Primer On Warehouse Receipt

A warehouse receipt is a written acknowledgement by a warehouseman that he has received and held certain goods therein described in store for the person to whom it is issued.

A warehouseman is the person lawfully engaged in the business of storing goods for compensation for such service.

To whom delivered:

Upon demand made by the holder of the receipt or depositor provided such demand is accompanied by:

1. an offer to satisfy warehouseman's lien;

2. an offer to surrender receipt; and

3. a readiness and willingness to sign. (Sec. 8)

Kinds:

Negotiable - if deliverable to order or to bearer;

Non-negotiable - if deliverable to a specified person it must be stamped, otherwise warehouseman is liable to person believing it to be negotiable.

Conflicting Claims - remedy of a warehouseman is to file an action for interpleader.

Warehouseman's Lien - this is effective on the goods deposited which operate as a retaining lien until his charges are paid. The lien is lost (a) by surrender of goods, and (b) refusal to deliver goods when demand is proper.

Remedies Available to Warehouseman to Enforce his Warehouseman's Lien:

1. To refuse to deliver the goods until his lien is satisfied.

2. To sell the goods and apply the proceeds thereof to the value of the lien.

3. To institute an action for collection judicially.

Lawful Reasons or Justifications for a warehouseman's refusal to Deliver the Goods:

1. The conditions prescribed in Sec. 8 of Art. 2137 was not satisfied by the holder of the receipt.

2. The warehouseman has legal title in himself on the goods either through transfer or satisfaction of warehouseman's lien.

3. The warehouseman has legally set-up the title or right of third persons as lawful defense for non-delivery of goods.

4. The warehouseman has a lien valid against the person claiming the goods.

5. The failure was not due to any fault on the part of the warehouseman such as calamity and fortuitous event.

Distinction between Negotiable Instrument and Negotiable Warehouse Receipt

1. as to alteration – negotiable instrument becomes null and void while negotiable warehouse receipt is still valid but enforceable only in accordance with its original tenor.

2. if originally payable to bearer - in negotiable instrument it will always remain payable to bearer regardless of the way it is endorsed, whether specially or in blank while in negotiable warehouse receipt if it is payable to bearer endorsed specially, it will be converted into receipt deliverable to order and can only be negotiated further by endorsement and delivery.

3. as to rights of holder - in negotiable instrument, a holder in due course may be able to obtain the title better than which the party negotiated the instrument to him had, while in negotiable warehouse receipt, the endorsee, even if holder in due course, obtains only such title as the person negotiating had over the goods.