Rule 57 Preliminary Attachment Pelaez

CASE DIGESTS
on
PROVISIONAL REMEDIES
Submitted to:
Atty. Carell Ryza Nartatez- Pendatun

Professor, Provisional Remedies and Special Civil Actions
Submitted by:
Chester Bryan P. Pelaez

th
Student, 4 Year Juris Doctor, non- thesis (5 year program)
1. Reyes vs. Lim, et al.

Rule 57 – Preliminary Attachment
G.R. No. 134241; August 11, 2003
Facts:
Lim prayed for the cancellation of the Contract to Sell and for the issuance of a writ of
preliminary attachment against Reyes. The RTC denied the prayer for a writ of preliminary
attachment. Lim requested in open court that Reyes be ordered to deposit the P10 million down
payment with the cashier of the RTC of Parañaque. The RTC granted this motion. The RTC
directed Reyes to deposit the P10 million down payment with the Clerk of Court on or before 30
October 1997. The CA ruled the RTC could validly issue the assailed orders in the exercise of its
equity jurisdiction. The court may grant equitable reliefs to breathe life and force to substantive
law such as Article 1385 of the Civil Code since the provisional remedies under the Rules of Court
do not apply to this case. The CA held the assailed orders merely directed Reyes to deposit the
P10 million to the custody of the RTC to protect the interest of Lim who paid the amount to Reyes
as downpayment. This did not mean the money would be returned automatically to Lim.
Issue:
Whether or not the CA erred in holding that the RTC can issue the assailed Order requiring
Reyes to deposit he amount of P10 million during the pendency of the action, when deposit is not
among the provisional remedies enumerated in Rule 57 to 61 of the 1997 Rules on Civil Procedure.
Ruling:
No. The instant case, however, is precisely one where there is a hiatus in the law and in the
Rules of Court. If left alone, the hiatus will result in unjust enrichment to Reyes at the expense of
Lim. The hiatus may also imperil restitution, which is a precondition to the rescission of the
Contract to Sell that Reyes himself seeks. This is not a case of equity overruling a positive
provision of law or judicial rule for there is none that governs this particular case. This is a case of
silence or insufficiency of the law and the Rules of Court. In this case, Article 9 of the Civil Code
expressly mandates the courts to make a ruling despite the "silence, obscurity or insufficiency of
the laws." This calls for the application of equity, which "fills the open spaces in the law."
Reyes is seeking rescission of the Contract to Sell. In his amended answer, Lim is also
seeking cancellation of the Contract to Sell. The RTC then ordered Reyes to deposit in court the
P10 million down payment that Lim made under the Contract to Sell. Reyes admits receipt of the
P10 million down payment but opposes the order to deposit the amount in court. Reyes contends
that prior to a judgment annulling the Contract to Sell, he has the "right to use, possess and enjoy"
the P10 million as its "owner" unless the court orders its preliminary attachment. To subscribe to
Reyes’ contention will unjustly enrich Reyes at the expense of Lim. Reyes sold to Line One the
Property even before the balance of P18 million under the Contract to Sell with Lim became due.
Reyes cannot claim ownership of the P10 million down payment because Reyes had already sold
to another buyer the Property for which Lim made the down payment. On balance, it is
unreasonable and unjust for Reyes to object to the deposit of the P10 million down payment. The
application of equity always involves a balancing of the equities in a particular case, a matter
addressed to the sound discretion of the court. Here, we find the equities weigh heavily in favor of
Lim, who paid the P10 million down payment in good faith only to discover later that Reyes had
subsequently sold the Property to another buyer.
2. Davao Light v. Court of Appeals

GR No. 93262; December 29, 1991
Facts:
The Davao Light and Power Co., Inc. ("Davao Light") filed a collection suit against
Queensland Hotel ("Queensland") and Teodorico Adarna ("Adarna") with an ex parte application
for a writ of preliminary attachment. On 3 May 1989, the trial court issued an Order of Attachment,
and the corresponding Writ of Attachment on 11 May 1989. On 12 May 1989, the summons, a
copy of the complaint, and the writ of attachment was served upon Queensland and Adarna.
Queensland and Adarna filed a motion to discharge the attachment on the ground that at the time
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the Order of Attachment and Writ of Attachment were issued, the trial court has yet to acquire
jurisdiction over the cause of action and over the persons of the defendants.
Issue:
Whether or not the writ of preliminary attachment was validly issued.
Ruling:
Yes. A writ of preliminary attachment may be issued before the court acquires jurisdiction
over the person of the defendant.
The court may validly issue a writ of preliminary injunction prior to the acquisition of
jurisdiction over the person of the defendant. There is an appreciable period of time between the
commencement of the action (takes place upon the filing of an initiatory pleading) and the service
of summons to the defendant. In the meanwhile, there are a number of actions which the plaintiff
or the court may validly take, including the application for and grant of the provisional remedy of
preliminary attachment. There is nothing in the law which prohibits the court from granting the
remedy prior to the acquisition of jurisdiction over the person of the defendant. In fact, Rule 57 of
the Rules of Court allows the granting of a writ of preliminary injunction at the commencement of
the suit. In the cases of Toledo v. Burgos and Filinvest Credit Corporation v. Relova, it was held
that notice and hearing are not prerequisites to the issuance of a writ of preliminary attachment.
Further, in the case of Mindanao Savings & Loan Association, Inc. v. Court of Appeals, it was
ruled that giving notice to the defendant would defeat the purpose of the remedy by affording him
or her the opportunity to dispose of his properties before the writ can be issued.
A preliminary attachment may be discharged with the same ease as obtaining it. In any
case, the ease of availing the provisional remedy of preliminary attachment is matched by the ease
with which it can be remedied by either the posting of a counterbond, or by a showing of its
improper or irregular issuance. The second means of defeating a preliminary attachement,
however, may not be availed of if the writ was issued upon a ground which is at the same time the
applicant's cause of action.
Preliminary attachment not binding until jurisdiction over the person of the defendant is
acquired. The writ of preliminary attachment, however, even though validly issued, is not binding
upon the defendant until jurisdiction over his person is first acquired.
3. Calo and San Jose vs. Roldan, et al.

G.R. No. L-252; March 30, 1946
Facts:
Regino Relova and Teodula Bartolome filed a complaint against Tranquilino Calo and
Doroteo San Jose, alleging that they are the owners and possessors of parcels of land (unplanted
rice land and coconut land). Also alleged that defendants connived, used force, stealth, threats and
intimidation to enter and work or harvest the existing fruits found in aforementioned lands. Also
alleged that defendants destroyed and took away the madre-cacao fence and barbed wires built on
the northwestern portion of the coconut land. Prayed for a writ of preliminary injunction.
Defendants filed an opposition, on the ground that they are the owners of the land and have
been in actual possession since 1925. Petition for writ of preliminary injunction was denied after
hearing.
Plaintiffs filed urgent petition ex parte, praying that their MR of the order denying their
petition be granted and/or for the appointment of a receiver of the properties described on the
ground that (a) the plaintiffs have an interest in the properties in question, and the fruits thereof
were in danger of being lost unless a receiver was appointed; and that (b) the appointment of a
receiver was the most convenient and feasible means of preserving, administering and or disposing
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of the properties in litigation which included their fruits. Judge Roldan considered the MR and
granted that appointment of a receiver.
Issue:
Whether or not Judge Roldan acted in excess of his jurisdiction or with grave abuse of
discretion in issuing the order appointing a receiver.
Ruling:
Yes. Plaintiff's action is one of ordinary injunction, since they allege that they are the
owners of the lands and were in actual possession, and that the defendants entered, worked or
harvested the existing fruits found on said lands, violating plaintiffs’ proprietary rights.
The provisional remedies denominated attachment, preliminary injunction, receivership,

and delivery of personal property, provided in Rules 59, 60, 61, and 62 of the Rules of Court,
respectively, are remedies to which parties litigant may resort for the preservation or protection of
their rights or interest, and for no other purpose, during the pendency of the principal action. If an
action, by its nature, does not require such protection or preservation, said remedies can not be
applied for and granted. To each kind of action or actions a proper provisional remedy is provided
for by law. The Rules of Court clearly specify the case in which they may be properly granted.
Attachment may be issued only in the case or actions specifically stated in section 1, Rule
59, in order that the defendant may not dispose of his property attached, and thus secure the
satisfaction of any judgment that may be recovered by plaintiff from defendant. A property subject
of litigation between the parties, or claimed by plaintiff as his, cannot be attached upon motion of
the same plaintiff.
The special remedy of preliminary prohibitory injunction lies when the plaintiff's principal
action is an ordinary action of injunction, that is, when the relief demanded in the plaintiff's
complaint consists in restraining the commission or continuance of the act complained of, either
perpetually or for a limited period, and the other conditions required by section 3 of Rule 60 are
present. The purpose of this provisional remedy is to preserve the status quo of the things subject
of the action or the relation between the parties, in order to protect the rights of the plaintiff
respecting the subject of the action during the pendency of the suit. Because, otherwise or if no
preliminary prohibition injunction were issued, the defendant may, before final judgment, do or
continue the doing of the act which the plaintiff asks the court to restrain, and thus make ineffectual
the final judgment rendered afterwards granting the relief sought by the plaintiff. But, as this court
has repeatedly held, a writ of preliminary injunction should not be granted to take the property out
of the possession of one party to place it in the hands of another whose title has not been clearly
established.
In the case at bar, the provisional remedy proper to plaintiffs' action of injunction is a
preliminary prohibitory injunction if they are the owner and in actual possession of said property.
However, the lower court found at the hearing that the defendants were in possession of the lands,
the lower court denied their petition in accordance with the law, although in plaintiffs’ pending
motion for reconsideration, they insisted that they are in actual possession of the lands.
Hence, Judge Roldan acted in excess of his jurisdiction in appointing a receiver.

Appointment of a receiver is not proper or does not lie in an action of injunction such as the one
filed by the plaintiff. The petition for appointment of a receiver filed by the plaintiffs is based on
the ground that it is the most convenient and feasible means of preserving, administering and
disposing of the properties in litigation; and according to plaintiffs' theory or allegations in their
complaint, neither the lands nor the palay harvested therein, are in litigation. The litigation or issue
raised by plaintiffs in their complaint is not the ownership or possession of the lands and their
fruits. It is whether or not defendants intend or were intending to enter or work or harvest whatever
existing fruits could then be found in the lands described in the complaint, alleged to be the
exclusive property and in the actual possession of the plaintiffs. It is a matter not only of law but
of plain common sense that a plaintiff will not and legally can not ask for the appointment or
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receiver of property which he alleges to belong to him and to be actually in his possession. For the
owner and possessor of a property is more interested than persons in preserving and administering
it.
4. K.O. Glass Construction Co., Inc. vs. Valenzuela

G.R. No. L-48756; September 11, 1982
Facts:
On October 6, 1977, an action was instituted in the Court of First Instance of Rizal by
Antonio D. Pinzon to recover from Kenneth O. Glass the sum of P37,190.00, alleged to be the
agreed rentals of his truck, as well as the value of spare parts which have not been returned to him
upon termination of the lease. In his verified complaint, the plaintiff asked for an attachment
against the property of the defendant consisting of collectibles and payables with the Philippine
Geothermal, Inc., on the grounds that the defendant is a foreigner; that he has sufficient cause of
action against the said defendant; and that there is no sufficient security for his claim against the
defendant in the event a judgment is rendered in his favor.
Finding the petition to be sufficient in form and substance, the respondent Judge ordered
the issuance of a writ of attachment against the properties of the defendant upon the plaintiff's
filing of a bond in the amount of P37,190.00.
On June 19, 1978, the defendants therein filed a bond in the amount of P37,190.00 and
asked the court for the release of the same amount deposited with the Clerk of Court, 7 but, the
respondent Judge did not order the release of the money deposited.
Issue:
Whether or not the respondent judge committed grave abuse of discretion in issuing the
writ of preliminary attachment and in not ordering the release of the money deposited with the
Clerk of Court.
Ruling:
Yes, the respondent judge committed grave abuse of discretion.
First, there was no ground for the issuance of the writ of preliminary attachment. Section
1, Rule 57 of the Revised Rules of Court, which enumerates the grounds for the issuance of a writ
of preliminary attachment.
Sec. 1. Grounds upon which attachment may issue. —A plaintiff or any proper party may, at
the commencement of the action or at any time thereafter, have the property of the adverse
party attached as security for the satisfaction of any judgment that may be recovered in the
following cases:
(a) In an action for the recovery of money or damages on a cause of action arising from
contract, express or implied, against a party who is about to depart from the Philippines
with intent to defraud his creditor;
(f) In an action against a party who resides out of the Philippines, or on whom summons
may be served by publication.
Pinzon however, did not allege that the defendant Kenneth O. Glass "is a foreigner (who)
may, at any time, depart from the Philippines with intent to defraud his creditors including the
plaintiff." He merely stated that the defendant Kenneth O. Glass is a foreigner.
There being no showing, much less an allegation, that the defendants are about to depart from the
Philippines with intent to defraud their creditor, or that they are non-resident aliens, the attachment
of their properties is not justified.
Second, the affidavit submitted by Pinzon does not comply with the Rules. Under the
Rules, an affidavit for attachment must state that (a) sufficient cause of action exists, (b) the case
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is one of those mentioned in Section I (a) of Rule 57; (c) there is no other sufficient security 'or the
claim sought to be enforced by the action, and (d) the amount due to the applicant for attachment
or the value of the property the possession of which he is entitled to recover, is as much as the sum
for which the order is granted above all legal counterclaims. Section 3, Rule 57 of the Revised
Rules of Court reads. as follows:
While Pinzon may have stated in his affidavit that a sufficient cause of action exists against
the defendant Kenneth O. Glass, he did not state therein that "the case is one of those mentioned
in Section 1 hereof; that there is no other sufficient security for the claim sought to be enforced by
the action; and that the amount due to the applicant is as much as the sum for which the order
granted above all legal counter-claims." It has been held that the failure to allege in the affidavit
the requisites prescribed for the issuance of a writ of preliminary attachment, renders the writ of
preliminary attachment issued against the property of the defendant fatally defective, and the judge
issuing it is deemed to have acted in excess of his jurisdiction.
Finally, it appears that the petitioner has filed a counterbond in the amount of P37,190.00
to answer for any judgment that may be rendered against the defendant. Upon receipt of the
counter-bond the respondent Judge should have discharged the attachment pursuant to Section 12,
Rule 57 of the Revised Rules of Court
Section 12. Discharge of attachment upon giving counterbond.—At any time after an order
of attachment has been granted, the party whose property has been attached….. Upon the
filing of such counter-bond…. Upon the discharge of an attachment….. shall be delivered to
the party making the deposit.
5. PCIB vs Alejandro
G.R No 175587; September 21, 2007
Facts:
PCIB filed against respondent Alejandro a complaint for a sum of money with prayer for
the issuance of a writ of preliminary attachment. Said complaint alleged that on September 10,
1997, Alejandro, a resident of Hong Kong, executed in favor of PCIB a promissory note obligating
himself to pay P249,828,588.90 plus interest. In view of the fluctuations in the foreign exchange
rates which resulted in the insufficiency of the deposits of Alejandro as security for the loan, PCIB
requested the latter to put up additional security. Alejandro sought a reconsideration of said request
pointing out petitioner’s alleged mishandling of his account due to its failure to carry out his
instruction to close his account as early as April 1997, when the prevailing rate of exchange of the
US Dollar to Japanese yen was US$1.00:JPY127.50. The amount of P249,828,588.90 was the
consolidated amount of a series of yen loans granted by PCIB to Alejandro during the months of
February and April 1997.
In praying for the issuance of a writ of preliminary attachment under Section 1 paragraphs
(e) and (f) of Rule 57 of the Rules of Court, petitioner alleged that (1) respondent fraudulently
withdrew his unassigned deposits notwithstanding his verbal promise to PCIB not to withdraw the
same prior to their assignment as security for the loan; and (2) that respondent is not a resident of
the Philippines.
The trial court granted the application and issued the writ ex parte after PCIB posted a Php
18.7M bond, issued by Prudential Guarantee & Assurance Inc. Also, the bank deposits of
Alejandro with RCBC were garnished. Alejandro, through counsel, voluntarily submitted to the
jurisdiction of the court.
Subsequently, Alejandro filed a motion to quash the writ contending that the withdrawal
of his unassigned deposits was not fraudulent as it was approved by PCIB. He also alleged that
petitioner knew that he maintains a permanent residence at Calle Victoria, Ciudad Regina, Batasan
Hills, Quezon City, and an office address in Makati City at the Law Firm Romulo Mabanta
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Buenaventura Sayoc & De los Angeles, where he is a partner. In both addresses, petitioner
regularly communicated with him through its representatives. Respondent added that he is the
managing partner of the Hong Kong branch of said Law Firm; that his stay in Hong Kong is only
temporary; and that he frequently travels back to the Philippines.
The trial court issued an order quashing the writ and holding that the withdrawal of
respondent’s unassigned deposits was not intended to defraud petitioner. It also found that the
representatives of petitioner personally transacted with respondent through his home address in
Quezon City and/or his office in Makati City. It thus concluded that petitioner misrepresented and
suppressed the facts regarding respondent’s residence considering that it has personal and official
knowledge that for purposes of service of summons, respondent’s residence and office addresses
are located in the Philippines.
With the denial of PCIB’s motion for reconsideration, it elevated the case to the CA via a
petition for certiorari. The petition was dismissed for failure to prove that the trial court abused its
discretion in issuing the aforesaid order. PCIB filed a motion for reconsideration but was denied.
On petition with the SC, the case was dismissed for late filing. PCIB filed a motion for
reconsideration but was likewise denied with finality on March 6, 2000.
Issue:
Whether or not the court can pass upon the issues of propriety of the issuance of a writ of
attachment, misrepresentation by PCIB and residence of Alejandro.
Ruling:
No. The ruling of the trial court that PCIB is not entitled to a writ of attachment because
Alejandro is a resident of the Philippines, that his act of withdrawing his deposits with petitioner
was without intent to defraud, and that PCIB misrepresented that Alejandro was residing out of
the Philippines, is now beyond the power of this Court to review, having been the subject of a final
and executory order. The rule on conclusiveness of judgment precludes the relitigation of a
particular fact or issue in another action between the same parties even if based on a different claim
or cause of action. The judgment in the prior action operates as estoppel as to those matters in
issue or points controverted, upon the determination of which the finding or judgment was
rendered. Hence, the issues of misrepresentation by petitioner and the residence of respondent for
purposes of service of summons can no longer be questioned by petitioner in this case.
6. General vs. de Venecia

