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FIRSTDIVISION

[G.R.No.119231.April18,1996]

PHILIPPINENATIONALBANK,petitioner,vs.HON.PRES.JUDGEBENITOC.SE,
JR., RTC, BR. 45, MANILA NOAHS ARK SUGAR REFINERY ALBERTO T.
LOOYUKO,JIMMYT.GOandWILSONT.GO,respondents.
SYLLABUS
1.COMMERCIALLAWWAREHOUSERECEIPTSLAWTHEUNCONDITIONALPRESENTMENT
OF THE RECEIPTS FOR PAYMENT CARRIED WITH IT THE ADMISSIONS OF THE
EXISTENCE AND VALIDITY OF THE TERMS, CONDITIONS AND STIPULATIONS WRITTEN
ON THE FACE OF THE WAREHOUSE RECEIPTS, INCLUDING THE UNQUALIFIED
RECOGNITIONOFTHEPAYMENTOFWAREHOUSEMANSLIENFORSTORAGEFEESAND
PRESERVATIONEXPENSESCASEATBAR.Petitionerisinestoppelindisclaimingliabilityfor
thepaymentofstoragefeesduetheprivaterespondentsaswarehousemanwhileclaimingtobe
entitledtothesugarstockscoveredbythesubjectWarehouseReceiptsonthebasisofwhichit
anchorsitsclaimforpaymentordeliveryofthesugarstocks.Theunconditionalpresentmentof
the receipts by the petitioner for payment against private respondents on the strength of the
provisions of the Warehouse Receipts Law (R.A. 2137) carried with it the admission of the
existence and validity of the terms, conditions and stipulations written on the face of the
WarehouseReceipts,includingtheunqualifiedrecognitionofthepaymentofwarehousemanslien
for storage fees and preservation expenses. Petitioner may not now retrieve the sugar stocks
withoutpayingtheliendueprivaterespondentsaswarehouseman.
2.ID.ID.ID.WAREHOUSEMANSLIENPOSSESSORYINNATURE.WhilethePNBisentitled
tothestocksofsugarastheendorseeofthequedans,deliverytoitshallbeeffectedonlyupon
paymentofthestoragefees.Imperativeistherightofthewarehousemantodemandpaymentof
hislienatthisjuncture,because,inaccordancewithSection29oftheWarehouseReceiptsLaw,
thewarehousemanloseshislienupongoodsbysurrenderingpossessionthereof.Inotherwords,
the lien may be lost where the warehouseman surrenders the possession of the goods without
requiringpaymentofhislien,becauseawarehousemanslienispossessoryinnature.
APPEARANCESOFCOUNSEL
RolanA.Nietoforpetitioner.
Madella&CruzLawOfficesforprivaterespondents.

DECISION
HERMOSISIMA,JR.,J.:

The source of conflict herein is the question as to whether the Philippine National Bank should
paystoragefeesforsugarstockscoveredbyfive(5)WarehouseReceiptsstoredinthewarehouseof
private respondents in the face of the Court of Appeals decision (affirmed by the Supreme Court)
declaring the Philippine National Bank as the owner of the said sugar stocks and ordering their
deliverytothesaidbank.Fromthesamefactsbutonadifferentperspective,itcanbesaidthatthe
issueis:Canthewarehousemanenforcehiswarehousemanslienbeforedeliveringthesugarstocks
asorderedbytheCourtofAppealsorneedhefileaseparateactiontoenforcepaymentofstorage
fees?

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Thehereinpetitionseekstoannul:(1)theResolutionofrespondentJudgeBenitoC.Se,Jr.ofthe
Regional Trial Court of Manila, Branch 45, dated December 20, 1994, in Civil Case No. 9053023,
authorizingreceptionofevidencetoestablishtheclaimofrespondentsNoahsArkSugarRefinery,et
al., for storage fees and preservation expenses over sugar stocks covered by five (5) Warehouse
Receipts which is in the nature of a warehousemans lien and (2) the Resolution of the said
respondentJudge,datedMarch1,1995,declaringthevalidityofprivaterespondentswarehousemans
lien under Section 27 of Republic Act No 2137 and ordering that execution of the Court of Appeals
decision, dated December 13, 1991, be in effect held in abeyance until the full amount of the
warehousemanslienonthesugarstockscoveredbyfive(5)quedanssubjectoftheactionshallhave
beensatisfiedconformablywiththeprovisionsofSection31ofRepublicAct2137.
AlsoprayedforbythepetitionisaWritofProhibitiontorequirerespondentRTCJudgetodesist
from further proceeding with Civil Case No. 9053023, except order the execution of the Supreme
Court judgment and a Writ of Mandamus to compel respondent RTC Judge to issue a Writ of
ExecutioninaccordancewiththesaidexecutorySupremeCourtdecision.

