Complicaciones agudas durante el inicio de la dieta

G. R. No. 135462 December 7, 2001 PARDO, J.

In the event of default by the entrustee on his obligations under the trust receipt agreement, it is not absolutely necessary that the entruster cancel the trust and take possession of the goods to be able to enforce his rights thereunder.

Facts:

Joseph L. G. Chua, the President of Fortune Motors Corp.(FMC), Palawan Lumber Manufacturing Corp. and South City Homes, Inc. executed in favor of BA Finance Corp.(BAFC) a Continuing Suretyship Agreementin which, they jointly and severally unconditionally guaranteed the payment and discharge of any and all indebtedness of FMC to BAFC. Subsequently, Canlubang Automotive Resources Corporation (CARCO) drew six Drafts in its own favor, payable thirty (30) days after sight, charged to the account of FMC. FMC thereafter executed trust receipts covering the motor vehicles delivered to it by CARCO. CARCO assigned the drafts and trust receipts to BAFC. Upon default of FMC, BAFC sent demand letter to the aforementioned sureties. They, however, failed to settle their outstanding account so BAFC fileda complaint for a sum of money with prayer for preliminary attachment. RTC ordered FMC, Palawan Lumber Manufacturing Corporation and Joseph Chua jointly and severally to pay BAFC.

Issue:

Whether BAFC has a valid cause of action for a sum of money following the drafts and trust receipts transactions.

Ruling:

YES.Petitioners finally posit that as an entruster, respondent BAFC must first demand the return of the unsold vehicles from Fortune Motors Corporation, pursuant to the terms of the trust receipts. Having failed to do so, petitioners had no cause of action whatsoever against Fortune Motors Corporation and the action for collection of sum of money was, therefore, premature. A trust receipt is a security transaction intended to aid in financing importers and retail dealers who do not have sufficient funds or resources to finance the importation or purchase of merchandise, and who may not be able to acquire credit except through utilization, as collateral, of the merchandise imported or purchased. In the event of default by the entrustee on his obligations under the trust receipt agreement, it is not absolutely necessary that the entruster cancel the trust and take possession of the goods to be able to enforce his rights thereunder. We ruled:

Significantly, the law uses the word may in granting to the entruster the right to cancel the trust and take possession of the goods. Consequently, petitioner has the discretion to avail of such right or seek any alternative action, such as a third party claim or

a separate civil action which it deems best to protect its right, at any time upon default or failure of the entrustee to comply with any of the terms and conditions of the trust agreement.

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LANDL & COMPANY (PHIL.) INC., PERCIVAL G. LLABAN and MANUEL P. LUCENTE v. METROPOLITAN BANK & TRUST COMPANY

G.R. No. 159622 July 30, 2004 YNARES-SANTIAGO, J.

The initial repossession by the bank of the goods subject of the trust receipt did not result in the full satisfaction of the petitioners’ loan obligation.

Facts:

Upon compliance with the requirements, Metrobankopened an irrevocable letter of credit for Landl& Company Inc. On the maturity date of the trust receipt, Landl defaulted in the payment of its obligation to the bank and failed to turn over the goods to the latter. Metrobank demanded the turn over the goods subject of the trust receipt to which the company obliged. The goods were sold to Metrobank as the highest bidder at a public auction.The proceeds of the auction sale, however, were insufficient to completely satisfy Landl’s outstanding obligation to the Bank. Accordingly, Metrobankdemanded the payment of the remaining balance but to no avail. Hence, it filed a complaint for sum of money against Landland its directors.

Issue:

Whether Metrobank had the right to claim the deficiency from Landl et al. notwithstanding the fact that the goods covered by the trust receipt were fully turned over to it.

Ruling:

YES. The initial repossession by the bank of the goods subject of the trust receipt did not result in the full satisfaction of the petitioners’ loan obligation. Petitioners are apparently laboring under the mistaken impression that the full turn-over of the goods suffices to divest them of their obligation to repay the principal amount of their loan obligation. This is definitely not the case. In Philippine National Bank v. Hon. Gregorio G. Pineda and Tayabas Cement Company, Inc., we had occasion to rule:

PNBs possession of the subject machinery and equipment being precisely as a form of security for the advances given to TCC under the Letter of Credit, said possession by itself cannot be considered payment of the loan secured thereby. Payment would legally result only after PNB had foreclosed on said securities, sold the same and applied the proceeds thereof to TCC's loan obligation. Mere possession does not amount to foreclosure for foreclosure denotes the procedure adopted by the mortgagee to terminate the rights of the mortgagor on the property and includes the sale itself.

Neither can said repossession amount to dacion en pago. Dation in payment takes place when property is alienated to the creditor in satisfaction of a debt in money and the same is governed by sales. Dation in payment is the delivery and transmission of ownership of a thing by the debtor to the creditor as an accepted equivalent of the performance of the obligation. As aforesaid, the repossession of the machinery and equipment in question was merely to secure the payment of TCC's loan obligation and not for the purpose of

transferring ownership thereof to PNB in satisfaction of said loan. Thus, no dacion en pago was ever accomplished.

Warehouse Receipt's Law

LIBERATA ANTONIO ESTRADA, CANUTO CENIZAN, NAZARIO DE LA CRUZ, GENARO