G.R. No. L-894; July 30, 1947
Facts:
A complaint was filed by Ruedas against Luis General. That complaint was filed on June
4, 1946, to recover the value of a promissory note.
It prayed additionally for preliminary attachment of defendant's property, upon the

allegation that the latter was about to dispose of his assets to defraud creditors. Two days later, the
writ of attachment was issued upon the filing of a suitable bond.
Having been served with summons, the defendant therein, Luis F. General, submitted, on
June 11, 1946, a motion praying for dismissal of the complaint and dissolution of the attachment.
He claimed it was premature, in view of the provisions of the debt moratorium orders of the
President of the Philippines (Executive Orders Nos. 25 and 32 of 1945). Denial of this motion and
of the subsequent plea for reconsideration, prompted the institution of this special civil action,
which we find to be meritorious, for the reason that the attachment was improvidently permitted,
the debt being within the terms of the decree of moratorium (Executive Order No. 32).
Issue:
Can an attachment issue when the demand is not yet due and demandable?
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Ruling:
No. It is our view that, upon objection by the debtor, no court may now proceed to hear a
complaint that seeks to compel payment of a monetary obligation coming within the purview of
the moratorium. And the issuance of a writ of attachment upon such complaint may not, of course,
be allowed. Such levy is necessarily one step in the enforcement of the obligation, enforcement
which, as stated in the order, is suspended temporarily, pending action by the Government.
But the case for petitioner is stronger when we reflect that his promise is to pay P4,000
"within six months after peace has been declared." It being a matter of contemporary history that
the peace treaty between the United States and Japan has not even been drafted, and that no
competent official has formally declared the advent of peace (see Raquiza vs. Bardford, 75 Phil.,
50), it is obvious that the six-month period has not begun; and Luis F. General has at present and
in June, 1946, no demandable duty to make payment to plaintiffs, independently of the moratorium
directive.
On the question of validity of the attachment, "the general rule is that, unless the statute
expressly so provides, the remedy by attachment is not available in respect to a demand which is
not due and payable, and if an attachment is issued upon such a demand without statutory authority
it is void." (7 C.J.S., p. 204.)
It must be observed that under our rules governing the matter the person seeking a
preliminary attachment must show that "a sufficient cause of action exists" and that the amount
due him is as much as the sum for which the order of attachment is granted" (sec. 3, Rule 59).
Inasmuch as the commitment of Luis F. General has not as yet become demandable, there existed
no cause of action against him, and the complaint should have been dismissed and the attachment
lifted.
7. Miailhe vs. Lencquesaing

GR No. L-67715; July 11, 1986
Facts:
Petitioners William Miailhe, sisters Monique Miailhe and Elaine Miailhe de Lencquesaing
and their mother Victoria Miailhe are co-owners of a property located in Metro Manila. After
failing to secure an out-of-court partition due to unwillingness of respondent Elaine, petitioners
filed an action for Partition in RTC Manila.
Respondent filed a criminal complaint for estafa against William for allegedly
misappropriating the funds which should have been turned over to her as her share in the rentals
of the property. She then flew back in Paris, her country of residence.
Petitioners then filed a complaint for damages against respondent for embarrassing his
honor and reputation as a private person. He also prayed for the issuance of a writ of preliminary
attachment of the properties of respondent consisting of 1/6 undivided interests in certain real
properties in Manila, on the ground that respondent is a non-resident of the Philippines, pursuant
to par. (f), section 1 of Rule 57. RTC Manila Judge Barbers granted the petition for preliminary
attachment. Respondent, after denying their motion to lift the writ of attachment for being non-
compliant with Section 1 of Rule 57, and for that said claim was for unliquidated damages, filed
an appeal with the IAC on the grounds of grave abuse of discretion.
Issue:
Whether or not RTC Judge Barbers exceeded his jurisdiction in granting the writ of
preliminary of attachment in favor of petitioner William.
Ruling:
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Yes. RTC Judge Barbers exceeded his jurisdiction in issuing the writ of attachment on a
claim based on an action for damages arising from delict and quasi delict the amount of which is
uncertain and had not been reduced to judgment just because the defendant is not a resident of the
Philippines. Because of the uncertainty of the amount of plaintiff's claim it cannot be said that said
claim is over and above all legal counterclaims that defendant may have against plaintiff, one of
the indispensable requirements for the issuance of a writ of attachment which should be stated in
the affidavit of applicant as required in Sec. 3 of Rule 57.
While it is true that Section 1(f) of Rule 57 provides that attachment may issue in an action
against a party who resides out of the Philippines, " irrespective of the nature of the action or suit,
still it is imperative that the amount sought be liquidated.
8. Insular Savings Bank vs. CA

GR. No. 123638; June 15, 2005
Facts:
On Dec. 11, 1991, private respondent Far East Bank and Trust Company instituted
Arbitration case against herein petitioner before the Arbitration Committee of the Philippine
Clearing House Corporation (PCHC). The dispute involved three unfunded checks, amounting to
P 25, 200,000.00, drawn against private respondent bank and presented by petitioner for clearing.
Private respondent returned the checks however its total value was already credited to petitioner’s
account. Petitioner refused to return the same. Pending the arbitration case, respondent bank filed
a Civil case in the RTC of Makati and prayed for the issuance of a writ of preliminary attachment
for the amount of P 25, 200,000.00, which said court granted. While the arbitration case was still
pending, the parties agreed to temporarily divide the amount where each party have P 12,
600,000.00. Petitioner then filed a motion to discharge attachment by counter –bond in the amount
of P 12, 600,000.00, which was denied by the RTC. On appeal, CA found no merit in the
petitioner’s case. Hence this review.
Issue:
Whether or not the trial court committed grave abuse of discretion in denying petitioner’s
motion to discharge attachment by counter-bond in the amount of P 12, 600, 000.00.
Ruling:
Yes. Under the old Sec. 12 of the Rules of Court: At any time after an order of attachment
has been granted, the party whose property has been attached, may upon reasonable notice to the
applicant, apply to the judge who granted the order or to the judge of the court which the action is
pending, for an order, discharging the attachment wholly or in part on the security given. The judge
shall, after hearing, order the discharge of the attachment if a cash deposit is made, or a counter-
bond executed to the attaching creditor is filed on behalf of the adverse party, with the clerk or
judge of the court where the application is made in an amount equal to the value of the property
attached as determined by the judge, to secure the payment of any judgment that the attaching
creditor may recover in the action. ’
As things stood, respondent’s principal claim against petitioner immediately prior to the
filing of the motion to discharge attachment has effectively been pruned down to P 12, 600, 000.00.
Accordingly, the trial court should have allowed a total discharge of the attachment on a counter-
bond on the reduce claim of respondent. The trial court, therefore, committed grave abuse of
discretion when it denied petitioner’s motion to discharge attachment by counter-bond in the
amount of P12, 600, 000.00. In the Revised Rules of Court, Sec. 12 of Rule 57 provides that court
shall order the discharge of attachment if the movant ‘makes a cash deposit, or files a counter
bond… in an amount equal to that fixed by the court in the order of attachment, exclusive of costs.’
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9. Tan v. Zandueta
G.R. No. L-43721; June 15, 1935
Facts:
The respondent Tiu Chay sued the petitioner Isidro Tan, to recover from him the amount
of P22,500 which he alleged to be the half corresponding to him of the P45,000 which they won
as a prize in the last drawing of the sweepstakes which they purchased with a part of the capital
invested in a sari-sari store.
Simultaneously with his complaint, Tiu Chay asked and obtained from the respondent
judge the attachment of the property of the petitioner Isidro Tan upon filing a bond in the amount
of P5,000. Isidro Tan succeeded in dissolving the attachment by filing, a counter bond in the same
amount to secure said attachment. As soon as he obtained the order and filed the required counter
bond, he withdrew from the Philippine National Bank his deposit.
When the time given by the respondent judge to file said counter expired, he was required
to appear before the respondent judge and show cause why he should not be found in contempt of
court, however the judge was not satisfied. Thereafter, he was declared guilty of contempt and
immediately ordered his confinement.
Issue:
Whether or not the writ of preliminary attachment issued by the respondent judge at the
instance of Tiu Chay was irregular and illegal?
Ruling:
No, the writ of preliminary attachment was issued in strict conformity to the law, because
the complaint wherein the said attachment was issued alleged that the petitioner, after collecting
the prize of a ticket in the sweepstakes, appropriated the entire prize exclusively for himself, in
complete disregard of said Tiu Chay. He was merely a depository or agent of the latter as to said
half, he was required to turn over to the respondent the part of the prize won corresponding to the
latter.
Petitioner's contention that, in view of his motion to dissolve the writ of preliminary
attachment, on the ground that the allegations of the complaint of the respondent Tiu Chay were
not true, said attachment should have been dissolved without any condition, is without force. The
respondent judge had discretionary power, according to section 441 of Act No. 190, to dissolve or
to leave in force the said attachment, and it was precisely in the exercise of this power, that he
decided to dissolve the attachment but conditioned on petitioner's filing a counter bond for P5,000.
10. Olsen & Co. vs. Olsen

GR No. L-23237; November 14, 1925
Facts:
This is an appeal taken by the defendant from a judgment of the Court of First Instance of
Manila, sentencing him to pay plaintiff corporation the sum of P66,207.62 with legal interest
thereon at the rate of 6 per cent per annum from February 1, 1923, the date of the filing of the
complaint, until full payment and the costs, and dismissing the cross-complaint and counterclaim
set up by him.
As ground of his appeal, the defendant assigns four errors committed by the trial court, to
wit: (1) The holding that the defendant-appellant contracted fraudulently the debt which the
plaintiff-appellee seeks to recover in its complaint; (2) its failure to set aside the writ of preliminary
attachment issued by it ex parte; (3) the fact of it not having absolved the defendant from the
complaint of the plaintiff corporation and of not having given judgment for the defendant and
against the plaintiff for the amount of his counterclaim, after deducing the debt due from him to
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the plaintiff corporation in the sum of P66,207.62; and (4) its action in denying the motion for new
trial of the defendant.
Issues:
(1) Whether or not an order denying a motion for the annulment of a preliminary attachment
may be reviewed through an appeal
(2) Whether or not the trial court committed error in denying the motion for the annulment of
the preliminary attachment levied upon the property of the defendant-appellant.
Rulings:
(1) The preliminary attachment is an auxiliary remedy the granting of which lies within the
sound discretion of the judge taking cognizance of the principal case upon whose existence
it depends. The order of the judge denying a motion for the annulment of a writ of
preliminary attachment, being of an incidental or interlocutory and auxiliary character,
cannot be the subject of an appeal independently from the principal case, because our
procedural law now in force authorizes an appeal only from a final judgement which gives
an end to the litigation. This lack of ordinary remedy through an appeal does not mean,
however, that any excess a lower court may commit in the exercise of its jurisdiction is
without remedy; because there are the special remedies, such as certiorari, for the purpose.
While it is true that an order denying a motion for the annulment of a preliminary
attachment is not subject to review through an appeal independently from the principal
case, it not consisting a final order, yet when the writ of preliminary attachment becomes
final by virtue of a final judgment rendered in the principal case, said writ is subject to
review jointly with the judgment rendered in the principal case through an ordinary appeal.
The appellate court has the power to revoke or confirm said order, in like manner as a
judgment on the merits; because it is a ruling to which an exception may be taken, and
therefore is subject to review in an appeal by bill of exceptions. The fact that section 441
of the Code of Civil Procedure does not provide any remedy against the granting or denial
of a motion for the annulment of a writ of preliminary attachment, except in case of excess
of jurisdiction, does not confer upon said order a final and irrevocable character, taking it
out from the general provisions as to appeal and review, for a special provision is necessary
for that purpose.
(2) It is admitted by the defendant-appellant that he is indebted to the plaintiff-appellee

corporation in the sum of P66,207.62, but denies that he has contracted said debt
fraudulently.
The evidence shows that the defendant-appellant was president-treasurer and general
manager of the plaintiff-appellee corporation and exercised direct and almost exclusive
supervision over its function, funds and books of account until about the month of August,
1921. During that time, he has been taking money of the corporation without being duly
authorized to do so either by the board of directors or by the by-laws, the money taken by
him having amounted to the considerable sum of P66,207.62. The defendant-appellant
attempted to justify his conduct, alleging that the withdrawal of the funds of the
corporation for his personal use was made in his current account with said corporation.
Having, as he had, absolute and almost exclusive control over the function of the
corporation and its funds by virtue of his triple capacity as president, treasurer and general
manager, the defendant-appellant should have been more scrupulous in the application of
the funds of said corporation to his own use. As a trustee of said corporation, it was his
duty to see by all legal means possible that the interests of the stockholders were protected,
and should not abuse the extraordinary opportunity which his triple position offered him
to dispose of the funds of the corporation. The approval of his account at the first meeting
of the stockholders cannot be considered as a justification of his conduct, nor does it
remove every suspicion of bad faith, because the corporation was constituted exclusively
by the defendant-appellant himself and his co-speculator, Marker, and nothing else could
10
be expected from it. As to the debt he owed to the corporation, Walter E. Olsen was in
effect a lender and a borrower at the same time. The conduct of the defendant-appellant in
connection with the funds of the corporation he represented was more than an irregularity;
and while it is not sufficiently serious to constitute a criminal fraud, it is undoubtedly a
fraud of a civil character, because it is an abuse of confidence to the damage of the
corporation and its stockholders, and constitutes one of the grounds enumerated in section
424, in connection with section 412 of the Code of Civil Procedure for the issuance of a
preliminary attachment, and the order of the Court of First Instance of Manila, denying
the motion for the annulment of the injunction in question, is in accordance with law.
11. Santos vs Bernabe

G.R. No. L-31163; November 6, 1929
Facts:
On March 20, 1928, Urbano Santos deposited 778 cavans and 38 kilos of palay in the
warehouse of Jose Bernabe. At the same time, Pablo Tiongson also deposited 1,026 cavans and 9
kilos of palay. The share of Tiongson and Santos were mixed together and cannot be separated.
Later on, Pablo Tiongson files a case against Jose Bernabe to recover the 1,026 cavans and
9 kilos of palay deposited in Bernabe’s warehouse. Tiongson then files for a petition for a writ of
attachment and the Court granted it. Bernabe’s properties were attached, including only 924 cavans
of rice and 31 ½ kilos of palay which was found by the sheriff in Bernabe’s warehouse. These
were sold at a public auction and the proceeds were delivered to Tiongson.
It does not appear that the sacks of palay of Urbano Santos and those of Pablo Tiongson,
deposited in Jose C. Bernabe's warehouse, bore any marks or signs, nor were they separated one
from the other. Santos tried to intervene in the attachment of the palay. However, the sheriff had
already proceeded with the attachment, so Santos files a complaint.
Santos says that Tiongson cannot claim the 924 cavans and 31 ½ kilos of palay. Santos
says that by asking for the attachment of the properties, Tiongson is claiming that the cavans of
rice all belonged to Bernabe and not to him.
Issue:
Whether or not the issuance of the preliminary attachment was proper.
Ruling:
Yes. The issuance of the preliminary attachment was proper. The action brought by Pablo
Tiongson against Jose Bernabe is that provided in section 262 of the Code of Civil Procedure for
the delivery of personal property
Although it is true that the plaintiff and his attorney did not follow strictly the
procedure provided in said section for claiming the delivery of said personal property
nevertheless, the procedure followed by him may be construed as equivalent thereto,
considering the provisions of section 2 of the Code of Civil Procedure of the effect that "the
provisions of this Code, and the proceedings under it, shall be liberally construed, in order
to promote its object and assist the parties in obtaining speedy justice."
Liberally construing, therefore, the above cited provisions of section 262 of the Code of
Civil Procedure, the writ of attachment applied for by Pablo Tiongson against the property of Jose
Bernabe may be construed as a claim for the delivery of the sacks of palay deposited by the former
with the latter.
11
12. State Investment House vs. CA

GR No. 82446; July 29, 1988
Facts:
P. O. Valdez Inc. entered a loan contract with State Investment House Inc. The said loan
was secured by 2 parcels of land, stock certificate and Postdated checks. The Postdated checks
were deposited by State Investment House upon maturity, but the same were bounced for
insufficient funds. Despite of demands P.O Valdez failed to pay its obligation.
State Investment House filed a collection suit with a prayer for preliminary attachment.
The trial court granted the writ of preliminary attachment but lifted by the same court upon motion
by the P.O Valdez Inc. The preliminary attachment was grounded upon fraud when it was alleged
that P. O Valdez misrepresented the State Investment House in issuing a checks without funds.
Issue:
Whether or not the lifting of writ preliminary attachment is correct.
Ruling:
Yes. The SC said that the main thrust of the prayer for preliminary attachment is the alleged
misrepresentation of the debtor P.O. Valdez Inc. The two checks given by P.O Valdez Inc. served
as a collateral for the loans granted by State Investment House, such checks are mere evidence of
outstanding obligation of P.O Valdez Inc. to State Investment House. It could have refused
accepting the checks as collateral, the loans had been contracted and released to P.O Valdez Inc.
long before the checks were issued. Thus the State Investment House cannot assail that loan was
granted because of misrepresentation by P.O Valdez Inc. hence it would be proper the lifting of
writ of preliminary attachment.
13. Aboitiz & Company, Inc vs. Cotabato Bus Company

