Part Four: Warehouse Receipts Law

Act No. 2137

Cases:
Commissioner of Internal Revenue v. Hawaiian-Philippines Co., 11 SCRA 256 (1964)
Gonzalez v. Go Tiong, 104 Phil 492 (1958)
PNB v. Producers Warehouse Assn., 42 Phil 608 (1922)
Cruz v. Valero, 89 Phil. 260 (1951)
Estrada v. CAR, 2 SCRA 986 (1961)
Consolidated Terminals v. Artex Development, 63 SCRA 46 (1975)
Lu Kian v MRR, 19 SCRA 5 (1967)
American Foreign Banking Corp vs. Herridge, 49 Phil 975 (1924)
PNB v Atendido, 94 Phil 255 (1954)
Martinez v. PNB, 93 Phil. 756 (1953)
Siy Cong Bieng v. Hongkong Shanghai Bank, 56 Phil. 598 (1932)
PNB v. Noah’s Ark Sugar Rejinery, 226 SCRA 36 (1993)
PNB v. Se, 256 SCRA 380 (1996)
PNB v. Sayo, 292 SCRA 202 (1998)
Commissioner of Internal Revenue v. Hawaiian-Philippines Co., 11 SCRA 256 (1964)
**Facts:**
1. The petitioner is the Commissioner of Internal Revenue, filing a petition for review of the
decision by the Court of Tax Appeals.
2. The respondent is the Hawaiian-Philippine Company, operating a sugar central in Silay,
Occidental Negros, and engaged in manufacturing sugar from sugarcane supplied by
planters.
3. The respondent stores processed sugar in its warehouses, issuing warehouse receipts or
"quedans" to the planters who own the sugar.
4. Storage fees are charged and collected by the respondent after the first ninety days of
free storage, amounting to a significant gross receipt over several years.
5. The respondent's accounting practices result in storage charges being recorded as
credits, reducing deductible expenses and increasing taxable income.
6. The Commissioner of Internal Revenue assessed fixed and percentage taxes, a surcharge,
and an administrative penalty against the respondent, leading to a refund petition by the
latter.
7. The Court of Tax Appeals ordered the Commissioner to refund the taxes deposited by the
respondent.

**Issues:**
1. Whether the respondent, engaged in storing sugarcane in its warehouses, qualifies as a
warehouseman liable for fixed and percentage taxes under relevant sections of the National
Internal Revenue Code.
2. Whether the respondent's storage activities are merely incidental to its primary business
of sugar manufacturing, exempting it from tax liability.
3. Whether the imposition of taxes on the respondent's warehousing business constitutes
double taxation.

**Decisions:**
1. The Court reverses the decision of the Court of Tax Appeals and rules in favor of the
Commissioner of Internal Revenue.
2. The Court determines that the respondent's storage activities, including charging and
collecting storage fees, qualify it as a warehouseman liable for taxes under the National
Internal Revenue Code.
3. The Court rejects the argument that the respondent's warehousing business is merely
incidental to its sugar manufacturing operations, emphasizing that the two are distinct and
separately taxable activities.
4. The Court dismisses the claim of double taxation, asserting that taxation on separate and
distinct businesses is permissible under Philippine law, citing relevant legal precedents.

In summary, the Court holds that the respondent is liable for fixed and percentage taxes as
a warehouseman, rejecting arguments of incidental business activity and double taxation.
Gonzalez v. Go Tiong, 104 Phil 492 (1958)
**Facts:**
1. Go Tiong operated a rice mill and warehouse in Pangasinan and obtained a license to
operate as a bonded warehouseman.
2. To secure his obligations, Luzon Surety Co. issued Guaranty Bond No. 294.
3. Go Tiong received deliveries of palay (rice grains) from the plaintiff, Ramon Gonzales,
both before and after obtaining his license, issuing receipts for the deposits.
4. When Gonzales demanded the value of his deposits, Go Tiong deferred payment, and
shortly thereafter, the warehouse burned down.
5. Gonzales, along with other depositors, filed claims with the Bureau of Commerce, which
paid some claims with insurance proceeds.
6. Gonzales filed a lawsuit against Go Tiong and Luzon Surety Co. for the value of his palay,
damages, and attorney's fees.

