Republic of the Philippines

SUPREME COURT
Manila
SECOND DIVISION
G.R. No. L-41764 December 19, 1980
NEW

PACIFIC

TIMBER

&

SUPPLY

COMPANY,

INC., petitioner,

vs.
HON. ALBERTO V. SENERIS, RICARDO A. TONG and EX-OFFICIO SHERIFF
HAKIM S. ABDULWAHID,respondents.

CONCEPCION JR., J.:

A petition for certiorari with preliminary injunction to annul and/or modify the
order of the Court of First Instance of Zamboanga City (Branch ii) dated August
28, 1975 denying petitioner's Ex-Parte Motion for Issuance of Certificate Of
Satisfaction Of Judgment.
Herein petitioner is the defendant in a complaint for collection of a sum of
money filed by the private respondent. 1On July 19, 1974, a compromise
judgment was rendered by the respondent Judge in accordance with an
amicable settlement entered into by the parties the terms and conditions of
which, are as follows:

(1) That defendant will pay to the plaintiff the amount of Fifty Four
Thousand Five Hundred Pesos (P54,500.00) at 6% interest per
annum to be reckoned from August 25, 1972;
(2) That defendant will pay to the plaintiff the amount of Six
Thousand Pesos (P6,000.00) as attorney's fees for which P5,000.00
had

been

acknowledged

received

by

the

plaintiff

under

Consolidated Bank and Trust Corporation Check No. 16-135022

amounting to P5,000.00 leaving a balance of One Thousand Pesos
(P1,000.00);
(3) That the entire amount of P54,500.00 plus interest, plus the
balance of P1,000.00 for attorney's fees will be paid by defendant
to the plaintiff within five months from today, July 19, 1974; and
(4) Failure one the part of the defendant to comply with any of the
above-conditions, a writ of execution may be issued by this Court
for the satisfaction of the obligation.

For failure of the petitioner to comply with his judgment obligation, the
respondent Judge, upon motion of the private respondent, issued an order for
the issuance of a writ of execution on December 21, 1974. Accordingly, writ of
execution was issued for the amount of P63,130.00 pursuant to which, the ExOfficio Sheriff levied upon the following personal properties of the petitioner, to
wit:

(1) Unit American Lathe 24

(1) Unit American Lathe 18 Cracker Wheeler
(1) Unit Rockford Shaper 24
and set the auction sale thereof on January 15, 1975. However, prior to
January 15, 1975, petitioner deposited with the Clerk of Court, Court of First
Instance, Zamboanga City, in his capacity as Ex-Officio Sheriff of Zamboanga
City, the sum of P63,130.00 for the payment of the judgment obligation,
consisting of the following:
1. P50.000.00 in Cashier's Check No. S-314361 dated January 3,
1975 of the Equitable Banking Corporation; and
2. P13,130.00incash.
In

a letter

dated January

14,

1975,

to

the Ex-Officio Sheriff,

private

respondent through counsel, refused to accept the check as well as the cash
deposit. In the 'same letter, private respondent requested the scheduled
auction sale on January 15, 1975 to proceed if the petitioner cannot produce
the cash. However, the scheduled auction sale at 10:00 a.m. on January 15,
1975 was postponed to 3:00 o'clock p.m. of the same day due to further
attempts to settle the case. Again, the scheduled auction sale that afternoon
did not push through because of a last ditch attempt to convince the private
respondent to accept the check. The auction sale was then postponed on the

following day, January 16, 1975 at 10:00 o'clock a.m.

At about 9:15 a.m., on

January 16, 1975, a certain Mr. Taedo representing the petitioner appeared in
the office of the Ex-Officio Sheriff and the latter reminded Mr. Taedo that the
auction sale would proceed at 10:00 o'clock. At 10:00 a.m., Mr. Taedo and Mr.
Librado, both representing the petitioner requested the Ex-Officio Sheriff to give
them fifteen minutes within which to contract their lawyer which request was
granted. After Mr. Taedo and Mr. Librado failed to return, counsel for private
respondent insisted that the sale must proceed and the Ex-Officio Sheriff
proceeded with the auction sale.

In the course of the proceedings, Deputy

Sheriff Castro sold the levied properties item by item to the private respondent
as the highest bidder in the amount of P50,000.00. As a result thereof, the ExOfficio Sheriff declared a deficiency of P13,130.00.

Thereafter, on January 16,

1975, the Ex-Officio Sheriff issued a "Sheriff's Certificate of Sale" in favor of the
private respondent, Ricardo Tong, married to Pascuala Tong for the total
amount of P50,000.00 only. 8Subsequently, on January 17, 1975, petitioner
filed an ex-parte motion for issuance of certificate of satisfaction of judgment.
This motion was denied by the respondent Judge in his order dated August 28,
1975. In view thereof, petitioner now questions said order by way of the present
petition alleging in the main that said respondent Judge capriciously and
whimsically abused his discretion in not granting the motion for issuance of
certificate of satisfaction of judgment for the following reasons: (1) that there
was already a full satisfaction of the judgment before the auction sale was
conducted with the deposit made to the Ex-Officio Sheriff in the amount of

