This document summarizes key provisions of ACT. 2137, also known as the WH Receipts Law, which regulates warehouse receipts in the Philippines. The law covers all warehouses and warehousemen engaged in storing goods for profit. It aims to regulate the rights and liabilities of parties in warehousing contracts, protect good faith purchasers of negotiable warehouse receipts, and facilitate the use of receipts as documents of title. The law requires warehouse receipts to contain certain essential terms and imposes obligations on warehousemen to carefully store and deliver goods. It also addresses issues like liability for misdelivery, cancellation requirements for negotiable receipts, and the effects of receipt alterations.

1. ACT. 2137 as amended: The WH Receipts Law
SCOPE:
-Covers all WH whether pub/priv, bonded/not.
-held to be applicable to a WHM licensed under ACT
no. 8393 as amended by RA No.247 kn as Gen.
Bonded Warehouse Act
ACT 2137 applies to WH receipts issued by a WHM as
defined in Sec. 58a, to wit:
WAREHOUSEMAN- “a person lawfully
engaged in the business of storing goods for profit”.
WAREHOUSE- building or place where the
goods are deposited and stored for profit.
WAREHOUSE RECEIPT- a written
acknowledgement by a WHM that he has received or
holds certain goods therein describe in store for the
person to whom it is issued (Vannet v. Reilly-Hertz
Auto. Co., 173 N.W. 466)
-a simple written contract between the owner
of the goods and the WHM to pay the compensation for
that service (Hale v Milwaukee Dock Co., 29 Wis. 482,
67 CJ. 463)
-a bilateral contract—It imports that goods are
in the hands of the WHM and is symbolical
representation of the property itself.
**WHR is NOT NEGOTIABLE INSTRUMENT w/in the
meaning of the NIL (in the technical sense that a
BILL OF EXCHANGE of PROMISSORY NOTE is
negotiable), even though the WH ACT declares it
negotiable.
**Negotiability is PROVIDED by the ACT.
CIVIL CODE applied to other cases where the receipts
are not issued by a WHM
Purpose of the LAW:
1. To REGULATE the STATUS, RIGHTS, and
LIABILITIES of the parties in a warehousing
contract,
2. To PROTECT those who, IN GOOD FAITH and
FOR VALUE acquire NEGOTIABLE WAREHOUSE
RECEIPTs by negotiation
3. To FACILITATE the use of warehouse receipts
as DOCUMENTS OF TITLE
4. To render the TITLE TO, and RIGHT OF
POSSESSION of property stored in warehouses
more easily convertible
5. In order to accomplish these, to PLACE MUCH
GREATER RESPONSIBILITY on the
WAREHOUSEMAN
ISSUE OF WH RECEIPTS
SECTION 1: Person WHO may ISSUE receipts:
1. may be issued by a WHM
2. PERSON AUTH to ACT as an AGENT of the WHM
*WHR issued by someone other than a WHM or his
agent, it would not be considered as the FORMER
RECEIPT
SECTION 2: Form of receipts; essential terms.
-WHR need NOT be in any PARTICULAR form, but
EVERY receipt must embody w/in its
WRITTEN/PRINTED terms:
1. LOCATION of the WH where the goods are stored
2. DATE OF ISSUE of the R
3. CONSECUTIVE number of the R
4. STATEMENT whether the goods received will be
delivered to the BEARER, to a SPECIFIED PERSON,
or to a SPECIFIED PERSON or HIS ORDER
5. RATE of storage CHARGES
6. DESCRIPTION of the goods or PACKAGE
containing them
7. SIGNATURE of the WHM w/c may be made by his
AGENT
8. If the R is issued for goods of w/c the WHM is the
OWNER, either SOLELY or JOINTLY or IN COMMON
w/ others, the FACT of such OWNERSHIP, and
9. STATEMENT of the AMOUNT of ADVANCES made
of liabilities incurred for w/c the WHM claim as LIEN.
Advances- money paid before its due
*If the precise amount of such advances made or of
such liabilities incurred is, AT THE SAME TIME of the
ISSUE of the receipt, UNKNOWN to the WHM or to his
AGENT who issues it, a STATEMENT OF THE FACT
that ADVANCES have been made of liabilities incurred
and the PURPOSE there if SUFFICIENT.
A WHM shall be liable to any person injured thereby
for all damages caused by the OMISSION from a
NEGOTIABLE RECEIPT of any of the terms herein
required.
Purpose of Section 2- terms prescribed in the Sect.
2 are required FOR THE PROTECTION OF THE
DEPOSITOR AND THOSE SUCCEEDINGHIS RIGHT.
EFFECT OF OMISSION OF ANY ESSENTIAL TERMS:
1. VALIDITY of receipt NOT AFFECTED:
-omission of any of the requirements will NOT
AFFECT the validity of the WHR.
2. WHM LIABLE for DAMAGES:

2. -WHM will ONLY RENDER the WHM LIABLE for
DAMAGES to those INJURED by his omission.
(Wordson v. Davenport Mill & Elevator Co.)
3. NEGOTIABLITY of Receipt NOT AFFECTED
-neither is the negotiability affected. (sec. 2 does not
deal w/ the negotiability of WHR)
4. CONTRACT CONVERTED to ORDINARY DEPOSIT
-issuance of WHR in the FORM PROVIDED by LAW is
MERELY PERMISSIVE AND DIRECTORY---not
MANDATORY in the sense that if the requirements are
not observed, then the goods are delivered for storage
become ORDINARY DEPOSIT. (Gonzales v. Go Ting
& Luzon Surety Co.)
SECTION 3. FORM OF RECEIPTS- What TERMS may
be INSERTED.
-A WHM may insert in a receipt issued by him, ANY
OTHER TERMS AND CONDITIONS PROVIDED that
SUCH TERMS & CONDITIONS shall not:
a. Be contrary to the provision of this act.
b. In any wise IMPAIR HIS OBLIGATION TO
EXERCISE that degree of care in the
safekeeping of the goods entrusted to him w/c
a REASONABLE CAREFUL MAN would
exercise in regard to SIMILAR GOODS F
HIS OWN.
*** c) Must NOT be contrary to Law, Morals, Good
Customs, Public Order or Public Policy (Art. 1306
of the Civil Code)
TERMS THAT CANNOT be included in a WHR:
1. EXEMPTION FROM LIABILITY for
MISDELIVERY
-under Sub. Sec. (a), a WHM is not auth to
insert any term exempting him from liability for
MISDELIVERY of goods bec. such would be
against Sec.10.
Sec. 10-WHM shall be liable as for the
conversion to all having a right of property or
possession in the goods if he delivered the
goods otherwise than as auth. (a) By the
person lawfully entitled to the possession of
the goods or his agent (b) person in possession
of a negotiable receipt.