GR No. L-35990; June 17, 1981
Facts:
The instant petition is a collection of P155,739.41 filed by petitioner Aboitiz against
Cotabato Bus Co. Through a writ of preliminary attachment, the sheriff attached personal
properties of the Cotabato Bus consisting of some buses, machinery and equipment because
petitioner alleged that the defendant “has removed or disposed of its properties or assets, or is
about to do so, with intent to defraud its creditors.”
Cotabato Bus filed an “Urgent Motion to Dissolve or Quash Writ of Attachment” alleging
that “the Cotabato Bus Company has not been selling or disposing of its properties, neither does it
intend to do so, much less to defraud its creditors; that also the Cotabato Bus Company, Inc. has
been acquiring and buying more assets”. The lower court denied the motion including the appeal.
CA restrained the court from enforcing the writ of attachment. Hence this appeal.
Issue:
Whether or not the writ of attachment was properly issued upon showing that Cotabato
Bus’ removal its properties which constitute an act in fraud of its creditors.
Ruling:
No. This cannot be the removal intended as ground for the issuance of a writ of attachment
under section 1 (e), Rule 57, of the Rules of Court. The repair of the five buses was evidently
motivated by a desire to serve the interest of the riding public, clearly not to defraud its creditors,
as there is no showing that they were not put on the run after their repairs, as was the obvious
purpose of their substitution to be placed in running condition.
Moreover, as the buses were mortgaged to the DBP, their removal or disposal as alleged
by petitioner to provide the basis for its prayer for the issuance of a writ of attachment should be
12
very remote, if not nil. If removal of the buses had in fact been committed, which seems to exist
only in petitioner’s apprehensive imagination, the DBP should not have failed to take proper court
action, both civil and criminal, which apparently has not been done.
The dwindling of respondent’s bank account despite its daily income is easily explained
by its having to meet heavy operating expenses, which include salaries and wages of employees
and workers. If, indeed the income of the company were sufficiently profitable, it should not allow
its buses to fall into disuse by lack of repairs. It should also maintain a good credit standing with
its suppliers of equipment and other needs of the company to keep its business a going concern.
Petitioner Aboitiz is only one of the suppliers.
The sale or other form of disposition of any of this kind of property is not difficult of
detection or discovery, and strangely, petitioner, has adduced no proof of any sale or transfer of
any of them, which should have been easily obtainable.
14. People's Bank And Trust Company vs. Syvel's Incorporated, et al.
G.R. No. L-29280; August 11, 1988
Facts:
This is an action for foreclosure of chattel mortgage executed in favor of the plaintiff by
the defendant Syvel's Incorporated on its stocks of goods, personal properties and other materials
owned by it and located at its stores or warehouses
The chattel mortgage was duly registered in the corresponding registry of deeds of Manila
and Pasay City. The chattel mortgage was in connection with a credit commercial line in the
amount of P900,000.00 granted the said defendant corporation, the expiry date of which was May
20, 1966.
On May 20, 1965, defendants Antonio V. Syyap and Angel Y. Syyap executed an
undertaking in favor of the plaintiff whereby they both agreed to guarantee absolutely and
unconditionally and without the benefit of excussion the full and prompt payment of any
indebtedness to be incurred on account of the said credit line. Against the credit line granted the
defendant Syvel's Incorporated the latter drew advances in the form of promissory notes which are
attached to the complaint as Annexes "C" to "l." In view of the failure of the defendant corporation
to make payment in accordance with the terms and conditions agreed upon in the Commercial
Credit Agreement the plaintiff started to foreclose extrajudicially the chattel mortgage. However,
because of an attempt to have the matter settled, the extra-judicial foreclosure was not pushed thru.
As no payment had been paid, this case was eventually filed in this Court.
On petition of the plaintiff based on the affidavits executed by Mr. Leopoldo R. Rivera,
Assistant Vice President of the plaintiff bank and Atty. Eduardo J. Berenguer on January 12, 1967,
to the effecleet, among others, that the defendants are disposing of their properties with intent to
defraud their creditors, particularly the plaintiff herein, a preliminary writ of attachment was
issued. As a consequence of the issuance of the writ of attachment, the defendants, in their answer
to the complaint set up a compulsory counterclaim for damages.
Appellants contend that the affidavits of Messrs. Rivera and Berenguer on which the lower
court based the issuance of the writ of preliminary attachment relied on the reports of credit
investigators sent to the field and not on the personal knowledge of the affiants.
Issue:
Whether or not the lower court erred in not holding that the writ of preliminary attachment
is devoid of any legal and factual basis whatsoever. (NO)
13
Ruling:
No. The writ of preliminary attachment has legal and factual basis. Evidence adduced
during the trial strongly shows that the witnesses have personal knowledge of the facts stated in
their affidavits in support of the application for the writ. They testified that Syvel's Inc. had
disposed of all the articles covered by the chattel mortgage but had not remitted the proceeds to
appellee bank; that the Syvel's Stores at the Escolta, Rizal Avenue and Morayta Street were no
longer operated by appellants and that the latter were disposing of their properties to defraud
appellee bank. Such testimonies and circumstances were given full credit by the trial court in its
decision (Brief for Appellee, p. 14).
Hence, the attachment sought on the ground of actual removal of property is justified where
there is physical removal thereof by the debtor, as shown by the records.
Besides, the actuations of appellants were clearly seen by the witnesses who "saw a Fiat
Bantam Car-Fiat Car, a small car and about three or four persons hurrying; they were carrying
goods coming from the back portion of this store of Syvels at the Escolta, between 5:30 and 6:00
o'clock in the evening." (Record on Appeal, pp. 45-46).
Therefore, "the act of debtor (appellant) in taking his stock of goods from the rear of his
store at night, is sufficient to support an attachment upon the ground of the fraudulent concealment
of property for the purpose of delaying and defrauding creditors."
In any case, intent to defraud may be and usually is inferred from the facts and
circumstances of the case; it can rarely be proved by direct evidence. It may be gleaned also from
the statements and conduct of the debtor, and in this connection, the principle may be applied that
every person is presumed to intend the natural consequences of his acts (Francisco, Revised Rules
of Court, supra, pp. 24-25), In fact the trial court is impressed "that not only has the plaintiff acted
in perfect good faith but also on facts sufficient in themselves to convince an ordinary man that
the defendants were obviously trying to spirit away a port;.on of the stocks of Syvel's Incorporated
in order to render ineffectual at least partially anyjudgment that may be rendered in favor of the
plaintiff."
Appellants having failed to adduce evidence of bad faith or malice on the part of appellee
in the procurement of the writ of preliminary attachment, the claim of the former for damages is
evidently negated. In fact, the allegations in the appellee's complaint more than justify the issuance
of the writ of attachment.
15. Spouses Adlawan vs. Torres

G.R. Nos. 65957-58; July 5, 1994
Facts:
Eleazar Adlawan was awarded a contract for two irrigation projects by the National
Irrigation Administration (NIA). Consequently, Aboitiz and Company, Inc. (Aboitiz) loaned
Adlawan money and equipment for the said projects. For its inability to pay, Aboitiz filed a
collection for sum of money against Eleazar V. Adlawan in the Court of First Instance of Cebu
City. An ex parte application for attachment was also filed by Aboitiz against the property of
Adlawan which was subsequently granted and enforced after Aboitiz paid the attachment bond.
However, Aboitiz filed a notice of dismissal of its complaint which resulted to all orders of the
court issued prior to the filing of said notice of dismissal be considered as functus oficio and all
pending incidents thereto as moot and academic. Adlawan filed a motion to implement the order
of dismissal of the case but it was dismissed on the ground that Aboitiz filed an action for delivery
of personal property as well as Adlawan’s action for damages in connection with the seizure of his
property under the writ of attachment. The dismissal of the motion led to the ruling of the Supreme
Court to order Aboitiz to return the property of Adlawan without prejudice to the outcome of the
cases filed by both parties.
14
Then, Aboitiz filed for collection of sums of money with prayers for the issuance of writs
of attachment against Eleazar V. Adlawan and Elena S. Adlawan in the Regional Trail Court of
Cebu City. The Adlawans alleged that the filing of the two cases, as well as the issuance of the
writs of attachment, constituted undue interference with the processes of this court in the then
pending petition involving the same property. Aboitiz, on the other hand, averred that the issuance
of the writ of attachment was justified because the Adlawans were intending to defraud Aboitiz by
mortgaging 11 parcels of land to the Philippine Commercial and Industrial Bank (PCIB) in
consideration of a loan, thereby making PCIB a preferred creditor to the prejudice of respondent
Aboitiz
Issue:
Whether or not the issuance of writs of attachment is proper.
Ruling:
No. The affidavit submitted by Aboitiz in support of its prayer for the writ of attachment
does not meet the requirements of Rule 57 of the Revised Rules of Court regarding the allegations
on impending fraudulent removal, concealment and disposition of defendant's property. As held
in Carpio v. Macadaeg, 9 SCRA 552 (1963), to justify a preliminary attachment, the removal or
disposal must have been made with intent to defraud defendant's creditors. Proof of fraud is
mandated by paragraphs (d) and (e) of Section 1, Rule 57 of the Revised Rules of Court on the
grounds upon which attachment may issue. Thus, the factual basis on defendant's intent to defraud
must be clearly alleged in the affidavit in support of the prayer for the writ of attachment if not so
specifically alleged in the verified complaint.
Bare allegation that an encumbrance of a property is in fraud of the creditor does not
suffice. Factual bases for such conclusion must be clearly averred.The execution of a mortgage in
favor of another creditor is not conceived by the Rules as one of the means of fraudulently
disposing of one's property. By mortgaging a piece of property, a debtor merely subjects it to a
lien but ownership thereof is not parted with.
Furthermore, the inability to pay one's creditors is not necessarily synonymous with
fraudulent intent not to honor an obligation (Insular Bank of Asia & America, Inc. v. Court of
Appeals, 190 SCRA 629 [1990])
16. Claude Neon Lights, Federal Inc., U. S. A., petitioner, vs. Philippine Advertising
Corporation
G.R. No. L-37682; November 26, 1932
Facts:
Philippine Advertising Corporation (PAC) filed suit against Claude Neon Lights, Federal
Inc., USA (Claude) in the CFI Manila, claiming P300,000 as damages for alleged breach of the
agency contract existing between them. At the same time, PAC filed in said court an application
for writ of attachmentduly verified in which it is stated that Claude is a foreign corporation having
its principal place of business in the City of Washington, District of Columbia. It is not alleged in
said application that Claude was about to depart from the Philippine Islands with intent to defraud
its creditors or that it was insolvent or had removed or disposed of its property or was about to do
so with intent to defraud its creditors. The only statutory ground relied upon for the issuance of the
writ of attachment against Claude is paragraph 2 of section 424 of the Code of Civil Procedure,
which provides that plaintiff may have the property of the defendant attached "in an action against
a defendant not residing in the Philippine Islands".
Claude is a corporation duly organized under the laws of the District of Columbia; it had
complied with all the requirements of the Philippine laws and the was duly licensed to do business
in the Philippine Islands on the date said writ of attachment was issues. Claude was actively
engaged in doing business in the Philippine Islands and had considerable property therein, which
consisted to its manufacturing plant, machinery, merchandise and a large income under valuable
15
contracts, all of which property was in the possession and under the control and management of
PAC, as the agent of Claude, on the date said attachment was levied. Considered from a practical
and economic viewpoint, its position in the business community was indistinguishable from that
of a domestic corporation.
Issue:
Whether or not par. 2 of section 424 of the Code of Civil Procedure is applicable to Claude.
Ruling:
No. Section 242 of the Code of Civil Procedure under which the petitioner's property was
attached, reads as follows:
Attachment. — A plaintiff may, at the commencement of his action, or at any time

afterwards, have the property of the defendant attached as security for the satisfaction of
any judgment that may be recovered, unless the defendant gives security to pay such
judgment, in the manner hereinafter provided, in the following cases.
1. In all the cases mentioned in section four hundred and twelve, providing for the
arrest of a defendant. But the plaintiff must make an election as to whether he will
ask for an order of arrest or an order of attachment; he shall not be entitled to both
orders;
2. In an action against a defendant not residing in the Philippine Islands.
It may be observed at the outset that the words of section 424, supra, taken in their literal
sense seem to refer to a physical defendant who is capable of being "arrested" or who is "not
residing in the Philippine Islands". It is only by a fiction that it can be held that a corporation is
"not residing in the Philippine Islands". A corporation has no home or residence in the sense in
which those terms are applied to natural persons. For practical purposes, a corporation is
sometimes said, in a metaphorical sense, to be "a resident" of a certain state or a "citizen" of a
certain country, which is usually the state or country by which or under the laws of which it was
created. But that fiction or analogy between corporations and natural persons by no means extends
so far that it can be said that every statute applicable to natural persons is applicable to
corporations.Indeed, within the same jurisdiction a corporation has been held to be a "citizen" of
the state of its creation for the purpose of determining the jurisdiction of the Federal courts
(Wisconsin vs. Pelican Insurance Co., 127 U. S., 265) but not a "citizen" within the meaning of
section 2 of article 4 of the Constitution of the United States which provides that the citizens of
each state shall be entitled to all the privileges and immunities of citizens of the several states (Paul
vs. Virginia, 8 Wall., 169).
There is no the same reason for subjecting a duly licensed foreign corporation to the
attachment of its property by a plaintiff under section 424, paragraph 2, as may exist in the case of
a natural person not residing in the Philippine Islands. The law does not require the latter, as it
does the former, to appoint a resident agent for service of process; nor to prove to the satisfaction
of the Government before he does business here, as the foreign corporation must prove, that he "is
solvent and in sound financial condition" (section 68, Act No. 1459, as amended, the Corporation
Law), or to produce evidence of "fair dealing" (ibid.). He pays no license fee nor is his business
subject at any time to investigation by the Secretary of Finance and the Governor-General; nor is
his right to continue to do business revocable by the Government (Cf. section 71, Act No. 1459 of
the Corporation Law). His books and papers are not liable to examination "at any time" by the
Attorney-General, the Insular Auditor, the Insular Treasurer, "or any other officer of the
Government" on the order of the Governor-General (section 54, ibid.). He is not, like a foreign
corporation "bound by all laws, rules and regulations applicable to domestic corporations" . . .
(section 73, ibid.), which are designed to protect creditors and the public. He can evade service of
summons and other legal process, the foreign corporation never.
Paragraph 2 of section 424, supra does not apply to a domestic corporation. Our laws and
jurisprudence indicate a purpose to assimilate foreign corporations, duly licensed to do business
16
here, to the status of domestic corporations. (Cf. Section 73, Act No. 1459, and Marshall Wells
Co. vs. Henry W. Elser & Co., 46 Phil., 70, 76; Yu Cong Eng vs.Trinidad, 47 Phil., 385, 411.) We
think it would be entirely out of line with this policy should we make a discrimination against a
foreign corporation, like Claude, and subject its property to the harsh writ of seizure by attachment
when it has complied not only with every requirement of law made especially of foreign
corporations, but in addition with every requirement of law made of domestic corporations.
17. State Investment vs. Citibank

GR No.79926-27; October 17, 1991
Facts:
The chief question in the appeal at bar is whether or not foreign banks licensed to do
business in the Philippines, may be considered "residents of the Philippine Islands" within the
meaning of Section 20 of the Insolvency Law.
The petition for involuntary insolvency (filed by BA, Citibank and HSBC) alleged that
CMI had obtained loans from the three petitioning banks (Bank of America, Citibank, HSBC) ;
that in November, 1981, State Investment House, Inc. (SIHI) and State Financing Center, Inc.
(SFCI) had separately instituted actions for collection of sums of money and damages in the Court
of First Instance of Rizal against CMI; and that on application of said plaintiffs, writs of
preliminary attachment had been issued which were executed on "the royalty/profit sharing
payments due CMI from Benguet Consolidated Mining, Inc.; and that he (CMI) has suffered his
(CMI's) property to remain under attachment or legal process for three days for the purpose of
hindering or delaying or defrauding his (CMI's) creditors. The petition was opposed by State
Investment House, Inc. (SIHI) and State Financing Center, Inc. (SFCI). 3 It claimed that the Court
had no jurisdiction because the alleged acts of insolvency were false: the writs of attachment
against CMI had remained in force because there were "just, valid and lawful grounds for the(ir)
issuance; the Court had no jurisdiction to take cognizance of the petition for insolvency
because petitioners are not resident creditors of CMI in contemplation of the Insolvency Law; and
the Court has no power to set aside the attachment issued in favor of intervenors-oppositors SIHI
and SFCI. SIHI and SFCI then filed a Motion for Summary Judgment dated May 23, 1983 "on the
ground that, based on the pleadings and admissions on record, the trial court had no jurisdiction to
adjudicate CMI insolvent since the petitioners (respondent foreign banks) are not "resident
creditors" of CMI as required under the Insolvency Law.
The Regional Trial Court 13 found merit in the motion for summary judgment. By Order
datedOctober 10, 1983, it rendered "summary judgment dismissing the . . . petition for lack of
jurisdiction over the subject matter. The Appellate Court reversed the Trial Court's Order of
October 10, 1983 and remanded the case to it for further proceedings.
Issue:
Whether or not the writs of attachment against CMI were based on "just, valid and lawful
grounds”.
Ruling:
No. The Supreme Court itself has already had occasion to hold that a foreign corporation
licitly doing business in the Philippines, which is a defendant in a civil suit, may not be considered
a non-resident within the scope of the legal provision authorizing attachment against a defendant
not residing in the Philippine Islands;" in other words, a preliminary attachment may not be
applied for and granted solely on the asserted fact that the defendant is a foreign corporation
authorized to do business in the Philippines — and is consequently and necessarily, "a party who
resides out of the Philippines." Parenthetically, if it may not be considered as a party not residing
in the Philippines, or as a party who resides out of the country, then, logically, it must be considered
a party who does reside in the Philippines, who is a resident of the country. Be this as it may, this
Court pointed out that:
17
. . . Our laws and jurisprudence indicate a purpose to assimilate foreign corporations, duly licensed
to do business here, to the status of domestic corporations. (Cf. Section 73, Act No. 1459, and
Marshall Wells Co. vs. Henry W. Elser & Co., 46 Phil. 70, 76; Yu; Cong Eng vs. Trinidad, 47
Phil. 385, 411) We think it would be entirely out of line with this policy should we make a
discrimination against a foreign corporation, like the petitioner, and subject its property to the
harsh writ of seizure by attachment when it has complied not only with every requirement of law
made specially of foreign corporations, but in addition with every requirement of law made of
domestic corporations. . . . .
Obviously, the assimilation of foreign corporations authorized to do business in the

Philippines "to the status of domestic corporations," subsumes their being found and operating as
corporations, hence, residing, in the country.
18. Sievert vs. CA

G.R. No. 84034; December 22, 1988
Facts:
Alberto Sievert, a citizen and resident of the PH, received by mail a petition for issuance
of a preliminary attachment filed with RTC Manila. He had not previously received any summons
and copy of a complaint against him.
On day set for hearing of the petition, Sievert’s counsel went before the TC and entered a
special appearance for the purpose of objecting to the jurisdiction of the court. Prayed for denial
of that Petition for lack of jurisdiction over the person of Sievert upon the ground that since no
summons had been served upon him in the main case, no jurisdiction over the person of Sievert
had been acquired by the court. However, court denied his objection. Sievert filed petition for
certiorari, which the CA dismissed.
Issue:
Whether or not the judge may issue a writ of preliminary attachment against Sievert before
summons is served on him / WON a court which has not acquired jurisdiction over the person of
the defendant in the main case, may bind such defendant or his property by issuing a writ of
preliminary attachment
Ruling:
No. RTC and CA erred when it held that the defendant may be bound by a writ of
preliminary attachment even before summons together with a copy of the complaint in the main
case has been validly served upon him.
There is no question that a writ of preliminary attachment may be applied for a plaintiff "at
the commencement of the action or at any time thereafter" in the cases enumerated in Section 1 of
Rule 57 of the Revised Rules of Court. The issue posed in this case, however, is not to be resolved
by determining when an action may be regarded as having been commenced, a point in time which,
in any case, is not necessarily fixed and Identical regardless of the specific purpose for which the
deter. nation is to be made. The critical time which must be Identified is, rather, when the trial
court acquires authority under law to act coercively against the defendant or his property in a
proceeding in attachment. We believe and so hold that critical time is the time of the vesting of
jurisdiction in the court over the person of the defendant in the main case.
Attachment is an ancillary remedy. It is not sought for its own sake but rather to enable the
attaching party to realize upon relief sought and expected to be granted in the main or principal
action. A court which has not acquired jurisdiction over the person of defendant, cannot bind that
defendant whether in the main case or in any ancillary proceeding such as attachment proceedings.
The service of a petition for preliminary attachment without the prior or simultaneous service of
summons and a copy of the complaint in the main case — and that is what happened in this case
— does not of course confer jurisdiction upon the issuing court over the person of the defendant.
18
Ordinarily, the prayer in a petition for a writ of preliminary attachment is embodied or

incorporated in the main complaint itself as one of the forms of relief sought in such complaint.
Thus, valid service of summons and a copy of the complaint will in such case vest jurisdiction in
the court over the defendant both for purposes of the main case and for purposes of the ancillary
remedy of attachment. In such case, notice of the main case is at the same time notice of the
auxiliary proceeding in attachment. Where, however, the petition for a writ of preliminary
attachment is embodied in a discrete pleading, such petition must be served either simultaneously
with service of summons and a copy of the main complaint, or after jurisdiction over the defendant
has already been acquired by such service of summons. Notice of the separate attachment petition
is not notice of the main action. If a court has no jurisdiction over the subject matter or over the
person of the defendant in the principal action, it simply has no jurisdiction to issue a writ of
preliminary attachment against the defendant or his property.
It is basic that the requirements of the Rules of Court for issuance of preliminary attachment
must be strictly and faithfully complied with in view of the nature of this provisional remedy.
In the case at bar, the want of jurisdiction of the trial court to proceed in the main case
against the defendant is quite clear. It is not disputed that neither service of summons with a copy
of the complaint nor voluntary appearance of Sievert was had in this case.
19. Cuartero vs. CA

