RIZAL COMMERCIAL BANKING CORPORATION vs.

METRO CONTAINER
CORPORATION
G.R. No. 127913
September 13, 2001
PETITONER: RIZAL COMMERCIAL BANKING CORPORATION (RCBC)
RESPONDENT: METRO CONTAINER CORPORATION
PONENTE: KAPUNAN, J.
FACTS:
On 26 September 1990, Ley Construction Corp. (LEYCON) contracted a loan from
RCBC in the amount of P30,000,000.00, which was secured by a real estate
mortgage. LEYCON failed to settle its obligations prompting RCBC to institute
extrajudicial foreclosure proceedings against it. When the foreclosure took place on
28 December 1992 with RCBC as the highest bidder, LEYCON promptly filed an
action for Nullification of Extrajudicial Foreclosure Sale and Damages (foreclosure
case) against RCBC. Meanwhile, RCBC consolidated its ownership over the property
due to LEYCON's failure to redeem it within the 12-month redemption period and a
transfer certificate of title was issued in its favor. By virtue thereof, RCBC demanded
rental payments from Metro Container Corporation (METROCAN) which was leasing
the property from LEYCON. LEYCON, as lessor of the subject property, filed an action
for Unlawful Detainer (ejectment case) against METROCAN, its lessee, before the
MeTC.
Unsure which between LEYCON and RCBC was entitled to receive the payment of
monthly rentals on the subject property, METROCAN filed a complaint for
Interpleader, before the Regional Trial Court against LEYCON and RCBC to compel
them to interplead and litigate their several claims among themselves and to
determine which among them shall rightfully receive the payment of monthly
rentals on the subject property.
During the pre-trial conference in the interpleader case, the trial court ordered the
dismissal of the case insofar as METROCAN and LEYCON were concerned, in view of
an amicable settlement they entered, by virtue of which METROCAN paid back
rentals to LEYCON.
In the ejectment case, the MeTc rendered a decision, which became final and
executory, ordering METROCAN to pay LEYCON whatever rentals due on the subject
premises. METROCAN moved for the dismissal of the foreclosure case for having
become moot and academic due to the amicable settlement it entered with LEYCON
and the decision in the ejectment case. LEYCON, likewise, moved for the dismissal
of the case citing the same grounds cited by METROCAN.
The two motions were dismissed for lack of merit. The motions for reconsideration
filed by METROCAN and LEYCON were also denied. METROCAN sought relief from
the CA via a petition for certiorari and prohibition with prayer for the issuance of a
temporary restraining order and a writ of preliminary injunction. LEYCON, as private
respondent, also sought for the nullification of the RTC orders. The CA granted the
petition. The CA also ordered the dismissal of the interpleader action.

In the present petition, RCBC argues that while a party who initiates an interpleader
action may not be compelled to litigate if he is no longer interested to pursue such
cause of action, said party may not unilaterally cause the dismissal of the case after
the answer have been filed.

ISSUE: WON METROCAN can unilaterally cause the dismissal of the interpleader
case initiated by it.
HELD: YES. The reason for the interpleader action ceased when the MeTC rendered
judgment in the ejectment case when the court directed METROCAN to pay LEYCON
"whatever rentals due on the subject premises. While RCBC, not being a party to the
ejectment case, could not be bound by the judgment therein, METROCAN is bound
by the MeTc decision. When the decision in the ejectment case became final and
executory, METROCAN has no other alternative left but to pay the rentals to
LEYCON. Precisely because there was already a judicial fiat to METROCAN, there was
no more reason to continue with the interpleader action. Thus, METROCAN moved
for the dismissal of the interpleader action not because it is no longer interested but
because there is no more need for it to pursue such cause of action.
An action of interpleader is afforded to protect a person not against double liability
but against double vexation in respect of one liability. It requires, as an
indespensable requisite, that "conflicting claims upon the same subject matter are
or may be made against the plaintiff-in-interpleader who claims no interest
whatever in the subject matter or an interest which in whole or in part is not
disputed by the claimants." The decision in ejectment case resolved the conflicting
claims insofar as payment of rentals was concerned.