P63,000.00 consisting of P50,000.00 in Cashier's Check and P13,130.00 in

cash; and (2) that the auction sale was invalid for lack of proper notice to the
petitioner and its counsel when the Ex-Officio Sheriff postponed the sale from
June 15, 1975 to January 16, 1976 contrary to Section 24, Rule 39 of the
Rules of Court. On November 10, 1975, the Court issued a temporary
restraining order enjoining the respondent Ex-OfficioSheriff from delivering the
personal properties subject of the petition to Ricardo A. Tong in view of the
issuance of the "Sheriff Certificate of Sale."
We find the petition to be impressed with merit.
The main issue to be resolved in this instance is as to whether or not the
private respondent can validly refuse acceptance of the payment of the
judgment obligation made by the petitioner consisting of P50,000.00 in
Cashier's Check and P13,130.00 in cash which it deposited with the ExOfficio Sheriff before the date of the scheduled auction sale. In upholding
private respondent's claim that he has the right to refuse payment by means of
a check, the respondent Judge cited the following:
Section 63 of the Central Bank Act:
Sec. 63. Legal Character. Checks representing deposit money do
not have legal tender power and their acceptance in payment of
debts, both public and private, is at the option of the creditor,
Provided, however, that a check which has been cleared and

credited to the account of the creditor shall be equivalent to a

delivery to the creditor in cash in an amount equal to the amount
credited to his account.
Article 1249 of the New Civil Code:
Art. 1249. The payment of debts in money shall be made in the
currency stipulated, and if it is not possible to deliver such
currency, then in the currency which is legal tender in the
Philippines.
The delivery of promissory notes payable to order, or bills of
exchange or other mercantile documents shall produce the effect of
payment only when they have been cashed, or when through the
fault of the creditor they have been impaired.
In the meantime, the action derived from the original obligation
shall be held in abeyance.
Likewise, the respondent Judge sustained the contention of the private
respondent that he has the right to refuse payment of the amount of
P13,130.00 in cash because the said amount is less than the judgment
obligation, citing the following Article of the New Civil Code:
Art. 1248. Unless there is an express stipulation to that effect, the
creditor cannot be compelled partially to receive the presentations

in which the obligation consists. Neither may the debtor be

required to make partial payment.
However, when the debt is in part liquidated and in part
unliquidated, the creditor may demand and the debtor may
effectthe payment of the former without waiting for the liquidation
of the latter.
It is to be emphasized in this connection that the check deposited by the
petitioner in the amount of P50,000.00 is not an ordinary check but a
Cashier's Check of the Equitable Banking Corporation, a bank of good standing
and reputation. As testified to by the Ex-Officio Sheriff with whom it has been
deposited, it is a certified crossed check.9 It is a well-known and accepted
practice in the business sector that a Cashier's Check is deemed as cash.
Moreover, since the said check had been certified by the drawee bank, by the
certification, the funds represented by the check are transferred from the credit
of the maker to that of the payee or holder, and for all intents and purposes,
the latter becomes the depositor of the drawee bank, with rights and duties of
one in such situation.

10

Where a check is certified by the bank on which it is

drawn, the certification is equivalent to acceptance. 11 Said certification

"implies that the check is drawn upon sufficient funds in the hands of the
drawee, that they have been set apart for its satisfaction, and that they shall be
so applied whenever the check is presented for payment. It is an understanding
that the check is good then, and shall continue good, and this agreement is as

binding on the bank as its notes in circulation, a certificate of deposit payable

to the order of the depositor, or any other obligation it can assume. The object
of certifying a check, as regards both parties, is to enable the holder to use it as
money."

12

When the holder procures the check to be certified, "the check

operates as an assignment of a part of the funds to the creditors."

13

Hence, the

exception to the rule enunciated under Section 63 of the Central Bank Act to
the effect "that a check which has been cleared and credited to the account of
the creditor shall be equivalent to a delivery to the creditor in cash in an
amount equal to the amount credited to his account" shall apply in this case.
Considering that the whole amount deposited by the petitioner consisting of
Cashier's Check of P50,000.00 and P13,130.00 in cash covers the judgment
obligation of P63,000.00 as mentioned in the writ of execution, then, We see no
valid reason for the private respondent to have refused acceptance of the
payment of the obligation in his favor. The auction sale, therefore, was uncalled
for. Furthermore, it appears that on January 17, 1975, the Cashier's Check
was even withdrawn by the petitioner and replaced with cash in the
corresponding amount of P50,000.00 on January 27, 1975 pursuant to an
agreement entered into by the parties at the instance of the respondent Judge.
However, the private respondent still refused to receive the same. Obviously,
the private respondent is more interested in the levied properties than in the
mere satisfaction of the judgment obligation. Thus, petitioner's motion for the
issuance of a certificate of satisfaction of judgment is clearly meritorious and

the respondent Judge gravely abused his discretion in not granting the same
under the circumstances.
In view of the conclusion reached in this instance, We find no more need to
discuss the ground relied in the petition.
It is also contended by the private respondent that Appeal and not a special
civil action for certiorari is the proper remedy in this case, and that since the
period to appeal from the decision of the respondent Judge has already
expired, then, the present petition has been filed out of time. The contention is
untenable. The decision of the respondent Judge in Civil Case No. 250 (166)
has long become final and executory and so, the same is not being questioned
herein. The subject of the petition at bar as having been issued in grave abuse
of discretion is the order dated August 28, 1975 of the respondent Judge which
was merely issued in execution of the said decision. Thus, even granting that
appeal is open to the petitioner, the same is not an adequate and speedy
remedy for the respondent Judge had already issued a writ of execution.

14

WHEREFORE, in view of all the foregoing, judgment is hereby rendered:

1. Declaring as null and void the order of the respondent Judge dated August
28, 1975;
2. Declaring as null and void the auction sale conducted on January 16, 1975
and the certificate of sale issued pursuant thereto;

3. Ordering the private respondent to accept the sum of P63,130.00 under

deposit as payment of the judgment obligation in his favor;
4. Ordering the respondent Judge and respondent Ex-Officio Sheriff to release
the levied properties to the herein petitioner.
The temporary restraining order issued is hereby made permanent.
Costs against the private respondent.
SO ORDERED.
Barredo (Chairman), Aquino, Abad Santos and De Castro, JJ., concur.