G.R. No. L-867 December 29, 1949
ANTONIO DEL ROSARIO, ET AL., plaintiffs-appellees, vs. CARLOS SANDICO, ET AL., defendants. CARLOS SANDICO, appellant.

FACTS

The Court of Appeals rendered a decision on July 8, 1944, during the Japanese occupation, ordering plaintiffs to pay defendant Carlos Sandico P3,944.20 within 90 days from finality of judgment to recover possession of a property held in antichresis. Upon failure to pay, the property would be auctioned. Plaintiffs deposited the amount in Japanese war notes with the court within the period, but Sandico refused acceptance, arguing the payment was invalid as it was made in Japanese war notes and was deposited by a purchaser of some plaintiffs’ interests, not by all plaintiffs themselves.

ISSUE

1. Whether payment of a judgment debt using Japanese war notes, which were legal tender during the occupation, is valid.
2. Whether the consignation (deposit) of the payment was valid under the Civil Code.

RULING

1. Yes, payment in Japanese war notes was valid. The Court of Appeals’ judgment did not specify the currency for payment. Since Japanese war notes were legal tender when the judgment became final, payment with them was valid. The Court cited Soriano v. Abalos and Haw Pia v. China Banking Corporation, rejecting the argument that payment must be in pre-war Philippine currency. Article 1170 of the Civil Code, requiring payment in the “specie stipulated,” does not apply as the contract did not stipulate a specific currency different from legal tender.
2. The consignation was valid. The deposit into court by the plaintiffs (including through their transferee) within the 90-day period was a valid consignation under Articles 1176 and 1177 of the Civil Code, as the creditor unjustifiably refused acceptance.
The appealed order was affirmed. The defendant-appellant was ordered to surrender possession of the property to the plaintiffs.

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