THEFACTS

InaccordancewithActNo.2137,theWarehouseReceiptsLaw,NoahsArkSugarRefineryissued
on several dates, the following Warehouse Receipts (Quedans): (a) March 1, 1989, Receipt No.
18062,coveringsugardepositedbyRosaSy(b)March7,1989,ReceiptNo.18080,coveringsugar
deposited by RNS Merchandising (Rosa Ng Sy) (c) March 21, 1989, Receipt No. 18081, covering
sugar deposited by St. Therese Merchandising (d)March 31, 1989, Receipt No. 18086, covering
sugar deposited by St. Therese Merchandising and (e) April 1, 1989, Receipt No. 18087, covering
sugardepositedbyRNSMerchandising.Thereceiptsaresubstantiallyintheform,andcontainsthe
terms,prescribedfornegotiablewarehousereceiptsbySection2ofthelaw.
Subsequently,WarehouseReceiptsNos.18080and18081werenegotiatedandendorsedtoLuis
T.RamosandReceiptsNos.18086,18087and18062werenegotiatedandendorsedtoCresencia
K. Zoleta. Ramos and Zoleta then used the quedans as security for two loan agreements one for
P15.6 million and the other for P23.5 million obtained by them from the Philippine National Bank.
TheaforementionedquedanswereendorsedbythemtothePhilippineNationalBank.
LuisT.RamosandCresenciaK.ZoletafailedtopaytheirloansuponmaturityonJanuary9,1990.
Consequently,onMarch16,1990, the Philippine National Bank wrote to Noahs Ark Sugar Refinery
demandingdeliveryofthesugarstockscoveredbythequedansendorsedtoitbyZoletaandRamos.
NoahsArkSugarRefineryrefusedtocomplywiththedemandallegingownershipthereof,forwhich
reasonthePhilippineNationalBankfiledwiththeRegionalTrialCourtofManilaaverifiedcomplaint
for Specific Performance with Damages and Application for Writ of Attachment against Noahs Ark
SugarRefinery,AlbertoT.Looyuko,JimmyT.GoandWilsonT.Go,thelastthreebeingidentifiedas
thesoleproprietor,managingpartner,andExecutiveVicePresidentofNoahsArk,respectively.
RespondentJudgeBenitoC.Se,Jr.,inwhosesalathecasewasraffled,deniedtheApplication
forPreliminaryAttachment.Reconsiderationthereforwaslikewisedenied.
NoahsArkanditscodefendantsfiledanAnswerwithCounterclaimandThirdPartyComplaintin
which they claimed that they are the owners of the subject quedans and the sugar represented
therein,averringastheydidthat:

9.***InanagreementdatedApril1,1989,defendantsagreedtoselltoRosaNgSyofRNSMerchandisingand
TeresitaNgofSt.ThereseMerchandisingthetotalvolumeofsugarindicatedinthequedansstoredatNoahs
ArkSugarRefineryforatotalconsiderationofP63,000,000.00,

***Thecorrespondingpaymentsintheformofchecksissuedbythevendeesinfavorofdefendantswere
subsequentlydishonoredbythedraweebanksbyreasonofpaymentstoppedanddrawnagainstinsufficient
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funds,

***Uponpropernotificationtosaidvendeesandplaintiffinduecourse,defendantsrefusedtodeliverto
vendeesthereinthequantityofsugarcoveredbythesubjectquedans.

