ANDRES vs MANTRUST

FACTS:
Andres, using the business name “Irene’s Wearing Apparel” was engaged in the manufacture of
ladies garments, children’s wear, men’s apparel and linens for local and foreign buyers. Among
its foreign buyers was Facts of the United States. Sometime in August 1980, Facts instructed the
First National State Bank (FNSB) of New Jersey to transfer $10,000 to Irene’s Wearing Apparel
via Philippine National Bank (PNB) Sta. Cruz, Manila branch. FNSB instructed Manufacturers
Hanover and Trust Corporation (Mantrust) to effect the transfer by charging the amount to the
account of FNSB with private respondent. After Mantrust effected the transfer, the payment was
not effected immediately because the payee designated in the telex was only “Wearing Apparel.”
Private respondent sent PNB another telex stating that the payment was to be made to “Irene’s
Wearing Apparel.” On August 28, 1980, petitioner received the remittance of $10,000. After
learning about the delay, Facets informed FNSB about the situation. Facts, unaware that
petitioner had already received the remittance, informed private respondent and amended its
instruction y asking it to effect the payment to Philippine Commercial and Industrial Bank
(PCIB) instead of PNB. Private respondent, also unaware that petitioner had already received the
remittance, instructed PCIB to pay $10,000 to petitioner. Hence, petitioner received another
$10,000 which was charged again to the account of Facets with FNSB. FNSB discovered that
private respondent had made a duplication of remittance. Private respondent asked petitioner to
return the second remittance of $10,000 but the latter refused to do so contending that the
doctrine of solution indebiti does not apply because there was negligence on the part of the
respondents and that they were not unjustly enriched since Facets still has a balance of $49,324.
ISSUE:
Whether or not the private respondent has the right to recover the second $10,000 remittance it
had delivered to petitioner.
RULING:
Art 2154 of the New Civil Code is applicable. For this article to apply, the following requisites
must concur: 1. that he who paid was not under obligation to do so; and 2. that payment was
made by reason of an essential mistake of fact. There was a mistake, not negligence, in the
second remittance. It was evident by the fact that both remittances have the same reference
invoice number