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EASTERN SHIPPING LINES v. CA

This case has been cited 161 times or more.

	GR No. 165377 2010-02-16	LOLITA REYES DOING BUSINESS UNDER NAME v. CENTURY CANNING CORPORATION PERALTA, J.
We find that respondent has sufficiently established petitioner's liability in the amount of P463,493.63. Such amount must be paid with legal interest from the filing of the complaint on June 25, 1998, until fully paid. As held in the landmark case of Eastern Shipping Lines, Inc. v. Court of Appeals,[36] to wit: 1. When the obligation is breached, and it consists in the payment of a sum of money, i.e., a loan or forbearance of money, the interest due should be that which may have been stipulated in writing. Furthermore, the interest due shall itself earn legal interest from the time it is judicially demanded. In the absence of stipulation, the rate of interest shall be 12% per annum to be computed from default, i.e., from judicial or extrajudicial demand under and subject to the provisions of Article 1169 of the Civil Code.
	GR No. 179952 2009-12-04	METROPOLITAN BANK v. BA FINANCE CORPORATION CARPIO MORALES, J.
said provision does not find application in this case since the nature of the relationship between BA Finance and petitioner is one of agency whereby petitioner, as collecting bank, is to collect for BA Finance the corresponding proceeds from the check.[48] Not being a loan or forbearance of money, the interest should be 6% per annum computed from the date of extrajudicial demand on September 25, 1992 until finality of judgment; and 12% per annum from finality of judgment until payment, conformably with Eastern Shipping Lines, Inc. v. Court of Appeals.[49]
	GR No. 153820 2009-10-16	DELFIN TAN v. ERLINDA C. BENOLIRAO BRION, J.
Undoubtedly, Tan made a clear and unequivocal demand on the vendors to return his down payment as early as May 28, 1993. Pursuant to our definitive ruling in Eastern Shipping Lines, Inc. v. Court of Appeals,[20] we hold that the vendors should return the P200,000.00 down payment to Tan, subject to the legal interest of 6% per annum computed from May 28, 1993, the date of the first demand letter.
	GR No. 181206 2009-10-09	MEGAWORLD GLOBUS ASIA v. MILA S. TANSECO CARPIO MORALES, J.
While the appellate court correctly awarded P14,281,731.70 then, the interest rate should, however, be 6% per annum accruing from the date of demand on May 6, 2002, and then 12% per annum from the time this judgment becomes final and executory, conformably with Eastern Shipping Lines, Inc. v. Court of Appeals.[22]
	GR No. 177113 2009-10-02	STA. LUCIA REALTY v. SPS. FRANCISCO AND EMELIA* BUENAVENTURA YNARES-SANTIAGO, J.
However, we find that the applicable interest rate for the amount to be reimbursed to respondents is 6% per annum, reckoned from the time of the filing of the complaint, because the case at bar involves a breach of obligation and not a loan or forbearance of money. In Eastern Shipping Lines Inc. v. Court of Appeals,[15] we explained that: 1. When the obligation is breached, and it consists in the payment of a sum of money, i.e., a loan or forbearance of money, the interest due should be that which may have been stipulated in writing. Furthermore, the interest due shall itself earn legal interest from the time it is judicially demanded. In the absence of stipulation, the rate of interest shall be 12% per annum to be computed from default, i.e., from judicial or extrajudicial demand under and subject to the provisions of Article 1169 of the Civil Code.
	GR Nos. 180880-81 2009-09-25	KEPPEL CEBU SHIPYARD v. PIONEER INSURANCE NACHURA, J.
Pursuant to our ruling in Eastern Shipping Lines, Inc. v. Court of Appeals,[55] the award in favor of Pioneer in the amount of P350,146,786.89 should earn interest at 6% per annum from the filing of the case until the award becomes final and executory. Thereafter, the rate of interest shall be 12% per annum from the date the award becomes final and executory until its full satisfaction.
	GR No. 170674 2009-08-24	FOUNDATION SPECIALISTS v. BETONVAL READY CONCRETE CORONA, J.
