JOHANNES RIESENBECK, PETITIONER, VS. THE HON. COURT OF APPEALS, AND JUERGEN MAILE, RESPONDENTS.

This is a petition for review on certiorari to annul the
decision dated April 21, 1989 of the Court of Appeals which dismissed for lack
of merit the petition for certiorari against two (2) orders of Regional
Trial Court Judge Teodoro K. Risos.

On July 25, 1988, petitioner Riesenbeck filed in the Regional
Trial Court of Cebu, Branch 27, a complaint for consignation and damages
against respondent Juergen Maile. On
July 27, 1988, petitioner consigned and deposited with the Clerk of Court of
the Regional Trial Court of Cebu the sum of P113,750. The private respondent subsequently filed a Manifestation
Accepting Consignation and Motion to Dismiss dated August 1, 1988, wherein he
stated, inter alia, that “without necessarily admitting
the correctness of the obligation of plaintiff
to defendant, the latter hereby manifests to accept the said
amount of P113,750 which is consigned by plaintiff, provided that the
present complaint be dismissed outright with cost against plaintiff.” (p. 14,
CA Rollo.) The petitioner opposed the manifestation. Despite the pendency of his Manifestation, respondent Maile filed
an Answer with Special Defenses and Counterclaim. On August 23, 1988, petitioner filed his Answer to
Counterclaim. Private respondent filed
a rejoinder/reply to the petitioner’s opposition.

Thereafter, on September 28, 1988, respondent Judge issued the
first questioned order reading in part as follows:

“After a thorough evaluation of the issues involved in the
manifestation and the opposition thereto, the Court is of the opinion that
there was a valid consignation, and defendant could legally accept the payment
by consignation with reservation to prove damages and other claims as held by
the Supreme Court in the case of Sing Juco vs. Cuaycong, 46 Phil. 81.

“WHEREFORE, the Clerk of Court of this Court is hereby ordered to
deliver to defendant Juergen Maile the sum of P113,750.00 immediately,
but the motion to dismiss is hereby in the meantime DENIED.” (p. 31, CA Rollo.)

On November 11, 1988, Judge Risos denied petitioner’s motion for
reconsideration.

On November 18, 1988, petitioner filed a petition for certiorari
in the Court of Appeals to annul and set aside the two orders of Judge Risos.

In a decision dated April 21, 1989, the Court of Appeals
dismissed the petition for certiorari.

Petitioner’s motion for reconsideration was denied by the Court
of Appeals in a Resolution dated August 29, 1989.

In this petition for review, the petitioner raises the following
issue: What is the effect on the
petitioner’s obligation to the private respondent of the latter’s acceptance with
reservation of the amount consigned by the
petitioner.

Private respondent’s acceptance of the amount consigned by the
petitioner-debtor with a reservation or qualification as to the correctness of
the petitioner’s obligation, is legally permissible. There is authority for the view that before a consignation can be
judicially declared proper, the creditor may prevent the withdrawal of the
amount consigned by the debtor, by accepting the consignation, even with
reservations (Tolentino, Civil Code of the Phil., Vol. IV, 1973 Ed., p. 317,
citing 3 Llerena 263).

In ruling that there was a valid consignation and that the
respondent creditor could accept the same with a reservation of his damages and
other claims, the Court of Appeals relied on the 1924 case of Sing Juco vs.
Cuaycong, 46 Phil. 81. In that case,
the defendants consigned in court the amount which they had received from the
plaintiff as the price of sugar, the sale of which did not materialize. The defendants were given the alternative of
delivering the sugar or returning the price per stipulation in the
contract. We ruled that plaintiff’s
acceptance of the money consigned, unconditionally and without reservation, was
a waiver of his other claims under the contract.

A sensu contrario, when the creditor’s acceptance
of the money consigned is conditional and with reservations, he is not deemed
to have 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, Civil Code of the Phil., Vol. IV, 1973 Ed., p. 317,
citing 3 Llerena 263). The same factual
milieu obtains here because the respondent creditor accepted with reservation
the amount consigned in court by the petitioner-debtor. Therefore, the creditor is not barred from
raising his other claims, as he did in his answer with special defenses and
counterclaim against the petitioner-debtor.

As respondent-creditor’s acceptance of the amount consigned was
with reservations, it did not completely extinguish the entire indebtedness of
the petitioner-debtor. It is apposite
to note here that consignation is completed at the time the creditor accepts
the same without objections, or, if he objects, at the time the court declares that it
has been validly made in accordance with law. (Tolentino, Civil Code of the Phil., Vol. IV, 1973 Ed., p. 315.)

Since the lower court in this case declared on September 28, 1988
that there was a valid consignation by the petitioner, the latter cannot tenably
argue that he is still the owner of the amount consigned and that he can still
withdraw it.

The consignation has retroactive effect. The payment is deemed to have been made at
the time of the deposit of the money in court, or when it was placed at the
disposal of the judicial authority, supra. In this case, payment is considered made on July 27, 1988 when
petitioner consigned and deposited with the respondent court the sum of P113,750.

WHEREFORE, the instant petition
is hereby DISMISSED for lack of merit.

SO ORDERED.

Cruz, (Chairman), Medialdea, and
Bellosillo, JJ., concur.