-FOR NOT GIVING STATUTORY NOTICE in case
of sale of goods bec. such would be contrary to
Sec. 33 and 34.
Sec. 33-notice & publication
Sec. 44-perishable and hazardous goods-
notice to the owner or to the person whose
names the goods are stored
2. EXEMPTION from LIABILITY for
NEGLIGENCE
-under subsection (b) (In any wise IMPAIR HIS
OBLIGATION TO EXERCISE that degree of
care), the WHM CANNOT insert any term w/c
would relieve him from liability of his own
negligence such as “FOR the account and the
risk of the depositor.”
Section 4 and 5- Difference of Nego & Non-Nego
Receipt
SECTION 4: NON-NEGOTIABLE Receipt
-a receipt w/c it stated that the goods received will be
delivered to the depositor or to any other specified
person
SECTION 5. NEGOTIABLE Receipt
-a receipt w/c it is stated that the goods received will
be delivered to the bearer or to the order of any
person named in such receipt
*NO PROVISION shall be inserted in a negotiable
receipt that it is NON-NEGOTIABLE- such provision, if
inserted shall be VOID.
”negotiable” is used only indicating that in the
passage of WHR through the channels of commerce,
the law regards the property w/c the described as ff
them and gives to their regular transfer by
INDORSEMENT the effect of manual delivery of the
things specified in them. (Vannet v. Rally Hertz Auto,
Co)
REASON why it is NOT NEGOTIABLE:
It does not comply with Sec. 1b of ACT No 2031 NIL
w/c requires unconditional promise or order to pay
sum or certain money.
SECTION 6. DUPLICATE receipts must be so
marked. (applies to neg. receipts)
-When more than one negotiable receipt is issued for
the same goods, the word “DUPLICATE” shall be plainly
placed upon the face of every such receipt, EXCEPT the
first one issued.
A WHM shall be liable for ALL DAMAGES caused BY HIS
FAILURE so to do to ANYONE who PURCHASED the
subsequent receipt for value supposing it to be an
original, EVEN THOUGH THE PURCHASE BE AFTER the
delivery of the goods by the WHM to the holder of the
original receipt.
SECTION 7: FAILURE to mark “Non-negotiable”
(refers to non-negotiable receipts)

3. -A non-nego R shall have PLAINLY placed upon its
FACE by the WHM issuing it, “NON-NEGOTIABLE” or
“NOT NEGOTIABLE”.
In case of the WHM’s failure so to do, A HOLDER OF
THE RECEIPT WHO PURCHASED IT FOR VALUE
SUPPOSING IT TO BE NEGO, MAY, AT HIS OPTION,
TREAT such receipt as imposing upon the WHM the
SAME liabilities he would have incurred had the receipt
been negotiable.
EFFCT OF FAILURE TO MARK “NEGOTIABLE OR
NON-NEGOTIABLE”
“Negotiable” -usually written/printed on the FACE of a
negotiable WHR, and the FAILURE to do so mark it
does NOT render it non-negotiable if it contains
WORDS of negotiability.
In NON-NEGO R, the law IMPOSES upon the WHM the
duty to mark them “non-negotiable” PROVIDED the
holder of such unmarked R purchased it for VALUE
supposing it to be negotiable.
OBLIGATIONS AND RIGHTS OF WHM UPON
THEIR RECEIPTS
SECTION 8. OBLI of the WHM TO DELIVER:
-a WHM, in the absence of some lawful excuse provide
this ACT, is BOUND TO DELIVER THE GOODS UPON A
DEMAND MADE either bye the HOLDER of a receipt for
the goods OR by the DEPOSITOR; if such demand is
ACCOMPANIED w/:
1. offer to satisfy the WHM’s lien
2. offer to surrender the receipt, if negotiable,
w/ such indorsements as would necessary for
the negotiation of the R
3. readiness and willingness to sign, when the
goods are delivered, an ackno that they have
been delivered, if such signature is req. by the
WHM
-In case the WHM refuses/fails to deli the goods in
compliance w/ a demand of a holder or depositor so
accompanied, the BURDEN SHALL BE UPON THE WHM
TO ESTABLISH THE EXISTENCE OF A LAWFUL EXCUSE
FOR SUCH REFUSAL.
PRINCIPAL OBLIGATION OF THE WHM:
1. Take care of the goods untrusted to his
safekeeping (sec. 21)
2. Deliver them to the holder of the R or the
depositor provided the condi under sec. 8 are
fulfilled
LAWFUL EXERCISE for REFUSAL to
DELIVER GOODS:
WHM may still refuse delivery of goods covered
by the WHR on some lawful excuses prov in this
act (sec. 10, 16, 18, 21, 31 and 36) –but the
existence of a lawful excuse for such refusal is an
affirmative defense w/c the WHM must prove.
(Sec. 8 P2)
SECTION 9: JUSTIFICATION of the WHM in
delivering.
-WHM is justified in delivering the goods,
subject to the provisions of the 3 ff sections, TO ONE
IS:
a. the person lawfully entitled to the
possession of the goods/ his agent
b. a person who us either himself entitled to
delivery by the terms of non-negotiable receipt
issued for the goods, or who has written
authority from the person so entitled either
indorsed upon the R or written upon another
paper, or
c. a person in possession of a negotiable R by
the terms of w/c the goods are deliverable to
him or order, or to bearer, or w/c has been
indorsed to him or in blank by the person to
whom delivery was promised by the terms of
the R or by his mediate or immediate endorser.
SECTION 10. WHM’s liability for MISDELIVERY
-Where a whm delivers the goods to one who is NOT in
fact lawfully entitled to the possession of them, the
whm shall be liable AS FOR CONVERSION TO ALL
HAVING A RIGHT OF PROPERTY ORPOESSION IN THE
GOODS IF HE DELIVERED THE GOODS OTHERWISE
THAN AS AUTH BY a. and b. (up) of the prec. Section..
And THOUGH he delivered the good as auth by a and
b, he shall be so LIABLE, if PRIOR TO SUCH delivery,
he had either:
1. Been requested, by or on behalf of the
person lawfully entitled to a right of
property or possession of the goods, NOT
TO MAKE SUCH DELIVERY
2. HAD INFO that the deli about to be made
was to one NOT LAWFULLY entitled to the
possession of the goods
Liability of the WHM for MISDELIVERY:
1. Liability similar to a bank paying forged
check
2. Liability as for conversion
Sec. 11. Negotiable receipt must be cancelled
when goods delivered. — Except as provided in
section 36:

4. -where a WHM delivers goods for which he had issued
a negotiable receipt, the NEGOTIATION of which would
TRANSFER the RIGHT to the POSSESSION of the
goods, and fails to take up and cancel the receipt, he
shall be LIABLE to ANY ONE who PURCHASES for
VALUE in GOOD FAITH such receipt, for failure to
deliver the goods to him, whether such purchaser
acquired title to the receipt BEFORE or AFTER the
delivery of the goods by the WHM.