We likewise hold that the imposition of a 12% p.a. interest on the award to Betonval (in addition to the 24% p.a. interest) in the assailed judgment is proper. When the judgment of the court awarding a sum of money becomes final and executory, the rate of legal interest shall be 12% p.a. from such finality until its satisfaction, this interim period being deemed to be by then an equivalent to a forbearance of credit.[31]
	GR No. 171035 2009-08-24	WILLIAM ONG GENATO v. BENJAMIN BAYHON PUNO, C.J.
We now go to the interest awarded by the trial court. We note that the interest has been pegged at 5% per month, or 60% per annum. This is unconscionable, hence cannot be enforced.[29] In light of this, the rate of interest for this kind of loan transaction has been fixed in the case of Eastern Shipping Lines v. Court of Appeals,[30] at 12% per annum, calculated from October 3, 1989, the date of extrajudicial demand.[31]
	GR No. 149241 2009-08-24	DART PHILIPPINES v. SPS. FRANCISCO AND ERLINDA CALOGCOG NACHURA, J.
Engaged in the business of manufacturing or importing into the Philippines Tupperware products and marketing the same under a direct selling distribution system,[3] petitioner entered into a Distributorship Agreement with respondents on March 3, 1986.[4] The agreement was to expire on March 31, 1987 but was subject to an automatic renewal clause for two one-year terms.[5] On April 1, 1991, the parties again executed another Distributorship Agreement[6] which was to expire on March 31, 1992 but renewable on a yearly basis upon terms and conditions mutually agreed upon in writing by the parties.[7]
	GR No. 171035 2009-07-24	WILLIAM ONG GENATO v. BENJAMIN BAYHON
We now go to the interest awarded by the trial court. We note that the interest has been pegged at 5% per month, or 60% per annum. This is unconscionable, hence cannot be enforced.[29] In light of this, the rate of interest for this kind of loan transaction has been fixed in the case of Eastern Shipping Lines v. Court of Appeals,[30] at 12% per annum, calculated from October 3, 1989, the date of extrajudicial demand.[31]
	GR No. 174610 2009-07-14	SORIAMONT STEAMSHIP AGENCIES v. SPRINT TRANSPORT SERVICES CHICO-NAZARIO, J.
Finally, the adjustment by the Court of Appeals with respect to the applicable rate of legal interest on the P320,000.00, representing the value of the subject equipment, and on the P270,124.42, representing the unpaid rentals awarded in favor of Sprint, is proper and with legal basis. Under Article 2209 of the Civil Code, when an obligation not constituting a loan or forbearance of money is breached, then an interest on the amount of damages awarded may be imposed at the discretion of the court at the rate of 6% per annum. Clearly, the monetary judgment in favor of Sprint does not involve a loan or forbearance of money; hence, the proper imposable rate of interest is six (6%) percent. Further, as declared in Eastern Shipping Lines, Inc. v. Court of Appeals,[22] the interim period from the finality of the judgment awarding a monetary claim until payment thereof is deemed to be equivalent to a forbearance of credit. Eastern Shipping Lines, Inc. v. Court of Appeals[23] explained, to wit: I. When an obligation, regardless of its source, i.e., law, contracts, quasi-contracts, delicts or quasi-delicts is breached, the contravenor can be held liable for damages. The provisions under Title XVIII on "Damages" of the Civil Code govern in determining the measure of recoverable damages.
	GR No. 166518 2009-06-16	NATIONAL HOUSING AUTHORITY v. HEIRS OF ISIDRO GUIVELONDO PUNO, J.
Unfortunately for petitioner, the abovequoted doctrine is not applicable to the instant case for the simple reason that respondents herein do not ask for interest as part of the judgment in an expropriation case, but for interest which is imposed due to the delay in the payment of a money judgment. As stated above, the former is imposed in order to place the owner in a position as good as (but not better than) the position he was in before the taking occurred, while the latter is considered as legal interest, to be computed at 12% per annum from such finality until its satisfaction,[15] because the interim period is deemed to be equivalent to a forebearance of credit.[16] Consequently, the award of the former needs to be stated in the judgment, while the award of the latter need not.[17] Moreover, the former is computed from the date of possession or filing of the complaint for expropriation,[18] the latter is merely computed from the time the judgment becomes final and executory.[19] Therefore, we find no patent error in the imposition of interest on petitioner.