G.R. No. 102448; August 5, 1992
Facts:
On August 20, 1990, petitioner Ricardo Cuartero filed a complaint before the Regional
Trial Court of Quezon City against the private respondents, Evangelista spouses, for a sum of
money plus damages with a prayer for the issuance of a writ of preliminary attachment.
On September 19, 1990, the writ of preliminary attachment was issued pursuant to the trial
court's order dated August 24, 1990. On the same day, the summons for the spouses Evangelista
was likewise prepared.
The following day, that is, on September 20, 1990, a copy of the writ of preliminary
attachment, the order dated August 24, 1990, the summons and the complaint were all
simultaneously served upon the private respondents at their residence. Immediately thereafter,
Deputy Sheriff Ernesto L. Sula levied, attached and pulled out the properties in compliance with
the court's directive to attach all the properties of private respondents not exempt from execution,
or so much thereof as may be sufficient to satisfy the petitioner's principal claim in the amount of
P2,171,794.91.
Private respondents, then, filed a special civil action for certiorari with the Court of Appeals
questioning the orders of the lower court dated August 24, 1990 and October 4, 1990 with a prayer
for a restraining order or writ of preliminary injunction to enjoin the judge from taking further
proceedings below.
In a Resolution dated October 31, 1990, the Court of Appeals resolved not to grant the
prayer for restraining order or writ of preliminary injunction, there being no clear showing that the
spouses Evangelista were entitled thereto.
On June 27, 1991, the Court of Appeals granted the petition for certiorari and rendered the
questioned decision. The motion for reconsideration filed by herein petitioner Cuartero was denied
for lack of merit in a resolution dated October 22, 1991.
Issue:
Whether or not CA erred when it held that RTC could not validly issue the subject writ of
preliminary attachments.
19
Ruling:
No, the CA did not err in holding that RTC did not validly issue the subject writ of
preliminary attachments.
The appellate tribunal relied on the case of Sievert v. Court of Appeals, 168 SCRA 692
(1988) in arriving at the foregoing conclusion. It stated that:
Valid service of summons and a copy of the complaint vest jurisdiction in the court over the
defendant both for the purpose of the main case and for purposes of the ancillary remedy of
attachment and a court which has not acquired jurisdiction over the person of defendant, cannot
bind the defendant whether in the main case or in any ancillary proceeding such as attachment
proceedings
A writ of preliminary attachment is defined as a provisional remedy issued upon order of

the court where an action is pending to be levied upon the property or properties of the defendant
therein, the same to be held thereafter by the sheriff as security for the satisfaction of whatever
judgment might be secured in said action by the attaching creditor against the defendant (Adlawan
v. Tomol)
Under section 3, Rule 57 of the Rules of Court, the only requisites for the issuance of the
writ are the affidavit and bond of the applicant.
As has been expressly ruled in BF Homes, Inc. v. Court of Appeals, 190 SCRA 262 (1990),
citing Mindanao Savings and Loan Association, Inc. v. Court of Appeals, 172 SCRA 480 (1989),
no notice to the adverse party or hearing of the application is required inasmuch as the time which
the hearing will take could be enough to enable the defendant to abscond or dispose of his property
before a writ of attachment issues. In such a case, a hearing would render nugatory the purpose of
this provisional remedy.
The writ of preliminary attachment can be applied for and granted at the commencement
of the action or at any time thereafter (Section 1, Rule 57, Rules of Court).
In Davao Light and Power, Co., Inc. v. Court of Appeals, supra, the phrase "at the
commencement of the action" is interpreted as referring to the date of the filing of the complaint
which is a time before summons is served on the defendant or even before summons issues.
It must be emphasized that the grant of the provisional remedy of attachment practically
involves three stages: first, the court issues the order granting the application; second, the writ of
attachment issues pursuant to the order granting the writ; and third, the writ is implemented. For
the initial two stages, it is not necessary that jurisdiction over the person of the defendant should
first be obtained. However, once the implementation commences, it is required that the court must
have acquired jurisdiction over the defendant for without such jurisdiction, the court has no power
and authority to act in any manner against the defendant. Any order issuing from the Court will
not bind the defendant.
In Sievert v. Court of Appeals, supra, cited by the Court of Appeals in its questioned
decision, the writ of attachment issued ex-parte was struck down because when the writ of
attachment was being implemented, no jurisdiction over the person of the defendant had as yet
been obtained. The court had failed to serve the summons to the defendant.
The circumstances in Sievert are different from those in the case at bar. When the writ of
attachment was served on the spouses Evangelista, the summons and copy of the complaint were
also simultaneously served.
In the present case, one of the allegations in petitioner's complaint below is that the
defendant spouses induced the plaintiff to grant the loan by issuing postdated checks to cover the
installment payments and a separate set of postdated cheeks for payment of the stipulated interest
20
(Annex "B"). The issue of fraud, then, is clearly within the competence of the lower court in the
main action.
20. Northwest Airlines vs CA

241 SCRA 192
Facts:
Petitioner NORTHWEST, a corporation organized under the laws of the State of
Minnesota, U.S.A., sought to enforce in the RTC a judgment rendered in its favor by a Japanese
court against private respondent SHARP, a corporation incorporated under Philippine laws.
Plaintiff Northwest Airlines and defendant C.F. Sharp & Company, through its Japan
branch, entered into an International Passenger Sales Agency Agreement, whereby the former
authorized the latter to sell its air transportation tickets. Unable to remit the proceeds of the ticket
sales made by defendant on behalf of the plaintiff under the said agreement, plaintiff sued
defendant in Tokyo, Japan, for collection of the unremitted proceeds of the ticket sales, with claim
for damages.
A writ of summons was issued by the Tokyo District Court against defendant at its office.
The attempt to serve the summons was unsuccessful because the bailiff was advised by a person
in the office that Mr. Dinozo, the person believed to be authorized to receive court processes was
in Manila and would be back on April 24, 1980.
On April 24, 1980, bailiff returned to the defendant's office to serve the summons. Mr.
Dinozo refused to accept the same claiming that he was no longer an employee of the defendant.
After the two attempts of service were unsuccessful, the judge of the Tokyo District Court
decided to have the complaint and the writs of summons served at the head office of the defendant
in Manila. The Director of the Tokyo District Court requested the Supreme Court of Japan to serve
the summons through diplomatic channels upon the defendant's head office in Manila.
On August 28, 1980, defendant received from Deputy Sheriff Rolando Balingit the writ of
summons. Despite receipt of the same, defendant failed to appear at the scheduled hearing. Thus,
the Tokyo Court proceeded to hear the plaintiff's complaint and rendered judgment. The same
became final and executory.
The judgment was enforced, defendant filed its answer averring that the judgment of the
Japanese Court sought to be enforced is null and void and unenforceable in this jurisdiction having
been rendered without due and proper notice to the defendant and/or with collusion or fraud and/or
upon a clear mistake of law and fact.
Issue:
Whether or not a Japanese court can acquire jurisdiction over a Philippine corporation
doing business in Japan by serving summons through diplomatic channels on the Philippine
corporation at its principal office in Manila after prior attempts to serve summons in Japan had
failed.
Ruling:
Yes. A foreign judgment is presumed to be valid and binding in the country from which it
comes, until the contrary is shown. It is also proper to presume the regularity of the proceedings
and the giving of due notice therein.
Under Section 50, Rule 39 of the Rules of Court, a judgment in an action in personam of a
tribunal of a foreign country having jurisdiction to pronounce the same is presumptive evidence of
a right as between the parties and their successors-in-interest by a subsequent title. The judgment
may, however, be assailed by evidence of want of jurisdiction, want of notice to the party,
21
collusion, fraud, or clear mistake of law or fact. Also, under Section 3 of Rule 131, a court, whether
of the Philippines or elsewhere, enjoys the presumption that it was acting in the lawful exercise of
jurisdiction and has regularly performed its official duty.
Consequently, the party attacking a foreign judgment has the burden of overcoming the
presumption of its validity. Being the party challenging the judgment rendered by the Japanese
court, SHARP had the duty to demonstrate the invalidity of such judgment. In an attempt to
discharge that burden, it contends that the extraterritorial service of summons effected at its home
office in the Philippines was not only ineffectual but also void, and the Japanese Court did not,
therefore acquire jurisdiction over it.
It is settled that matters of remedy and procedure such as those relating to the service of
process upon a defendant are governed by the lex fori or the internal law of the forum. In this case,
it is the procedural law of Japan where the judgment was rendered that determines the validity of
the extraterritorial service of process on SHARP. As to what this law is a question of fact, not of
law. It may not be taken judicial notice of and must be pleaded and proved like any other fact
Sections 24 and 25, Rule 132 of the Rules of Court provide that it may be evidenced by an official
publication or by a duly attested or authenticated copy thereof. It was then incumbent upon SHARP
to present evidence as to what that Japanese procedural law is and to show that under it, the assailed
extraterritorial service is invalid. It did not. Accordingly, the presumption of validity and regularity
of the service of summons and the decision thereafter rendered by the Japanese court must stand.
Alternatively in the light of the absence of proof regarding Japanese law, the presumption
of identity or similarity or the so-called processual presumption may be invoked. Applying it, the
Japanese law on the matter is presumed to be similar with the Philippine law on service of
summons on a private foreign corporation doing business in the Philippines. Section 14, Rule 14
of the Rules of Court provides that if the defendant is a foreign corporation doing business in the
Philippines, service may be made: (1) on its resident agent designated in accordance with law for
that purpose, or, (2) if there is no such resident agent, on the government official designated by
law to that effect; or (3) on any of its officers or agents within the Philippines.
It was the Tokyo District Court which ordered that summons for SHARP be served at its
head office in the Philippine's after the two attempts of service had failed. The Tokyo District
Court requested the Supreme Court of Japan to cause the delivery of the summons and other legal
documents to the Philippines. Acting on that request, the Supreme Court of Japan sent the
summons together with the other legal documents to the Ministry of Foreign Affairs of Japan
which, in turn, forwarded the same to the Japanese Embassy in Manila. Thereafter, the court
processes were delivered to the Ministry (now Department) of Foreign Affairs of the Philippines,
then to the Executive Judge of the Court of First Instance (now Regional Trial Court) of Manila,
who forthwith ordered Deputy Sheriff Rolando Balingit to serve the same on SHARP at its
principal office in Manila. This service is equivalent to service on the proper government official
under Section 14, Rule 14 of the Rules of Court, in relation to Section 128 of the Corporation
Code. Hence, SHARP's contention that such manner of service is not valid under Philippine laws
holds no water.
In deciding against the petitioner, the respondent court sustained the trial court's reliance on
Boudard vs. Tait where this Court held:
The fundamental rule is that jurisdiction in personam over nonresidents, so as to sustain a

money judgment, must be based upon personal service within the state which renders the
judgment.
xxx xxx xxx

The process of a court, has no extraterritorial effect, and no jurisdiction is acquired over the person
of the defendant by serving him beyond the boundaries of the state. Nor has a judgment of a court
of a foreign country against a resident of this country having no property in such foreign country
22
based on process served here, any effect here against either the defendant personally or his property
situated here.
Process issuing from the courts of one state or country cannot run into another, and
although a nonresident defendant may have been personally served with such process in the state
or country of his domicile, it will not give such jurisdiction as to authorize a personal judgment
against him.
This court itself has already had occasion to hold [Claude Neon Lights, Fed. Inc. vs.
Philippine Advertising Corp., 57 Phil. 607] that a foreign corporation licitly doing business in the
Philippines, which is a defendant in a civil suit, may not be considered a non-resident within the
scope of the legal provision authorizing attachment against a defendant not residing in the
Philippine Islands; [Sec. 424, in relation to Sec. 412 of Act No. 190, the Code of Civil Procedure;
Sec. 1(f), Rule 59 of the Rules of 1940, Sec. 1(f), Rule 57, Rules of 1964] in other words, a
preliminary attachment may not be applied for and granted solely on the asserted fact that the
defendant is a foreign corporation authorized to do business in the Philippines — and is
consequently and necessarily, "a party who resides out of the Philippines." Parenthetically, if it
may not be considered as a party not residing in the Philippines, or as a party who resides out of
the country, then, logically, it must be considered a party who does reside in the Philippines, who
is a resident of the country. Be this as it may, this Court pointed out that:
. . . Our laws and jurisprudence indicate a purpose to assimilate foreign corporations, duly licensed
to do business here, to the status of domestic corporations. (Cf. Section 73, Act No. 1459, and
Marshall Wells Co. vs. Henry W. Elser & Co., 46 Phil. 70, 76; Yu Cong Eng vs. Trinidad, 47 Phil.
385, 411) We think it would be entirely out of line with this policy should we make a
discrimination against a foreign corporation, like the petitioner, and subject its property to the
harsh writ of seizure by attachment when it has complied not only with every requirement of law
made specially of foreign corporations, but in addition with every requirement of law made of
domestic corporations. . . .
21. Salas vs. Adil

G.R. No. L-46009; May 14, 1979
Facts:
On September 10, 1976, respondents Rosita Bedro and Benita Yu filed the afore-mentioned
civil action with the Court of First Instance of Iloilo against herein petitioners Ricardo T. Salas
and Maria Salas, the Philippine Commercial & Industrial Bank, in its capacity as Administrator of
the Testate Estate of the deceased Charles Newton Hodges, and Avelina A. Magno, in her capacity
as Administratrix of the Testate Estate of the deceased Linnie Jane Hodge to annul the deed of sale
of Lot No. 5 executed by administrators of the Hodges Estate in favor of the Spouses Ricardo T.
Salas and Maria Salas and for damages.
In a motion dated May 12, 1977, private respondents filed a motion for attachment,
alleging, among others, that the case was “for annulment of a deed of sale and recovery of
damages” and that the defendants have removed or disposed of their properties or are about to do
so with intent to defraud their creditors especially the plaintiffs in this case.
On May 13, 1977, respondent Judge issued ex-parte a Writ of Attachment "against the properties
of the defendants particularly Lots Nos. 1 and 4 of Psc-2157 less the building standing thereon
upon the plaintiffs filing a bond in the amount of P200,000.00 subject to the approval of this
Court." After a surety bond in the amount of P200,000.00, executed on May 11, 1977 by the
Central Surety and Insurance Company as surety was filed, the writ itself was issued by respondent
Judge on May 16, 1977, directing the Sheriff to attach the properties above-mentioned. On May
17, 1977, the Deputy Sheriff of Iloilo levied upon the aforesaid properties of petitioners.
23
Issue:
In what instance is the hearing of writ required?
Held:
Considering the gravity of the allegation that herein petitioners have removed or disposed
of their properties or are about to do so with intent to defraud their creditors, and further
considering that the affidavit in support of the pre attachment merely states such ground in general
terms, without specific allegations of lances to show the reason why plaintiffs believe that
defendants are disposing of their properties in fraud of creditors, it was incumbent upon respondent
Judge to give notice to petitioners and to allow wherein evidence is them to present their position
at a to be received. Moreover, it appears from the records that private respondents are claiming
unliquidated damages, including moral damages, from petitioners. The authorities agree that the
writ of attachment is not available 'm a suit for damages where the amount claimed is contingent
or unliquidated.
22. La Granja, Inc. vs. Samson

G.R. No. 40054; September 14, 1933
Facts:
Petitioner La Granja, Inc. filed a complaint for a recovery of sum of money in the CFI of
Cagayan against Chua Bian, Chua Yu Lee and Chua Ki. Petitioner also prayed for the issuance of
an order of attachment against the aforementioned defendants' property and accompanied said
complaint with an affidavit of the manager of the aforesaid petitioner, La Granja, Inc., wherein it
was alleged among other essential things, that the said defendants have disposed or are disposing
of their properties in favor of the Asiatic Petroleum Co., with intent to defraud their creditors.
Felix Samson, judge of the CFI of Cagayan, required petitioners to present evidence to
substantiate the allegation before granting its petition.
Petitioner refused to comply with the court’s requirement alleging that it was not obliged
to do so. Hence, respondent judge dismissed the petition for an order of attachment.
Issue:
Whether or not the mere filing of an affidavit in due form is sufficient to compel a judge
to issue an order of attachment.
Ruling:
No. The mere filing of an affidavit executed in due form is not sufficient to compel a judge
to issue an order of attachment, but it is necessary that by such affidavit it be made to appear to
the court that there exists sufficient cause for the issuance thereof, the determination of such
sufficiency being discretionary on the part of the court.
Section 426 of the Code of Civil Procedure provides that a judge or justice of the peace
shall grant an order of attachment when it is made to appear to the judge or justice of the peace by
the affidavit of the plaintiff, or of some other person who knows the facts, that a sufficient cause
of action exists, and that the case is one of those mentioned in section four hundred and twenty-
four, and that there is no other sufficient security for the claim sought to be enforced by the action,
and that the amount due to the plaintiff above all legal set-offs or counterclaims is as much as the
sum for which the order is granted.
Although the law requires nothing more than the affidavit as a means of establishing the
existence of such facts, nevertheless, such affidavit must be sufficient to convince the court of their
existence, the court being justified in rejecting the affidavit if it does not serve this purpose and in
denying the petition for an order of attachment. The affidavit filed by the petitioner, La Granja,
Inc., must not have satisfied the respondent judge inasmuch as he desired to ascertain or convince
himself of the truth of the facts alleged therein by requiring evidence to substantiate them. The
24
sufficiency or insufficiency of an affidavit depends upon the amount of credit given it by the judge,
and its acceptance or rejection, upon his sound discretion
23. Jardine vs. CA

G.R.. No. 55272; April 10, 1989
Facts:
On Sept. 28, 1979, petitioner Jardine filed a complaint in the CFI against private respondent
Impact Corp., to collect various sums of money. Allegedly, IMPACT assigned its receivables to
Jardine on the condition that IMPACT was to collect them on their due dates from their issuers
and remit the collected amounts to Jardine and/or repurchase the assigned receivables. However,
IMPACT failed to remit to Jardine the amounts collected by the former which gave rise to the
complaint. In the same complaint, petitioner, alleging, among others, its willingness to post a bond,
applied for a writ of preliminary attachment against private respondent. The lower court granted
Jardine’s petition for the issuance of a writ of attachment. 3 days after the lower court’s grant,
defendant filed a motion to set aside the writ of preliminary attachment contending that the grounds
upon which plaintiff based its application are not specified under section 1 of Rule 57 and that
there was no affidavit of merit to support the application for attachment as required by Sec. 3 of
Rule 57. The Trial court denied defendant’s motion. On appeal, CA annulled the writ of attachment
for having been issued improperly and irregularly on the ground that there is no sufficient security
for the claim sought to be enforced by the action; and that the amount due to the applicant or the
value of the property on the basis of which he is entitled to recover, is as much as the sum for
which the order is granted above all legal counterclaims. Hence this review.
Issue:
Whether or not the non-compliance with the formal requirements invalidate the writ of
attachment.
Ruling:
Yes. The authority to issue an attachment rests on express statutory provisions and unless
there is authority in the statute, there is no power to issue the writ and such authority as the statute
confers must be strictly construed. Petitioner’s application for a writ of preliminary attachment
must therefore be scrutinized and assessed by the requisites and conditions specifically prescribed
by law for the issuance of such writ.
Section 3, Rule 57 of the Revised Rules of Court governs the issuance of a writ of attachment, to
wit:
Sec. 3. Affidavit and bond required.-An order of attachment shall be granted only when it
is made to appear by the affidavit of the applicant or some other person who personally knows of
the facts, that a sufficient cause of action exists, that the case is one of those mentioned in section
1 hereof, that there is no sufficient security for the claim sought to be enforced by the action, and
that the amount due to applicant or the value of the property the possession of which he is entitled
to recover is as much as the sum for which the order is granted above all legal counterclaims.
More specifically, it has been held that the failure to allege in the affidavit the requisites
prescribed for the issuance of the writ of preliminary attachment, renders the writ of preliminary
attachment issued against the property of the defendant fatally defective, and the judge issuing it
is deemed to have acted in excess of his jurisdiction. In fact, in such cases, the defect cannot even
be cured by amendment.
25
24. Ting vs. Villarin

