(55) PNB v. HON. PRES. JUDGE BENITO C. SE, JR., RTC, BR.

45, MANILA; NOAH'S RTC dismissed PNB's complaint against pRs for lack of cause of action and
ARK SUGAR REFINERY; ALBERTO T. LOOYUKO, JIMMY T. GO and WILSON T. GO likewise dismissed pRs counterclaim against PNB and of the Third-Party
Summary: Complaint and the Third-Party Defendants Counterclaim.
Noah's Ark Sugar Refinery issued on several dates, 5 Warehouse Receipts
(Quedans) 3 to RNS Merchandising (Rosa Ng Sy); 2 to St. Therese Merchandising; SC reversed the RTC decision, and ordered pRs, jointly and severally to deliver to
(Teresita Ng). Subsequently, the Warehouse Receipts were negotiated and PNB, the sugar stocks covered by the Warehouse Receipts/ Quedans; or
endorsed to Luis T. Ramos and to Cresencia K. Zoleta. Ramos and Zoleta then alternatively, to pay PNB actual damages of P39.1M, with legal interest.
used the quedans as security for two loan agreements - one for P15.6M and the
other for P23.5M- obtained by them from the PNB. The aforementioned quedans pRs' MR, then a Supplemental/Second MR denied.
were endorsed by them to the PNB. pRs filed a Motion Seeking Clarification of the Decision-> denied.
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Ramos and Zoleta failed to pay their loans upon maturity on Jan 9, 1990. pRs thereupon filed before the RTC an Omnibus Motion seeking among others
Consequently, PNB wrote to Noah's Ark Sugar Refinery demanding delivery of the deferment of the proceedings until pRs are heard on their claim for
the sugar stocks covered by the quedans endorsed to it by Zoleta and Ramos. warehouseman's lien. On the other hand, PNB filed a Motion for the Issuance of
a Writ of Execution and an Opposition to the Omnibus Motion filed by pRs.
Noah's Ark Sugar Refinery refused to comply, for which reason PNB filed with
the RTC Manila a complaint for SP+Damages against Noah's Ark Sugar Refinery, RTC granted pRs' Omnibus Motion and set reception of evidence on their claim
Alberto T. Looyuko, Jimmy T. Go and Wilson T. Go, the last three being identified for warehouseman's lien. The resolution of the PNB's Motion for Execution was
as the sole proprietor, managing partner, and EVP of Noah's Ark, respectively. ordered deferred until the determination of pRs' claim.

Noah's Ark and its co-defendants filed an Answer with Counterclaim and Third-
Party Complaint:
- they are the owners of the subject quedans and the sugar represented therein.
- In an agreement dated April 1, 1989, they agreed to sell to Rosa Ng Sy and
Teresita Ng the total volume of sugar indicated in the quedans stored at Noah's
Ark Sugar Refinery for a total consideration of P63M.
- the corresponding payments in the form of checks issued by the vendees in
their favor were subsequently dishonored by the drawee banks by reason of
payment stopped and drawn against insufficient funds,
- considering that the vendees and first endorsers of subject quedans did not
acquire ownership thereof, the subsequent endorsers and PNB itself did not
acquire a better right of ownership than the original vendees/first endorsers.
PNB then filed a Motion for Summary Judgment.
RTC Manila denied the Motion for Summary Judgment.
CA, however, set aside the RTC order and ordered RTC to render summary
judgment.
RTC, eventually, ruled in favor of the pRs.
- there exists in favor of the pRs a valid warehouseman's lien under S27 of RA
2137 and accordingly, execution of the judgment is hereby ordered stayed and/
or precluded until the full amount of their lien on the sugar stocks covered by
the 5 quedans subject of this action shall have been satisfied conformably with
the provisions of S31 of RA 2137.
Consequently, the PNB filed the herein petition to seek the nullification of the
above-assailed orders of the RTC judge.
SC affirmed the CA decision.
(1) The SC resolution simply resolved and upheld the propriety of summary
judgment. SC ruled that, considering the circumstances obtaining before the
trial court, the issuance of the Warehouse Receipts not being disputed by the
pRs, a summary judgment in favor of PNB was proper.
(2) The Resolution of the RTC Judge declaring the validity of pRs'
warehouseman's lien under S27 of RA2137 and ordering that execution of the
judgment, be in effect held in abeyance until the full amount of the negotiated and endorsed to Cresencia K. Zoleta. Ramos and Zoleta then used the
warehouseman's lien shall have been satisfied is proper. quedans as security for two loan agreements - one for P15.6M and the other for
- The ff stipulation in the subject Warehouse Receipts provides for Noah's Ark's P23.5M- obtained by them from the PNB. The aforementioned quedans were
right to impose and collect warehouseman's lien: endorsed by them to the PNB.
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 Ramos and Zoleta failed to pay their loans upon maturity on Jan 9, 1990.
charged in accordance with the Refining Contract under which the refined sugar covered Consequently, PNB wrote to Noah's Ark Sugar Refinery demanding delivery of
by this Quedan was produced. the sugar stocks covered by the quedans endorsed to it by Zoleta and Ramos.
