Professional Documents
Culture Documents
Velez v. Balzarra
FACTS:
Plaintiff Velez filed a complaint for the return of parcels of land sold by
Defendant to Plaintiffs husband. She further alleged that defendants had
remained in possession of said land under Contract of Lease but for over 2
years defendants had not paid the agreed rentals.
Defendant alleged that the real agreement was a loan secured by a mortgage
of those lands.
Trial court found that the payments made by defendants were not made by
way of interest but as payments for the principal. Defendant overpaid
therefore Plaintiff should return excess.
ISSUE: Whether payments were intended to be applied to the principal OR were
considered as rents, interests?
HELD:
Payments were NOT rents, interests
Neri took possession of land and collected fruits. The creditor having enjoyed
the beneficial use of the lands delivered as security for the loan, it appears to
have been the intention of the parties that the creditor should be
compensated thereby.
Though receipts, payments are called rents, they were prepared by Neri (Ps
husband) and Plaintiff, and defendants in their ignorance did not look into the
wording, being merely satisfied that they were proofs of payment.
The liability of plaintiff to return the excess payments is in keeping with
Article 1895 (Old Civil Code) which provides that, when something is
received which there is no right to collect, and which by mistake has been
unduly delivered, the obligation to restore it arises.
The 2 requisites are present: 1) There is no right to collect these excess
sums; and 2) the amounts have been paid through mistake by defendants.
Such mistake is shown by the fact that their contracts never intended that
either rents or interest should be paid, and by the further fact that when
these payments were made, they were intended by defendants to be applied
to the principal, but they overpaid the amounts loaned to them.
FACTS:
Respondent Abellas son Mike rented for residential purposes the house of
Petitioner Calibo.
Respondent left a tractor in his sons garage for safekeeping
Petitioner Mike had not paid rentals, electric and water bills
Mike reassured Calibo that the tractor would stand as guarantee for its
payment
Respondent wanted to take possession of his tractor but Petitioner said that
the Mike had left the tractor with him as security for the payment of Mikes
obligation to him.
Respondent issued postdated checks but Petitioner will only accept check if
Respondent executes Promissory Note to cover payment for unpaid electric
and water bills.
Petitioner instituted an action for replevin claiming ownership of the tractor
and seeking to recover possession thereof from petitioner. Likewise, he
asserts that the tractor was left with him, in the concept of an innkeeper, on
deposit and that he may validly hold on thereto until Mike Abella pays his
obligations.
TC and CA Mike could not have validly pledged the tractor because he was
not the owner. NO DEPOSIT
ISSUE: WON there was a valid deposit?
HELD: NO
In a contract of deposit, a person receives an object belonging to another
with the obligation of safely keeping it and of returning the same. Petitioner
himself stated that he received the tractor not to safely keep it but as a form
of security for the payment of Mike Abellas obligations. There is no deposit
where the principal purpose for receiving the object is not safekeeping.
Consequently, petitioner had no right to refuse delivery of the tractor to its
lawful owner. On the other hand, private respondent, as owner, had every
right to seek to repossess the tractor including the institution of the instant
action for replevin.
FACTS:
Respondent McLoughlin would stay at Tropicana Hotel every time he is here in
the Philippines and would rent a safety deposit box.
The safety deposit box could only be opened through the use of 2 keys, one
of which is given to the registered guest, and the other remaining in the
possession of the management of the hotel.
McLoughlin allegedly placed the following in his safety deposit box 2
envelopes containing US Dollars, one envelope containing Australian Dollars,
Letters, credit cards, bankbooks and a checkbook.
When he went abroad, a few dollars were missing and the jewelry he bought
was likewise missing.
Eventually, he confronted Lainez and Paiyam who admitted that Tan opened
the safety deposit box with the key assigned to him. McLoughlin went up to
his room where Tan was staying and confronted her. Tan admitted that she
had stolen McLouglins key and was able to open the safety deposit box with
the assistance of Lopez, Paiyam and Lainez. Lopez alsto told McLoughlin that
Tan stole the key assigned to McLouglin while the latter was asleep.