**Issues:**
1. Whether the plaintiff's claim is governed by the Bonded Warehouse Act (Act No. 3893)
or the Civil Code.
2. Whether the burning of the warehouse exempts Go Tiong from liability.
3. Whether the amicable settlement between Gonzales and Go Tiong discharged the
surety's liability.
4. Whether the failure to issue warehouse receipts precludes Gonzales from suing on the
bond.

**Decisions:**
1. **Governing Law:** The court affirmed that deposits made with a bonded
warehouseman are governed by Act No. 3893, regardless of the type of receipts issued. The
provisions of the Warehouse Receipts Law are not mandatory, and the issuance of
warehouse receipts is permissive, not obligatory.
2. **Liability for Warehouse Loss:** The court rejected the argument that the burning of
the warehouse was a fortuitous event, finding that Go Tiong's actions, including accepting
excess deposits and failing to issue warehouse receipts, contributed to the risk.
3. **Effect of Settlement:** The court ruled that the non-consummated compromise
settlement between Gonzales and Go Tiong did not discharge the surety's liability since the
settlement was not effective.
4. **Failure to Issue Warehouse Receipts:** The court held that the failure to issue
warehouse receipts does not preclude Gonzales from suing on the bond, as the surety is
responsible for the warehouseman's failure to fulfill statutory duties.

In conclusion, the court affirmed the decision of the lower court, holding Go Tiong and
Luzon Surety Co. jointly and severally liable for the value of the deposits, damages,
attorney's fees, and costs.
PNB v. Producers Warehouse Assn., 42 Phil 608 (1922)
**Facts:**

1. The plaintiff (PNB) is a corporation organized under the banking laws of the Philippine
Islands.
2. The defendant (PWA) is a domestic corporation engaged in a general warehouse
business.
3. The Produce Company is another domestic corporation acting as the general manager of
the defendant's business under a written contract.
4. The defendant issued negotiable warehouse receipts (quedans) to the Produce Company
for 15,699.34 piculs of copra.
5. The plaintiff, as a bank, arranged for an overdraft with the Produce Company and
received the quedans as collateral.
6. The plaintiff requested delivery of the copra described in the quedans from the
defendant but was refused.
7. The plaintiff initiated legal action to recover the value of the copra.

**Issues:**

1. Whether the defendant had the authority to issue the warehouse receipts to the Produce
Company.
2. Whether the plaintiff complied with any conditions precedent for the delivery of the
copra.
3. Whether the defendant's refusal to deliver the copra was justified.
4. Whether the plaintiff is entitled to recover the value of the copra from the defendant.

**Decisions:**

1. The court found that the Produce Company, acting as the defendant's general manager,
had the authority to issue warehouse receipts on behalf of the defendant.
2. The court determined that the defendant's claim of non-compliance with conditions
precedent was invalid because it had previously denied the existence of the warehouse
receipts, thus waiving any requirement for compliance with conditions.
3. The defendant's refusal to deliver the copra was deemed unjustified since it had
previously denied the existence of the warehouse receipts, making its claim invalid.
4. The court ruled in favor of the plaintiff, ordering the defendant to pay the plaintiff the
value of the copra, deducted by the amount previously surrendered, with interest from the
date of the request for delivery.
Cruz v. Valero, 89 Phil. 260 (1951)
**Facts:**
1. The appellant, a sugar cane planter, had a share of centrifugal sugar and molasses stored
in the warehouse of the Luzon Sugar Company.
2. The appellant claimed that the Luzon Sugar Company disposed of his sugar without his
consent and failed to deliver the agreed-upon amount when he attempted to withdraw it.
3. The Luzon Sugar Company asserted that the sugar was lost due to a fortuitous event or
force majeure, namely, the bombing of its compound by Japanese airplanes on 28
December 1941, and subsequent occupation by the Japanese Army from 1 January to 20
February 1942.
4. The appellant also sought to recover the value of two tires and tubes taken by Captain
Nunaka of the Imperial Japanese Army.

