Republic vs Grijaldo

Facts:

Grijaldo obtained five loans from the Bank of Taiwan in the total sum of
P1,281.97 with interest at therats of 6% per annum compounded quarterly.
These were evidenced by five promissory notes.
These loans were crop loans and was considered tobe due one year after they
were incurred.
As a security for the payment of the loans, a chattel mortgage was executed
on the standing crops of his land.
The assets in the Bank of Taiwan were vested in the US Govt which were
subsequently transferred to the Republic of the Philippines
RP is now demanding the payment of the account.
Justice of Peace dismisses the case on the ground of prescription. CA
rendered a decision ordering the appellant to pay the appellee.

Defendants contentions:
1)The appellee has no cause of action against appellant since the transaction was
with Taiwan Bank.
2)That if the appellee has a cause of action at all, ithad prescribed
3)The lower court erred in ordering the appellant topay P2,377.23
Issue: Can RP still collect from Grijaldo?
Held: Yes
Ratio: The obligation of the contract was not to deliver a determinate thing, it was a
generic thing the amount of money representing the total sum of his loans. The
destruction of anything of the same kind does not extinguishthe obligation. The loss
of the crops did not extinguish his obligation to pay because the account could still
be paid from other sources aside from the mortgaged crops.
Also, prescription does not run against the State.