Special Commercial Law, Part III - Trust Receipts Law

III. Trust Receipts Law (Pres. Decree No. 115)

           

            Purpose of the Law

            Trust Receipts, Definition

            Trust Receipt Transaction, Definition

            Parties to a Trust Receipt

            Importance of Trust Receipts

            Difference of Trust Receipts and Letters Of Credit

A. Definition/concept of a trust receipt transaction

1. Loan/security feature

2. Ownership of the goods, documents and instruments under a trust receipt

B. Rights of the entruster

1. Validity of the security interest as against the creditors of the entrustee/innocent purchasers for value

C. Obligations and liability of the entrustee

1. Payment/delivery of proceeds of sale or disposition of goods, documents or instruments

2. Return of goods, documents or instruments in case of sale

3. Liability for loss of goods, documents or instruments

4. Penal sanction if offender is a corporation

D. Remedies available

            Cases:

1. Development Bank of the Philippines v. Prudential Bank, G.R. No. 143772, Nov. 22, 2005

2. Landl & Company (Phil.) Inc., et al v. Metropolitan Bank, G.R. No. 159622, July 30, 2004

3. Anthony L. Ng v. People of the Philippines, G.R. NO. 173905, April 23,

2010