	GR No. 174286 2009-06-05	TRADERS ROYAL BANK v. CUISON LUMBER CO. BRION, J.
Additionally, the respondents are also liable to pay interest by way of damages for their failure to pay the rentals due for the use of the subject property. In Eastern Shipping Lines v. CA,[47] we laid down the following guidelines with respect to the award and the computation of legal interest, as follows: II. With regard particularly to an award of interest in the concept of actual and compensatory damages, the rate of interest, as well as the accrual thereof, is imposed, as follows:
	GR No. 173227 2009-01-19	SEBASTIAN SIGA-AN v. ALICIA VILLANUEVA CHICO-NAZARIO, J.
We held in Eastern Shipping Lines, Inc. v. Court of Appeals,[45] that when an obligation, not constituting a loan or forbearance of money is breached, an interest on the amount of damages awarded may be imposed at the rate of 6% per annum. We further declared that when the judgment of the court awarding a sum of money becomes final and executory, the rate of legal interest, whether it is a loan/forbearance of money or not, shall be 12% per annum from such finality until its satisfaction, this interim period being deemed equivalent to a forbearance of credit.
	GR No. 162729 2008-12-17	SOLEDAD LEONOR PEÑA SUATENGCO v. CARMENCITA O. REYES LEONARDO-DE CASTRO, J.
On the matter of interest, we affirm the amount of interest awarded by the two courts below, there being a written stipulation as to its rate. In Eastern Shipping Lines, Inc. v. Court of Appeals,[14] we laid down the following guidelines on the imposition of legal interest: xxx xxx xxx
	GR No. 158621 2008-12-10	ROYAL CARGO CORPORATION v. DFS SPORTS UNLIMITED AUSTRIA-MARTINEZ, J.
Aside from the principal amount of P248,449.63, petitioner also seeks recovery of interests thereon. As to computation of legal interest, the seminal ruling in Eastern Shipping Lines, Inc. v. Court of Appeals[49] controls, to wit:x x x x
	GR No. 174154 2008-10-17	JESUS CUENCO v. TALISAY TOURIST SPORTS COMPLEX NACHURA, J.
When the judgment of the court awarding a sum of money becomes final and executory, the rate of legal interest, whether the case falls under paragraph 1 or paragraph 2, above, shall be 12% per annum from such finality until its satisfaction, this interim period being deemed to be by then an equivalent to a forbearance of credit.[44]
	GR No. 123238 2008-09-22	PHILIPPINE AIRLINES v. CA AND SPS. MANUEL S. BUNCIO AND AURORA R. BUNCIO CHICO-NAZARIO, J.
On another point, we held in Eastern Shipping Lines, Inc. v. Court of Appeals,[33] that when an obligation, not constituting a loan or forbearance of money is breached, an interest on the amount of damages awarded may be imposed at the rate of 6% per annum. We further declared that when the judgment of the court awarding a sum of money becomes final and executory, the rate of legal interest, whether it is a loan/forbearance of money or not, shall be 12% per annum from such finality until its satisfaction, this interim period being deemed to be then equivalent to a forbearance of credit.
	GR No. 167708 2008-08-22	SECRETARY OF LABOR v. PANAY VETERAN'S SECURITY CORONA, J.
In Eastern Shipping Lines, Inc. v. Court of Appeals,[22] the Court laid down the following guidelines: When an obligation, regardless of its source, i.e., law, contracts, quasi-contracts, delicts or quasi-delicts, is breached, the contravenor can be held liable for damages. The provisions under Title XVIII on "Damages" of the Civil Code govern in determining the measure of recoverable damages.
	GR No. 176217 2008-08-13	STA. LUCIA REALTY DEVELOPMENT INC. v. ROMEO UYECIO CARPIO MORALES, J.
On the issue of interest, the imposition of 12% per annum interest on the amount of refund must be reduced to 6%, conformably with this Court's ruling in Eastern Shipping Lines, Inc. v. Court of Appeals[24] and in Fil-Estate Properties, Inc. v. Go,[25] the amount to be refunded being neither a loan nor a forbearance of money, goods or credit.