10.***Consideringthatthevendeesandfirstendorsersofsubjectquedansdidnotacquireownershipthereof,
thesubsequentendorsersandplaintiffitselfdidnotacquireabetterrightofownershipthantheoriginal
vendees/firstendorsers.1

TheAnswerincorporatedaThirdPartyComplaintbyAlbertoT.Looyuko,JimmyT.GoandWilson
T.Go,doingbusinessunderthetradenameandstyleNoahsArkSugarRefineryagainstRosaNgSy
andTeresitaNg,prayingthatthelatterbeorderedtodeliverorreturntothemthequedans(previously
endorsedtoPNBandthesubjectofthesuit)andpaydamagesandlitigationexpenses.
The Answer of Rosa Ng Sy and Teresita Ng, dated September 6, 1990, one of avoidance, is
essentiallytotheeffectthatthetransactionbetweenthem,ontheonehand,andJimmyT.Go,onthe
other, concerning the quedans and the sugar stocks covered by them was merely a simulated one
beingpartofthelatters complex banking schemes and financial maneuvers,andthus,theyarenot
answerableindamagestohim.
OnJanuary31,1991,thePhilippineNationalBankfiledaMotionforSummaryJudgmentinfavor
oftheplaintiffasagainstthedefendantsforthereliefsprayedforinthecomplaint.
On May 2, 1991, the Regional Trial Court issued an order denying the Motion for Summary
Judgment. Thereupon, the Philippine National Bank filed a Petition for Certiorari with the Court of
Appeals,docketedasCAG.R.SP.No.25938onDecember13,1991.
PertinentportionsofthedecisionoftheCourtofAppealsread:

InissuingthequestionedOrders,therespondentCourtruledthatquestionsoflawshouldberesolvedafterand
notbefore,thequestionsoffactareproperlylitigated.Ascrutinyofdefendantsaffirmativedefensesdoesnot
showmaterialquestionsoffactastotheallegednonpaymentofpurchasepricebythevendees/firstendorsers,
andwhichnonpaymentisnotdisputedbyPNBasitdoesnotmateriallyaffectPNBstitletothesugarstocksas
holderofthenegotiablequedans.

Whatisdeterminativeoftheproprietyofsummaryjudgmentisnottheexistenceofconflictingclaimsfromprior
partiesbutwhetherfromanexaminationofthepleadings,depositions,admissionsanddocumentsonfile,the
defensesastothemainissuedonottendermaterialquestionsoffact(seeGarciavs.CourtofAppeals,167
SCRA815)ortheissuesthustenderedareinfactsham,fictitious,contrived,setupinbadfaithorso
unsubstantialasnottoconstitutegenuineissuesfortrial.(SeeVergaravs.Suelto,etal.,156SCRA753
Mercado,etal.vs.CourtofAppeals,162SCRA75).ThequestionedOrdersthemselvesdonotspecifywhat
materialfactsareinissue.(SeeSec.4,Rule34,RulesofCourt).

Torequireatrialnotwithstandingpertinentallegationsofthepleadingsandotherfactsappearingontherecord,
wouldconstituteawasteoftimeandaninjusticetothePNBwhoserightstorelieftowhichitisplainlyentitled
wouldbefurtherdelayedtoitsprejudice.

InissuingthequestionedOrders,WefindtherespondentCourttohaveactedingraveabuseofdiscretionwhich
justifyholdingnullandvoidandsettingasidetheOrdersdatedMay2andJuly4,1990ofrespondentCourt,
andthatasummaryjudgmentberenderedforthwithinfavorofthePNBagainstNoahsArkSugarRefinery,et
al.,asprayedforinpetitionersMotionforSummaryJudgment.2

OnDecember13,1991,theCourtofAppealsnullifiedandsetasidetheordersofMay2andJuly
4,1990oftheRegionalTrialCourtandorderedthetrialcourttorendersummaryjudgmentinfavorof
thePNB.OnJune18,1992,thetrialcourtrenderedjudgmentdismissingplaintiffscomplaintagainst
private respondents for lack of cause of action and likewise dismissed private respondents
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counterclaim against PNB and of the ThirdParty Complaint and the ThirdParty Defendants
Counterclaim.OnSeptember4,1992,thetrialcourtdeniedPNBsMotionforReconsideration.
OnJune9,1992,thePNBfiledanappealfromtheRTCdecisionwiththeSupremeCourt,G.R.
No.107243,bywayofaPetitionforReviewonCertiorariunderRule45oftheRulesofCourt.This
CourtrenderedjudgmentonSeptember1,1993,thedispositiveportionofwhichreads:

WHEREFORE,thetrialjudgesdecisioninCivilCaseNo.9053023,datedJune18,1992,isreversedandset
asideandanewonerenderedconformablywiththefinalandexecutorydecisionoftheCourtofAppealsinCA
G.RSP.No.25938,orderingtheprivaterespondentsNoahsArkSugarRefinery,AlbertoT.Looyuko,JimmyT.
GoandWilsonT.Go,jointlyandseverally:

(a) to deliver to the petitioner Philippine National Bank, the sugar stocks covered by the Warehouse
Receipts/Quedanswhicharenowinthelatterspossessionasholderforvalueandinduecourseor
alternatively,topay(said)plaintiffactualdamagesintheamountofP39.1million,withlegalinterest
thereonfromthefilingofthecomplaintuntilfullpaymentand
(b)topayplaintiffPhilippineNationalBankattorneysfees,litigationexpensesandjudicialcostshereby
fixedattheamountofOneHundredFiftyThousandPesos(P150,000.00)aswellasthecosts.

SOORDERED.3

On September 29, 1993, private respondents moved for reconsideration of this decision. A
Supplemental/SecondMotionforReconsiderationwithleaveofcourtwasfiledbyprivaterespondents
onNovember8,1993.WedeniedprivaterespondentsmotiononJanuary10,1994..
Private respondents filed a Motion Seeking Clarification of the Decision, dated September 1,
1993.Wedeniedthismotioninthismanner:

ItbearsstressingthatthereliefgrantedinthisCourtsdecisionofSeptember1,1993ispreciselythatsetoutin
thefinalandexecutorydecisionoftheCourtofAppealsinCAG.R.SPNo.25938,datedDecember13,1991,
whichwasaffirmedintotobythisCourtandwhichbecameunalterableuponbecomingfinalandexecutory.4

Private respondents thereupon filed before the trial court an Omnibus Motion seeking among
others the deferment of the proceedings until private respondents are heard on their claim for
warehousemans lien. On the other hand, on August 22, 1994, the Philippine National Bank filed a
Motion for the Issuance of a Writ of Execution and an Opposition to the Omnibus Motion filed by
privaterespondents.
The trial court granted private respondents Omnibus Motion on December 20, 1994 and set
receptionofevidenceontheirclaimforwarehousemanslien.TheresolutionofthePNBsMotionfor
Executionwasordereddeferreduntilthedeterminationofprivaterespondentsclaim.
OnFebruary21,1995,privaterespondentsclaimforlienwasheardandevidencewasreceivedin
supportthereof.Thetrialcourtthereaftergavebothpartiesfive(5)daystofilerespectivememoranda.
OnFebruary28,1995, the Philippine National Bank filed a Manifestation with Urgent Motion to
NullifyCourtProceedings.Inadjudicationthereof,thetrialcourtissuedthefollowingorderonMarch
1,1995:

WHEREFORE,thiscourtherebyfindsthatthereexistsinfavorofthedefendantsavalidwarehousemanslien
underSection27ofRepublicAct2137andaccordingly,executionofthejudgmentisherebyorderedstayedand/
orprecludeduntilthefullamountofdefendantslienonthesugarstockscoveredbythefive(5)quedanssubject
ofthisactionshallhavebeensatisfiedconformablywiththeprovisionsofSection31ofRepublicAct2137.5

Consequently,thePhilippineNationalBankfiledthehereinpetitiontoseekthenullificationofthe
aboveassailedordersofrespondentjudge.
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ThePNBsubmitsthat:
I

PNBsRIGHTTOAWRITOFEXECUTIONISSUPPORTEDBYTWOFINALANDEXECUTORY
DECISIONS:THEDECEMBER13,1991COURTOFAPPEALSDECISIONINCAG.R.SP.NO.25938AND,
THENOVEMBER9,1992SUPREMECOURTDECISIONING.RNO.107243.RESPONDENTRTCS
MINISTERIALANDMANDATORYDUTYISTOISSUETHEWRITOFEXECUTIONTOIMPLEMENTTHE
DECRETALPORTIONOFSAIDSUPREMECOURTDECISION
II

