Case No. 9
Republic of the Philippines v. Jose Grijaldo G.R. No. L-20240; ece!ber "#$ #%&' (acts) Jose Grijaldo obtained five loans fro! the branch of the *an+ of ,aian. ,he loans ere evidenced b five pro!issor notes e/ecuted b the appellant in favor of the *an+ of ,aian. ,o secure the pa!ent of the loans$ Grijaldo e/ecuted a chattel !ortae on the standin crops on his land. ,he assets in the Philippines of the *an+ of ,aian$ ,aian$ Ltd. ere vested in the Govern!ent of the 1nited tates. Pursuant to the Philippine Propert 3ct of #%4& of the 1nited tates$ these assets includin the loans in uestion$ ere subseuentl transferred to the Republic of the Philippines b the Govern!ent of the 1nited tates under ,ransfer 3ree!ent of 20 Jul #%'4. Republic of the Philippines$ represented b the 5hair!an of the *oard of Liuidators$ !ade a ritten e/trajudicial de!and upon the appellant for the pa!ent of account in uestion. Republic filed a co!plaint in the Justice of the Peace of 5ourt of 6iniaran$ Neros 7ccidental$ to collect fro! the appellant the unpaid account in uestion. ,he court a uo rendered a decision orderin Grijaldo to pa the Republic of the Philippines the su! of P2$"88.2" as of "# ece!ber #%'% plus interest at the rate of &9 per annu! co!pounded uarterl. Grijaldo contends that Republic of the Philippines has no cause of action aainst hi! since the contract of loan as instituted ith the *an+ of ,aian. :ssues) hether or or not the obliation obliation of Grijaldo as e/tinuished. e/tinuished. 6eld) N7. ,he ,he obliation obliation of the appellan appellantt under the the five pro!iss pro!issor or notes notes as not not to deliver deliver a deter!inate thin na!el$ the crops to be harvested fro! his land$ or the value of the crops that ould be harvested harvested fro! his land. Rather, his obligation was to pay a generic thing — the amount of money representing the total sum of the five loans, with interest. ,he transaction beteen the appellant and the *an+ of ,aian$ ,aian$ Ltd. as a series of five contracts of si!ple loan of su!s of !one. <* a contract of =si!ple> loan$ one of the parties delivers to another ... !one or other consu!able thin upon the condition that the sa!e a!ount of the sa!e +ind and ualit shall shall be paid. paid.<< =3rtic =3rticle le #%""$ #%""$ 5ivil 5ivil 5ode> 5ode> ,he ,he obli obliati ation on of the appell appellant ant under under the five five pro!issor notes evidencin the loans in uestions uestions is to pa the value thereof; that is$ to deliver a su! of !one ? a clear case of an obliation to deliver$ a eneric thin. 3rticle 3rticle #2&" of the 5ivil 5ode provides) @:n an obliation to deliver a eneric thin$ the loss or destruction of anthin of the sa!e +ind does not e/tinuish the obliation.A ,he chattel !ortae on the crops roin on appellantBs land si!pl stood as a securit for the fulfill!ent of appellantBs obliation covered b the five pro!issor notes$ and the loss of the crops did not e/tinuish his obliation to pa$ because the account could still be paid fro! other other sources aside fro! the !ortaed !ortaed crops. :n his second point of contention$ the appellant !aintains that the action of the appellee had prescribed. ,he appellant points out that the loans beca!e due on June #$ #%44; and hen the co!plaint as filed on Januar #8$#%&# a period of !ore than #& ears had alread elapsed ? far beond the period of ten ears hen an action based on a ritten contract should be brouht to court. ,his contention of the appellant has no !erit. (irstl$ it should be considered that the co!plaint in the present case as brouht b the Republic of the Philippines not as a no!inal part but in the e/ercise of its soverein functions$ to protect the interests of the tate over a public propert. propert. 1nder pararaph 4 of 3rticle ##0C of the 5ivil 5ode prescription$ both acuisitive and e/tinctive$ does not run aainst the tate. ,his 5ourt has held that the statute of li!ita li!itati tions ons does does not not run aains aainstt the riht riht of action action of the Govern Govern!en !entt of the Philip Philippin pines. es.
econdl$ the running of the period of prescription of the action to collect the loan from the appellant was interrupted by the moratorium laws. ,he loan in uestion$ as evidenced b the five pro!issor notes$ ere incurred in the ear #%4"$ or durin the period of Japanese occupation of the Philippines.
D(or reference) hile the ban+ of ,aian$ Ltd. as the oriinal creditor and the transaction beteen Grijaldo and the *an+ of ,aian as a private contract of loan$ the successive transfer of the rihts over the loans in uestion fro! the *an+ of ,aian$ Ltd. to the 1nited tates Govern!ent$ and fro! the 1nited tates Govern!ent to the overn!ent of the Republic of the Philippines$ !ade the Republic of the Philippines the successor of the rihts$ title and interest in said loans. :t thereb created a privit of contract beteen the Republic of the Philippines and Grijaldo. ,he ord privy denotes the idea of succession. 6ence$ an assinee of a credit and the one subroated to it ill be privies. ,he 1nited tates of 3!erica actin as a bellierent soverein poer seiEed the assets of the *an+ of ,aian$ Ltd.$ hich beloned to an ene! countr. The republic of the Philippines had become a privy to the original contract of loan between an! of Taiwan "td. and #ri$aldo.