Sec. 12. Negotiable receipts must be cancelled or
marked when PART of goods delivered.
— Except as provided in section 36, where a whm
delivers PART of the goods for which he had issued a
NEGOTIABLE receipt and fails either to take up and
cancel such receipt or to place plainly upon it a
statement of what goods or packages have been
delivered, he shall be LIABLE to any one who
purchases for value in good faith such receipt, for
failure to deliver all the goods specified in the receipt,
whether such purchaser acquired title to the receipt
before or after the delivery of any portion of the goods
by the warehouseman.
*This provision is NOT applicable to non-
negotiable R bec. the whm may make deli w/out
req. their surrender or cancellation.
Sec. 13. Altered receipts.
— The alteration of a receipt shall not excuse the
warehouseman who issued it from any liability if such
alteration was:
(a) Immaterial,
(b) Authorized, or
(c) Made without fraudulent intent.
If the alteration was authorized, the whm shall be
LIABLE according to the TERMS of the receipt as
ALTERED.
If the alteration was unauthorized but made
without fraudulent intent, the whm shall be liable
according to the TERMS of the receipt AS THEY WERE
before alteration.
Material and fraudulent alteration of a receipt
shall NOT excuse the whm who issued it from
LIABILITY to DELIVER according to the TERMS of the
receipt AS ORIGINALLY ISSUED, the GOODS for which
it was issued BUT SHALL EXCUSE him from ANY
OTHER liability TO THE PERSON who made the
alteration and to any person who TOOK with NOTICE of
the alteration.
Any purchaser of the receipt for value without
notice of the alteration shall ACQUIRE the SAME
RIGHTS against the whm which such purchaser would
have acquired if the receipt had not been altered at the
time of purchase.
**An ALTERATION is a variation made in the language
or terms of a legal document that affects the rights
and obligations of the parties to it.
EFFECTS OF ALTERATION ON LIABILITY OF A
WAREHOUSEMAN:
1. Alteration Immaterial
Ex: the tenor of the receipt is not changed like
the substitution of the real name of the
property
-Whether Fraudulent or NOT, the whm is liable
on the altered receipt accdng to its ORIGINAL
TENOR
2. Alteration material
Ex: the tenor of the R is changed like the
erasure of the name of the party and the
insertion of another
-but auth, whm is liable accdng to its
ORIGINAL TENOR
3. Material Alteration innocently made
-if unauth, whm is liable on the altered R
acdng to its ORIGINAL TENOR
4. Material alteration fraudulent
-whm is liable acdng to the ORIGINAL TENOR
of the R to a PURCHASER of for VALUE w/out
notice AND EVEN IF the alterer and
SUBSEQUENT purchasers w/ notice except as
regard to the last 2, the whm’s liability is ONLY
LIMITED TO delivery as he is excused from any
liability.
Sec. 14. Lost or destroyed receipts.
— Where a negotiable R has been LOST OR
DESTROYED, a COURT of COMPETENT jurisdiction may
ORDER the delivery of the goods upon SATISFACTORY
PROOF of such loss or destruction and upon the giving
of a BOND with sufficient SURETIES to be APPROVED
by the court to protect the whm from any liability or
expense, which he or any person injured by such
delivery may incur by reason of the original receipt
remaining outstanding. The court may also in its
DISCRETION order the payment of the whm's
reasonable costs and counsel fees.
The delivery of the goods under an order of the court
as provided in this section, shall NOT relieve the whm
from liability to a person to whom the negotiable
receipt has been or shall be negotiated for value
WITHOUT NOTICE of the proceedings or of the delivery
of the goods.
*Under Sec. 8 & 11, whm is not liable for non delivery
w/out the surrender of the R.

5. *Even if the R is claimed to be lost or destroyed, it is
ESSENTIAL that the C shall past upon the question &
make SURE the R is really lost or destroyed.
*Under Sec. 14, a COMP C may order the deli of the
goods only:
1. Upon proof of the loss or destruction of the R
2. Upon proof of a bond w/ sufficient sureties to be
approved by C
*By virtue of the 2nd
par, the whm is still liable to a
holder of the receipt for value w/out notice since whm
can SECURE himself on the BOND given.
Sec. 15. Effect of duplicate receipts.
— A receipt upon the face of which the word
"duplicate" is plainly placed is a REPRESENTATION and
WARRANTY by the whm that such R is an ACCURATE
COPY of an original R properly ISSUED and
UNCANCELED at the date of the issue of the duplicate,
but shall impose upon him NO other liability.
Liability of a WHM as to DUPLICATE:
Gen. Rule: When more than one R is issued for the
same goods, the word duplicate must be PLAINLY
placed by the whm UPON THE FACE of every such R
except the FIRST issued.
The WHM warrants that:
1. Duplicate copy is an ccurate copy of the orig
R
2.Such ORIG R is UNCANCELLED at the DATE
of the ISSUE of the duplicate
Sec. 16. Warehouseman cannot set up title in
himself .
— NO title or right to the possession of the goods, on
the part of the whm, unless such title or right is
DERIVED DIRECTLY or INDIRECTLY from a TRANSFER
made by the DEPOSITOR at the TIME OF or
SUBSEQUENT to the DEPOSIT for STORAGE, or from
the whm's lien, shall excuse the whm from liability for
REFUSING to deliver the goods acrdg to the terms of
the receipt.
*The whm cannot refuse to deliver the goods on the
ground that HE HAS TITLE or RIGHT OF POSSESSION
of the same unless such title or right is DERIVED:
1. Derived directly or indirectly from a transfer
made by the depositor at the time of deposit or
subsequent thereto
2. warehouse lien
Sec. 17. Interpleader of adverse claimants.
— If more than one person claims the title or
possession of the goods, the whm may, either as a
defense to an action brought against him for non-
delivery of the goods or as an original suit, whichever
is appropriate, require all known claimants to
interplead.
Sec. 18. Warehouseman has reasonable time to
determine validity of claims.
— If SOMEONE other than the depositor or PERSON
CLAIMING under him HAS A CLAIM to the TITLE or
POSSESSION of goods, and the whm has INFO of such
claim, the whm shall be EXCUSED from liability for
REFUSING to deliver the goods, either to the depositor
or person claiming under him or to the adverse
claimant until the whm has had a REASONABLE TIME
to ASCERTAIN the VALIDITY of the ADVERSE claim or
to bring LEGAL PROCEEDINGS to compel claimants to
interplead.