G.R. No. L-61754; August 17, 1989
Facts:
Private respondent Consolidated Bank and Trust Company filed a complaint for a sum of
money with prayer for a writ of preliminary attachment against Perlon Textile Mills and its
directors. The complaint recites that, Roberto Ting, a director and his wife Dolores Lim Ting was
impleaded as a party defendant in order to bind their conjugal partnership of gains which allegedly
benefitted from the transactions subject of the complaint.
In support of the application for preliminary attachment, Consolidated Bank averred the
ground of "fraud in contracting an obligation, for the defendants’ in violation of the trust receipt
agreement under Sec. 1, Rule 57 of the Rules of Court.
Acting on the application for a writ of attachment by Consolidated Bank, the respondent
judge issued the orders to attach the estate of the spouses. The petitioners, thereafter questioned
the order of writ of preliminary attachment on the ground that the application hinges on "fraud in
contracting" the trust receipt agreements.
Issue:
Whether or not the order of writ of preliminary attachment and the attachment of the
petitioner’s conjugal partnership property valid?
Ruling:
No, the complaint did not provide for a sufficient basis for the issuance of a writ of
preliminary attachment. It is not enough for the complaint to ritualistically cite that the defendants
are "guilty of fraud in contracting an obligation." An order of attachment cannot be issued on a
general averment, such as one ceremoniously quoting from a pertinent rule. The need for a
recitation of factual circumstances that support the application becomes more compelling here
considering that the ground relied upon is "fraud in contracting an obligation."
Fraud cannot be presumed.
The respondent judge thus failed in this duty to ensure that, before issuing the writ of
preliminary attachment, all the requisites of the law have been complied with. He acted in excess
of his jurisdiction and the writ he so issued is thus null and void.
Further, the attachment ordered by the respondent judge for the attachment of the estate of
Spouses Ting is likewise null and void. The attached property of the spouses Ting are conjugal,
the same cannot be validly brought under the painful process of attachment because:
(a) First, the wife Dolores was impleaded merely because of the fact that she is the spouse
of Roberto;
(b) Second, the conjugal partnership cannot possibly be benefitted. Consolidated Bank's
allegation that the act of the husband redounded to the benefit of the conjugal
partnership is mere "book form" when the husband binds himself, as guarantor, because
this act does not conserve or augment conjugal funds but instead threatens to dissipate
them by unnecessary and unwarranted risks to the partnership's financial stability.
When the husband assumes the obligation of a guarantor, the presumption that he acts,
as administrator, for the benefit of the conjugal partnership, is lost.
25. Carlos vs. Sandoval

GR No. 135830; September 30, 2005
Facts:
These consolidated petitions emanated from a civil case filed by Juan de Dios Carlos
("Carlos") against respondents Felicidad Sandoval ("Sandoval") and Teofilo Carlos II (Teofilo II)
26
Carlos asserted that he was the sole surviving compulsory heir of his parents, Felix B.
Carlos and Felipa Elemia, who had acquired during their marriage, six parcels of land (subject
properties). His brother, Teofilo, died intestate in 1992. At the time of his death, Teofilo was
apparently married to Sandoval, and cohabiting with her and their child, respondent Teofilo II.
Nonetheless, Carlos alleged in his Complaint that Teofilo and Sandoval were not validly married
as they had not obtained any marriage license. Furthermore, Carlos also asserted that Teofilo II
could not be considered as Teofilo’s child. As a result, Carlos concluded that he was also the sole
heir of his brother Teofilo, since the latter had died without leaving any heirs.
Carlos also claimed that Teofilo, prior to their father Felix’s death in 1963, developed a
scheme to save the elder Carlos’s estate from inheritance taxes. Under the scheme, the properties
of the father would be transferred to Teofilo who would, in turn, see to it that the shares of the
legal heirs are protected and delivered to them. Felix assented to the plan, and the subject properties
were transferred in the name of Teofilo. After Teofilo’s death, Carlos entered into certain
agreements with Sandoval in connection with the subject properties. Carlos did so, believing that
the latter was the lawful wife of his brother Teofilo. Subsequently though, Carlos discovered that
Sandoval and his brother were never validly married, as their marriage was contracted without a
marriage license.
Carlos now sought to nullify these agreements with Sandoval for want of consideration,
the premise for these contracts being non-existent. Thus, Carlos prayed of the RTC to declare the
alleged marriage between Teofilo and Sandoval void ab initio, provided that Teofilo died without
issue, order that new titles covering the subject properties be issued in the name of Carlos, and
require Sandoval to restitute Carlos in the amount of ₱18,924,800.00.
Carlos likewise prayed for the issuance of the provisional relief of preliminary attachment.
The Court of Appeals found that there was no sufficient cause of action to warrant the preliminary
attachment, since Carlos had merely alleged general averments in order to support his prayer.
Issues:
(1) whether the "proper hearing" requirement under Section 20, Rule 57 had been satisfied
prior to the award by the Court of Appeals of damages on the attachment bond.
(2) whether or not the award of damages shall be included in the judgment on the main case,
and that it should not be rendered prior to the adjudication of the main case.
Rulings:
(1) Yes. Such Damages May Be Awarded Only After Proper Hearing. Section 20 of Rule 57
requires that there be a "proper hearing" before the application for damages on the
attachment bond may be granted. The hearing requirement ties with the indispensable
demand of procedural due process. Due notice to the adverse party and its surety setting
forth the facts supporting the applicant's right to damages and the amount thereof under
the bond is essential. No judgment for damages may be entered and executed against the
surety without giving it an opportunity to be heard as to the reality or reasonableness of
the damages resulting from the wrongful issuance of the writ.
In this case, both Carlos and SIDDCOR were duly notified by the appellate court of the
Motion for Judgment on the Attachment Bond and were required to file their respective
comments thereto. Carlos and SIDDCOR filed their respective comments in opposition to
private respondents’ motion. Clearly, all the relevant parties had been afforded the bare
right to be heard on the matter. "Proper hearing" contemplated would not merely
encompass the right of the parties to submit their respective positions, but also to present
evidence in support of their claims, and to rebut the submissions and evidence of the
adverse party. This is especially crucial considering that the necessary elements to be
established in an application for damages are essentially factual: namely, the fact of
damage or injury, and the quantifiable amount of damages sustained.
27
In this case, we rule that the demands of a "proper hearing" were satisfied as of the time
the Court of Appeals rendered its assailed judgment on the attachment bond. The
circumstances in this case that we consider particularly telling are the settled premises that
the judicial finding on the wrongfulness of the attachment was then already conclusive and
beyond review, and that the amount of actual damages sustained was likewise indubitable
as it indeed could be found in the official case record in CA-G.R. CV No. 53229. As a
result, petitioners would have been precluded from either raising the defenses that the
preliminary attachment was valid or disputing the amount of actual damages sustained by
reason of the garnishment. The only matter of controversy that could be litigable through
the traditional hearing would be the matter of moral and exemplary damages, but the Court
of Appeals appropriately chose not to award such damages.Moreover, petitioners were
afforded the opportunity to counter the arguments extended by the respondents. They fully
availed of that right by submitting their respective comments/oppositions. In fine, the due
process guarantee has been satisfied in this case.
(2) Section 20, Rule 57 does state that the award of damages shall be included in the judgment
on the main case, and seemingly indicates that it should not be rendered prior to the
adjudication of the main case. The rule, which guarantees a right to damages incurred by
reason of wrongful attachment, has long been recognized in this jurisdiction. Under Section
20, Rule 57 of the 1964 Rules of Court, it was provided that there must be first a judgment
on the action in favor of the party against whom attachment was issued before damages
can be claimed by such party. The Court however subsequently clarified that under the
rule, "recovery for damages may be had by the party thus prejudiced by the wrongful
attachment, even if the judgment be adverse to him." Nevertheless, Section 20, Rule 57
explicitly provides that the award for damages be included in the judgment on the main
case. It is clear that under Section 20, Rule 57, the application for damages on the
attachment bond cannot be independently set up, but must be filed in the main case,
26. H.B. Zachry Company International vs. CA

G.R. No. 106989; May 10, 1994
Facts:
On 17 July 1987, VBC entered into a written Subcontract Agreement with Zachry, a
foreign corporation. The latter had been engaged by the United States Navy to design and construct
264 Family Housing Units at the US Naval Base at Subic, Zambales. Under the agreement,
specifically under Section 3 on Payment, VBC was to perform all the construction work on the
housing project and would be paid "for the performance of the work the sum of Six Million Four
Hundred Sixty-eight Thousand U.S. Dollars (U.S. $6,468,000.00), subject to additions and
deductions for changes as hereinafter provided." This "lump sum price is based on
CONTRACTOR'S proposal, dated 21 May 1987 (including drawings), submitted to OWNER for
Alternate Design-Apartments." It was also provided "that substantial differences between the
proposal and the final drawings and Specification approved by the OWNER may be grounds for
an equitable adjustment in price and/or time of performance if requested by either party in
accordance with Section 6 on Changes.
When VBC had almost completed the project, Zachry complained of the quality of work,
making it a reason for its decision to take over the management of the project, which paragraph c,
Section 7 of the Subcontract Agreement authorized.
Hence, on 20 March 1990, VBC filed a Complaint with the Regional Trial Court (RTC) of
Makati against Zachry for the collection of the payments due it with a prayer for a writ of
preliminary attachment over Zachry's bank account in Subic Base and over the remaining thirty-
one undelivered housing units which were to be turned over to the US Navy by Zachry on 30
March 1990. Paragraph 2 of the Complaint alleges that defendant Zachry "is a foreign corporation
with address at 527 Longwood Street, San Antonio, Texas, U.S.A. and has some of its officers
working at U.S. Naval Base, Subic Bay, Zambales where it may be served with summons. On 6
28
April 1990, Zachry filed a motion to dismiss the complaint on the ground of lack of jurisdiction
over its person because the summons was not validly served on it.
Issue:
Whether the issuance of the writ of preliminary attachment prior to the service of the
summons and a copy of the amended complaint on the respondent is valid.
Held:
VBC takes refuge in the ruling in Davao Light & Power Co. vs. Court of Appeals and
argues that the issuance of the writ of attachment on 21 March 1990, although before the service
of the summons, was valid. Its issuance and implementation are two different and separate things;
the first is not affected by any defect in the implementation which may be corrected. Moreover,
assuming arguendo that the initial service of summons was defective, it was cured by the numerous
pleadings thereafter filed. Finally, whatever doubts existed on the effectiveness of the
implementation of the writ was erased by its re-service on the resident agent of Zachry.
It was error for the Court of Appeals to declare, on the ground of grave abuse of discretion,
the nullity of the writ of attachment issued by the trial court on 21 March 1990. In the first place,
the writ was in fact issued only on 26 March 1990 and served, together with the summons, copy
of the complaint, the Order of 21 March 1990, and the bond, on 27 March 1990 on Zachry at its
field office in Subic Bay, Zambales, through one Ruby Apostol. In the second place, even granting
arguendo that the Court of Appeals had indeed in mind the 26 March 1990 writ of attachment, its
issuance, as well as the issuance of the 21 March 1990 Order, did not suffer from any procedural
or jurisdictional defect; the trial court could validly issue both.
The validity then of the order granting the application for a writ of preliminary attachment
on 21 March 1990 and of the issuance of the writ of preliminary attachment on 26 March 1990 is
beyond dispute. However, the enforcement of the preliminary attachment on 27 March 1990,
although simultaneous with the service of the summons and a copy of the complaint, did not bind
Zachry because the service of the summons was not validly made. When a foreign corporation has
designated a person to receive service of summons pursuant to the Corporation Code, that
designation is exclusive and service of summons on any other person is inefficacious. The valid
service of summons and a copy of the amended complaint was only made upon it on 24 April
1990, and it was only then that the trial court acquired jurisdiction over Zachry's person.
Accordingly, the levy on attachment made by the sheriff on 27 April 1990 was invalid. However,
the writ of preliminary attachment may be validly served anew.
27. Siari Valley Estates, Inc. vs. Lucasan, et al.

G.R. No. L-1328; August 31, 1960
Facts:
The Court of First Instance of Zamboanga del Norte rendered a decision ordering Filemon
Lucasan to deliver to Siari Valley Estates, Inc. the cattle inside the former's pasture or pay its value.
The decision was affirmed by the Supreme Court and became final and executory. In carrying out
with the judgement, the sheriff proceeded to levy on certain parcels of lands belonging to Lucasan
which was sold in a public bidding where Siari Valley became the highest bidder. The property
levied on execution by the sheriff to satisfy the judgment merely described the property as
unregistered land and the same was registered under Act 3344 in the office of the register of deeds.
It also appears that in the notice of sale the property was merely described according to the
boundaries and area appearing in the tax declaration and not according to what appears in the
certificate of title. Lucasan filed an opposition alleging that he was in possession of one of the
parcels of land sold which he has erected a house and which he has extra judicially constituted as
a family home. The Court allowed Siari Valley to take possession of all lands sold, with the
exception of parcel 1 on which the family home was constituted, holding that the levy and sale
made by the sheriff with regard to said parcel were not made in accordance with law and so are
null and void.
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Issue:
Whether or not the levy made by the sheriff on parcel 1 is valid.
Held:
No. The rule provides that real property shall "be levied on in like manner and with like
effect as under an order of attachment" (Section 14, Rule 39), and the provision regarding
attachment of real property postulates that the attachment shall be made "by filing with the register
of deeds a copy of the order, together with the description of the property attached, and a notice
that it is attached, and by leaving a copy of said order, description, and notice with the occupant
of the property, if any there be," and that "Where the property has been brought under the operation
of the Land Registration Act, the notice shall contain a reference to the number of the certificate
of title and the volume and page in the registration book where the certificate is registered" (Section
7 [a], Rule 59).
Since the notice of levy made by the sheriff as regards parcel number 1 which is a registered
land contains no reference to the number of its certificate of title and the volume and page in the
registry book where the title is registered, it follows that said notice is legally ineffective and as
such did not have the effect of binding the property for purposes of execution. Consequently, the
sale carried out by virtue of said levy is also invalid and of no legal effect.
28. Ravanera vs. Imperial

GR No. L-34657, October 23, 1979
Facts:
Archbishop of Nueva Caceres filed an action for rescission of contract and recovery of
possession of real properties against respondent Imperial. While respondent Imperial perfected his
appeal the CA ordered the filing of a Motion for Execution of the decision and respondent Imperial
was given 15 days from receipt of the order to put up supersedeas bond for the rental of the
property, moral damages and for the expenses of suit to stay the execution. This order became the
subject of Special Civil Action for certiorari and prohibition before the Supreme Court (SC) but
the SC dismissed the petition on the ground that the order of execution being incidental to the
appeal.
Archbishop of Nueva posted a bond for the issuance of writ of execution but the said writ
of execution was not enforced because of amicable settlement proposed between the parties
however the amicable settlement was not materialized thus the writ of execution has been effected
and as a result of which notice of Levy was issued by which certain properties of the respondent
Imperial were attached. Public auction of the properties was followed after the required
publication and herein petitioner Ravanera became the highest bidder and a Provisional Deed of
Sale was issued in her favor. Although within the period of 1 year respondent Imperial was able
to redeem some of the properties bought at auction but some were not thus the Sheriff executed a
Definite Deed of Sale.
Petitoner Ravanera filed a motion for a writ of possession of the properties covered by the
Definite Deed of Sale which was opposed by respondent Imperial alleging that the notice of Levy
was null and void hence the provisional and definite deed of sale were likewise void. The
respondent court suspended the writ of possession.
It was averred by respondent Imperial that the writ of possession has no legal basis because
the order or writ of execution was in the first place null and void because the action filed was
rescission of contract while in fact there is no more contract of lease to rescind since it had already
been expired. With this contention the Court of Appeal set aside the writ of possession and made
the preliminary injunction previously issued permanent.
Issue:
Whether or not there was a valid levy upon the properties of respondent Imperial?
30
Ruling:
Yes. The CA declared the levy null and void because there was no notice of levy given to
the owner or occupant, however the SC reiterates that such ruling has already been modified by
the case of Pamintuan vs Munuz which states that the levy is validly effected by the service of
notice of sale upon the judgment debtor prior to the sale. What is required is that the judgment
debtor must be notified of the auction sale before the actual date of sale.
In this case it shows that the notice of levy and the notice of auction sale were delivered
through registered mail to herein respondent Imperial on October 15, 1969 and the auction sale
was conducted November 3, 1969. Hence respondent Imperial had been notified of the auction
sale long before the actual date of sale, which is a requirement for the validity of the levy.
It was also assailed by respondent Imperial that there is substantial defect in the notice of
levy on all the properties levied upon and sold to petitioner Ravanera for it does not contain the
reference such as the number of the certificate of title, the volume and page in the registration
book. The SC said that the purpose of these requirements is to inform the debtor as well as the
third person what particular land or property is brought to the custody of the court.
In this case the respondent Imperial was able to exercise his right of redemption with
reference to the registered parcels of land it can be inferred in so far as respondent Imperial is
concerned the purpose of the requirement has been fully served or attained.
29. Obaña vs. CA

