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RCBC vs Metro Container Corporation

Civil Procedure Case Digests Interpleader

Facts: For failure of Ley Construction Corporation (LEYCON) to settle its loan obligations, Rizal Commercial Banking Corporation (RCBC) instituted an extrajudicial foreclosure proceeding against it. In a bidding, RCBC was adjudged the highest bidder. LEYCON promptly filed an action for Nullification of Extrajudicial Foreclosure Sale and Damages against RCBC. Meanwhile, RCBC consolidated its ownership over the property due to LEYCON's failure to redeem the mortgaged property within the 12-month redemption period. By virtue thereof, RCBC demanded rental payments from Metro Container Corporation (METROCAN) which was leasing the mortgaged property from LEYCON.

On the other hand, LEYCON filed an action for Unlawful Detainer against METROCAN before the MeTC. Consequently, METROCAN filed a complaint for Interpleader against LEYCON and RCBC before the RTC to compel them to interplead and litigate their several claims among themselves and to determine which among them shall rightfully receive the payment of monthly rentals on the subject property.

On 31 October 1995, judgment was rendered in the Unlawful Detainer case, which, among other things, ordered METROCAN to pay LEYCON whatever rentals due on the subject premises. The said decision became final and executory. By reason thereof, METROCAN and LEYCON separately filed a motion to dismiss the interpleader case. However, the said motions were dismissed for lack of merit. METROCAN appealed to the Court of Appeals which granted the petition and ordered the dismissal of the interpleader case. Hence, RCBC filed the instant petition.

Issue: May METROCAN unilaterally cause the dismissal of the interpleader case?

Held: Yes. An action of interpleader is afforded to protect a person not against double liability but against double vexation in respect of one liability. It requires, as an indispensable requisite, that conflicting claims upon the same subject matter are or may be made against the plaintiff-in-interpleader who claims no interest whatever in the subject matter or an interest which in whole or in part is not disputed by the claimants.

When the decision in the Unlawful Detainer case became final and executory, METROCAN has no other alternative left but to pay the rentals to LEYCON. Precisely because there was already a judicial fiat to METROCAN, there was no more reason to continue with the interpleader case. Thus, METROCAN moved for the dismissal of the interpleader action not because it is no longer interested but because there is no more need for it to pursue such cause of action. The decision in the Unlawful Detainer case resolved the conflicting claims insofar as payment of rentals was concerned.

RCBC was correct in saying that it is not bound by the decision in the Unlawful Detainer case. It is not a party thereto. However, it could not compel METROCAN to pursue the interpleader case. RCBC has other avenues to prove its claim. It is not bereft of other legal remedies. In fact, the issue of ownership can very well be threshed out in the case for Nullification of Extrajudicial Foreclosure Sale and Damages filed by LEYCON against RCBC. (RCBC vs Metro Container Corporation, G.R. No. 127913. September 13, 2001) 

 

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