DUTY OF THE WHM where there are SEVERAL
CLAIMANTS:
1. Whm must determine w/in the reasonable time
the validity of the conflicting claims and to
deliver to the person whom he finds entitled to
the possession of goods (Sec. 18)
*However, whm is not excused from liability of
mistake.
2. For the protection of the whm, he must bring
the complaint in interpleader and req. the
different claimants to litigate among
themselves. (Sec 17)
*the whm will be relieved from liability in delivering
the goods to the person whom the C finds a better
right.
LIABILITY OF WHM TO RIGHTFUL CLAIMANT:
-Where a whm does not compel interpleader in
case req. it, he is LIABLE for refusal to deliver
to the rightful claimant.
-and where he neither pleads nor investigates,
he will after the lapse of reasonable time, be
held GUILTY OF CONVERSION as of the DATE
of original demands for the goods.
CONVERSION -occurs when a person without
authority or permission intentionally takes the
personal property of another or deprives another of
possession of personal property. It is a tort which
allows the injured party to seek legal relief.
Sec. 19. Adverse title is no defense except as
above provided.
— Except as provided in the 2 preceding sections and
in sections 9 and 36, NO right or title of a third person
shall be a DEFENSE to an action brought by the
depositor or person claiming under him against the

6. whm for FAILURE to DELIVER the goods acrdg to the
terms of the receipt.
ADVERSE TITLE of 3rd
PERSON not a DEFENSE for
REFUSAL to DELIVER
-whm cannot set up title for himself as an excuse for
his failure or refusal to deliver the goods (sec16).
-neither can the whm, as depositary for hire, set up
an adverse title in another as an excuse for his failure
or refusal to deliver the property to his BAILOR on
demand
Sec. 20. Liability for non-existence or
misdescription of goods.
— A whm shall be liable to the holder of a R for
DAMGES caused by the NON-EXISTENCE of the goods
or by the FAILURE of the GOODS to CORRESPOND w/
the DESCRIPTION thereof in the R at the time of its
issue.
If, however, the goods are described in a R merely by
a STATEMENT of MARKS OR LABELS upon them OR
upon PACKAGES containing them OR by a statement
that the goods are SAID TO BE goods of a certain kind
OR that the packages containing the goods are SAID
TO CONTAIN goods of a certain kind or by words of like
PURPORT, such statements, IF TRUE, shall NOT make
liable the whm issuing the R, ALTHOUGH the goods are
NOT of the kind which the marks or labels upon them
indicate or of the kind they were said to be by the
depositor.
LIABILITY OF WHM for the non-existence or
misdescription of goods:
Gen RULE: whm is under the obligation to deli the
IDENTICAL PROPERTY STORED w/ him and if he fails to
do so, he is liable DIRECTLY to the owner.
*As against a bonafide purchaser of a whm R, the whm
is estopped, whether the R is negotiable or not, to
deny that he has received the goods described in it.
*But if description consists of merely marks or labels
upon the goods or upon the packages containing them,
etc., the whm is NOT liable even if goods are NOT of
the kind as indicated in the marks or label.
Sec. 21. Liability for care of goods.
— A warehouseman shall be liable for any loss or
injury to the goods caused by his FAILURE to
EXERCISE such CARE in regard to them as
REASONABLY CAREFUL OWNER of SIMILAR goods
would exercise, but he shall not be liable, in
the ABSENCE of an AGREEMENT to the CONTRARY, for
any loss or injury to the goods which could NOT HAVE
BEEN AVOIDED by the exercise of such care.
Liability of whm for LOSS DUE TO LACK OF CARE
-the whm is req. to exercise ORDINARY or
REASONABLE CARE in the custody of the goods, that
is, the CARE a REASONABLY CAREFUL OWNER WOULD
EXERCISE OVER SIMILAR GOODS OF HIS OWN.
-aka diligence of a father of the family
-In the absence of agreement to the contrary, the whm
is NOT liable for any loss or injury of goods w/c could
not have been avoided by the exercise of such care.
*What constitutes ordinary and reasonable care
depends upon the circumstances such as the character
and value of the prop and the character and the loc of
the WH.
**Stipulation of limiting its liability is VOID (Sec.3)
Sec. 22. Goods must be kept separate.
— Except as provided in the following section, a whm
shall keep the goods SO FAR SEPARATE from goods of
other DEPOSITORS and from other goods of the SAME
depositor for which a SEPARATE receipt has been
issued, AS TO PERMIT at all times the IDENTIFICATION
and redelivery of the goods deposited.
Sec. 23. Fungible goods may be commingled if
warehouseman authorized.
— If auth by agreement or by custom, a whm may
mingle fungible goods with other goods of the same
kind and grade. In such case, the various depositors
of the mingled goods shall own the entire mass in
common and each depositor shall be entitled to such
portion thereof as the amount deposited by him bears
to the whole.
INTENTION OF SEC. 22 and 23:
*It is for the benefit of the holders of the receipts and
not for the benefit of the whm.
*Auth from the owner is a MUST.
*Art. 1976 of the NCC, “unless there is stipulation to
the contrary, the depositary may commingle grain or
other articles of the same kind and quality.”
Sec. 24. Liability of warehouseman to depositors of
commingled goods. — The warehouseman shall be
severally liable to each depositor for the care and
redelivery of his share of such mass to the same
extent and under the same circumstances as if the
goods had been kept separate.
Sec. 25. Attachment or levy upon goods for which
a negotiable receipt has been issued.
— If goods are delivered to a whm by the owner or by
a person whose act in conveying the title to them to a
purchaser in good faith for value would bind the owner,

7. and a negotiable receipt is issued for them, they can
NOT thereafter, while in the possession of the whm, be
ATTACHED by GARNISHMENT or otherwise, or be
LEVIED UPON under an execution UNLESS the receipt
be FIRST SURRENDERED to the whm or its
NEGOTIATION ENJOINED. The whm shall in no case
be compelled to deliver up the actual possession of the
goods UNTIL the RECEIPT is surrendered to him OR
IMPOUNDED by the COURT.
ATTACHMENT or LEVY of NEGOTIABLE R:
*whm has the direct obligation to hold possession of
the goods for the original owner or for the person to
whom the negotiable R of title has been duly
negotiated. (Sec.41) While in possession of such WHM,
the G cannot be ATTACHED, GARNISHED, LEVIED upon
under an EXECUTION, UNLESS:
1. Document is first surrendered
2. Its negotiation is enjoined
3. Document is impounded by the C
*WHM can not be compelled to deliver up the
possession of the goods until the receipt is surrendered
to him or impounded by the court.
*This prohibition is for the protection of the whm since
he could be made liable to a subsequent purchaser for
value in good faith (like Art 1519 of CC)
*Applicable only to owner
Sec. 26. Creditor's remedies to reach negotiable
receipts.
