TLG International Continental Enterprising, Inc. v. Flores
REITERATIONFacts
The Antecedents: Petitioner TLG International Continental Enterprising, Inc. intervened as a sub-lessee in Civil Case No. 14880, an action for declaratory relief concerning lease rights. To protect its rights and due to uncertainty regarding the rightful recipient of monthly rentals, petitioner deposited sums totaling P3,750.00 with the Clerk of Court of the Court of First Instance of Rizal as consignation. Procedural History: The defendants in Civil Case No. 14880 filed an Omnibus Motion to dismiss the complaint and the complaint in intervention, arguing that the subject matter could be better ventilated in a pending ejectment case. The trial court granted this motion and dismissed both the complaint and the complaint in intervention. The Petition: Petitioner filed a motion to withdraw the deposited sums, asserting that the dismissal of the case without a resolution on the entitlement to the rentals left it with no recourse. The respondent judge denied this motion, as well as a subsequent motion for reconsideration. This led to the filing of the instant petition for certiorari.
Issue(s)
Whether a debtor may withdraw a sum deposited by way of consignation after the dismissal of the main case but before the creditor has accepted the deposit or the court has issued a judicial declaration of its validity.
Ruling
The petition for certiorari is granted. The orders dated June 23, 1972, and July 15, 1972, are set aside, and the respondent judge is directed to grant the withdrawal of the deposit.
Ratio Decidendi
On Issue 1: Applying Article 1260 of the Civil Code, the Court held that a debtor is entitled as a matter of right to withdraw the deposit made with the court before the consignation is accepted by the creditor or before a judicial approval is rendered. The Court noted that in this case, the dismissal of the main action and the intervention occurred before the amount was accepted or approved, which rendered the consignation ineffectual as per the ruling in Bravo v. Barreras. Consequently, it became incumbent upon the respondent judge to allow the withdrawal upon the petitioner's motion. The Court rejected the respondent's argument that he lacked authority because the deposit wasn't 'ordered' by the court. The Court reasoned that the deposit was a direct consequence of the court's own order admitting the 'Complaint In Intervention' and was made pursuant to Article 1258 of the Civil Code. Since the money was officially receipted by the Clerk of Court under Section 6 of the Judiciary Act (Republic Act No. 296), it remained under the court's control and jurisdiction. Citing Manajero v. Buyson Lampa, the Court emphasized that once the deposit is made, the money is under the jurisdiction of the court and requires an express order of restitution for recovery, which the judge was duty-bound to provide under the circumstances.
Main Doctrine
Before acceptance by the creditor or judicial declaration of proper consignation, the debtor may withdraw the sum deposited, and the dismissal of the case before such acceptance or declaration renders the consignation ineffectual, entitling the debtor to withdraw the deposit.