**Issues:**
1. Whether the Luzon Sugar Company is liable for the non-delivery of the appellant's sugar
and molasses.
2. Whether the Luzon Sugar Company unlawfully disposed of the appellant's sugar without
his consent.
3. Whether the loss of sugar, molasses, tires, and tubes was due to a fortuitous event or
force majeure, relieving the appellees from liability.

**Decisions:**
1. The court affirmed the lower court's decision, which dismissed the appellant's complaint.
The appellant failed to prove that the Luzon Sugar Company unlawfully disposed of his
sugar or that it was liable for non-delivery. Additionally, the court found that the loss of
sugar, molasses, tires, and tubes was due to a fortuitous event or force majeure, namely, the
war and occupation by the Japanese Army. Therefore, the appellees were relieved from
liability.
2. The appellant's appeal was dismissed, and they were directed to pay the costs of the suit.
3. The counterclaim of the defendants was also dismissed, as there was no evidence of
malice on the part of the appellant in bringing the suit.

In summary, the court held that the loss of the sugar, molasses, tires, and tubes was not the
responsibility of the appellees but was due to the war or a fortuitous event, thereby
relieving them of liability.
Estrada v. CAR, 2 SCRA 986 (1961)
**Facts:**
1. The petitioners filed a petition on June 10, 1961, requesting that the manager of the
Moncada Bonded Warehouse and respondent Faustino F. Galvan be declared in contempt
of court and punished accordingly.
2. Earlier resolutions were issued by the court, particularly on January 6, 1961, and April
12, 1961, concerning the release of deposits to the petitioners from the Moncada Bonded
Warehouse.
3. The resolutions ordered the release of 10% of the net produce of the first crop and 15%
of the net produce of the second crop to the petitioners, with certain deductions.
4. The manager of the Moncada Bonded Warehouse and respondent Faustino F. Galvan
were served notice of the court's resolutions but refused to comply.

**Issues:**
1. Whether the excuses provided by the manager of the Moncada Bonded Warehouse and
respondent Faustino F. Galvan for non-compliance with the court's orders are valid.
2. Whether the petitioners are entitled to receive the portion of the palay (rice grains) as
ordered by the court.
3. Whether the petitioners' dire need for the palay for their subsistence justifies the
immediate release of the said palay.

**Decisions:**
1. The court found that while the excuses provided by the manager and respondent might
have some merit, they do not constitute valid reasons to evade compliance with the court's
orders.
2. The court ordered the manager or owner of the Moncada Bonded Warehouse and
respondent Faustino F. Galvan to release and deliver to the petitioners the remaining
portion of the palay, as ordered by the trial court.
3. The court emphasized the urgency of the petitioners' need for the palay for their
subsistence and directed the immediate release of the said palay to ameliorate their
precarious situation.
4. The court clarified that the petitioners can receive their shares in the palay upon
issuance of corresponding receipts, without the necessity of producing and surrendering
the original warehouse receipts.

In summary, the court ruled in favor of the petitioners, ordering the release of the
remaining portion of the palay to address their urgent need for subsistence, despite the
excuses provided by the manager and respondent.
Consolidated Terminals v. Artex Development, 63 SCRA 46 (1975)
**Facts:**
Consolidated Terminals, Inc. (CTI) operated a customs bonded warehouse where it
received 193 bales of high-density compressed raw cotton, valued at P99,609.76, on
deposit. These goods were to be held on behalf of Luzon Brokerage Corporation until the
consignee, Paramount Textile Mills, Inc., opened a corresponding letter of credit in favor of
the shipper, Adolph Hanslik Cotton of Corpus Christi, Texas.
Artex Development Co., Inc. (Artex) allegedly obtained delivery of the cotton by
presenting a forged permit to deliver imported goods issued by the Bureau of Customs.
Artex paid CTI P15,000 as storage and handling charges. However, at the time of delivery,
the letter of credit had not been opened, and the customs duties and taxes were unpaid.
CTI initially sought to recover possession of the cotton through a writ of replevin
but later transformed its complaint into an action for damages against Artex, seeking
compensation for the value of the cotton, nominal and exemplary damages, and attorney's
fees.
Artex claimed it returned the cotton to Paramount Textile Mills, Inc. when their
sales contract was rescinded due to the cotton not meeting specified quality standards.
However, no copy of the rescissory agreement was provided by Artex.