— A creditor whose DEBTOR is the OWNER of a
negotiable R shall be entitled to such AID from
COURTS of appropriate jurisdiction, by INJUNCTION
and otherwise, in ATTACHING such R or in satisfying
the claim by means thereof as is allowed at law or in
equity in these islands in regard to property which can
not readily be attached or levied upon by ordinary legal
process.
REMEDIES of Creditor or OWNER of nego R
*This Sec. expressly gives the court full power to AID
by injunction and otherwise CREDITOR seeking to get
negotiable R covering such goods.
Sec. 27. What claims are included in the
warehouseman's lien.
— Subject to the provisions of section 30, a whm shall
have a LIEN on
a. GOODS deposited or on the PROCEEDS thereof
in HIS hands,
b. for all LAWFUL CHARGES for STORAGE and
PRESERVATION of the goods;
c. also for all LAWFUL CLAIMS for money
advanced, interest, insurance, transportation,
labor, weighing, coopering and other charges
and expenses in relation to such goods,
d. also for all reasonable charges and expenses
for NOTICE and advertisements of sale,
e. and for SALE of the goods where default had
been made in satisfying the warehouseman's
lien.
Sec. 28. Against what property the lien may be
enforced.
— Subject to the provisions of section 30, a whm's lien
may be enforced:
(a) Against ALL GOODS, whenever deposited,
belonging to the PERSON who is LIABLE as DEBTOR for
the claims in regard to which the lien is asserted, and
(b) Against ALL GOODS belonging to others which
have been deposited AT ANY TIME by the person who
is liable as DEBTOR for the claims in regard to which
the lien is asserted IF SUCH PERSON had been so
ENTRUSTED w/ the possession of goods that a PLEDGE
of the same by him at the time of the deposit to one
who took the goods in good faith for value WOULD
HAVE BEEN VALID.
GOODS SUBJECT TO LIEN:
Sec. 28:
1. Goods belonging to depositor or his
principal
a. against the goods of the depositor who is
liable to the whm as debtor whenever such
goods are deposited
b. against the goods of other persons stored
by the depositor who is liable to the
warehouse man as debtor w/ auth to make
a valid pledge
2. Goods stored in FRAUD of true owners rights
*Nothing in this act gives the whm a lien on goods
belonging to another and stored by stranger in FRAUD
of the true owners rights.
Sec. 29. How the lien may be lost.
— A whm loses his lien upon goods:
(a) By surrendering possession thereof, or
(b) By refusing to deliver the goods when a demand is
made with w/ he is bound to comply under the
provisions of this Act.
Sec. 30. Negotiable receipt must state charges
for which the lien is claimed.
— If a negotiable receipt is issued for goods, the whm
shall have NO lien thereon EXCEPT for charges for
storage of goods subsequent to the date of the receipt
UNLESS the receipt expressly ENUMERATED other

8. charges for which a lien is claimed. In such case,
there shall be a lien for the charges enumerated so far
as they are within the terms of section 27 although the
amount of the charges so enumerated is not stated in
the receipt.
Sec. 31. Warehouseman NEED NOT DELIVER until
LIEN is SATISFIED.
— A whm having a lien VALID against the person
demanding the goods may refuse to deliver the goods
to him until the lien is satisfied.
Sec. 32. Warehouseman's lien does not preclude
other remedies.
— Whether a whm HAS or HAS NOT a lien upon the
goods, he is ENTITLED to ALL REMEDIES allowed by
law to a CREDITOR against a DEBTOR for the collection
from the depositor of ALL CHARGES and ADVANCES
which the depositor has expressly or impliedly
contracted with the whm to pay.
Sec. 33. Satisfaction of lien by sale.
— A whm's LIEN for a CLAIM which has become DUE
may be SATISFIED as follows:
(a) An ITEMIZED STATEMENT of the WHM's
claim, showing the SUM DUE at the time of
the NOTICE and the DATE/s when it
becomes due,
(b) A brief DESCRIPTION of the goods against
which the lien exists,
(c) A DEMAND that the AMOUNT of the claim
as STATED in the NOTICE of such further claim
as shall accrue, shall BE PAID on or before a
day mentioned, NOT LESS than 10 DAYS from
the delivery of the notice if it is PERSONALLY
DELIVERED, OR FROM THE TIME when the
notice shall REACH its DESTINATION, acdng
to the DUE COURSE of POST, if the NOTICE is
SENT by MAIL,
(d) A STATEMENT that UNLESS the claim is
PAID within the time SPECIFIED, the goods will
be ADVERTISED for SALE and sold by AUCTION
at a specified TIME and PLACE.
In accordance with the terms of a notice so given, a
SALE of the goods BY AUCTION may be had to
SATISFY any VALID CLAIM of the whm for which he
has a lien on the goods. The SALE shall be HAD in the
PLACE WHERE the LIEN was ACQUIRED, or, if such
PLACE is manifestly UNSUITABLE for the purpose of
the claim specified in the notice to the depositor has
ELAPSED, and advertisement of the sale, describing
the goods to be sold, and stating the name of the
owner or person on whose account the goods are held,
and the time and place of the sale, shall be PUBLISHED
ONCE a WEEK for 2 consecutive weeks in a
NEWSPAPER PUBLISHED in the place where such sale
is to be held. The sale shall NOT be held less than 15
DAYS from the TIME of the 1st publication. If there is
NO newspaper published in such place, the
advertisement shall be POSTED at least 10 DAYS
BEFORE such sale in not less than 6 conspicuous
places therein.
From the PROCEEDS of such sale, the whm shall
satisfy his LIEN including the REASONABLE CHARGES
of NOTICE, ADVERTISEMENT and SALE. The BALANCE,
if any, of such proceeds shall be held by the whm and
delivered ON DEMAND to the person to whom he would
have been bound to deliver or justified in delivering
goods.
At NY TIME BEFORE the goods are so SOLD, any
person claiming a right of property or possession
therein may PAY the whm the AMOUNT NECESSARY to
SATISFY his LIEN and to PAY the REASONABLE
EXPENSES and LIABILITIES incurred in serving notices
and advertising and preparing for the sale up to the
time of such payment. The whm shall deliver the
goods to the person making payment if he is a person
entitled, under the provision of this Act, to the
possession of the goods on payment of charges
thereon. Otherwise, the whm shall retain the
possession of the goods acdg to the terms of the
original contract of deposit.
Sec. 34. Perishable and hazardous goods.
