My stored property was lost to a government order and the keeper received payment for it - is that money mine?

Normally the keeper is not liable for a force majeure loss

Start with the ordinary rule this sits against. A depositary is not an insurer of your property; if the thing is lost through a fortuitous event — something neither party could foresee or prevent — he is generally not liable for the loss itself, because he was at no fault. A government order that confiscates, requisitions or condemns the goods, and a genuine force majeure, both fall in that category. So the reader who expects to recover the value of the thing from the keeper as damages usually cannot. But Article 1990 addresses a different situation: the case where the very loss produced something in return.

Whatever came in its place is yours

The article provides: If the depositary by force majeure or government order loses the thing and receives money or another thing in its place, he shall deliver the sum or other thing to the depositor. The key fact is that the depositary received a substitute — compensation for a requisition, an indemnity, an insurance or expropriation payment, or a replacement thing. That substitute is not his to keep. He must hand over the money or the other thing to you. He was holding your property, and what the event converted your property into is held on the same footing: for you, not for himself.

The substitute steps into the thing's place

The principle underneath is straightforward — the substitute steps into the shoes of the thing. Because the depositary never owned what he was keeping, he cannot come to own the proceeds simply because the original was taken or destroyed while a payment was made for it. Whatever value flowed from the loss traces back to your property and remains yours. This is why the distinction in the first paragraph matters: you may have no claim for the value of a thing lost to force majeure, yet a clear claim to whatever the same event yielded, if anything was paid. The two answers do not conflict; they turn on whether a substitute actually came in.

Trace whether anything was actually received

In practice everything depends on whether a payment or replacement was in fact received, so that is what to establish. Did a compensation, indemnity or replacement change hands as a result of the taking, and what was its amount or form? The order or notice that caused the loss, and any record of what was paid because of it, are the documents that settle your claim. If the keeper received nothing — the goods were simply destroyed and no one paid for them — there is nothing to deliver, and the ordinary force-majeure rule leaves the loss where it fell. If he did receive something, Article 1990 makes it yours to collect.

Cases citing this provision

These Supreme Court decisions cite the provision above. We list them so you can read them yourself; the summaries of what each decided are not ours to give.

• Spouses Rolando and Herminia Salvador vs. Spouses Rogelio and Elizabeth Rabaja and Rosario Gonzales, G.R. No. 199990, February 4, 2015 — read the decision on LawPhil →

Related provisions

• Civil Code, Article 1990 — Loss by Force Majeure With Substitute