Art. 1240 Aranas vs. Tutaan [No.

L-52807 February 29, 1984] Facts On May 3, 1971 the lower court declared that Petitioner Luisa Quijencio (and by her spouse Jose Araas) was the owner of 400 shares including the stock dividends that accrued to said shares, of respondent Universal Textile Mills, Inc. (UTEX) as defendant and Gene Manueland B. R. Castaeda as codefendants, and subsequently ordered UTEX to cancel said certificates and issue new ones in the name of Plaintiff and to deliver all dividends appertaining to the same, whether in cash or in stocks. UTEX filed a motion for clarification whether the phrase to deliver to her all dividends appertaining to the same, whether in cash or in stocks meant dividends properly pertaining to plaintiffs after the courtsdeclaration of plaintiff ownership of said 400 shares of stock. Defendant UTEX has always maintained it would rightfully abide by whatever decision may be rendered since such would be the logical consequence after the ruling in respect to the rightful ownership of said shares of stock. The motion was granted which ruled against UTEX, ordering it to pay plaintiff the cash dividends, which accrued to the stocks in question after rendition of its current decision excluding cash dividends already paid to Gene Manuel and B. R. Castaeda which accrued before its decision. UTEX alleged that the cash dividends had already been paid thereby absolving it from payment thereof. Issue Was the contention of UTEX, alleging that the cash dividends of stock had already been paid and thereby absolving it from any further payment, valid? Decision No. The final and executory judgment against UTEX declared petitioners as the owners of the questioned UTEX shares of stock against its co-defendants. It was further made clear in the motion for clarification that all dividends accruing to the said shares after the rendition of the decision of Aug. 7, 1971 rightfully belonged to petitioners. If UTEX nevertheless chose to pay the wrong parties, notwithstanding its full knowledge and understanding of the final judgment, it was still liable to pay the petitioners as the lawful declared owners of the questions shares of stocks. The burden of recovering the supposed payment of the cash dividends made by UTEX to the wrong parties Castaeda and Manuel falls upon itself by its own action and cannot be passed by it to the petitioner as the innocent parties. It is elementary that payment made by a judgment debtor to a wrong party cannot extinguish the judgment obligation of such debtor to its creditor.