reconsideration.

Private respondents thereupon filed before the trial court an Omnibus Motion seeking among others the deferment of the
proceedings until private respondents are heard on their claim for warehouseman's lien.

Issues:

Can the warehouseman enforce... his warehouseman's lien before delivering the sugar stocks as ordered by the Court of
Appeals or need he file a separate action to enforce payment of storage fees?

Ruling:

Petitioner's submission is on a technicality, that is, that private respondents have lost their right to recover warehouseman's
lien on the sugar stocks covered by the five (5) Warehouse Receipts for the reason that they failed to set up said claim in their
Answer before the... trial court... private respondents maintain that they could not have claimed the right to a warehouseman'
s lien in their Answer to the complaint before the trial court as it would have been inconsistent with their stand that they claim
ownership of the stocks covered by the... quedans since the checks issued for payment thereof were dishonored. If they were
still the owners, it would have been absurd for them to ask payment for storage fees and preservation expenses.

Of considerable relevance is the pertinent stipulation in the subject Warehouse Receipts which provides for respondent Noah's
Ark's right to impose and collect warehouseman's lien:

"Storage of the refined sugar quantities mentioned herein shall be free up to one (1) week from the date of the quedans
covering said sugar and thereafter, storage fees shall be charged in accordance with the Refining Contract under which the
refined sugar covered... by this Quedan was produced. "[6]

Accordingly, 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.

Even in the absence of such a... provision, law and equity dictate the payment of the warehouseman' s lien pursuant to Sections
27 and 31 of the Warehouse Receipts Law (R.A. 2137), to wit:

SECTION 27. What claims are included in the warehouseman's lien. - Subject to the provisions of section thirty, a
warehouseman shall have lien on goods deposited or on the proceeds thereof in his hands, for all lawful charges for storage
and preservation of the... goods; also for all lawful claims for money advanced, interest, insurance, transportation, labor,
weighing coopering and other charges and expenses in relation to such goods; also for all reasonable charges and expenses for
notice, and advertisement of sale, and for sale of the... goods where default has been made in satisfying the warehouseman's
lien.
SECTION 31. Warehouseman need not deliver until lien is satisfied. - A warehouseman having a lien valid against the person
demanding the goods may refuse to deliver the goods to him until the lien is satisfied."

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. As contracts,... the receipts must be respected by authority of Article 1159 of the Civil Code, to wit:

"ART. 1159. Obligations arising from contracts have the force of law between the contracting parties and should be complied
with in good faith."

Principles:

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 fees.

Imperative is the right of the warehouseman to demand payment of his lien at this juncture, because, in accordance with
Section 29 of the Warehouse Receipts Law, the warehouseman loses his lien upon goods by surrendering possession thereof. In
other words, the lien may be lost... where the warehouseman surrenders the possession of the goods without requiring
payment of his lien, because a warehouseman's lien is possessory in nature.

PHILIPPINE NATIONAL BANK, VS. HON. MARCELINO L. SAYO, JR., IN HIS CAPACITY AS PRESIDING JUDGE OF THE REGIONAL TRIAL
COURT OF MANILA (BRANCH 45) G.R. No. 129918, FIRST DIVISION, July 9, 1998, DAVIDE, JR., J The warehouseman is entitled to
the warehouseman’s lien that attaches to the goods that may be invoked against anyone who claims a right of possession
thereon. In this case, the lien was lost when the respondents refused to deliver the goods, which were not anchored to a valid
excuse (i.e. non satisfaction of warehousemean’s lien) but on an adverse claim of ownership. HOWEVER, the loss of
Warehouseman’s lien does not necessarily mean the extinguishment of the obligation to pay the Warehouseman’s fees and
charges, which continues to be a personal liability of the owners, PNB in this case.

FACTS In accordance with the Warehouse Receipts Law, Noah's Ark Sugar Refinery issued on several dates Warehouse Receipts
(quedans) covering sugar deposited by Rosa Sy, RNS Merchandising, and St. Therese Merchandising. The receipts are
substantially in the form, and contain the terms, prescribed for negotiable warehouse receipts by Section 2 of the law.
Subsequently, Warehouse Receipts were negotiated and endorsed to Luis T. Ramos and to Cresencia K. Zoleta. Ramos and
Zoleta then used the quedans as security for two loan agreements — one for P15.6 million and the other for P23.5 million —
obtained by them from the PNB. They endorsed the aforementioned quedans to PNB. After the decision in G.R. No. 119231
(PNB v. Se) became final and executory, various incidents took place before the trial court. Noah’s Ark and its officers filed a
Motion for Execution of Defendants’ Lien as Warehouseman pursuant to SC’s decision which was opposed by PNB. The RTC,
this time presided Hon. Marcelino L. Sayo Jr., granted the Motion for Execution. PNB was immediately served with a Writ of
Execution for the amount of P662,548,611.50. PNB thus filed an Urgent Motion seeking the deferment of the enforcement of
the Writ of Execution. Nevertheless, the Sheriff levied on execution several properties of PNB. The said bank also filed a MR
with Urgent Prayer for Quashal of Writ of Execution. After several exchanges of motions, Judge Sayo denied with finality for lack
of merit the motions filed by PNB.

