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Tio Khe Chio v. Court of Appeals G.R. Nos. 76101-02 Sept.

30, 1991 Chief Justice Fernan Facts: Tio Khe Chio imported 1,000 bags of fishmeal from the US, and the goods were insured with Eastern Assurance and Surety Corporation (EASCO). When the goods reached Manila via the vessel owned by Far Eastern Shipping Co. (FESC), they were found to have been damaged by sea water when rendered the fishmeal useless. Upon refusal of EASCO and FESC to pay his claim, Tio Khe Chio filed a suit against the two. The trial court rendered judgment in favor of Tio Khe Chio; only FESC appealed the decision, and was subsequently absolved by the appellate court. Upon Tio Khe Chios motion, a writ of execution was issued against EASCO. The sheriff who enforced the writ fixed the legal rate of interest at 12%. EASCO then filed a petition to quash the writ on the ground that the legal rate of interest to be computed must be 6% per annum un accordance with Art. 2209 of the Civil Code. Tio Khe Chio, on the other hand, argued that since his claim is based on an insurance contract, then is it the Insurance Code (Secs. 243 and 244 setting for a 12% interest rate per annum) which must govern. Issue: WON the Insurance Code applies to the present case. Held: No, it does not. in the case at bar, the Court of Appeals made no finding that there was an unjustified refusal or withholding of payment on Tio Khe Chios claim. Under Secs. 243 and 244 of the Insurance Code, an insured shall have the right to collect interest in case of any unjustified refusal or withholding of payment of the insurer. Hence, said sections of the Insurance Code are not pertinent to the present case.