- Considering that PNB does not deny the existence, validity and genuineness of
the Warehouse Receipts, it cannot disclaim liability for the payment of the Noah's Ark Sugar Refinery refused to comply, for which reason PNB filed with
storage fees stipulated therein. PNB is in estoppel in disclaiming liability for the the RTC Manila a verified complaint for SP+Damages and Application for Writ of
payment of storage fees due the pRs as warehouseman while claiming to be Attachment against Noah's Ark Sugar Refinery, Alberto T. Looyuko, Jimmy T. Go
entitled to the sugar stocks covered by the subject Warehouse Receipts on the and Wilson T. Go, the last three being identified as the sole proprietor, managing
basis of which it anchors its claim for payment or delivery of the sugar stocks. partner, and Executive Vice President of Noah's Ark, respectively.
- Imperative is the right of the warehouseman to demand payment of his lien at
this juncture, because, in accordance with S29 of the Warehouse Receipts Law, RTC Judge Se, Jr. denied the Application for Preliminary Attachment.
the warehouseman loses his lien upon goods by surrendering possession Reconsideration therefor was likewise denied.
thereof.
----------------------------------------------------------- Noah's Ark and its co-defendants filed an Answer with Counterclaim and Third-
HERMOSISIMA, JR., J April 18, 1996 Party Complaint:
FACTS - they are the owners of the subject quedans and the sugar represented therein.
In accordance with Act No. 2137, the Warehouse Receipts Law, Noah's Ark Sugar - In an agreement dated April 1, 1989, they agreed to sell to Rosa Ng Sy and
Refinery issued on several dates, the ff Warehouse Receipts (Quedans): Teresita Ng the total volume of sugar indicated in the quedans stored at Noah's
(a) March 1, 1989, Receipt No. 18062, covering sugar deposited by Rosa Sy; Ark Sugar Refinery for a total consideration of P63M.
(b) March 7, 1989, Receipt No. 18080, covering sugar deposited by RNS - the corresponding payments in the form of checks issued by the vendees in
Merchandising (Rosa Ng Sy); their favor were subsequently dishonored by the drawee banks by reason of
(c) March 21, 1989, Receipt No. 18081, covering sugar deposited by St. Therese payment stopped and drawn against insufficient funds,
Merchandising; - considering that the vendees and first endorsers of subject quedans did not
(d) March 31, 1989, Receipt No. 18086, covering sugar deposited by St. Therese acquire ownership thereof, the subsequent endorsers and PNB itself did not
Merchandising; and acquire a better right of ownership than the original vendees/first endorsers.
(e) April 1, 1989, Receipt No. 18087, covering sugar deposited by RNS
Merchandising. PNB filed a Motion for Summary Judgment.
The receipts are substantially in the form, and contains the terms, prescribed for RTC denied the Motion for Summary Judgment. Thereupon, PNB filed a Petition
negotiable warehouse receipts by S2 of the law. for Certiorari with the CA.

Subsequently, Warehouse Receipts Nos. 18080 and 18081 were negotiated and CA nullified and set aside the orders of the RTC and ordered RTC to render
endorsed to Luis T. Ramos; and Receipts Nos. 18086, 18087 and 18062 were summary judgment.
 Consequently, the PNB filed the herein petition to seek the nullification of the
On June 18, 1992, RTC dismissed PNB's complaint against pRs for lack of cause of above-assailed orders of respondent judge.
action and likewise dismissed pRs counterclaim against PNB and of the Third- ---------------------------
Party Complaint and the Third-Party Defendants Counterclaim. PNB's Position:
On Sept 4, 1992, RTC denied PNB's MR. - pRs' have lost their right to recover warehouseman's lien on the sugar stocks
covered by the 5 Warehouse Receipts for the reason that they failed to set up
PNB filed an appeal with the SC by way of a Petition for Review on Certiorari said claim in their Answer before the trial court and that pRs did not appeal
under R45. from the decision in this regard.
SC reversed the RTC decision, and ordered pRs, jointly and severally: - the denial by the SC on March 9, 1994 of the motion seeking clarification of our
(a) to deliver to PNB, the sugar stocks covered by the Warehouse Receipts/ decision has foreclosed pRs right to enforce their warehouseman's lien for
Quedans; or alternatively, to pay PNB actual damages in the amount of P39.1M, storage fees and preservation expenses under the Warehouse Receipts Act.
with legal interest; and
(b) to pay PNB attorneys fees, litigation expenses and judicial costs of P150k as pRs' Position:
well as the costs. - 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
pRs' MR, then a Supplemental/Second MR denied. inconsistent with their stand that they claim ownership of the stocks covered by
pRs filed a Motion Seeking Clarification of the Decision-> denied. the quedans since the checks issued for payment thereof were dishonored. If
pRs thereupon filed before the RTC an Omnibus Motion seeking among others they were still the owners, it would have been absurd for them to ask payment
the deferment of the proceedings until pRs are heard on their claim for for storage fees and preservation expenses.
warehousemans lien. On the other hand, PNB filed a Motion for the Issuance of a - the SC resolution, dated March 9, 1994, denying their motion for clarification
Writ of Execution and an Opposition to the Omnibus Motion filed by pRs. did not preclude their right to claim their warehouseman's lien under S27 and
S31 of RA2137, as the SC resolution merely affirmed and adopted the earlier
RTC granted pRs' Omnibus Motion on Dec 20, 1994 and set reception of evidence decision of the CA and did not make any finding on the matter of the
on their claim for warehousemans lien. The resolution of the PNB's Motion for warehouseman's lien.