**Issues:**
1. Whether CTI, as a warehouseman, has a cause of action for damages against Artex.
2. Whether Artex's alleged actions constituted a wrongful act against CTI, justifying
damages.
3. Whether CTI's amended complaint sufficiently alleged a violation of its rights by Artex.

**Decisions:**
The Court affirmed the lower court's dismissal of CTI's complaint for damages
against Artex. It held that CTI failed to demonstrate a clear cause of action against Artex.
The Court reasoned that CTI, as a warehouseman, did not have ownership rights over the
cotton and therefore could not claim damages for its loss.
The Court emphasized that the real parties interested in the cotton were Luzon
Brokerage Corporation, Paramount Textile Mills, Inc., Adolph Hanslik Cotton, and the
government agencies responsible for customs duties and taxes. None of these parties had
sued CTI for damages or recovery of the cotton or related taxes and duties.
Furthermore, the Court noted that CTI's amended complaint did not unequivocally
allege a violation of its rights by Artex. It could not determine what delict or wrong Artex
committed against CTI that would justify CTI's claim for damages.
Ultimately, the Court held that CTI's claim for damages against Artex was untenable
based on the allegations presented. Therefore, it affirmed the dismissal of CTI's complaint
with costs against CTI.

**Conclusion:**
The Court's decision affirmed the dismissal of CTI's complaint for damages against Artex,
ruling that CTI did not have a valid cause of action. The case underscores the importance of
clearly establishing the legal basis for a claim and demonstrating the violation of rights to
justify seeking damages in a legal proceeding.
Lu Kian v MRR, 19 SCRA 5 (1967)
**Facts:**
1. Lua Kian filed a suit against Manila Railroad Co. and Manila Port Service for the recovery
of the invoice value of imported evaporated "Carnation" milk alleged to have been
undelivered.
2. Lua Kian imported 2,000 cases of Carnation Milk from the Carnation Company of San
Francisco, California, and shipped them on Board SS "GOLDEN BEAR" per Bill of Lading No.
17.
3. Only 1,829 cases marked `LUA KIAN 1458' were discharged from the vessel SS `GOLDEN
BEAR' and received by defendant Manila Port Service.
4. Additionally, 3,171 cases of Carnation Milk marked "CEBU UNITED 4860-PH-MANILA"
were discharged from the same vessel unto the custody of defendant Manila Port Service,
with a pending claim for short-delivery against the defendant.
5. Defendant Manila Port Service delivered 1,913 cases of Carnation Milk marked "LUA
KIAN 1458" to the plaintiff through its broker.
6. A provisional claim was filed by the consignee's broker for the plaintiff on January 19,
1960, with defendant Manila Port Service.
7. The invoice value of the 87 cases of Carnation Milk claimed by the plaintiff to have been
short-delivered is P1,183.11, while the invoice value of the 87 cases claimed by the
defendant Manila Port Service to have been over-delivered is P1,130.65.
8. A previous shipment of 1,000 cases of Carnation Milk consigned to Lua Kian had a claim
for short-delivery against defendant Manila Port Service, which was settled for P750.00.
9. The parties reserve the right to submit documentary evidence.
10. The matter of attorney's fees and costs is submitted to the discretion of the Court.

**Issues:**
1. Whether Manila Port Service should be held liable for the undelivered cases of milk.
2. Whether the attorney's fees awarded below are reasonable.