RESPONDENTRTCISWITHOUTJURISDICTIONTOHEARPRIVATERESPONDENTSOMNIBUS
MOTION.THECLAIMSSETFORTHINSAIDMOTION:(1)WEREALREADYREJECTEDBYTHE
SUPREMECOURTINITSMARCH9,1994RESOLUTIONDENYINGPRIVATERESPONDENTSMOTION
FORCLARIFICATIONOFDECISIONIN.G.R.NO.107243AND(2)AREBARREDFOREVERBYPRIVATE
RESPONDENTSFAILURETOINTERPOSETHEMINTHEIRANSWER,ANDFAILURETOAPPEALFROM
THEJUNE18,1992RTCDECISIONINCIVILCASENO.9052023
III

RESPONDENTRTCSONLYJURISDICTIONISTOISSUETHEWRITTOEXECUTETHESUPREME
COURTDECISION.THUS,PNBISENTITLEDTO:(1)AWRITOFCERTIORARITOANNULTHERTC
RESOLUTIONDATEDDECEMBER20,1994ANDTHEORDERDATEDFEBRUARY7,1995ANDALL
PROCEEDINGSTAKENBYTHERTCTHEREAFTER(2)AWRITOFPROHIBITIONTOPREVENT
RESPONDENTRTCFROMFURTHERPROCEEDINGWITHCIVILCASENO.9053023AND
COMMITTINGOTHERACTSVIOLATIVEOFTHESUPREMECOURTDECISIONING.R.NO.107243
AND(3)AWRITOFMANDAMUSTOCOMPELRESPONDENTRTCTOISSUETHEWRITTOEXECUTE
THESUPREMECOURTJUDGMENTINFAVOROFPNB

The issues presented before us in this petition revolve around the legality of the questioned
ordersofrespondentjudge,issuedastheywereafterwehaddeniedwithfinalityprivaterespondents
contention that the PNB could not compel them to deliver the stocks of sugar in their warehouse
coveredbytheendorsedquedansorpaythevalueofthesaidstocksofsugar.
Petitionerssubmissionisonatechnicality,thatis,thatprivaterespondentshavelosttheirrightto
recoverwarehousemanslienonthesugarstockscoveredbythefive(5)WarehouseReceiptsforthe
reason that they failed to set up said claim in their Answer before the trial court and that private
respondents did not appeal from the decision in this regard, dated June 18, 1992. Petitioner
asseveratesthatthedenialbythisCourtonMarch9,1994ofthemotionseekingclarificationofour
decision, dated September 1, 1993, has foreclosed private respondents right to enforce their
warehousemanslienforstoragefeesandpreservationexpensesundertheWarehouseReceiptsAct.
Ontheotherhand,privaterespondentsmaintainthattheycouldnothaveclaimedtherighttoa
warehouseman s lien in their Answer to the complaint before the trial court as it would have been
inconsistentwiththeirstandthattheyclaimownershipofthestockscoveredbythequedanssincethe
checksissuedforpaymentthereofweredishonored.Iftheywerestilltheowners,itwouldhavebeen
absurd for them to ask payment for storage fees and preservation expenses. They further contend
thatourresolution, dated March 9,1994, denying their motion for clarificationdidnotprecludetheir
right to claim their warehousemans lien under Sections 27 and 31 of Republic Act 2137, as our
resolutionmerelyaffirmedandadoptedtheearlierdecision,datedDecember13,1991,oftheCourtof
Appeals(6thDivision)inCAG.R.SP.No.25938anddidnotmakeanyfindingonthematterofthe
warehousemanslien.
Wefindforprivaterespondentsontheforegoingissueandsothepetitionnecessarilymustfail.