GR No. 78635, April 27, 1989
Facts:
Appellant Suntay was the former counsel of Liberty H. Dizon and her minor children, in
an intestate proceeding and in the petition for guardianship. Atty. Suntay filed an “Explanation
and Motion” for the approval of attorney’s fees amounting to P5,000.00, from the ward’s
guardianship estate. Dizon was ordered to pay immediately but failed to comply despite repeated
demands.
Thus, in 1972, Atty Suntay moved for the issuance of an order of attachment upon a land
together with the improvements belonging to Dizon and her wards. By virtue of the Writ of
Attachment, a levy was made on said property, annotated at the back of TCT.
Due to the failure of the sheriff to serve the summonses because Mrs. Dizon and her wards
no longer resided at their last known address and that their present address cannot be ascertained,
Atty Suntay filed a ‘Motion for Service of Summons by Publication (Exh. H) which was granted
by the court. Accordingly, summons were served upon Mrs. Dizon and her wards through
publication.
The Deed of Absolute Sale dated May 16, 1973 between Dizon, and Obaña involving the
attached property, cancelled TCT in the name of Liberty H. Dizon transferring the encumbrance
consisting of notice of levy in favor of appellant Obana.
After summons by publication had been effected, the court declared Liberty H. Dizon and
her wards, in default and allowed Atty Suntay’s evidence to be presented ex-parte.
A decision was made awarding Atty. Suntay the amount of P10,000.00 representing his
claim for attorney’s fees and a writ of execution was issued per order of the court, and then
followed by a Notice of Levy on Execution dated August 7, 1974, issued by the sheriff of Quezon
City.
31
Thereafter, the TCT in the name of Leonora Obaña was issued in favor of Atty Suntay,
being the highest bidder. For failure of Mrs. Dizon and her wards or by appellee Leonora Obaña
to redeem the property a ‘Sheriff’s Final Deed of Sale’ was issued in favor of Suntay. Both
certificates of sale were registered in the Register of Deeds of Quezon City and was annotated at
the back of TCT.
When Atty Suntay filed a petition in the then CFI of Rizal, the CFI of Quezon City directed
the Register of Deeds to issue a new title covering the subject land in the name of Rafael G. Suntay
married to Victoria J. Suntay.
Obana filed an action for annulment of judgment contending that the decision rendered was
null and void because the said court did not acquire jurisdiction over Liberty H. Dizon and her
wards, since they were not properly served with summons. Obana also claimed that the
proceedings before the sheriff failed to comply with the jurisdictional requirements on the manner
of service of notice in the New Rules of Court thus rendering the proceedings void ab initio.
Atty Suntay countered that there is res judicata and the recourse under Rule 38 has long
prescribed. He added that when Obana bought the property in question and title was transferred to
her on July 2, 1973, she is charged with knowledge of the pendency of the Case thru the annotation
at the back of TCT.
Court held that no jurisdiction was acquired over the persons of Dizons, the action being
strictly in personam and summons by publication is insufficient; and that no valid attachment and
levy were made by the sheriff as no personal service of the copy of the notice to the occupant of
the property was made.
On appeal CA dismissed petitioner Obaña’s complaint on the grounds of lack of cause of

action and res judicata.
Issue:
(1) Whether or not the Court of First Instance of Bulacan acquire jurisdiction over the
defendants thru summons by publication.
(2) Whether or not there was a valid attachment of the real property.
Ruling:
(1) No. In an action strictly in personam personal service of summons within the forum is
essential to the acquisition of jurisdiction over the person of the defendant who does not
voluntarily submit himself to the authority of the court. In other words, summons by
publication cannot—–consistently with the due process clause in the Bill of Rights—–
confer upon the court jurisdiction over said defendants
The creditor, however, in an action in personam can take the recourse to locate properties,
real or personal of the resident defendant-debtor with unknown address and causing said
properties to be attached under Rule 57 of Section 1(f) in which case the attachment
converts the action into a proceeding in rem or quasi-in-rem and the summons by
publication may then be deemed valid and effective.
In Venturanza v. Court of Appeals (156 SCRA 305, 312 [1987]), this Court ruled: “There
is no question that the case at bar which is an action for collection of a sum of money is an
action in personam thereby requiring personal service of summons on the defendants.”
(2) No. It should be noted that Section 7 of Rule 57 requires that in attaching real property a
copy of the order, description, and notice must be served on the occupant. The trial court
in the annulment case ruled that the attachment was void from the beginning. The action in
personam which required personal service was never converted into an action in rem where
service by publication would have been valid.
32
The propriety of service of summons by publication is not dependent upon the technical
characterization of the action as one in rem or quasi in rem but upon compliance with the
requirements for the situations found in Sections 16, 17, and 18 of Rule 14 of the Rules of
Court. We declared the service of summons by publication as “legally and constitutionally
vitiated.” In the present case, however, the action was one in personam. The service was
equally void and of no effect.
The Court of Appeals ignored the fact that property already sold to Obana was attached
and then bidded out to Atty. Suntay without any notice to her. And because the notice of
lis pendens in the collection case was secured ex-parte without the defendant Dizon and
petitioner Obaña, who were never brought to court, having any inkling about it, the notice
was not annotated on the owner’s duplicate copy of Transfer Certificate of Title No.
173792.
Respondent Suntay cannot claim ignorance of the sale to petitioner Obaña as a ground for
not bringing her into the picture. As stressed by the petitioner, Liberty Dizon filed her
motion for the approval of the sale of the disputed house and lot in the guardianship case
through her counsel, herein private respondent Suntay. He could not have been unaware
that the house and lot he was attaching had been sold to Obaña because the sale of the
Dalmar property was authorized by the guardianship court in the case where he was counsel
for the guardian.
Considering all the foregoing circumstances, the order in LRC 750 which is based on
irregular proceedings in the prior case and which directed the cancellation of Obaña’s
transfer certificate of title cannot assume finality. The respondent court committed
reversible error in using it as a basis for res judicata. There is the added factor that a land
registration court in a cancellation of title case could not possibly inquire into the
controversial matters raised in the annulment of judgment case.
And finally, in our capacity as a court of equity in addition to being a court of law, we
cannot close our eyes to the rank injustice whereby the owner of a million peso house and
lot is compelled to give up her property to answer for a P10,000.00 attorney’s fee incurred
by its former owner and which the lawyer cannot apparently collect from his own client.
30.) Du vs. Stronghold Insurance

G.R. No. 156580; June 14, 2004
Facts:
Aurora Olarte de Leon was the registered owner of Lot No. 10-A (LRC Psd 336366) per
Transfer Certificate of Title No. 582/T-3. Sometime in January 1989, De Leon sold the property
to Luz Du under a ‘Conditional Deed of Sale’ wherein said vendee paid a down payment of
₱75,000.00 leaving a balance of ₱95,000.00.
"Then again, on April 28, 1989, Aurora de Leon sold [the] same property to spouses
Enrique and Rosita Caliwag without prior notice to Luz Du. As a result, Transfer Certificate of
Title No. 582/T-3 was cancelled and Transfer Certificate of Title No. 2200 was issued in favor of
the Caliwag spouses.
"Meanwhile, Stronghold Insurance Corp., Inc. commenced Civil Case No. 90-1848 against
spouses Rosita and Enrique Caliwag et al., for allegedly defrauding Stronghold and
misappropriating the company’s fund by falsifying and simulating purchases of documentary
stamps. The action was accompanied by a prayer for a writ of preliminary attachment duly
annotated at the back of Transfer Certificate of Title No. 2200 on August 7, 1990.
33
"On her part, on December 21, 1990, Luz Du initiated Civil Case No. 60319 against Aurora
de Leon and the spouses Caliwag for the annulment of the sale by De Leon in favor of the
Caliwags, anchored on the earlier mentioned Deed of Conditional Sale.
"On January 3, 1991, Luz Du caused the annotation of a Notice Of Lis Pendens at the back
of Transfer Certificate of Title No. 2200.
"On February 11, 1991, the decision was handed down in Civil Case No. 90-1848 in favor
of Stronghold, ordering the spouses Caliwag jointly and severally to pay the plaintiff
₱8,691,681.60, among others. When the decision became final and executory, on March 12, 1991,
a notice of levy on execution was annotated on Transfer Certificate of Title No. 2200 and the
attached property was sold in a public auction.
On [August] 5, 1991,5 the certificate of sale and the final Deed of Sale in favor of
Stronghold were inscribed and annotated leading to the cancellation of Transfer Certificate of Title
No. 2200 and in lieu thereof, Transfer Certificate of Title No. 6444 was issued in the name of
Stronghold.
"It came to pass that on August 5, 1992, Luz Du too was able to secure a favorable judgment
in Civil Case No. 60319 and which became final and executory sometime in 1993, as well.
"Under the above historical backdrop, Luz Du commenced the present case (docketed as
Civil Case No. 64645) to cancel Transfer Certificate of Title No. 6444 in the name of Stronghold
with damages claiming priority rights over the property by virtue of her Notice Of Lis Pendens
under Entry No. 13305 and inscribed on January 3, 1991, and the final and executory decision in
Civil Case No. 60319 she filed against spouses Enrique and Rosita Caliwag. According to Luz Du,
despite her said notice of lis pendens annotated, Stronghold still proceeded with the execution of
the decision in Civil Case No. 90-1848 against the subject lot and ultimately the issuance of
Transfer Certificate of Title No. 6444 in its (Stronghold’s) name."
The trial court ruled that Stronghold had superior rights over the property because of the
prior registration of the latter’s notice of levy on attachment on Transfer Certificate of Title (TCT)
No. 2200.
For this reason, it found no basis to nullify TCT No. 6444, which was issued in the name
of respondent after the latter had purchased the property in a public auction.
The CA held that Stronghold’s notice of levy on attachment had been registered almost
five (5) months before petitioner’s notice of lis pendens. Hence, respondent enjoyed priority in
time. Such registration, the appellate court added, constituted constructive notice to petitioner and
all third persons from the time of Stronghold’s entry, as provided under the Land Registration Act
-- now the Property Registration Decree.
The CA also held that respondent was a purchaser in good faith. The necessary sequels of
execution and sale retroacted to the time when Stronghold registered its notice of levy on
attachment, at a time when there was nothing on TCT No. 2200 that would show any defect in the
title or any adverse claim over the property.
Petitioner submits that her unregistered right over the property by way of a prior
conditional sale in 1989 enjoys preference over the lien of Stronghold -- a lien that was created by
the registration of respondent’s levy on attachment in 1990. Maintaining that the ruling in
Capistrano v. PNB was improperly applied by the Court of Appeals, petitioner avers that unlike
the circumstances in that case, the property herein had been sold to her before the levy.
Issue:
Whether or not a Notice of Levy on Attachment on the property is a superior lien over the
unregistered right of a buyer of a property in possession pursuant to a Deed of Conditional Sale.
34
Ruling:
Yes. The preference given to a duly registered levy on attachment or execution over a prior
unregistered sale is well-settled in our jurisdiction.
As early as Gomez v. Levy Hermanos, this Court has held that an attachment that is duly
annotated on a certificate of title is superior to the right of a prior but unregistered buyer. In that
case, the Court explained as follows:
"x x x. The legal effect of the notation of said lien was to subject and subordinate the right
of the purchaser (Apolonia Gomez), to the lien. She acquired the ownership of the said parcels
only from the date of the recording of her title in the register, which took place on November 21,
1932, and the right of ownership which she inscribed was not an absolute but a limited right,
subject to a prior registered lien, by virtue of which Levy Hermanos, Inc. was entitled to the
execution of the judgment credit over the lands in question, a right which is preferred and superior
to that of the plaintiff (sec, 51, Act No. 496 and decisions cited above). x x x"
As the property in this case was covered by the torrens system, the registration of
Stronghold’s attachment was the operative act that gave validity to the transfer and created a lien
upon the land in favor of respondent.
31. Valdevieso vs. Damalerio

G.R. No. 133303; February 17, 2005
Facts:
Valdevieso bought from Spouses Uy a parcel of land consisting of 10,000 square meters,
more or less, located at General Santos City with TCT No. T-30586. The deed of sale was not
registered, nor was the title of the land transferred to Valdevieso. Later on, the said property was
immediately declared by Valdevieso for taxation purposes as Tax Declaration No. l6205 with the
City Assessor’s Office. Later on, Spouses Damalerio filed with the RTC of General Santos City a
complaint for a sum of money against spouses Uy with application for the issuance of a Writ of
Preliminary Attachment. The RTC issued a Writ of Preliminary Attachment by virtue of which the
property, then still in the name of Lorenzo Uy but which had already been sold to Valdevieso, was
levied. The levy was duly recorded in the Register of Deeds of General Santos City and annotated
upon TCT No. T-30586. Later on, TCT No. T-30586 in the name of Lorenzo Uy was cancelled
and, in lieu thereof, TCT No. T-74439 was issued in the name of Valdevieso. This new TCT carried
with it the attachment in favor of Spouses Damalerio. Valdevieso filed a third-party claim to
discharge or annul the attachmentlevied on the property covered by TCT No. T-74439 on the
ground that the said property belongs to him and no longer to Spouses Uy.
RTC ruled in favor of Valdevieso. Citing Manliguez v. Court of Appealsand Santos v.

Bayhon, it held that the levy of the property by virtue of attachment is lawful only when the levied
property indubitably belongs to the defendant. Applying the rulings in the cited cases, it opined
that although Lorenzo Uy remained the registered owner of the property attached, yet the fact was
that he was no longer the owner thereof as it was already sold earlier to petitioner, hence, the writ
of attachment was unlawful. CA reversed the resolution and declared that an attachment or levy of
execution, though posterior to the sale, but if registered before the sale is registered, takes
precedence over the sale. The writ of attachment in favor of the Spouses Damalerio, being recorded
ahead of the sale to Valdevieso, will therefore take precedence.
Issue:
Whether or not a registered writ of attachment on the land is a superior lien over that of an
earlier unregistered deed of sale.
Ruling:
Yes. The law applicable to the facts of this case is Section 51 of P.D. No. 1529. Said Section
provides: Sec. 51. Conveyance and other dealings by registered owner. - An owner of registered
35
land may convey, mortgage, lease, charge, or otherwise deal with the same in accordance with
existing laws. He may use such forms of deeds, mortgages, leases or other voluntary instruments
as are sufficient in law. But no deed, mortgage, lease, or other voluntary instrument, except a will
purporting to convey or affect registered land, shall take effect as a conveyance or bind the land,
but shall operate only as a contract between the parties and as evidence of authority to the Register
of Deeds to make registration.
The act of registration shall be the operative act to convey or affect the land insofar as third
persons are concerned, and in all cases under this Decree, the registration shall be made in the
office of the Register of Deeds for the province or city where the land lies.
It is to be noted that though the subject land was deeded to Valdevieso as early as 05
December 1995, it was not until 06 June 1996 that the conveyance was registered, and, during that
interregnum, the land was subjected to a levy on attachment.It should also be observed that, at the
time of the attachment of the property on 23 April 1996, the spouses Uy were still the registered
owners of said property. Under the cited law, the execution of the deed of sale in favor of
Valdevieso was not enough as a succeeding step had to be taken, which was the registration of the
sale from the spouses Uy to him. Insofar as third persons are concerned, what validly transfers or
conveys a person’s interest in real property is the registration of the deed. Thus, when Valdevieso
bought the property on 05 December 1995, it was, at that point, no more than a private transaction
between him and the spouses Uy. It needed to be registered before it could bind third parties,
including Spouses Damalerio. When the registration finally took place on 06 June 1996, it was
already too late because, by then, the levy in favor of Spouses Damalerio, pursuant to the
preliminary attachment ordered by the General Santos City RTC, had already been annotated on
the title.
The settled rule is that levy on attachment, duly registered, takes preference over a prior
unregistered sale. This result is a necessary consequence of the fact that the property involved was
duly covered by the Torrens system which works under the fundamental principle that registration
is the operative act which gives validity to the transfer or creates a lien upon the land. The
preference created by the levy on attachment is not diminished even by the subsequent registration
of the prior sale. This is so because an attachment is a proceeding in rem. It is against the particular
property, enforceable against the whole world. The attaching creditor acquires a specific lien on
the attached property which nothing can subsequently destroy except the very dissolution of the
attachment or levy itself. Such a proceeding, in effect, means that the property attached is an
indebted thing and a virtual condemnation of it to pay the owner’s debt. The lien continues until
the debt is paid, or sale is had under execution issued on the judgment, or until the judgment is
satisfied, or the attachment discharged or vacated in some manner provided by law.
32. Walker vs. Mcmicking

GR No.L-5534; December 23, 1909
Facts:
On June 30, 1908, the plaintiff, Walker, was the owner of a Filipino carriage factory. The
building in which the factory was operated and its contents were sold to a partnership known as
"Arenas & Co.," by Walker, whose ownership, at the time of the sale. The contract was evidenced
by a writing from which it appears that the said company was to pay for the said factory and its
contents the sum of P3,200, P600 of which was paid at the time of the sale (June 30, 1908) and the
balance was to be paid in three installments, due, respectively, P600 on the 15th of July, 1908,
P1,000 due on the 15th of September, 1908, and P1,000 due on the 31st of December, 1908. The
said company paid the installment due on the 15th of July, 1908, but failed to pay said installments
due in September and December.
Walker, early in the month of January, 1909, by virtue of the said provision of the contract,
rescinded said sale and took possession of said factory with its contents. The plaintiff Rohde, acting
36
for himself and for the plaintiff Walker, took possession of said factory and its contents, on or
about the first of January, 1909.
It appears, however, that on or about the 16th of December, 1908, the defendant-appellant
McMicking, acting as sheriff of the city of Manila, levied an attachment upon the said factory and
its contents, by virtue of a judgment theretofore rendered against the said Arenas & Co. The record
does not disclose fully just what was done in effecting said attachment. It appears, however, by an
indorsement upon said alleged writ of attachment, or perhaps by a stipulation between the parties
(to the attachment), that the goods attached "shall remain in the possession of the same defendants,
relieving the sheriff of all responsibility as regards the care and custody thereof."
The lower court, basing his conclusions upon the provisions of section 428 of the Code of
Procedure in Civil Actions, held that the attachment was null for the reason that the defendant did
not comply with said section. Section 428 provides that: “The order of attachment shall be served
by the officer of the court by attaching and safely keeping all the movable property of the defendant
in the Philippine Islands, or so much thereof as may be sufficient to satisfy the plaintiff's demands,
unless the defendants gives security by obligation to the plaintiff, with sufficient surety, to be
approved by the judge who granted the order of attachment, in an amount sufficient to satisfy such
demands besides costs, . . . . The property so attached shall be held to await final judgment in
execution, unless released as provided in this section or section four hundred and forty.”
Issue:
Whether or not the preliminary attachment issued on December 17, 1908 was null and void.
Ruling:
Yes. It will be noted, even admitting that the defendant is here sued as sheriff, and that his
responsibility in this action is as sheriff, that he did not comply with said section 428, in making
said attachment. He did not attach and safely keep the movable property attached. A verbal
declaration of seizure of service of a writ of attachment is not sufficient. There must be an actual
taking of possession and placing the attached property under the control of the officer or someone
representing him. (Hollister vs. Goodale, 8 Conn., 332, 21 Am. Dec., 674; Jones vs. Howard, 99
Ga., 451, 59 Am. St. Rep., 231.)
The SC believed that under said section 428 to constitute a valid levy of an attachment, the
officer levying it must take actual possession of the property attached as far as under the
circumstances is practicable. He must put himself in position to, and must assert and, in fact,
enforce a dominion over the property adverse to and exclusive of the attachment debtor, and such
property must be in substantial presence and possession. (Corniff vs. Cook, 95 Ga., 61, 51 Am. St.
Rep., 55, 61.) Of course, this does not mean that the attaching officer may not, under an
arrangement satisfactory to himself, put anyone in possession of the property for the purpose of
guarding it, but he can not in this way relieve himself from liability to the parties interested in said
attachment.
Thus, the defendant attached certain property under a writ of execution issued by one of
the courts of the city of Manila, which attachment, however, was levied upon the property in
question. This attachment, however, was rendered invalid and of no effect for the reason that the
defendant did not maintain his control over the same, either personally or by his representatives.
The attachment became invalid the moment the sheriff lost either his actual or constructive control
over the property.
33. National Bureau Of Investigation vs. Tuliao

A.M. No. P-96-1184; March 24, 1997
Facts:
Santiago Salvador bought a passenger jeep from Lito Ignacio to be paid in monthly
installments. After remitting the down payment, Salvador diligently paid all monthly amortizations
37
until March 1994 when, in the absence of Ignacio, he was forced to pay to an unnamed brother of
the seller the amounts due for the months of April and May 1994. However, the brother failed to
remit said amount to the seller. Because of this, Ignacio filed a suit for collection against Salvador.
Subsequently, an order was issued by the RTC directing Sheriff Tuliao to attach the
passenger jeep. Salvador, through counsel, filed a motion to discharge attachment upon filing of a
counterbond for the release of the vehicle in his favor.
The court issued an order, directing Sheriff Tuliao to release to Salvador the attached vehicle.
However, Tulaio refused to comply with said order. Instead, he released the passenger jeep to
Ignacio after the latter had executed a receipt therefor together with an undertaking that he would
produce the jeep whenever required by the court. Tuliao justified such release by saying that the
court had no storage building that would protect the jeep from damage or loss.
A complaint against Deputy Provincial Sheriff Rodolfo Tuliao of RTC Cauayan, Isabela
was filed by Santiago Salvador.
Tuliao’s contention: His act of not taking into his official custody the attached property
was not unlawful but was in fact reasonable because the court had no facility for its storage. That
it could no longer be returned to Salvador's possession in accordance with the court's order was
not his fault but that of the attaching creditor who had violated his obligation to produce the same
whenever required by the court.
Issue:
Whether or not Tuliao is administratively liable for failing to release the property under
custodia legis to Salvador in accordance with the order of the RTC.
Ruling:
Tuliao’s manner of attachment irregular and his reason therefor totally unacceptable, under
Sec. 5 and Sec. 7(c) of Rule 57, “(c) Personal property capable of manual delivery, by taking and
safely keeping it in his capacity, after issuing the corresponding receipt therefor”.
Clearly, Tuliao’s act of leaving the passenger jeep in the possession and control of the
creditor did not satisfy the foregoing requirements of the Rules; neither did it conform to the plainly
worded RTC order. The note in the receipt that imposed on Ignacio the obligation to produce the
same whenever required by the court was no compliance either, because it did not establish that
the property was in respondent sheriff's substantial presence and possession. Tuliao fell short of
his obligation to take and safely keep the attached property "in his capacity." He cannot feign
ignorance of this duty.
Again, a verbal declaration of seizure or service of a writ of attachment is not sufficient.