ISSUE Whether or not the loss of warehouseman’s lien extinguishes the obligation of PNB to pay storage fees and charges.

RULING No. The warehouseman is entitled to the warehouseman’s lien that attaches to the goods that may be invoked against
anyone who claims a right of possession thereon. In this case, the lien was lost when the respondents refused to deliver the
goods, which were not anchored to a valid excuse (i.e non satisfaction of warehousemean’s lien) but on an adverse claim of
ownership. HOWEVER, the loss of Warehouseman’s lien does not necessarily mean the extinguishment of the obligation to pay
the Warehouseman’s fees and charges, which continues to be a personal liability of the owners, PNB in this case. However,
such fees and charges have ceased to accrue from the date of the rejection by Noah’s Ark to heed the lawful demand for the
release of the goods. While 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 fees.

Makati Shangri-La v. Harper (G.R. No. 189998, August 29, 2012, 679 SCRA 445)

Fact:

In the first week of November 1999, Christian Harper came to Manila on a business trip. He checked in at the Shangri-La Hotel.
In the early morning of that date, however, he was murdered inside his hotel room by an unidentified malefactors.

Due to a call from the bank of Christian Harper for suspicious usage of his credit card. Harper’s family in Norway must tried to
called him at his hotel room to inform him about the attempt to use his American Express card. Not getting any response from
the room, his family requested the Duty Manager of the Shangri-La Hotel, to check on Harper’s room. He and a security
personnel went to the Room and were shocked to discover Harper’s lifeless body on the bed.

On August 30, 2002, respondents commenced this suit in the RTC to recover various damages from petitioner for damages. The
RTC rendered judgment finding the defendant hotel to be remiss in its duties and thus liable for the death of Christian Harper.

Petitioner appealed to the CA which affirmed the judgment of the RTC. Hence this case.

Issue:

Whether the Petitioner was liable due to its own negligence for the death of Harper?

Held:

Yes, As the action is predicated on negligence, the relevant law is Article 2176 of the Civil Code, which states that “Whoever by
act or omission causes damage to another, there being fault or negligence, is obliged to pay for the damage done. Such fault or
negligence, if there was no pre-existing contractual relation between the parties, is called quasi-delict and is governed by the
provisions of this chapter.”

Negligence is defined as the omission to do something which a reasonable man, guided by those considerations which
ordinarily regulate the conduct of human affairs, would do, or the doing of something which a prudent and reasonable man
would not do. The Supreme Court likewise ruled that negligence is want of care required by the circumstances. It is a relative or
comparative, not an absolute, term and its application depends upon the situation of the parties and the degree of care and
vigilance which the circumstances reasonably require. In determining whether or not there is negligence on the part of the
parties in a given situation, jurisprudence has laid down the following test: Did defendant, in doing the alleged negligent act,
use that reasonable care and caution which an ordinarily prudent person would have used in the same situation? If not, the
person is guilty of negligence. The law, in effect, adopts the standard supposed to be supplied by the imaginary conduct of the
discreet pater familias of the Roman law.

The test of negligence is objective. WE measure the act or omission of the tortfeasor with a perspective as that of an ordinary
reasonable person who is similarly situated. The test, as applied to the extant case, is whether or not defendant-appellant,
under the attendant circumstances, used that reasonable care and caution which an ordinary reasonable person would have
used in the same situation.

YHT Realty v. CA (G.R. No. 126780, February 17, 2005, 451 SCRA 638)

Fact:

Private Respondent was an Australian businessman-philanthropist who stayed in a Suites owned by the Petitioner. The Private
Respondent rented a safety deposit box with the said Suite. In Renting the box, he was asked to sign a waiver “Undertaking For
The Use of Safety Deposit Box” which exonerating the Hotel, its Management and Employees from liability in case of loss of the
item in the box. The companion of the respondent Tan, while the latter was sleeping with the assistance of the staff of the
Hotel, was allowed to open the depositary box of Respondent. When the respondent opened the box, he Notice in a number of
occasion that the Money he placed in the box was either missing or lacking. When he confronted the Management of the hotel,
the latter advised that it was his companion Tan who opened the box.