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We have carefully examined our resolution, dated March 9, 1994, which denied Noahs Arks
motion for clarification of our decision, dated September 1, 1993, wherein we affirmed in full and
adoptedtheCourtofAppealsearlierdecision,datedDecember13,1991,inCAG.R.SP.No.25938.
Wearenotpersuadedbythepetitionersargumentthatoursaidresolutioncarriedwithitthedenialof
thewarehousemanslienoverthesugarstockscoveredbythesubjectWarehouseReceipts.Wehave
simply resolved and upheld in our decision, dated September 1, 1993, the propriety of summary
judgmentwhichwasthenassailedbyprivaterespondents.Ineffect,weruledthereinthat,considering
thecircumstancesobtainingbeforethetrialcourt,theissuanceoftheWarehouseReceiptsnotbeing
disputedbytheprivaterespondents,asummaryjudgmentinfavorofPNBwasproper.Weineffect
furtheraffirmedthefindingthatNoahsArkisawarehousemanwhichwasobligedtodeliverthesugar
stockscoveredbytheWarehouseReceiptspledgedbyCresenciaK.ZoletaandLuisT.Ramostothe
petitionerpursuanttothepertinentprovisionsofRepublicAct2137.
In disposing of the private respondents motion for clarification, we could not contemplate the
matterofwarehousemanslienbecausetheissuetobefinallyresolvedthenwastheclaimofprivate
respondentsforretainingownershipofthestocksofsugarcoveredbytheendorsedquedans.Stated
otherwise, there was no point in taking up the issue of warehousemans lien since the matter of
ownership was as yet being determined. Neither could storage fees be due then while no one has
beendeclaredtheownerofthesugarstocksinquestion.
Of considerable relevance is the pertinent stipulation in the subject Warehouse Receipts which
providesforrespondentNoahsArksrighttoimposeandcollectwarehousemanslien:

Storageoftherefinedsugarquantitiesmentionedhereinshallbefreeuptoone(1)weekfromthedateofthe
quedanscoveringsaidsugarandthereafter,storagefeesshallbechargedinaccordancewiththeRefining
ContractunderwhichtherefinedsugarcoveredbythisQuedanwasproduced.6

Itisnotdisputed,therefore,that,underthesubjectWarehouseReceiptsprovision,storagefees
arechargeable.
Petitioner anchors its claim against private respondents on the five (5) Warehouse Receipts
issuedbythelattertothirdpartydefendantsRosaNgSyofRNSMerchandisingandTeresitaNgof
St.ThereseMerchandising,whichfoundtheirwaytopetitioneraftertheywerenegotiatedtothemby
Luis T. Ramos and Cresencia K. Zoleta for a loan of P39.1 Million. Accordingly, petitioner PNB is
legallyboundtostandbytheexpresstermsandconditionsonthefaceoftheWarehouseReceiptsas
tothepaymentofstoragefees.Evenintheabsenceofsuchaprovision,lawandequitydictatethe
paymentofthewarehousemanslienpursuanttoSections27and31oftheWarehouseReceiptsLaw
(R.A.2137),towit:

SECTION27.Whatclaimsareincludedinthewarehousemanslien.Subjecttotheprovisionsofsectionthirty,
awarehousemanshallhavelienongoodsdepositedorontheproceedsthereofinhishands,foralllawful
chargesforstorageandpreservationofthegoodsalsoforalllawfulclaimsformoneyadvanced,interest,
insurance,transportation,labor,weighingcooperingandotherchargesandexpensesinrelationtosuchgoods
alsoforallreasonablechargesandexpensesfornotice,andadvertisementofsale,andforsaleofthegoods
wheredefaulthasbeenmadeinsatisfyingthewarehousemanslien.

xxxxxxxxx

SECTION31.Warehousemanneednotdeliveruntillienissatisfied.Awarehousemanhavingalienvalid
againstthepersondemandingthegoodsmayrefusetodeliverthegoodstohimuntilthelienissatisfied.

Afterbeingdeclarednottheowner,butthewarehouseman,bytheCourtofAppealsonDecember
13,1991inCAG.R.SP.No.25938,thedecisionhavingbeenaffirmedbyusonDecember1,1993,
privaterespondentscannotlegallybedeprivedoftheirrighttoenforcetheirclaimforwarehousemans
lien,forreasonablestoragefeesandpreservationexpenses.PursuanttoSection31whichwequote
hereunder,thegoodsunderstoragemaynotbedelivereduntilsaidlienissatisfied.
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SECTION31.Warehousemanneednotdeliveruntillienissatisfied.Awarehousemanhavingalienvalid
againstthepersondemandingthegoodsmayrefusetodeliverthegoodstohimuntilthelienissatisfied.

