Eternal Gardens v. CA, North Philippine Union Mission Digest

Eternal Gardens v. CA, North Philippine Union Mission Digest

Facts:

1. Eternal Gardens entered into a land development agreement with private respondent Mission wherein the former would subdivide a property of the latter into memorial lots to be sold to third parties. Further, the parties agreed that the petitioner will deposit 40% of the monthly gross collection in the name of Mission. Subsequently, Maysilo Estates and the heirs of Vicente Encarnacion laid a claim on the subject property. This prompted the petitioner to file an interpleader suit to compel the Mission and Maysilo Estates to litigate their conflicting claims between themselves. On the other hand, the heirs of Encarnacion filed an action for the quieting of title to the property against the petitioner and the private respondent.

2. The respondent moved that the payments be deposited with the court while the case is ongoing. The petitioner assails the decision of the court ordering it to deposit the amounts due to the Mission by virtue of the agreement previously entered into.

Issue: Whether or not deposit is proper under the circumstances of this case

RULING:

Yes, as correctly held by the Court of Appeals, the essence of the interpleader on the part of the petitioner, aside from disavowal of interest in the property being litigated, is the deposit of the property or funds in controversy with the court. This rule is founded on justice and equity so that the plaintiff will not be benefited from the property or funds in litigation at the expense of whoever will ultimately be adjudged as entitled thereto.