**Decisions:**
1. The Court ruled that Manila Port Service is liable for the undelivered cases of milk.
2. The attorney's fees awarded below were reduced to P300.00.

**Analysis:**
The Court found that Manila Port Service had a duty to withhold delivery of the excess
cases marked for Cebu United Enterprises pending determination of rightful ownership
due to the discrepancy between the bill of lading and the markings. Despite exemptions in
the Management Contract, the Court held Manila Port Service liable because the bill of
lading clearly indicated only 3,000 cases consigned to Cebu United Enterprises. The Court
emphasized the duty of Manila Port Service, as a custodian of goods, to conduct its own
investigation or call upon the parties to interplead to determine the rightful owner of the
goods. Therefore, the Court affirmed the judgment against the defendants, with a reduction
in attorney's fees deemed reasonable.
American Foreign Banking Corp vs. Herridge, 49 Phil 975 (1924)
**Facts:**
1. U. de Poli, a licensed public warehouseman in Manila, issued warehouse receipt No. A-48
for 560 bales of tobacco described as "Cagayan tabaco en rama" with specified marks.
2. U. de Poli endorsed the receipt in blank and delivered it to the American Foreign Banking
Corporation as security for an overdraft.
3. The bank claimed ownership of the tobacco based on the receipt, but the tobacco was
later found to be from Isabela, not Cagayan.
4. The bank's claim was disputed by other creditors of U. de Poli's insolvent estate, arguing
that the receipt was invalid due to the incorrect description of the tobacco.

**Issues:**
1. Whether the description of the tobacco in the warehouse receipt was sufficient.
2. Whether the warehouse receipt effectively transferred ownership of the tobacco to the
bank.
3. Whether the receipt was valid as collateral security for an overdraft.

**Decisions:**
1. The Court ruled that the intention of the parties to the transaction must prevail over
technical objections to the sufficiency of the description of the tobacco.
2. The warehouse receipt, endorsed and delivered to the bank, constituted a sufficient
transfer of title to the tobacco in favor of the bank.
3. The decision of the Court in the case of Roman v. Asia Banking Corporation regarding the
sufficiency and effect of a similar warehouse receipt was followed.

**Summary:**
The Court affirmed the decision of the lower court, which ordered the assignee of U. de
Poli's insolvent estate to deliver the tobacco to the American Foreign Banking Corporation,
as claimed in the warehouse receipt. Despite the discrepancy in the description of the
tobacco, the Court emphasized the intention of the parties and upheld the validity of the
receipt as a negotiable warehouse receipt, effectively transferring ownership to the bank.
The decision was based on previous precedent and the specific circumstances of the case,
where the identity of the tobacco was fully established.
PNB v Atendido, 94 Phil 255 (1954)
**Facts:**
1. Laureano Atendido (LA) obtained a loan of P3,000 from the Philippine National Bank
(PNB) on June 26, 1940, payable in 120 days with 6% interest per annum from the date of
maturity.
2. LA pledged 2,000 cavanes of palay (rice) as security for the loan. The rice was stored in a
warehouse and LA endorsed the corresponding warehouse receipt to the bank.
3. Before the loan matured, the 2,000 cavanes of palay disappeared from the warehouse for
unknown reasons.
4. Upon maturity of the loan, LA failed to pay the principal or interest, leading to the bank
instituting legal action against him.

**Issues:**
1. Whether the surrender of the warehouse receipt, endorsed in blank, to the bank
transferred ownership of the rice to the bank or merely served as a guarantee for the loan.
2. Whether LA is relieved of liability due to the loss of the palay.

**Decisions:**
1. The surrender of the warehouse receipt endorsed in blank did not transfer ownership of
the rice to the bank. It served as a guarantee for the fulfillment of LA's obligation to repay
the loan. The ownership of the rice remained with LA, and the bank had the right to sell the
rice only in case of non-fulfillment of the obligation.