There must be an actual taking of possession and placing of the attached property under the control
of the officer or someone representing him. To constitute a valid levy of an attachment, the officer
levying it must take actual possession of the property attached as far as . . . practicable (under the
circumstances). He must put himself in a position to, and must assert and, in fact, enforce a
dominion over the property adverse to and exclusive of the attachment debtor, and such property
must be in his substantial presence and possession.
That Ignacio was able to move the passenger jeep to an unknown location is further proof
that Tuliao had not taken and safely kept it in his substantial presence, possession and control. His
claim that the RTC did not have any storage facility to house said property is no justification. He
could have deposited it in a bonded warehouse.
Contrary to Tuliao’s contention, compelling the attaching creditor to release the property
in question was not in order, because the proper remedy provided by the Rules of Court was for
the party whose property had been attached to apply for the discharge of the attachment by filing
a counterbond. The effect of this remedy is the delivery of possession of the attached property to
38
the party giving the counterbond. The attaching creditor was not authorized to have possession of
the attached property, contrary to the insistence of respondent sheriff.
Leaving the attached property in the possession of the attaching creditor makes a farce of
the attachment. This is not compliance with the issuing court's order. When a writ is placed in the
hands of a sheriff, it is his duty, in the absence of any instructions to the contrary, to proceed with
reasonable celerity and promptness to execute it according to its mandate. He is supposed to
execute the order of the court strictly to the letter. If he fails to comply, he is liable to the person
in whose favor the process or writ runs.
Tuliao's pretense of having acted in utmost good faith for the preservation of the attached
property is hardly credible because there was no reason for his having acted thus. In sum, he is
unable to satisfactorily explain why he failed to take such movable in his control.
By acceding to the request of Ignacio, Tuliao actually extended an undue favor which
prejudiced Ignacio as well as the orderly administration of justice. He exceeded his powers which
were limited to the faithful execution of the court's orders and service of its processes. His
prerogatives did not give him any discretion to determine who among the parties was entitled to
possession of the attacked property.
That he exerted efforts in going to the creditor's residence in Tuguegarao, Cagayan to

obtain possession of the attached property was an act of compliance with the writ of attachment.
This action, belated as it was, did not mitigate his liability. Much less did it exculpate him from
penalty.
34. Villanueva-Fabella vs. Lee

A.M. No. MTJ-04-1518; January 15, 2004
Facts:
The complainants are counsels for the defendants in Civil Case No. [38]-28457 entitled
‘Star Paper Corporation vs. Society of St. Paul and Fr. Leonardo Eleazar’ for Sum of Money with
Prayer for Preliminary Attachment. They narrated that on 19 June 2002, their clients were served
a copy of the complaint and a Writ of Attachment by Sheriff Dela Cruz based on the plaintiff’s
allegation that the defendants contracted a debt in bad faith with no intention of paying the same.
On the aforementioned day, a printing machine was levied and delivered to the plaintiff’s
warehouse, although there was an offer by the defendants to pay right there and then P223,457.75,
the amount fixed in the order of attachment, but the plaintiff denied the defendants’ plea not to
attach the machine, saying that [it] had already set [its] mind on attaching the same.
"The complainants claim[ed] that Sheriff Dela Cruz violated x x x Rule 57, Section 7, 1997
Rules of Civil Procedure which provide[d] that in the attachment of personal property capable of
manual delivery, [the property should] be taken and safely kept in the sheriff’s custody. The
machinery, according to complainants, [was] brought to [the] plaintiff’s warehouse in San
Francisco del Monte, Quezon City.
"On 3 July 2002, Judge Lee granted the defendants’ Urgent Motion to Discharge
Attachment filed 19 June 2002. Thereafter, on 9 July 2002, an Urgent Ex-Parte Motion to
Withdraw Cash Deposit was filed, without notice to the defendants and despite failure of the
plaintiff to set such litigious motion for hearing and contrary to existing laws and jurisprudence.
"A Motion for reconsideration of the 17 July 2002 Order was filed on 30 August 2002.
Defendants stressed that the Motion to Withdraw Cash Deposit has no basis, shows no urgency,
lacks notice and hearing, and is already a prejudgment of the case even before the pre-trial stage
which is tantamount to the taking of property without due process of law.
39
"The plaintiff then filed a Verified Motion for Reconsideration of the Order declaring it as
non-suited[,] which was set for hearing in the morning of 24 October 2002, the same day the
aforementioned ex parte presentation of evidence was supposed to commence.
"According to complainants, the Clerk of Court could not explain the irregularity in the
granting of the plaintiff’s Motion for Reconsideration and the fact that the same was swiftly
resolved[,] while the defendants’ similar motion [had] not been resolved for more than two (2)
months already.
Respondent judge admitted that he had committed a procedural error when he released the
counter-bond to the plaintiff in the said civil case. However, when the defendants therein, through
their Motion for Reconsideration, called his attention to the mistake, he immediately ordered the
return of the counter-bond to the custody of the Office of the Clerk of Court.
Issue:
Whether or not the respondent Judge erred in its order granting Motion to Withdraw Cash
Deposit.
Ruling:
No. Attachment is a juridical institution intended to secure the outcome of a trial --
specifically, the satisfaction of a pecuniary obligation.
In the instant case, respondent judge had ordered the withdrawal of the cash deposit of the
defendant and released it in favor of the plaintiff, even before judgment was rendered. This action
was clearly in violation of the Rules mandating that after the discharge of an attachment, the money
deposited shall stand in place of the property released. However, the inadvertence of respondent
judge was not gross enough to merit sanction.
First, he rectified himself within the period given for deciding motions. Section 15(1) of
Article VIII of the Constitution mandates all trial courts to resolve all matters filed within three
months from date of submission.The Motion for Reconsideration of the July 17, 2002 Order
granting the withdrawal of the deposit was filed on August 30, 2002, and submitted for resolution
on September 5, 2002, the date of hearing.The Order granting this Motion was then issued on
November 4, 2002, well within the three-month period. The money was returned, and no prejudice
was suffered by any of the parties.
Second, respondent judge owned up to his mistake in his Comment. This is an admirable
act. Under the Code of Judicial Conduct, judges should be the embodiment of competence and
should so behave at all times as to promote public confidence in the integrity of the judiciary.
The Rules mandate that, except for motions that the court may act upon without prejudicing
the rights of the adverse party, every written motion shall be set for hearing by the applicant.The
notice of hearing shall be addressed to the defendants therein and shall specify the time and date
of the hearing, which must not be later than ten (10) days after the filing of the motion.
Indeed, the plaintiff’s Motion to withdraw the cash deposit lacked notice of hearing and
proof of service. Respondent judge should not have acted upon it. However, because he had
erroneously thought that the rights of the defendants would not be prejudiced thereby, he took
action.
Applying Section 8 of Rule 140 of the Rules of Court, respondent judge is found wanting
in the exercise of good discretion only. His errors of judgment fall short of gross ignorance of the
law or procedure, yet reflect poorly on his esteemed position as a public officer in a court of justice.
Applying the Uniform Rules on Administrative Cases in the Civil Service, we find
respondent sheriff guilty of simple neglect of duty for violating Section 7(b) of Rule 57 of the
Rules of Court. Simple neglect of duty is the "failure x x x to give proper attention to a task
40
expected" of an employee, thus signifying a "disregard of a duty resulting from carelessness or

indifference."
35. Sebastian vs. Valino

A.M. No. P-91-549; July 5, 1993
Facts:
On March 3, 1989, Private Development Corporation of the Philippines (PDCP) filed a
replevin suit against Marblecraft, Inc., in Civil Case No. 89-3368, in order to foreclose the chattels
mortgaged by Marblecraft. On March 30, 1989, the Regional Trial Court, Makati, issued a writ of
seizure directed against Marblecraft covering the chattels sought to be replevied. On November 9,
1990, at around 10:37 A.M., respondent, accompanied by several policemen and PDCP
employees, went to the office of Marblecraft at Barrio Santolan, Pasig, to implement the writ of
seizure. Respondent and his companions forcibly opened the lockers and desk drawers of the
employees of complainant and took their personal belongings, as well as some office equipment
issued to them. Respondent only showed to complainant's counsel a copy of the writ but did not
furnish him with a copy of the application for the writ, the supporting affidavit and the bond. In
the course of the implementation of the writ, which lasted for four days, several pieces of
machinery and equipment were destroyed or taken away by respondent. Respondent turned over
the seized articles to the counsel of PDCP and allowed these items to be stored in PDCP's
warehouse in Taguig, Metro Manila.
Issue:
Whether or not the implementation was proper .
Ruling:
No. Under the Revised Rules of Court, the property seized under a writ of replevin is not
to be delivered immediately to the plaintiff. The sheriff must retain it in his custody for five days
and shall return it to the defendant, If the latter, as in the case, requires its return and files a
counterbond (Sec. 4, Rule 60, Revised Rules of Court). In violation of said Rule, respondent
immediately turned over the seized articles to PDCP. His claim that the Office of the Regional
Sheriff did not have a place to store the seized items, cannot justify his violation of the Rule. As
aptly noted by the Investigating Judge, the articles could have been deposited in a bonded
warehouse. Respondent must serve on Marblecraft not only a copy of the order of seizure but also
a copy of the application, affidavit and bond (Sec. 4, Rule 60, Revised Rules of Court). Respondent
did not furnish defendant with a copy of the application, affidavit and bond. By his own admission,
he only served it with a copy of the order of seizure.
36. Villareal vs. Rarama

A.M. No. P-94-1108; August 23, 1995
Facts:
It appears that an action for collection of a sum of money was filed by the Cooperative
Rural Bank of Davao City against the spouses Marianette (herein complainant) and Roy Villareal,
Lito Lacorda and Felimon Cangrejo before the MTCC. The records show that summons was served
upon respondent Cangrejo who, however, failed to file his answer, as a consequence of which he
was declared in default. On April 19, 1989, judgment 6 was rendered against him in favor of the
plaintiff bank without prejudice to his right to proceed against his co- debtors. On March 29, 1994,
an alias writ of execution 7 was issued by the trial court against Cangrejo.
According to complainant, at around 1:30 P.M. of April 25, 1994, respondent Rarama
arrived at her house in Digos, Davao del Sur, together with the other respondents and three
employees of the Cooperative Rural Bank of Davao City, Inc., including one Vic Belo who is a
collector of the bank. Respondent Rarama introduced himself as a sheriff of Davao City and
informed her that they were going to attach her properties because she lost in a case. Complainant
41
denied having been charged in court, much more of having lost in a case, and that she did not owe
anything to the bank. When respondent Rarama persisted in getting her properties, she demanded
and was shown the writ of execution. She objected thereto, claiming that the same was not
addressed to her but to Felimon Cangrejo and that the writ was being served after more than five
years from the date the decision was rendered. The reply given her was that she is the principal
borrower and the only one who is solvent.
Issue:
Can you levy on a property that does not belong to the defendant? Can the sheriff exercise
discretion in the levy of the properties?
Held:
No. While there is evidence to show that indeed complainant Marianette Villareal is the
principal debtor while Felimon Cangrejo is merely a co-maker, the fact remains that Cangrejo was
the sole debtor adjuged liable for the loan obtained from the Cooperative Rural Bank of Davao
City, Inc. and the alias writ of execution was directed only against him. Hence, respondent Rarama
had no authority to implement the same against herein complainant considering that, although she
was named as a defendant in the collection case, there was no judgment against her as of the date
of the incident.
A sheriff has no authority to levy on execution upon the property of any person other than
that of the judgment debtor. If he does so, the writ of execution affords him no justification, for
such act is not in obedience to the mandate of the writ. As long as the sheriff confines his acts to
the authority of the process, he is not liable, but all of his acts which are not justified by the writ
are without authority of law. This is so because if an execution against one man would excuse the
sheriff for taking the property of another, every citizen would be at his mercy and none could call
his estate his own.
37. Balantes vs Ocampo

A.M No. MTJ-93-853; March 14, 1995
Facts:
This case disposes of two related complaints of Domingo Balantes against respondent
Judge Julian Ocampo III and Clerk of Court Lilia S. Buena. Complainant Domingo Balantes is the
defendant in an ejectment case (Civil Case No. 8339) filed by plaintiff Roberto Roco and decided
by respondent judge Ocampo.
Respondent Judge issued a Writ of Execution and Demolition pending an appeal on

October 23, 1989, orderding the removal of one-half (1/2) portion of complainant's residential
house found to be built inside the titled property of the plaintiff. Another Writ was issued by
respondent judge on November 25, 1991 ordering the demolition of the remaining half portion of
complainant’s residential house. A motion for reconsideration was then filed by complainant but
was denied by the court.
It further appears that on August 19, 1992, a second writ of demolition was issued by the
respondent Judge, followed by a third one dated February 3, 1993.
Complainant alleges that respondent judge issued the orders granting the issuance of writ
of demolition with precipitate haste, hence he was deprived of his right to oppose the same.
Respondent Judge argues that a writ of demolition, being merely incidental to the execution
of a final judgment, is immediately enforceable after hearing the arguments of both parties.
Respondent Judge further argues that the restraining order issued on September 2, 1992 cannot be
complied with because by the time it was received by the City Sheriff, the writ of demolition had
already been effected and the premises delivered to the plaintiff.
42
With respect to the complaint filed against respondent Clerk of Court, complainant alleges
that she immediately proceeded to implement the writs of demolition without giving him a chance
to move for a reconsideration of the order granting issuance thereof.
Issue:
Whether or not the Clerk of Court and Ex-Officio Sheriff Lilia S. Buena be he held liable
for the execution of the subject Writ of Demolition.
Ruling:
No. The rule is that when a writ is placed in the hands of a sheriff, it is his duty, in the
absence of instructions, to proceed with reasonable celerity and promptness to execute it according
to its mandate.
As regards the charge against respondent Clerk of Court and Ex-Officio Sheriff Lilia S.
Buena, the same is dismissed, it appearing from the certification she issued that the Temporary
Restraining Order issued by the RTC, Branch 27, Naga City was received by her on September 2,
1992 at 2:15 p.m., after the demolition had been completely effected and the premises delivered
to the plaintiff at 1:30 p.m. of same date. It appears that respondent Buena was not aware of the
existing TRO which she received within the hour after the demolition had taken place, thus
rendering said restraining order a fait accompli. The rule is that when a writ is placed in the hands
of a sheriff, it is his duty, in the absence of instructions, to proceed with reasonable celerity and
promptness to execute it according to its mandate. He may not apply his discretion as to whether
to execute it or not.
38. Elipe vs. Fabre

A.M. No. P-94-1068, February 13, 1995
Facts:
An administrative complaint was filed against respondent Honesto Fabre for nonfeasance
and incompetence in the performance of his duties as Deputy Sheriff of MTCC at Cagayan de Oro
City. Accordingly, the MTCC issued a writ of execution for the enforcement of a barangay
agreement for collection of unpaid rentals and construction material amounting to P 100, 000.00.
Complainant testified that when respondent served the writ to judgment debtors, he was able to
levy only upon a dilapidated vehicle and an old piano and that the debtors was able to
surreptitiously removed several furniture and appliances from the rented house. Respondent did
not prevent the debtors from removing leviable properties.
Issue:
Whether or not the sheriff liable for his inaction and lack of diligence in enforcing the writ
of execution.
Ruling:
Yes. A sheriff, to whom a valid writ or process is delivered to be levied upon a property
within his jurisdiction, is liable to the person in whose favor the process or writ runs if he fails to
make a levy upon property owned by the judgment debtor within his jurisdiction and by reason
thereof the judgment creditor is injured. It is omission not dependent upon intentional wrong or
negligent omission to seize property of judgment debtor
39. Roque v. CA
G.R. No. L-42594; October 18, 1979
Facts:
Respondent Associated Banking Corporation instituted an action against private
respondent Fil-Eastern Wood Industries, Inc., a domestic corporation for recovery of a sum of
money. Upon the application by the Bank for a Writ of Preliminary Attachment and the filing and
43
approval of the required bond of P220,000.00, respondent Judge, issued an Order of Attachment
commanding the Sheriff to attach the estate of Fil-Eastern.
The Sheriff's "Notice of Levy Pursuant to the Writ of Attachment" was registered in the
Office of the Commander of the First Coast Guard pursuant to Sec. 805 of the Tariff and Customs
Code, as amended by Presidential Decree No. 34, requiring the registration of documents affecting
titles of vessels with that entity.
It appears that prior to the issuance of said Writ of Attachment, Fil-Eastern had delivered
the barge to the Cotabato Visayan Development Corporation for repair. However, Fil-Eastern
failed to pay the cost of repairs. A public auction was conducted wherein, petitioner Eligio Roque
acquired the barge and was issued a Certificate of Sale by the Notary Public.
On the same date, the Cotabato Visayan Development Corporation issued an Affidavit of
Release of mechanic's lien against Fil-Eastern. The Certificate of Sale was received in the office
of the Philippine Coast Guard on May 3, 1974. It was not until December 24, 1974, however, that
Certificate of Ownership was issued to Roque by the Philippine Coast Guard.
These monuments of title were issued only after counsel for Eligio Roque had assured the
Philippine Coast Guard, that "without touching on the merit of the preference of our client's claim
in relation to the levy registered by other claimants, such levy is not in any manner a legal obstacle
to the registration of the vessels in our client's name." Acting thereon, the Acting Commandant of
the Philippine Coast Guard authorized the issuance of a new certificate of registration. However,
neither the Certificate of Ownership nor the Certificate of Philippine Register carries that
annotation.
On August 29, 1974, the Bank filed a "Motion for the Issuance of another Writ of
Attachment" stating that at the time of the issuance of the Writ on February 4, 1974, the barge in
question could not be located within the jurisdiction of the trial Court. And that actual levy on the
barge could not be made as "the original Order of attachment is allegedly in the possession of the
Branch Deputy Sheriff appointed by the Honorable Court, who has not reported to the office since
August 26, 1974."
On the same date, the trial Court Judge Rafael S. Sison denied the issuance of another Writ
because it was deemed unnecessary but instead ordered the Deputy Sheriff of Branch XXVIII to
coordinate with the City Sheriff of Manila in the implementation of the Writ previously issued.
Meanwhile, without prior authority from Deputy Sheriff Garvida the barge in question was
"spirited away" to Bacolod City by a certain Captain Marcelino Agito, who claimed to have been
given the right to use the same by Fil-Eastern.
On January 6, 1975, respondent Judge issued an Order requiring Capt. Marcelino Agito, in
coordination with Deputy Sheriff Benjamin E. Garvida to bring back to Manila the barge in
question.
On April 7, 1975, Capt. Marcelino Aguito and Deputy Sheriff Benjamin Garvida filed a
Manifestation stating that petitioner Rodrigo Malonjao, acting for and in behalf of his co-petitioner
Eligio Roque, refused to-surrender the barge on the ground that Eligio Roque is now the new
owner, having acquired the same by purchase at public auction.
On April 14, 1975, respondent Judge issued an order declaring Rodrigo Malonjao and
Eulogio Roque, in contempt of Court to forthwith surrender possession of the said. Petitioners filed
a Motion seeking to set aside the Order of April 14, 1975, claiming that Roque is now the new
owner of the barge. Which was denied by respondent Judge on the ground that the records belied
petitioners' claim that the auction sale occurred very much ahead of the notice of levy.
44
On August 28, 1975, petitioners sought relief from the Court of Appeals by filing a
"Petition for certiorari and Prohibition with Preliminary Injunction and Preliminary
Mandatory Injunction" asking to vacate the Orders by respondent Judge. The Court of
Appeals, denied the Petition in its Decision. Ruled that certiorari did not lie as petitioner
was not without sufficient and adequate remedy to obtain relief from the damaging effects
of the Orders complained of.
Issues:
(1) Whether the levy and/or attachment by the sheriff of the barge in question are illegal?
(2) Whether petitioner can avail of Section 14, Rule 57 and/or Section 17, Rule 39 of the
Revised Rules of Court?
Rulings:
(1) No, petitioners further argue that the levy was illegal because the Writ was
implemented more than sixty days after its issuance so that they need not have complied
with Section 14, Rule 57, supra. The Rules do not provide any lifetime for a Writ of
Attachment unlike a Writ of Execution. But even granting that a Writ of Attachment is
valid for only sixty days since there was constructive levy within that period the fact
that actual seizure was effected only thereafter cannot affect the validity of that levy.
Neither can it be said that respondent Judge committed grave abuse of discretion in
issuing the Order of April 14, 1975 whereby it commanded the immediate
implementation of the Order of execution of March 7, 1975 and ordered petitioners to
surrender possession of the barge to the Sheriff under pain of contempt. A trial Court
is enjoined by law to bring about a prompt dispatch of the controversy pending before
it. Its Decision of October 9, 1974 had become final and executory, and execution then
became purely a ministerial phase of adjudication.
Petitioners’ remedy was to ventilate their claims of ownership in a separate and