	GR No. 164401 2008-06-25	LILIBETH SUNGA-CHAN v. CA VELASCO JR., J.
Third on the petitioners' list of unliquidated claims is the yet-to-be established value of the one-half partnership share and interest adjudicated to Chua, which, they submit, must first be determined with reasonable certainty in a judicial proceeding. And in this regard, petitioners, citing Eastern Shipping Lines, Inc. v. Court of Appeals,[29] would ascribe error on the RTC for adding a 12% per annum interest on the approved valuation of the one-half share of the assets, inclusive of goodwill, due Chua.
	GR Nos. 169408 & 170144 2008-04-30	HANJIN HEAVY INDUSTRIES v. DYNAMIC PLANNERS VELASCO JR., J.
When the judgment of the court awarding a sum of money becomes final and executory, the rate of legal interest, whether the case falls under paragraph 1 or paragraph 2, above, shall be 12% per annum from such finality until its satisfaction, this interim period being deemed to be by then an equivalent to a forbearance of credit.[58]
	GR No. 179337 2008-04-30	JOSEPH SALUDAGA v. FAR EASTERN UNIVERSITY and EDILBERTO C. DE JESUS in his capacity as President of FEU YNARES-SATIAGO, J.
In the instant case, it was established that petitioner spent P35,298.25 for his hospitalization and other medical expenses.[19] While the trial court correctly imposed interest on said amount, however, the case at bar involves an obligation arising from a contract and not a loan or forbearance of money. As such, the proper rate of legal interest is six percent (6%) per annum of the amount demanded. Such interest shall continue to run from the filing of the complaint until the finality of this Decision.[20] After this Decision becomes final and executory, the applicable rate shall be twelve percent (12%) per annum until its satisfaction.
	GR No. 170141 2008-04-22	JAPAN AIRLINES v. JESUS SIMANGAN REYES, R.T., J.
The above liabilities of JAL in the total amount of P800,000.00 earn legal interest pursuant to the Court's ruling in Construction Development Corporation of the Philippines v. Estrella,[76] citing Eastern Shipping Lines, Inc. v. Court of Appeals,[77] to wit:Regarding the imposition of legal interest at the rate of 6% from the time of the filing of the complaint, we held in Eastern Shipping Lines, Inc. v. Court of Appeals, that when an obligation, regardless of its source, i.e., law, contracts, quasi-contracts, delicts or quasi-delicts is breached, the contravenor can be held liable for payment of interest in the concept of actual and compensatory damages, subject to the following rules, to wit -
	GR No. 164195 2007-12-19	APO FRUITS CORPORATION v. CA CHICO-NAZARIO, J.
Under the above provision, in case of payment made in LBP bonds, the same shall earn interest rates aligned with the 91-day treasury bill (T-Bill) rates. The court notes that in the LBP's Motion for Reconsideration dated 5 October 2001[17] of the 25 September 2001 Decision of the RTC acting as SAC, the LBP disagreed with the imposition of interest rates by the RTC based on the 91-day T- Bill rate. LBP insisted therein that, assuming interest should be imposed on the amount of just compensation, it should be in accordance with existing jurisprudence laid down in Eastern Shipping Lines v. Court of Appeals,[18] to wit:II. With regard particularly to an award of interest in the concept of actual and compensatory damages, the rate of interest, as well as the accrual thereof, is imposed, as follows:
	GR No. 171545 2007-12-19	EQUITABLE PCI BANK v. NG SHEUNG NGOR** DOING BUSINESS UNDER NAME CORONA, J.
c) pursuant to our ruling in Eastern Shipping Lines v. Court of Appeals,[92] the total amount due on July 9, 2001 shall earn legal interest at 12% p.a. from the time petitioner Equitable PCI Bank demanded payment, whether judicially or extra-judicially; and
	GR NO. 131723 2007-12-13	MANILA ELECTRIC COMPANY v. T.E.A.M. ELECTRONICS CORPORATION NACHURA, J.
