PHILIPPINE NATIONAL BANK, petitioner, vs. HON. MARCELINO L.

SAYO, JR., in his capacity as Presiding Judge of the Regional Trial

Court of Manila (Branch 45), NOAH'S ARK SUGAR REFINERY,
ALBERTO T. LOOYUKO, JIMMY T. GO and WILSON T.
GO, respondents.

FACTS
Noah's Ark Sugar Refinery (Noah's Ark) issued several Warehouse Receipts
(Quedans) on various dates, some of which were endorsed, to Luis T. Ramos
and Cresencia K. Zoleta. Ramos and Zoleta then used the quedans as security
for two loan agreements with the Philippine National Bank (PNB). Ramos and
Zoleta failed to pay their loans upon maturity. Consequently, PNB demanded the
delivery of the sugar stocks covered by the quedans endorsed to it by Zoleta and
Ramos. Noah's Ark, however, refused, claiming ownership of the quedans. PNB
sued herein private respondents for specific performance. The case reached the
Supreme Court, which ruled in favor of PNB. Motions for reconsideration by
Noah's Ark was denied by the Court. Thereupon, private respondents filed before
the trial court an Omnibus Motion seeking, among others the deferment of the
proceedings until their claim for warehousemans lien would be heard. On the
other hand, PNB filed a Motion for the issuance of the Writ of Execution and
opposition to the Omnibus Motion filed by the private respondents. Private
respondents won their case up to the Supreme Court, which declared that while
the PNB is entitled to the stocks of sugar as the endorsee of the quedans,
delivery to it shall be effected only upon payment of the storage fees. PNB's
motion for reconsideration was denied. Private respondents filed a Motion for
Execution of Defendant's Lien, which was opposed by the petitioner. However,
the trial court granted private respondents Motion for Execution. PNB was
immediately served with a Writ of Execution. PNB filed a Motion for
Reconsideration with urgent prayer for Quashal of the Writ of Execution and an
Urgent Motion to Lift Garnishment of their funds with Bangko Sentral ng Pilipinas.
The trial court denied all the motions of PNB. Hence, PNB filed this special civil
action for certiorari asking for the annulment of the orders of the trial court: one,
granting private respondents' motion for execution to satisfy their
warehouseman's lien, and two, denying petitioners motion for reconsideration of
the first order and urgent motion to lift the garnishment.
Noahs Ark claimed for warehousemans lien for the storage of the goods.
RTC: granted lien. PNB appealed
ISSUE
WoN PNB is entitled to the stocks of sugar as the endorsee of the quedans,
without paying the lien

HELD
YES. The petition was meritorious.
While PNB is entitled to the stocks of sugar as the endorsee of the quedans,
delivery to it shall be effected only upon payment of the storage fees. The
warehouseman is entitled to the warehousemans lien that attaches to the goods
invokable against anyone who claims a right of possession thereon. However, in
this case, the lien was lost when R refused to deliver the goods, which were not
anchored to a valid excuse (i.e. nonsatisfaction of W/Hman Lien) but on an
adverse claim of ownership. The loss of W/H Mans lien does not necessarily
mean the extinguishment of the obligation to pay the W/H fees and charges
which continues to be a personal liability of the owners, PNB in this case.
However, such fees and charges have ceased to accrue from the date of the
rejection by Noahs Ark to heed the lawful demand for the release of the goods.