— If goods are of a PERISHABLE nature, or by keeping
will DETERIORATE greatly in VALUE, or, by their order,
LEAKAGE, INFLAMMABILITY, or EXPLOSIVE NATURE,
will be LIABLE to INJURE other property , the whm
may GIVE such NOTICE to the OWNER or to the person
in whose NAMES the goods are stored, as is reasonable
and possible under the circumstances, to satisfy the
lien upon such goods and to remove them from the
warehouse and in the event of the FAILURE of such
person to satisfy the lien and to receive the goods
W/IN the TIME so specified, the whm may SELL the
goods at public or private sale without advertising. If
the whm, after a REASONABLE EFFORT, is UNABLE to
SELL such goods, he may DISPOSE of them in any
LAWFUL MANNER and shall incur NO liability by reason
thereof.
The proceeds of any sale made under the terms of
this section shall be disposed of in the same way as
the proceeds of sales made under the terms of the
preceding section.
Sec. 35. Other methods of enforcing lien.
— The REMEDY for ENFORCING a LIEN herein provided
does NOT preclude any OTHER REMEDIES allowed by
law for the enforcement of a lien against personal
property nor BAR the right to recover so much of the
whm's claim as shall not be paid by the proceeds of
the sale of the property.
Sec. 36. Effect of sale.

9. — After goods have been lawfully sold to satisfy a
whm's lien, or have been lawfully sold or disposed of
because of their perishable or hazardous nature, the
whm shall NOT thereafter be liable for failure to deliver
the goods to the depositor or owner of the goods or to
a holder of the receipt given for the goods when they
were deposited, even if such receipt be negotiable.
ENFORCEMENT OF WHM LIEN:
Remedies available to whm for enforcing his lien:
a. By refusing to deliver the goods until the lien is
satisfied (Sec. 31)
b. By causing extrajudicial sale of the property
and applying the proceeds to the value of the
lien (Sec. 33, 34)
c. By filing a Civil Action for collection of unpaid
charges or by way of a counterclaim in an
action to recover the property for him, or such
other remedies allowed by law for the
enforcement of lien against a property (Sec
35) or to creditor against his debtor of all
charges w/c the depositor has bound himself to
pay
d. A whm is entitled to all remedies allowed by
law to a creditor against his debtor for the
collection from the depositor of all charges w/c
the depositor is obliged to pay (Sec 32)
EEFECT OF SALE OF GOODS:
1. In case of sale of goods, the whm is NOT liable
for non delivery even if the receipt given for
the goods when they were deposited be
negotiated. (Sec 36) This rule necessarily
qualifies the right of a purchaser of a
negotiable R
2. Where the sale was made without the
PUBLICATION req. and before the time
specified by law (Sec. 33, Par 2), Such sale is
VOID and the purchaser of the goods acquires
no title in them.
ACTS FOR WHICH WHM IS LIABLE:
1. Failure to stamp “duplicate” on copies of nego
R (Sec.6)
2. Failure to place non negotiable or not
negotiable on a non nego R (SEC 7)
3. Misdelivery of goods (Sec 10)
4. Failure to effect cancellation of negotiable R
upon delivery of the goods (Sec. 20)
5. Issuing R for non existing goods or
misdescribed goods (Sec. 20)
6. Failure to take care of goods (sec 21)
7. Failure to give notice in case of sale of goods
to satisfy his lien (Sec. 33) or bec. the goods
are perishable or hazardous. (Sec. 34)
NEGOTIATION AND TRANSFER OF RECEIPTS
Sec. 37. Negotiation of negotiable receipt of
delivery. — A negotiable receipt may be negotiated by
delivery:
(a) Where, by TERMS of the R, the whm UNDERTAKES
to deliver the goods to the BEARER, or
(b) Where, by the TERMS of the R, the whm
undertakes to deliver the goods to the ORDER of a
SPECIFIED PERSON, and such PERSON or a
SUBSEQUENT INDORSEE of the receipt has indorsed it
in BLANK or to BEARER.
Where, by the terms of a nego R, the goods are
deliverable to BEARER or where a negotiable R has
been INDORSED in BLANK or to BEARER, any holder
may indorse the same to himself or to any other
specified person, and, in such case, the receipt shall
thereafter be negotiated only by the indorsement of
such indorsee.
NEGOTIATION OF A NEGOTIATION R:
It is the same manner of negotiation of prom notes
and bills of exchange under NIL:
1. A nego warehouse receipt is negotiable by
delivery if the goods are deliverable to the
bearer by the person to whose order the goods
are deliverable or by subsequent indorsee.
Indorsement is in blank when the holder
merely signs his name at the back of the
receipt without specifying to whom the goods
are delivered.
2. If a R is specially indorsed, it become an order
receipt and negotiation can only be effected by
the indorsement of the indorsee.
A special indorsement specifies the person to
whom or to whose order the goods are to be
delivered. (Art. 1508, same as Sec. 37)
Sec. 38. Negotiation of negotiable receipt by
indorsement.
— A negotiable R may be negotiated by the
INDORSEMENT of the PERSON to WHOSE ORDER the
goods are, by the terms of the receipt,
deliverable. Such indorsement may be in blank, to
bearer or to a specified person. If indorsed to a
specified person, it may be again negotiated by
the indorsement of such person in blank, to bearer or
to another specified person. Subsequent negotiation
may be made in like manner.
Negotiation of Negotiable R by Indorsement:
1. If indorsed in blank or to bearer, the docu
becomes negotiable to delivery
2. If indorsed to a specified person, it maybe
again negotiated by indorsement of such
person in blank, to bearer or to another
specified person.
Sec. 39. Transfer of receipt.

10. — A receipt which is NOT in such FORM that it CAN be
negotiated by DELIVERY may be TRANSFERRED by the
HOLDER by DELIVERY to a PURCHASER or DONEE.
A non-negotiable R can NOT be NEGOTIATED, and the
indorsement of such a receipt GIVES the TRANSFEREE
NO ADDITIONAL RIGHT.
ADVANTAGES of a NEGOTIABLE WHR:
1. It protects a purchaser per value and in good
faith (Sec. 41)
2. The goods covered by the R CANNOT be
garnished or levied upon under execution
unless sit is surrendered, or impounded or its
negotiation enjoined.
3. In case of negotiation, the holder acquires
direct obligation of the whm to hold possession
of the goods for him w/out notice to such whm
(Sec.41)
4. The goods coves are not subject to sellers lien
or stoppage in transit (Sec. 49)
Transitu- act of a vendor of goods, upon a credit,
who, on learning that the buyer has failed, resumes
the possession of goods, while they are in the hands of
a carrier or middle-man, in their transit to the buyer,
and before they get into his actual possession.
Sec. 40. Who may negotiate a receipt.
— A negotiable receipt may be negotiated:
(a) By the OWNER thereof, or
(b) By ANY PERSON to whom the POSSESSION or
CUSTODY of the receipt has been ENTRUSTED by the
OWNER, if, by the terms of the receipt, the whm
UNDERTAKES to deliver the goods to the ORDER of the
PERSON to whom the possession or custody of the
receipt has been entrusted, or if, at the time of such
entrusting, the receipt is in such FORM that it may be
NEGOTIATED by DELIVERY.