2. LA is not relieved of liability due to the loss of the palay. Since the transaction was a
pledge, LA continued to be the owner of the rice during the pendency of the obligation.
Therefore, the loss of the property is borne by LA, and he remains liable to repay the loan.

The decision of the lower court was affirmed, and LA was ordered to pay the bank the sum
of P3,000, with interest, along with the costs of the action.
Martinez v. PNB, 93 Phil. 756 (1953)
**Facts:**
1. The estate of Pedro Rodriguez owed the Philippine National Bank (PNB) a significant
amount of money due to a crop loan.
2. In February 1942, Mrs. Amparo R. Martinez, the estate's late administratrix, endorsed
and delivered one or two quedans issued by the Bogo-Medellin Milling Co. to the PNB.
These quedans covered a quantity of sugar stored by the milling company, which belonged
to the estate.
3. During World War II in 1943, the sugar covered by the quedan(s) was lost while in the
possession of the milling company.
4. The estate paid off its debt to the bank, including interest, in 1948.

**Issues:**
1. Whether the endorsement and delivery of the quedan(s) transferred ownership of the
sugar to the bank.
2. Whether the loss of the sugar should be borne by the estate or the bank.
3. Whether the bank was negligent in preserving the sugar.
4. Whether the bank should compensate the estate for the potential value of the sugar if it
had been released earlier.

**Decisions:**
1. The court affirmed that the sugar still belonged to the estate at the time of its loss during
the war. The transaction between the estate and the bank was not a sale but a mortgage or
pledge, as the sugar was given as security for the crop loan.
2. Since the bank did not become the owner of the sugar, it was not responsible for the loss.
The estate, as the real owner, bears the loss.
3. The court did not entertain the claim of negligence against the bank, as it was not raised
in the lower court, and the loss occurred due to circumstances beyond the bank's control,
namely, the war.
4. The court rejected the estate's claim for compensation based on the potential value of the
sugar if it had been released earlier, as there was evidence that the bank was not aware of
any such request and had attempted to sell the sugar before the branch closure, albeit
unsuccessfully.

In summary, the decision affirmed that the bank did not automatically become the owner of
the sugar upon endorsement of the quedan(s), and the loss of the sugar during the war was
to be borne by the estate.
Siy Cong Bieng v. Hongkong Shanghai Bank, 56 Phil. 598 (1932)
**Facts:**
- The plaintiff, a corporation, brought an action against the defendant, the Hongkong and
Shanghai Banking Corporation, to recover the value of 464 bales of hemp (abaca) deposited
in bonded warehouses, totaling P31,645.
- Otto Ranft pledged the warehouse receipts (quedans) as security for his preexisting debt
to the defendant.
- Ranft died suddenly on June 25, 1926, the same day the quedans were delivered to the
defendant.
- Both parties submitted an agreed statement of facts to the court, stating that the quedans
were pledged by Ranft to the defendant to secure his debt.
- The plaintiff demanded the return of the quedans or their value upon learning of Ranft's
death, but the defendant refused, claiming it was a holder of the quedans in due course.

**Issues:**
1. Whether the defendant acted in good faith in receiving the quedans as security for
Ranft's debt.
2. Whether the plaintiff is estopped from denying the validity of the defendant's title to the
quedans.
3. Whether the defendant is liable for the loss of the quedans.

**Decisions:**
- The trial court ruled in favor of the plaintiff, finding that the defendant could not have
acted in good faith because it knew or should have known that Ranft had not yet acquired
ownership of the quedans.
- The appellate court reversed the decision, holding that the defendant acted lawfully in
receiving the quedans as security for Ranft's debt, and the plaintiff is estopped from
denying the validity of the defendant's title to the quedans.
- The court found no evidence of fraud on the part of the defendant and absolved the
defendant from the plaintiff's complaint, thereby reversing the judgment in favor of the
plaintiff.