Execution was ordered deferred until the determination of pRs' claim. ----------------------------------------
- On Feb 21, 1995, pRs' claim for lien was heard and evidence was received in WON the SC resolution carried with it the denial of the warehouseman's
support thereof. lien over the sugar stocks covered by the subject Warehouse Receipts.
Held: No
PNB filed a Manifestation with Urgent Motion to Nullify Court Proceedings. The SC resolution simply resolved and upheld the propriety of summary
judgment which was then assailed by pRs. In effect, SC ruled that, considering
Meanwhile, RTC ruled in favor of the pRs. the circumstances obtaining before the trial court, the issuance of the
- there exists in favor of the pRs a valid warehouseman's lien under S27 of RA Warehouse Receipts not being disputed by the pRs, a summary judgment in
2137 and accordingly, execution of the judgment is hereby ordered stayed and/ favor of PNB was proper. The SC in effect further affirmed the finding that
or precluded until the full amount of their lien on the sugar stocks covered by Noah's Ark is a warehouseman which was obliged to deliver the sugar stocks
the 5 quedans subject of this action shall have been satisfied conformably with covered by the Warehouse Receipts pledged by Cresencia K. Zoleta and Luis T.
the provisions of S31 of RA 2137. Ramos to PNB pursuant to the pertinent provisions of RA2137.
In disposing of the pRs' motion for clarification, SC could not contemplate the of the goods where default has been made in satisfying the warehousemans lien.
matter of warehouseman's lien because the issue to be finally resolved then was
the claim of pRs for retaining ownership of the stocks of sugar covered by the xxx xxx xxx
endorsed quedans. Stated otherwise, there was no point in taking up the issue of
warehouseman's lien since the matter of ownership was as yet being SECTION 31. Warehouseman need not deliver until lien is satisfied. - A warehouseman
determined. Neither could storage fees be due then while no one has been having a lien valid against the person demanding the goods may refuse to deliver the
declared the owner of the sugar stocks in question. goods to him until the lien is satisfied.

WON there was a valid warehouseman's lien in favor of pRs. Considering that PNB does not deny the existence, validity and genuineness of
Held: Yes the Warehouse Receipts, it cannot disclaim liability for the payment of the
The ff stipulation in the subject Warehouse Receipts provides for Noah's Ark's storage fees stipulated therein. PNB is in estoppel in disclaiming liability for the
right to impose and collect warehouseman's lien: payment of storage fees due the pRs as warehouseman while claiming to be
entitled to the sugar stocks covered by the subject Warehouse Receipts on the
Storage of the refined sugar quantities mentioned herein shall be free up to one (1) week basis of which it anchors its claim for payment or delivery of the sugar stocks.
from the date of the quedans covering said sugar and thereafter, storage fees shall be The unconditional presentment of the receipts by the PNB for payment against
charged in accordance with the Refining Contract under which the refined sugar covered pRs on the strength of the provisions of the Warehouse Receipts Law (R.A. 2137)
by this Quedan was produced. carried with it the admission of the existence and validity of the terms,
conditions and stipulations written on the face of the Warehouse Receipts,
It is not disputed, therefore, that, under the subject Warehouse Receipts including the unqualified recognition of the payment of warehouseman's lien
provision, storage fees are chargeable. for storage fees and preservation expenses. Petitioner may not now retrieve the
sugar stocks without paying the lien due pRs as warehouseman.
PNB anchors its claim against pRs on the 5 Warehouse Receipts issued by the
latter to third-party defendants Rosa Ng Sy of RNS Merchandising and Teresita In view of the foregoing, the rule may be simplified thus: While the PNB is
Ng of St. Therese Merchandising, which found their way to PNB after they were entitled to the stocks of sugar as the endorsee of the quedans, delivery to it shall
negotiated to them by Luis T. Ramos and Cresencia K. Zoleta for a loan of P39.1 be effected only upon payment of the storage fees.
M. Accordingly, 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 Imperative is the right of the warehouseman to demand payment of his lien at
fees. Even in the absence of such a provision, law and equity dictate the payment this juncture, because, in accordance with S29 of the Warehouse Receipts Law,
of the warehouseman's lien pursuant to S27 and S31 of the Warehouse Receipts the warehouseman loses his lien upon goods by surrendering possession
Law (R.A. 2137), to wit: thereof. In other words, the lien may be lost where the warehouseman
surrenders the possession of the goods without requiring payment of his lien,
SECTION 27. What claims are included in the warehousemans lien. - Subject to the because a warehousemans lien is possessory in nature.
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 WHEREFORE, the petition should be, as it is, hereby dismissed for lack of merit.
goods; also for all lawful claims for money advanced, interest, insurance, transportation, The questioned orders issued by RTC judge are affirmed.
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