Considering that petitioner does not deny the existence, validity and genuineness of the
WarehouseReceiptsonwhichitanchorsitsclaimforpaymentagainstprivaterespondents,itcannot
disclaimliabilityforthepaymentofthestoragefeesstipulatedtherein.Ascontracts,thereceiptsmust
berespectedbyauthorityofArticle1159oftheCivilCode,towit:

ART.1159.Obligationsarisingfromcontractshavetheforceoflawbetweenthecontractingpartiesandshould
becompliedwithingoodfaith.

Petitioner is in estoppel in disclaiming liability for the payment of storage fees due the private
respondents as warehouseman while claiming to be entitled to the sugar stocks covered by the
subjectWarehouseReceiptsonthebasisofwhichitanchorsitsclaimforpaymentordeliveryofthe
sugar stocks. The unconditional presentment of the receipts by the petitioner for payment against
private respondents on the strength of the provisions of the Warehouse Receipts Law (R.A. 2137)
carried with it the admission of the existence and validity of the terms, conditions and stipulations
writtenonthefaceoftheWarehouseReceipts,includingtheunqualifiedrecognitionofthepaymentof
warehousemanslienforstoragefeesandpreservationexpenses.Petitionermaynotnowretrievethe
sugarstockswithoutpayingtheliendueprivaterespondentsaswarehouseman.
Inviewoftheforegoing,therulemaybesimplifiedthus:WhilethePNBisentitledtothestocksof
sugar as the endorsee of the quedans, delivery to it shall be effected only upon payment of the
storagefees.
Imperative is the right of the warehouseman to demand payment of his lien at this juncture,
because, in accordance with Section 29 of the Warehouse Receipts Law, the warehouseman loses
hislienupongoodsbysurrenderingpossessionthereof.Inotherwords,thelienmaybelostwhere
the warehouseman surrenders the possession of the goods without requiring payment of his lien,
becauseawarehousemanslienispossessoryinnature.
We,therefore,upholdandsustainthevalidityoftheassailedordersofpublicrespondent,dated
December20,1994andMarch1,1995.
In fine, we fail to see any taint of abuse of discretion on the part of the public respondent in
issuingthequestionedorderswhichrecognizedthelegitimaterightofNoahsArk,afterbeingdeclared
aswarehouseman,torecoverstoragefeesbeforeitwouldreleasetothePNBsugarstockscovered
by the five (5) Warehouse Receipts. Our resolution, dated March 9, 1994, did not preclude private
respondentsunqualifiedrighttoestablishitsclaimtorecoverstoragefeeswhichisrecognizedunder
RepublicActNo.2137.NeitherdidtheCourtofAppealsdecision,datedDecember13,1991,restrict
suchright.
OurResolutionsreferencetothedecisionbytheCourtofAppeals,datedDecember13,1991,in
CAG.R.SP.No.25938,wasintendedtoguidethepartiesinthesubsequentdispositionofthecaseto
its final end. We certainly did not foreclose private respondents inherent right as warehouseman to
collect storage fees and preservation expenses as stipulated n the face of each of the Warehouse
ReceiptsandasprovidedforintheWarehouseReceiptsLaw(R.A.2137).
WHEREFORE,thepetitionshouldbe,asitis,herebydismissedforlackofmerit.Thequestioned
ordersissuedbypublicrespondentjudgeareaffirmed.
Costsagainstthepetitioner.
SOORDERED.
Padilla(Chairman),Bellosillo,Vitug,andKapunan,Jr.,JJ.,concur.

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1AnswerwithCounterclaimandThirdPartyComplaint,p.3Rollo,p.47.
2QuotedinthePetition,p.8Rollo,p.9.
3DecisionoftheSupremeCourtinG.R.No.107243,p.8Rollo,p.64.
4ResolutionoftheSupremeCourt(SectionDivision)inG.R.No.107243Rollo,p.71.
5ResolutionoftheRTCinCivilCaseNo.9053023,p.5Rollo,p.44.
6Comment,p.5Rollo,p.92.

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