McLoughlin insisted that it must be the hotel who must assume responsibility
for the loss he suffered.
Lopez refused to accept responsibility relying on the conditions for renting the
safety deposit box entitled Undertaking For the Use of Safety Deposit Box
ISSUE: Whether the hotels Undertaking is valid?
HELD: NO
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 carriers 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.
In an early case (De Los Santos v. Tan Khey), CA ruled that to hold
hotelkeepers or innkeeper liable for the effects of their guests, it is not
necessary that they be actually delivered to the innkeepers or their
employees. It is enough that such effects are within the hotel or inn. With
greater reason should the liability of the hotelkeeper be enforced when the
missing items are taken without the guests knowledge and consent from a
safety deposit box provided by the hotel itself, as in this case.
Paragraphs (2) and (4) of the undertaking manifestly contravene Article
2003, CC 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.
FACTS:
Laureano Atendido obtained from PNB a loan of P3k and pledged 2000 cavans
of palay to guarantee payment which were then deposited in the warehouse
of Cheng Siong Lam & Co and to that effect the borrower endorsed in favour
of the bank the corresponding warehouse receipt.
Before the maturity of the loan, the 2000 cavans of palay disappeared for
unknown reasons in the warehouse. When the loan matured, the borrower
failed to pay obligation
Defendant claimed that the warehouse receipt covering the palay which was
given as security having been endorsed in blank in favour of the bank and the
palay having been lost or disappeared, he thereby became relieved of
liability.
ISSUE: Whether the surrender of the warehouse receipt covering 2000 cavans of
palay given as security, endorsed in blank, to PNB, has the effect of transferring
their title or ownership OR it should be considered merely as a guarantee to secure
the payment of the obligation of Defendant?
HELD:
Nature of contract is Pledge supported by the stipulations embodied in the
contract signed by Defendant when he secured the loan from PNB.
The 2000 cavans of palay covered by the warehouse receipt were given to
PNB only as a guarantee to secure the fulfilment by Defendant in his
obligation. This clearly appears in the contract wherein it is expressly stated
that said 2000 cavanes of palay were given as collateral security.
It follows that by the very nature of the transaction its ownership remains
with the pledgor subject only to foreclosure in case of non-fulfillment of the
obligation.
By this we mean that if the obligation is not paid upon maturity the most that
the pledge can do is to sell the property and apply the proceeds to the
payment of the obligation and to return the balance, if any, to the pledgor.
This is the essence of the contract, for, according to law, a pledge cannot
become the owner of, nor appropriate to himself the thing given in pledge.
If by the contract of pledge, the pledgor continues to be the owner of the
thing pledged during the pendency of the obligation, it stands to reason that
in case of loss of the property, the loss should be borne by the pledgor.
The fact that the warehouse receipt covering the palay was delivered,
endorsed in blank, to the bank does not alter the situation, the purpose of
such endorsement being merely to transfer the juridical possession of the
property to the pledge and to forestall any possible disposition thereof on the
part of the pledgor.
Where a warehouse receipt or quedan is transferred or endorsed to
a creditor only to secure the payment of a loan or debt, the
transferee or endorsee does not automatically become the owner of
the goods covered by the warehouse receipt or quedan but he
merely retains the right to keep and with the consent of the owner
to sell them so as to satisfy the obligation from the proceeds of the
sale. This is for the simple reason that the transaction involved is not a sale
but only a mortgage or pledge, and that if the property covered by the
quedans or warehouse receipts is lost without fault or negligence of the
mortgagee or pledge or the transferee or endorsee of the warehouse receipt
or quedan, then said goods are to be regarded as lost on account of the real
owner, mortgagor or pledgor.
appears that although Lucero executed the bond without his knowledge,
nevertheless he did not object thereto or repudiate the same at any time.