Respondent TEC sufficiently established, and petitioner in fact admitted, that the former paid P1,000,000.00 and P280,813.72 under protest, the amounts representing a portion of the latter's claim of differential billing. With the finding that no tampering was committed and, thus, no differential billing due, the aforesaid amounts should be returned by petitioner, with interest, as ordered by the Court of Appeals and pursuant to the guidelines set forth by the Court.[46]
	GR No. 165608 2007-12-13	PHILIPPINE PHOSPHATE FERTILIZER CORPORATION v. KAMALIG RESOURCES TINGA, J,
WHEREFORE, in view of the foregoing, the Decision dated 26 May 2004 of the Court of Appeals is MODIFIED. Petitioner Philippine Phosphate Fertilizer Corporation is ORDERED to PAY respondent Kamalig Resources, Inc. the amount of P411,144.84, plus legal interest from the finality of this Decision,[41] and costs of the suit. The award of attorney's fees by the Court of Appeals in favor of respondent is DELETED.
	GR NO. 160026 2007-12-10	EDMERITO ANG GOBONSENG v. UNIBANCARD CORPORATION AZCUNA, J.
Moreover, the case of Eastern Assurance and Surety, Corporation (EASCO) v. Court of Appeals[16] reiterated the rules in fixing the rate of interest, thus:With regard particularly to an award of interest in the concept of actual and compensatory damages, the rate of interest, as well as the accrual thereof, is imposed as follows:
	GR No. 175687 2007-11-28	MATERRCO v. FIRST LANDLINK ASIA DEVELOPMENT CORPORATION CARPIO MORALES, J.
As to the award of legal interest to FLADC despite the fact that the same is not prayed for in its Complaint, the MeTC is vested with discretion to award the same. Respecting awards of interest in the concept of actual or compensatory damages, Eastern Shipping Lines v. Court of Appeals[26] teaches, viz:"When an obligation, not constituting a loan or forbearance of money, is breached, an interest on the amount of damages awarded may be imposed at the discretion of the court at the rate of 6% per annum. No interest, however, shall be adjudged on unliquidated claims or damages except when or until the demand can be established with reasonable certainty. Accordingly, where the demand is established with reasonable certainty, the interest shall begin to run from the time the claim is made judicially or extrajudicially (Art. 1169, Civil Code) but when such certainty cannot be so reasonably established at the time the demand is made, the interest shall begin to run only from the date of the judgment of the court is made (at which time the quantification of damages may be deemed to have been reasonably ascertained). The actual base for the computation of legal interest shall, in any case, be on the amount of finally adjudged." (Emphasis supplied)
	GR No. 157806 2007-11-22	SPS. SHEIKDING BOOC AND BILY BOOC v. FIVE STAR MARKETING CO. AUSTRIA-MARTINEZ, J.
The rental due respondent, being in the concept of actual or compensatory damages, shall earn interest in accordance with this Court's ruling in Eastern Shipping Lines, Inc. v. Court of Appeals,[47] to wit: When an obligation, regardless of its source, i.e., law, contracts, quasi-contracts, delicts or quasi-delicts is breached, the contravenor can be held liable for damages. The provisions under Title XVIII on "Damages" of the Civil Code govern in determining the measure of recoverable damages.
	GR No. 172406 2007-10-11	CONCEPCION ILAO-ORETA v. SPS. EVA MARIE CARPIO MORALES, J.
Following Eastern Shipping Lines, Inc. v. Court of Appeals,[32] this Court awards interest on the actual damages to be paid by Dr. Ilao-Oreta at the rate of 6% per annum from the time of the filing of the complaint on May 18, 1999, and at 12% per annum from the finality of this judgment until its satisfaction.
	GR NO. 156364 2007-09-03	JACOBUS BERNHARD HULST v. PR BUILDERS AUSTRIA-MARTINEZ, J.
Thus, exception (c) finds application in this case. Under Article 1414, one who repudiates the agreement and demands his money before the illegal act has taken place is entitled to recover. Petitioner is therefore entitled to recover what he has paid, although the basis of his claim for rescission, which was granted by the HLURB, was not the fact that he is not allowed to acquire private land under the Philippine Constitution. But petitioner is entitled to the recovery only of the amount of P3,187,500.00, representing the purchase price paid to respondent. No damages may be recovered on the basis of a void contract; being nonexistent, the agreement produces no juridical tie between the parties involved.[43] Further, petitioner is not entitled to actual as well as interests thereon,[44] moral and exemplary damages and attorney's fees.