The respondent went to the RTC and filed a complaint against the Petitioner. In the RTC, the Petitioner contented that the
waiver signed by the Respondent exonerate them from liabilities. the RTC found the Management of the Hotel negligent for
allowing a third person to open the box which the Respondent rented from them. The RTC found the Hotel and its staff liable
for the actual and Moral damages that the Respondent lost.

Petitioner went to CA to contest the decision. However, the CA agreed with the decision of the RTC and dismissed the petition.
Hence, the Petitioner elevated the issue to the SC.

Issue:

1. Whether the Petitioner Committed Gross Negligence for the stolen property of the Private Respondent?

2. Whether the “Undertaking For The Use of Safety Deposit Box” executed by the Private Respondent to exonerate the hotel
prom liability is null and void?

Held:

1. The evidence reveals that two keys are required to open the safety deposit boxes of Tropicana. One key is assigned to the
guest while the other remains in the possession of the management. If the guest desires to open his safety deposit box, he must
request the management for the other key to open the same. In other words, the guest alone cannot open the safety deposit
box without the assistance of the management or its employees. With more reason that access to the safety deposit box should
be denied if the one requesting for the opening of the safety deposit box is a stranger. Thus, in case of loss of any item
deposited in the safety deposit box, it is inevitable to conclude that the management had at least a hand in the consummation
of the taking, unless the reason for the loss is force majeure. Under Article 1170 of the New Civil Code, those who, in the
performance of their obligations, are guilty of negligence, are liable for damages. As to who shall bear the burden of paying
damages, Article 2180, paragraph (4) of the same Code provides that the owners and managers of an establishment or
enterprise are likewise responsible for damages caused by their employees in the service of the branches in which the latter are
employed or on the occasion of their functions. Also, this Court has ruled that if an employee is found negligent, it is presumed
that the employer was negligent in selecting and/or supervising him for it is hard for the victim to prove the negligence of such
employer. Thus, given the fact that the loss of McLoughlin’s money was consummated through the negligence of Tropicana’s
employees in allowing Tan to open the safety deposit box without the guest’s consent, both the assisting employees and YHT
Realty Corporation itself, as owner and operator of Tropicana, should be held solidarily liable pursuant to Article 2193.

2. Yes, Art. 2003. The hotel-keeper cannot free himself from responsibility by posting notices to the effect that he is not liable
for the articles brought by the guest. Any stipulation between the hotel-keeper and the guest whereby the responsibility of the
former as set forth in Articles 1998 to 2001 is suppressed or diminished shall be void.Article 2003 was incorporated in the New
Civil Code as an expression of public policy precisely to apply to situations such as that presented in this case. The hotel
business like the common carrier’s business is imbued with public interest. Catering to the public, hotelkeepers are bound to
provide not only lodging for hotel guests and security to their persons and belongings. The twin duty constitutes the essence of
the business. The law in turn does not allow such duty to the public to be negated or diluted by any contrary stipulation in so-
called “undertakings” that ordinarily appear in prepared forms imposed by hotel keepers on guests for their
signature.Paragraphs (2) and (4) of the “undertaking” manifestly contravene Article 2003 of the New Civil Code for they allow
Tropicana to be released from liability arising from any loss in the contents and/or use of the safety deposit box for any cause
whatsoever. Evidently, the undertaking was intended to bar any claim against Tropicana for any loss of the contents of the
safety deposit box whether or not negligence was incurred by Tropicana or its employees. The New Civil Code is explicit that the
responsibility of the hotel-keeper shall extend to loss of, or injury to, the personal property of the guests even if caused by
servants or employees of the keepers of hotels or inns as well as by strangers, except as it may proceed from any  force majeure.
It is the loss through force majeure that may spare the hotel-keeper from liability. In the case at bar, there is no showing that
the act of the thief or robber was done with the use of arms or through an irresistible force to qualify the same as  force
majeure.

Malayan Insurance Co. v. Salas (G.R. No. L-48820, May 25, 1979, 90 SCRA 252)

Diño v. CA (G.R. No. 89775, November 26, 1992, 216 SCRA 9)

Willex Plastic Industries v. CA (G.R. No. 103066, April 25, 1996, 256 SCRA 479)

South City Homes v. BA Finance Corporation (G.R. No. 135462 - December 7, 2001, 371 SCRA 603)