Sec. 41. Rights of person to whom a receipt has
been negotiated.
— A person to whom a negotiable receipt has been
DULY NEGOTIATED ACQUIRES thereby:
(a) Such TITLE to the goods as the PERSON
NEGOTIATING the receipt to him had or had
ABILITY to convey to a purchaser in good faith
for value, and also such TITLE to the goods as
the DEPOSITOR or PERSON to whose ORDER
the goods were to be delivered by the terms of
the receipt had or had ability to convey to a
purchaser in good faith for value, and
(b) The DIRECT OBLIGATION of the whm to
HOLD POSSESSION of the goods for him acdng
to the terms of the receipt as fully as if the
whm and contracted directly with him.
THE RIGHTS ACQUIRED BY PERSON WHOM THE R
HAS BEEN NEGOTIATED
(b) Title of the person negotiating the receipt over
the goods covered by the receipt
(c) Title of the person (depositor/owner) to whose
order by the terms of the receipt of the goods
were to be delivered over such goods,
(d) Direct obligation of the whm to hold possession
of the goods for him, as if the whm directly
contracted w/ him
Sec. 42. Rights of person to whom receipt has
been transferred.
— A person to whom a receipt has been TRANSFERRED
but NOT negotiated ACQUIRES thereby, as against the
transferor, the TITLE of the GOODS subject to the
TERMS of ANY AGREEMENT with the TRANSFEROR.
If the receipt is NON-negotiable, such person also
ACQUIRES the RIGHT TO NOTIFY the whm of the
TRANSFER to him of such receipt and thereby to
ACQUIRE the DIRECT obligation of the whm to HOLD
POSSESSIOM of the goods for him according to the
terms of the receipt.
PRIOR to the NOTIFICATION of the whm by the
transferor or transferee of a NON-negotiable
receipt, the TITLE of the transferee to the goods and
the RIGHT to acquire the obligation of the whm may be
DEFEATED by the LEVY of an ATTACHMENT or
EXECUTION upon the goods by a creditor of the
transferor or by a notification to the whm by the
transferor or a subsequent purchaser from the
transferor of a subsequent sale of the goods by the
transferor.
THE RIGHTS OF A PERSON TO WHOM RECEIPT
WAS BEEN TRANSFERRED:
Sec. 42 refers to the right of the person to whom the
nego whm receipt (not duly negotiated) has been
transferred (par1) or transferre of a non-nego doc (par
2 &3) The RIGHTS of the persons are:
1. The title of the goods as against to the
transferor.
2. The right to notify the whm of the transfer
thereof
3. The right thereafter, to acquire the obligation
of the whm to hold the goods for him
*The right of transferee IS NOT absolute as it is
subject to the terms of any agreement with the
transferor.
ATTACHEMENT OF GOODS COVERED BY RECEIPT:
1. Receipt non-negotiable
- transfer of non-negotiable docu of title does
not affect the delivery of goods covered by it.
2. Receipt negotiable

11. -goods can not be attached or be levied in
execution unless the receipt be first
surrendered to the whm or its negotiation
enjoined.
Sec. 43. Transfer of negotiable receipt without
indorsement.
— Where a negotiable receipt is TRANSFERRED for
VALUE by DELIVERY and the INDORSEMENT of the
TRANSFEROR is ESSENTIAL for negotiation, the
TRANSFEREE ACQUIRES a RIGHT AGAINST the
TRANSFEROR to COMPEL him to indorse the receipt
UNLESS a contrary intention appears. The negotiation
shall TAKE EFFECT as of the TIME when the
INDORSEMENT is actually made.
RIGHTS OF TRANSFEREE OF A NEGO R:
-this sec. specifies the RIGHTS of a person to whom an
ORDER R, which may not properly be negotiated by
mere delivery has been delivered , w/o indorsement.
They are:
1. the rights of the goods as against to transferor
2. the right to compel the transferor to indorse the
receipt
*if the INTENTION of the parties is that the receipt
should be merely transferred, the transferee HAS NO
RIGHTS TO REQUIRE THE TRANSFERROR to INDORSE
the receipt.
RULE when RECEIPT subsequently INDORSED:
For the purpose of determining whether the transferee
is PURCHASER for VALUE in good faith without notice
(Sec. 41), the nego shall TAKE EFFECT as of the time
when the indorsement is ACTUALLY MADE, NOT at the
time the receipt has been DELIVERED.
OWNERSHIP OF GOODS COVERED BY RECEIPT
NEGOTIATED OR TRANSFERRED:
1. Indorsee or transferee- For purposes of
facilitating commercial trans, the indorsee or
transferee of the whm R should be regarded as
the OWNER if the goods covered by it.
2. Indorser or transferor- where a warehouse R is
indorsed or transferred to a creditor ONLY to
secure the PAYMENT of a LOAN or DEBT, the
indorsee or transferee does NOT automatically
become the owner of the goods covered by the
warehouse receipt but he MERELY RETAINS
THE RIGHT TO KEEP AND WITH THE CONSENT
of the owner to sell them so as to satisfy the
obligation from the proceeds of sale, this for a
simple REASON that the trans involved is NOT
A SALE but only a mortgage or pledge.
3. INNOCENT THIRD PERSONS- where, however,
the rights if innocent 3rd
persons are involve,
the indorsee-pledgee of a wh R is considered
the OWNERof goods covered by it whenever
necessary for the protection.
Sec. 44. Warranties of a sale of receipt.
— A PERSON who, for VALUE, negotiates or transfers a
receipt by indorsement or delivery, including ONE who
ASSIGNS for VALUE a CLAIM secured by a receipt,
unless a contrary intention appears, warrants:
(a) That the receipt is GENUINE,
(b) That he HAS a LEGAL right to negotiate or
transfer it,
(c) That he HAS KNOWLEDGE of NO FACT which would
impair the validity or worth of the receipt, and
(d) That he HAS a right to transfer the title to the
goods and that the goods are merchantable or fit for
a particular purpose whenever such warranties
would have been implied, if the contract of the parties
had been to transfer without a receipt of the goods
represented thereby.
Sec. 45. Indorser not a guarantor.
— The INDORSEMENT of a receipt shall NOT MAKE the
INDORSER LIABLE for any failure on the part of the
whm or previous indorsers of the receipt to fulfill
their respective obligations.
Sec. 46. No warranty implied from accepting
payment of a debt.
— A mortgagee, pledgee, or holder for security of a
receipt who, in good faith, demands or receives
payment of the debt for which such receipt is
security, whether from a party to a draft drawn for
such debt or from any other person, shall not, by so
doing, be deemed to represent or to warrant the
genuineness of such receipt or the quantity or
quality of the goods therein described.