	GR NO. 169647 2007-08-31	ANTONIO CHIENG v. SPS. EULOGIO AND TERESITA SANTOS CHICO-NAZARIO, J.
We, nonetheless, do not subscribe to the computations made by the RTC. In Eastern Shipping Lines, Inc. v. Court of Appeals,[39] we ruled that when the obligation is breached and it consists in the payment of a sum of money such as a loan, the interest due should be that which may have been stipulated in writing. We also held that the interest due shall itself earn legal interest from the time it is demanded, and that in the absence of stipulation as to the payment of interest, the rate of interest shall be 12% per annum to be computed from default, i.e., from judicial or extra-judicial demand. We further declared that when the judgment of the court awarding a sum of money becomes final and executory, the rate of legal interest, regardless of whether it is a loan/forbearance of money case or not, shall be 12% per annum from such finality until its satisfaction, this interim period being deemed to be then equivalent to a forbearance of credit.
	GR NO. 170215 2007-08-28	SPS. ESMERALDO v. PHILIPPINE NATIONAL BANK CHICO-NAZARIO, J.
Given that the Statement of Account from PNB, being the only existing documentary evidence to support its claim, shows that petitioners' loan obligations to PNB as of 30 October 1992 amounted to P6,409,814.92, and considering that the amount of PNB's bid is P8,511,000.00, there is clearly an excess in the bid price which PNB must return, together with the interest computed in accordance with the guidelines laid down by the court in Eastern Shipping Lines v. Court of Appeals,[36] regarding the manner of computing legal interest, viz:II. With regard particularly to an award of interest in the concept of actual and compensatory damages, the rate of interest, as well as the accrual thereof, is imposed, as follows:
	GR No. 165164 2007-08-17	FIL-ESTATE PROPERTIES v. SPS. GONZALO QUISUMBING, J.
It will be noted that respondents sent a demand letter dated August 4, 1999 to Fil-Estate asking for the return of "the total amount paid including amortization interests" and "legal interest due thereon."[16] The latter did not respond favorably, and so the spouses filed a complaint demanding the reimbursement of P3,620,000 representing the lump sum price of the condominium unit with interest at the legal rate, and P100,000 attorney's fees. But the respondents actually sought the refund of P3,620,000.00, the lump sum cost of the condominium, more than their actual payment of P3,439,000.07. We are thus constrained to award only P3,439,000.07, representing the sum of their actual payments plus amortization interests and interest at legal rate which is 6% per annum from the date of demand on August 4, 1999. We are not unaware that the appellate court pegged the interest rate at 12% on the basis of Resolution No. R-421, Series of 1988 of the HLURB. But, conformably with our ruling in Eastern Shipping Lines, Inc. v. Court of Appeals,[17] the award of 12% interest on the amount of refund must be reduced to 6%.
	GR NO. 164159 2007-07-17	HONORIO C. BULOS v. KOJI YASUMA CHICO-NAZARIO, J.
In Eastern Shipping Lines, Inc. v. Court of Appeals,[31] the Court formulated the following rules of thumb to guide the lower courts in the imposition of the proper interest on the amounts due, to wit: x x x x.
	GR NO. 146555 2007-07-03	JOSE C. CORDOVA v. REYES DAWAY LIM BERNARDO LINDO ROSALES LAW OFFICES CORONA, J.
The guidelines for awarding interest were laid down in Eastern Shipping Lines, Inc. v. CA:[29]
	GR NO. 151953 2007-06-29	SALVADOR P. ESCAÑO v. RAFAEL ORTIGAS TINGA, J.
The seminal ruling in Eastern Shipping Lines, Inc. v. Court of Appeals[51] set forth the rules with respect to the manner of computing legal interest: When an obligation, regardless of its source, i.e., law, contracts, quasi-contracts, delicts or quasi-delicts is breached, the contravenor can be held liable for damages. The provisions under Title XVIII on "Damages" of the Civil Code govern in determining the measure of recoverable damages.