In summary, the court determined that the defendant lawfully acquired the quedans as
security for Ranft's debt, and the plaintiff is estopped from denying the validity of the
defendant's title to the quedans. Therefore, the defendant is not liable for the loss of the
quedans, and the plaintiff's complaint is dismissed.
PNB v. Noah’s Ark Sugar Rejinery, 226 SCRA 36 (1993)
**Facts:**
- The case involves a dispute over warehouse receipts (quedans) issued by Noah's Ark
Sugar Refinery in accordance with Act No. 2137, the Warehouse Receipts Law.
- The receipts were issued for sugar deposited by various parties on different dates in
1989.
- Some of the receipts were negotiated and indorsed to Luis T. Ramos and others to
Cresencia K. Zoleta, who then used them as security for loans from the Philippine National
Bank (PNB).
- When the loans matured and were not repaid, PNB demanded delivery of the sugar
covered by the receipts from Noah's Ark Sugar Refinery.
- Noah's Ark Sugar Refinery, along with its co-defendants, filed counterclaims and third-
party complaints, alleging, among other things, that the original buyers of the sugar did not
pay for it, rendering the negotiation of the receipts invalid.
- PNB filed a motion for summary judgment, arguing that there were no genuine issues of
material fact and it was entitled to judgment as a matter of law.
- The trial court denied PNB's motion, finding conflicting claims regarding the ownership of
the sugar and the applicability of the Warehouse Receipts Law.
- PNB appealed to the Court of Appeals, which ruled in favor of PNB and ordered the trial
court to render summary judgment in PNB's favor.
- Despite the appellate court's decision, the trial court rendered a judgment dismissing
PNB's complaint, leading to the current appeal.

**Issues:**
1. Whether the trial court erred in denying PNB's motion for summary judgment.
2. Whether the trial court erred in rendering a judgment contrary to the decision of the
Court of Appeals.

**Decisions:**
1. The trial court erred in denying PNB's motion for summary judgment. The Court of
Appeals ruled that there were no substantial triable issues of fact and that PNB was entitled
to judgment as a matter of law.
2. The trial court gravely erred in rendering a judgment contrary to the decision of the
Court of Appeals. The appellate court's decision was final and binding, and the trial court
was obligated to implement it.

**Conclusion:**
The trial court's decision is reversed, and a new judgment is rendered in accordance with
the decision of the Court of Appeals, ordering Noah's Ark Sugar Refinery and its co-
defendants to deliver the sugar stocks to PNB or pay damages, attorney's fees, and costs to
PNB.
PNB v. Se, 256 SCRA 380 (1996)
**Facts:**
- Noah’s Ark Sugar Refinery issued several Warehouse Receipts covering sugar stocks on
different dates.
- These Warehouse Receipts were negotiated and endorsed to Luis T. Ramos and Cresencia
K Zoleta, who then used them as security for loans obtained from the Philippine National
Bank (PNB).
- Ramos and Zoleta failed to pay their loans, leading PNB to demand delivery of the sugar
stocks covered by the Warehouse Receipts.
- Noah’s Ark Sugar Refinery refused to comply, claiming ownership of the sugar stocks.
- Legal proceedings ensued, resulting in a series of court decisions and appeals.
- Ultimately, the Supreme Court affirmed the Court of Appeals' decision, ordering Noah’s
Ark Sugar Refinery to deliver the sugar stocks to PNB.

**Issues:**
1. Whether Noah’s Ark Sugar Refinery can enforce its warehouseman’s lien for storage fees
before delivering the sugar stocks to PNB, as ordered by the Court of Appeals.
2. Whether the trial court's orders recognizing Noah’s Ark Sugar Refinery's right to claim a
warehouseman’s lien are valid.