Sec. 47. When negotiation not impaired by fraud,
mistake or duress.
— The validity of the negotiation of a receipt is not
impaired by the fact that such negotiation was a
breach of duty on the part of the person making the
negotiation or by the fact that the owner of the receipt
was induced by fraud, mistake or duress or to entrust
the possession or custody of the receipt to such
person, if the person to whom the receipt was
negotiated or a person to whom the receipt was
subsequently negotiated paid value therefor, without
notice of the breach of duty, or fraud, mistake or
duress.
Sec. 48. Subsequent negotiation.

12. — Where a person having sold, mortgaged, or
pledged goods which are in warehouse and for which
a negotiable receipt has been issued, or having sold,
mortgaged, or pledged the negotiable receipt
representing such goods, continues in possession of
the negotiable receipt, the subsequent negotiation
thereof by the person under any sale or other
disposition thereof to any person receiving the same in
good faith, for value and without notice of the previous
sale, mortgage or pledge, shall have the same
effect as if the first purchaser of the goods or
receipt had expressly authorized the subsequent
negotiation.
Sec. 49. Negotiation defeats vendor's lien.
— Where a negotiable receipt has been issued for
goods, no seller's lien or right of stoppage in
transitu shall defeat the rights of any purchaser
for value in good faith to whom such receipt has
been negotiated, whether such negotiation be prior
or subsequent to the notification to the warehouseman
who issued such receipt of the seller's claim to a lien or
right of stoppage in transitu. Nor shall the
warehouseman be obliged to deliver or justified in
delivering the goods to an unpaid seller unless the
receipt is first surrendered for cancellation.
IV — CRIMINAL
OFFENSES
Sec. 50. Issue of receipt for goods not received.
— A warehouseman, or an officer, agent, or servant of
a warehouseman who issues or aids in issuing a receipt
knowing that the goods for which such receipt is
issued have not been actually received by such
warehouseman, or are not under his actual control at
the time of issuing such receipt, shall be guilty of a
crime, and, upon conviction, shall be punished
for each offense by imprisonment not exceeding five
years, or by a fine not exceeding ten thousand pesos,
or both.
Sec. 51. Issue of receipt containing false
statement.
— A warehouseman, or any officer, agent or servant of
a warehouseman who fraudulently issues or aids in
fraudulently issuing a receipt for goods knowing
that it contains any false statement, shall be guilty
of a crime, and upon conviction, shall be punished
for each offense by imprisonment not exceeding one
year, or by a fine not exceeding two thousand
pesos, or by both.
Sec. 52. Issue of duplicate receipt not so marked.
— A warehouse, or any officer, agent, or servant of a
warehouseman who issues or aids in issuing a
duplicate or additional negotiable receipt for
goods knowing that a former negotiable receipt
for the same goods or any part of them is
outstanding and uncanceled, without plainly placing
upon the face thereof the word "duplicate" except in
the case of a lost or destroyed receipt after
proceedings are provided for in section fourteen, shall
be guilty of a crime, and, upon conviction, shall
be punished for each offense by imprisonment not
exceeding five years, or by a fine not exceeding ten
thousand pesos, or by both.
Sec. 53. Issue for warehouseman's goods or
receipts which do not state that fact.
— Where they are deposited with or held by a
warehouseman goods of which he is owner, either
solely or jointly or in common with others, such
warehouseman, or any of his officers, agents, or
servants who, knowing this ownership, issues or
aids in issuing a negotiable receipt for such
goods which does not state such ownership, shall
be guilty of a crime, and, upon conviction, shall be
punished for each offense by imprisonment not
exceeding one year, or by a fine not exceeding two
thousand pesos, or by both.
Sec. 54. Delivery of goods without obtaining
negotiable receipt.
— A warehouseman, or any officer, agent, or servant
of a warehouseman, who delivers goods out of the
possession of such warehouseman, knowing that a
negotiable receipt the negotiation of which would
transfer the right to the possession of such goods
is outstanding and uncanceled, without obtaining
the possession of such receipt at or before the
time of such delivery, shall, except in the cases
provided for in sections 14 and 36, be found guilty of
a crime, and, upon conviction, shall be punished
for each offense by imprisonment not exceeding one
year, or by a fine not exceeding two thousand pesos,
or by both.
Sec. 55. Negotiation of receipt for mortgaged
goods.
— Any person who deposits goods to which he has
no title, or upon which there is a lien or mortgage,
and who takes for such goods a negotiable receipt
which he afterwards negotiates for value with
intent to deceive and without disclosing his want
of title or the existence of the lien or mortgage,
shall be guilty of a crime, and, upon conviction, shall
be punished for each offense by imprisonment not
exceeding one year, or by a fine not exceeding two
thousand pesos, or by both.
V — INTERPRETATION
Sec. 56. Case not provided for in Act. — Any case not
provided for in this Act shall be governed by the

13. provisions of existing legislation, or in default
thereof, by the rule of the law merchant.
Sec. 57. Name of Act. — This Act may be cited as the
Warehouse Receipts Act.
Sec. 58. Definitions. — (a) In this Act, unless the
content or subject matter otherwise requires:
"Action" includes counterclaim, set-off, and suits in
equity as provided by law in these islands.
"Delivery" means voluntary transfer of possession from
one person to another.
"Fungible goods" means goods of which any unit is,
from its nature by mercantile custom, treated as the
equivalent of any other unit.
"Goods" means chattels or merchandise in storage or
which has been or is about to be stored.
"Holder" of a receipt means a person who has both
actual possession of such receipt and a right of
property therein.
"Order" means an order by indorsement on the receipt.
"Owner" does not include mortgagee.
"Person" includes a corporation or partnership or two
or more persons having a joint or common interest.
To "purchase" includes to take as mortgagee or as
pledgee.
"Receipt" means a warehouse receipt.
"Value" is any consideration sufficient to support a
simple contract. An antecedent or pre-existing
obligation, whether for money or not, constitutes value
where a receipt is taken either in satisfaction thereof or
as security therefor.
"Warehouseman" means a person lawfully engaged in
the business of storing goods for profit.
(b) A thing is done "in good faith" within the meaning
of this Act when it is in fact done honestly, whether it
be done negligently or not.
Sec. 59. Application of Act. — The provisions of this
Act do not apply to receipts made and delivered prior
to the taking effect hereof.
Sec. 60. Repeals. — All acts and laws and parts thereof
inconsistent with this Act are hereby repealed.
Sec. 61. Time when Act takes effect. — This Act shall
take effect ninety days after its publication in the
Official Gazette of the Philippines shall have been
completed.