Johannes Riesenbeck, petitioner v. The Hon.

Court of Appeals, and Juergen Maile, respondents

Riesenbeck v. Court of Appeals

Topic: Obligations; Extinguishment of Obligations; Voluntary; By Execution; Tender of Payment and Consignation Doctrine: Acceptance of the amount consigned by the creditor with a reservation/qualification as to correctness is legally permissible. Nature: Petition for review on certiorari of the decision of the Court of Appeals. Date: 1992 Ponente: Grio-Aquino, J. Facts: On 25 July 1988, petitioner Riesenbeck filed a complaint for consignation and damages against private respondent Maile in the RTC of Cebu. Two days later, he (petitioner) consigned and deposited with the Clerk of Court P 113,750. The private respondent then filed a Manifestation Accepting Consignation and Motion to Dismiss (1 August 1988), stating without necessarily admitting the correctness of the obligation of plaintiff to defendant, the latter [private respondent] hereby manifests to accept the said amount of P 113,750 which is consigned by plaintiff, provided that the present complaint be dismissed outright with cost against plaintiff. Riesenbeck opposed the manifestation, but the lower court ruled that there was a valid consignation, and the private respondent could legally accept the payment by consignation with reservation to prove damages and other claims. The trial court cited the case of Sing Juco v. Cuaycong as its basis. The petitioner filed for a motion for reconsideration, which was denied. The Court of Appeals also denied his petition for certiorari, and his subsequent motion for reconsideration. The petitioner then went to the Supreme Court. Issue: Can a creditor accept with reservation the amount consigned by the debtor? Held: Yes, it is legally permissible. The instant petition was dismissed for lack of merit. Ratio: Private respondents acceptance of the amount consigned by the petitioner-debtor with a reservation or qualification as to the correctness of the petitioners obligation is legally permissible. Before a consignation can be judicially declared proper, the creditor may prevent the withdrawal of the amount consigned by accepting the consignation, even with reservation (Tolentino). The Court mentioned the case of Sing Juco, where they ruled that the plaintiffs acceptance of the money consigned, unconditionally and without reservation, was a waiver of his other claims under the contract. Consequently, a creditors conditional acceptance of the money consigned means that he has not waived the claims he reserved against his debtor. Thus, when the amount consigned does not cover the entire obligation, the creditor may accept it, reserving his right to the balance (Tolentino). The creditor is not barred from raising his other claims. Consignation is completed at the time the creditor accepts the amount without objections. If he objects, it is deemed completed when the court declares that is has been validly made in accordance with the law. There was a valid consignation by the petitioner, as declared by the lower court. He cannot argue that he is still the owner of the amount consigned and that he can still withdraw it. The

consignation has a retroactive effect. The payment was considered made on 27 July 1988. (No concurring or dissenting opinions.)