**Decisions:**
- The Supreme Court affirmed the trial court's orders, upholding Noah’s Ark Sugar
Refinery's right to enforce its warehouseman’s lien for storage fees.
- PNB, by presenting the Warehouse Receipts for payment, admitted the existence and
validity of the terms, including the warehouseman’s lien for storage fees.
- While PNB is entitled to the sugar stocks, delivery can only be made upon payment of the
storage fees.
- Noah’s Ark Sugar Refinery's right to claim a warehouseman’s lien is upheld under the
Warehouse Receipts Law (RA. 2137).
- The court rejected PNB's argument that Noah’s Ark Sugar Refinery lost its right to claim
the warehouseman’s lien due to procedural issues, affirming that such right is inherent and
cannot be waived easily.
- The court clarified that its previous decisions did not preclude Noah’s Ark Sugar
Refinery's right to claim the warehouseman’s lien.

In conclusion, the court upheld Noah’s Ark Sugar Refinery's right to enforce its
warehouseman’s lien for storage fees before delivering the sugar stocks to PNB, as ordered
by the Court of Appeals, and affirmed the validity of the trial court's orders recognizing this
right.
PNB v. Sayo, 292 SCRA 202 (1998)
**Detailed Facts:**
1. **Origins of the Dispute**: The dispute stems from warehouse receipts (quedans) issued by
Ramos and Zoleta to the Philippine National Bank (PNB) as security for loans. These quedans
were used to secure loans obtained by Ramos and Zoleta from PNB.
2. **Warehouseman's Fees Dispute**: There is a disagreement between PNB and private
respondents regarding the warehouseman's fees and charges. Private respondents, who are the
owners of the warehouse, claim substantial fees owed by PNB.
3. **Legal Background**: The legal background involves the interpretation of laws governing
warehouse receipts and the rights and obligations of parties involved in such transactions. It
includes provisions related to warehouseman's liens, enforcement of security interests, and
remedies available to creditors.
4. **Failure to Reach Settlement**: Despite attempts by the parties to reach a settlement, they
were unable to agree on the terms, leading to continued litigation.
5. **Procedural History**: The case has undergone various stages of litigation, including
hearings, motions, and appeals, before reaching the Supreme Court.
6. **Efforts for Resolution**: The parties engaged in legal proceedings, submitting memoranda
and arguments to support their respective positions. However, no mutually acceptable solution
was reached, leading to the need for judicial intervention.
These detailed facts provide the context for the legal dispute between PNB and private
respondents regarding warehouseman's fees and charges, which forms the basis of the case
before the Supreme Court.

**Detailed Issues:**
1. **Appropriateness of Certiorari as Remedy**: The primary issue is whether certiorari under
Rule 65 is the proper remedy. This revolves around the nature of the trial court's orders and
whether they justify the extraordinary remedy of certiorari.
2. **Authority of the Trial Court**: Another issue is the authority of the trial court to issue the
writ of execution and determine the warehouseman's fees. This involves discussing the court's
jurisdiction and its power to make decisions in the case.
3. **Commencement Date for PNB's Liability**: A significant issue is determining when PNB's
liability for storage fees begins. There's disagreement between the parties about the start date for
PNB's liability, which needs clarification.
4. **Allegations of Grave Abuse of Discretion**: Lastly, there are allegations of grave abuse of
discretion by the trial court in its proceedings. This includes claims of procedural irregularities
and denial of due process.
**Detailed Decisions:**
1. **Appropriateness of Certiorari**: The Supreme Court decides that certiorari under Rule 65 is
the appropriate remedy. This is due to the nature of the trial court's orders, which warrant
extraordinary intervention.
2. **Enforcement of Warehouseman's Lien**: The Court determines that private respondents are
entitled to enforce their warehouseman's lien in the ongoing civil case, as per legal provisions
and prior court decisions.
3. **PNB's Liability for Storage Fees**: The Court finds PNB liable for storage fees. However,
further clarification is needed to determine the commencement date for its liability and ascertain
the extent of its obligations.
4. **Grave Abuse of Discretion**: Lastly, the Supreme Court concludes that the trial court
committed grave abuse of discretion. This was due to procedural irregularities, denial of due
process, and ordering immediate execution without proper procedural safeguards.

In summary, the Supreme Court grants PNB's petition, reverses the trial court's orders, and
directs further proceedings to address the issues raised and ensure fair adjudication of the
dispute.