independent reivindicatory action. ". . . a third person claiming to be the owner of the
property attached or levied upon is required to file a separate or independent action to
determine whether the property should answer for the claim of the attaching or
judgment creditor instead of being allowed to raise that issue in the case where the writ
of attachment or execution was issued (Sec. 17, Rule 39 and sec. 14, Rule 57, Rules of
Court; Bayer Philippines, Inc. v. Agana, L-38701, April 8, 1975, 63 SCRA 355).
(2) Yes, upon the issuance of the Order, dated August 29, 1974, commanding the
implementation of the Writ of Attachment, petitioners could have availed themselves
of the remedy provided for in Section 14, Rule 57 of the Rules of Court, which reads:
If the property taken be claimed by any person other than the party against whom
attachment had been issued or his agent, and such person makes an affidavit of his title
thereto or right to the possession thereof, stating the grounds of such right or title, and
serves such affidavit upon the officer while the latter has possession of the property,
and a copy thereof upon the attaching creditor, the officer shall not be bound to keep
the property under attachment, unless the attaching creditor or his agent, on demand
of the said officer, secures him against such claim by a bond in a sum not greater than
the value of the property attached. ...
For another, when respondent Sheriff seized the vessel in question to be sold at public
auction in accordance with the Order of execution of March 7, 1975, petitioner could
have availed of the remedy under Section 17, Rule 39 of the Rules of Court which
provides: If the property levied on be claimed by any other person than the Judgment
debtor or his agent, and such person make an affidavit of his title thereto or right to the
possession thereof, stating the grounds of such right or title, and serve the same upon
the officer making the levy, and a copy thereof upon the judgment creditor, the officer
shall not be bound to keep the property, unless such judgment creditor or his agent, on
45
demand of the officer, indemnify the officer against such claim by a bond in a sum not
greater than the value of the property levied on.
Petitioner Eligio Roque argues, however, that he could not avail of the foregoing Rules
inasmuch as the vessel was not in the actual custody of the Sheriff nor of the Court,
since the supposed levy by the Sheriff on February 7, 1974 was a mere paper levy
which, in legal contemplation, is no levy at all. As a general rule, however, a levy of
an attachment upon personal property may be either actual or constructive. In this case,
levy had been constructively made by the registration of the same with the Philippine
Coast Guard on February 7, 1974. Constructive possession should be held sufficient
where actual possession is not feasible, particularly when it was followed up by the
actual seizure of the property as soon as that could possibly be effected.
40. Summit Trading vs. Avendano

Gr No. L-60038; March 18, 1985
Facts:
This case is about the summons intended for defendant Summit Trading and Development
Corporation. As background, it should be stated that Segundo Pilipinia and Edgardo Mindo
acquired under Land Authority Administrative Order No. 4 two registered lots located at Barrio
San Vicente, San Pedro, Laguna.
The titles of the lots contain the annotation that should Pilipinia and Mindo sell the same,
they have the right to redeem the lots within five years from the date of the sale. They sold the lots
for P16,000 and P12,000 to Gavino Ortega but have retained possession of the lots which are
ricelands. They became tenants thereof.
At the instance of Ortega, the said annotation was cancelled by Judge Avendaño because
the lots would be converted into commercial, industrial or residential sites. That conversion has
not taken place. At present the two lots are still ricelands.
In a letter, Ortega advised Ernesto Pilipinia (attorney-in-fact of Segundo and Mindo) that
he and his father would have the right of first refusal in case the lots were sold. He then resold the
two lots to Summit Trading through its president, Virgilio P. Balaguer.
Pilipinia and Mindo filed a complaint against Ortega and Summit Trading for the
redemption or repurchase of the two lots. Ortega was duly summoned but was declared in default.
Summit Trading was also declared in default. In his judgment by default, Judge Avendano gave
plaintiffs Pilipinia and Mindo 15 days from notice within which to redeem the lots and ordered
Summit Trading to execute the corresponding deeds of sale and surrender the Torrens titles.
The default judgment was rendered on the assumption that Summit Trading was duly
summoned through Marina Saquilayan as secretary of Summit Trading. She received the summons
on August 28, 1981. Actually, Saquilayan received the summons as secretary of Balaguer, already
mentioned as the president of Summit Trading which purchased the lots from Ortega.
Nineteen days after Saquilayan received a copy of the decision, Summit Trading filed a
motion for reconsideration on the ground that the trial court did not acquire jurisdiction over it
because summons was not served upon it in accordance with Rule 14 of the Rules of Court which
provides: SEC. 13. Service upon private domestic corporation or partnership.-If the defendant is a
corporation organized under the laws of the Philippines or a partnership duly registered, service
may be made on the president, manager, secretary, cashier, agent, or any of its directors.
Issue:
Whether or not the service to the secretary is binding and valid
46
Ruling:
Yes. It is true that Saquilayan is not among the persons mentioned in section 13. However,
she, being under the control of Summit Trading, has not explained what she has done with the
summons and complaint. The logical assumption is that she delivered it to her boss, the president
of Summit Trading. As already stated, she received a copy of the decision and Summit Trading
became aware of it. Summit Trading's motion for reconsideration was denied.
While Summit Trading is technically correct in contending that there was no strict
compliance with section 13, we cannot close our eyes to the realities of the situation. Under the
facts of this case, Saquilayan, being the secretary of the president (whose contact with the outside
world is normally through his secretary), may be regarded as an "agent" within the meaning of
section 13.
Hence summons was validly served upon Summit Trading. Its negligence in not answering
the complaint was inexcusable. In fact, up to this time, Summit Trading has not bothered to state
its defenses to the action nor stated whether it has a meritorious case warranting the setting aside
of the default judgment.
In the instant case, service was made on the president's secretary who could have easily
notified the president that an action was filed against the corporation just as she had apprised him
of the judgment in this case.
The instant petition for certiorari, treated as an appeal under Republic Act No. 5440, was
filed out of time. Considered as a special civil action under Rule 65 of the Rules of Court, it is
baseless because the trial court had acquired jurisdiction over Summit Trading. As already shown,
summons was properly served on the president's secretary.
We are not saying that service on such a secretary is always proper. Generally, it is
improper. The president himself must be served personally with the summons if it is desired to
effect the service on that particular officer. But, as already stated, under the facts of this case, the
president's secretary may be regarded as the "agent" within the meaning of section 13 since service
upon her of the judgment itself came to the notice of Summit Trading.
41. Chemphil Export & Import Corporation vs. CA

G.R. Nos. 112438-39; December 12, 1995
Facts:
Dynetics, Inc. and Antonio M. Garcia filed a complaint for declaratory relief and/or
injunction against the PISO, BPI, LBP, PCIB and RCBC or the consortium with the Regional Trial
Court seeking judicial declaration, construction and interpretation of the validity of the surety
agreement that Dynetics and Garcia had entered into with the consortium and to perpetually enjoin
the latter from claiming, collecting and enforcing any purported obligations which Dynetics and
Garcia might have undertaken in said agreement.
The consortium filed their respective answers with counterclaims alleging that the surety
agreement in question was valid and binding and that Dynetics and Garcia were liable under the
terms of the said agreement.
A notice of garnishment covering Garcia's shares in CIP/Chemphil (including the disputed

shares) was served on Chemphil through its then President. The notice of garnishment was duly
annotated in the stock and transfer books of Chemphil on the same date.
The trial court denied the application of Dynetics and Garcia for preliminary injunction
and instead granted the consortium's prayer for a consolidated writ of preliminary attachment.
Hence, after the consortium had filed the required bond, a writ of attachment was issued and
47
various real and personal properties of Dynetics and Garcia were garnished, including the disputed
shares. This garnishment, however, was not annotated in Chemphil's stock and transfer book.
The Court holds that the CONSORTIUM has admitted that the writ of
attachment/garnishment issued on the shares of stock belonging to plaintiff Antonio M. Garcia
was not annotated and registered in the stock and transfer books of CHEMPHIL. On the other
hand, the prior attachment issued in favor of SBTC against the same CHEMPHIL shares of
Antonio M. Garcia, was duly registered and annotated in the stock and transfer books of
CHEMPHIL.
Issue:
Whether or not the attachment of shares of stock, in order to bind third persons, must be
recorded in the stock and transfer book of the corporation.
Ruling:
The Court of Appeals agreed with the consortium's position that the attachment of shares
of stock in a corporation need not be recorded in the corporation's stock and transfer book in order
to bind third persons.Section 7(d), Rule 57 of the Rules of Court was complied with by the
consortium (through the Sheriff of the trial court) when the notice of garnishment over the
Chemphil shares of Garcia was served on the president of Chemphil. Indeed, to bind third persons,
no law requires that an attachment of shares of stock be recorded in the stock and transfer book of
a corporation.
Therefore, ruled the Court of Appeals, the attachment made over the Chemphil shares in
the name of Garcia was made in accordance with law and the lien created thereby remained valid
and subsisting at the time Garcia sold those shares to FCI (predecessor-in-interest of appellee
CEIC) in 1988.
A secretary's major function is to assist his or her superior. He/she is in effect an extension
of the latter. Obviously, as such, one of her duties is to receive letters and notices for and on behalf
of her superior, as in the case at bench. The notice of garnishment was addressed to and was
actually received by Chemphil's president through his secretary who formally received it for him.
Thus, in one case, we ruled that the secretary of the president may be considered an "agent" of the
corporation and held that service of summons on him is binding on the corporation.
Moreover, the service and receipt of the notice of garnishment was duly acknowledged and
confirmed by the corporate secretary of Chemphil, Rolando Navarro and his successor Avelino
Cruz through their respective certifications.We rule, therefore, that there was substantial
compliance with Sec. 7 (d), Rule 57 of the Rules of Court.
42) Gotauco vs. Registry of Deeds

GR No. L-39596; March 23, 1934
Facts:
A levy of execution against judgment debtor Rafael Vilar was presented to the Registry of
Deeds, but the latter denied the inscription of said levy of execution because the tile to the lands
was in the name of Florentino Vilar. The fact shows that Florentino Vilar was dead and Rafael
Vilar is one of the heirs.
Issue:
Whether or not the property named under the deceased Florentino Vilar can be a subject of
attachment in favor of the judgment creditor of Rafael Vilar.
Ruling:
Yes. The Supreme Court (SC) held that pending liquidation of the estate of Florentino
Vilar, his heir has already a right of participation and interest over the property left by the deceased.
48
The judgment debtor holds such beneficial interest in the property that he can sell and dispose it
but only as to his share.
Since the judgment debtor has this right of conveyance, the judgment creditor may also run
against these properties to which the judgment debtor acquires beneficial interest. Thus, the
Registry of Deeds should not deny the inscription of levy of execution presented against Rafael
Vilar.
43. Engineering vs. NPC

GR. No. L-34589; June 29, 1988
Facts:
On August 29, 1968, ECI filed a complaint for damages against the NPC alleging that it
suffered damages to its facilities and equipment due to the inundation of its campsite in Bulacan,
due to the improper and careless opening by NPC of the spillway gates of Angat Dam at the height
of typhoon "Welming" on November 4,1967.
Court found NPC guilty of gross negligence ordering them to pay plaintiff actual or
compensatory damages, consequential damages, exemplary damages; and for attorney's fees ...
NPC filed a notice of appeal but before it could perfect its appeal, ECI moved for and was granted
execution pending appeal upon posting a covering bond of P200,000 which it later increased to
P1,109,000 to fully answer for whatever damages NPC might incur by reason of the premature
execution of the lower court's decision.
Deputy Sheriff Restituto R. Quemada who was assigned to enforce the writ of execution,
garnished in favor of ECI all amounts due and payable to NPC which were then in possession of
MERALCO and sufficient to cover the judgment sum of P1,108,985.31. NPC filed with the
Appellate Court a petition for certiorari.
CA granted NPCs petition and nullified the execution pending appeal of the judgment
rendered by the trial court as well as all issued writs and processes in connection with the
execution. MERALCO sought from the Appellate Court a clarification and reconsideration on the
ground, that the decision was being used by NPC to compel MERALCO to return the amount of
P1,114,545.23 (inclusive of sheriff's fees) in two checks which it had already entrusted to the
deputy sheriff on who then indorsed and delivered the same to ECI. Whereupon, in its resolution
of January 7, 1972, the Appellate Court held the sheriff, MERALCO and ECI liable to restore to
NPC the amount due to NPC which MERALCO had earlier turned over to the sheriff for payment
to ECI. Their two motions for reconsideration having been denied, ECI and MERALCO filed
separate petitions for review .
Issue:
Were the petitioners, including the sheriff, bound to restore to NPC the judgment amount
which has been delivered to ECI in compliance with the writ of garnishment?
Ruling:
No. In line with our pronouncement that we are sanctioning in this particular instance the
execution pending appeal of actual but not consequential and exemplary damages and attorney's
fees which must necessarily depend on the final resolution of the main cases, i.e., Nos. L-47379
and 47481, the direct consequence would be to authorize NPC to proceed against the covering
bond filed by ECI but only to the extent of the difference between the amount finally adjudicated
by this Court in the main cases [P724,985.31] and the amount originally decreed by the trial court
relating to the consequential and exemplary damages and attorney's fees [P1,108.985.31]. In other
words, ECIs bond is held answerable to NPC for P384,000.
But while partial restitution is warranted in favor of NPC, we find that the Appellate Court
erred in not absolving MERALCO, the garnishee, from its obligations to NPC with respect to the
49
payment to ECI of P1,114,543.23, thus in effect subjecting MERALCO to double liability.

MERALCO should not have been faulted for its prompt obedience to a writ of garnishment. Unless
there are compelling reasons such as: a defect on the face of the writ or actual knowledge on the
part of the garnishee of lack of entitlement on the part of the garnisher, it is not incumbent upon
the garnishee to inquire or to judge for itself whether or not the order for the advance execution of
a judgment is valid.
Section 8, Rule 57 of the Rules of Court provides, Effect of attachment of debts and
credits.-All persons having in their possession or under their control any credits or other similar
personal property belonging to the party against whom attachment is issued, or owing any debts
to the same, at the time of service upon them of a copy of the order of attachment and notice as
provided in the last preceding section, shall be liable to the applicant for the amount of such credits,
debts or other property, until the attachment be discharged, or any judgment recovered by him be
satisfied, unless such property be delivered or transferred, or such debts be paid, to the clerk, sheriff
or other proper officer of the court issuing the attachment.
Garnishment is considered as a specie of attachment for reaching credits belonging to the

judgment debtor and owing to him from a stranger to the litigation. Under the above-cited rule, the
garnishee [the third person] is obliged to deliver the credits, etc. to the proper officer issuing the
writ and "the law exempts from liability the person having in his possession or under his control
any credits or other personal property be, longing to the defendant, ..., if such property be delivered
or transferred, ..., to the clerk, sheriff, or other officer of the court in which the action is pending."
Applying the foregoing to the case at bar, MERALCO, as garnishee, after having been judicially
compelled to pay the amount of the judgment represented by funds in its possession belonging to
the judgment debtor or NPC, should be released from all responsibilities over such amount after
delivery thereof to the sheriff. The reason for the rule is self-evident. To expose garnishees to risks
for obeying court orders and processes would only undermine the administration of justice.
44. RCBC v de Castro

G.R. No. L-34548; November 29, 1988
Facts:
Badoc Planters, Inc. filed an action for recovery of unpaid tobacco deliveries against
PVTA. Hon. Lourdes P. San Diego, then Presiding Judge, ordering the defendants therein to pay
jointly and severally, the plaintiff Badoc Planters, Inc. (hereinafter referred to as “BADOC”)
within 48 hours the aggregate amount of P206,916.76, with legal interests thereon.
Accordingly, the Branch Clerk of Court on the very same day, issued a Writ of Execution
addressed to Special Sheriff Faustino Rigor, who then issued a Notice of Garnishment addressed
to the General Manager and/or Cashier of Rizal Commercial Banking Corporation (hereinafter
referred to as RCBC), the petitioner in this case, requesting a reply within five (5) days to said
garnishment as to any property which the Philippine Virginia Tobacco Administration (hereinafter
referred to as "PVTA") might have in the possession or control of petitioner or of any debts owing
by the petitioner to said defendant. Upon receipt of such Notice, RCBC notified PVTA thereof to
enable the PVTA to take the necessary steps for the protection of its own interest. However,
Philippine Virginia Tobacco Administration filed a Motion for Reconsideration.
The Judge set aside the Orders of Execution and of Payment and the Writ of Execution and
ordering petitioner and BADOC “to restore, jointly and severally, the account of PVTA with the
said bank in the same condition and state it was before.
Issues:
Whether or not PVTA funds are public funds not subject to garnishment.
50
Rulings:
Yes. PVTA funds are subject to garnishment. Republic Act No. 2265 created the PVTA as
an ordinary corporation with all the attributes of a corporate entity subject to the provisions of the
Corporation Law. Hence, it possesses the power “to sue and be sued” and “to acquire and hold
such assets and incur such liabilities resulting directly from operations authorized by the provisions
of this Act or as essential to the proper conduct of such operations.”
Among the specific powers vested in the PVTA are:
a. to buy Virginia tobacco grown in the Philippines for resale to local bona fide
tobacco manufacturers and leaf tobacco dealers [Section 4(b), R.A. No. 2265];
b. to contracts of any kind as may be necessary or incidental to the attainment of its

purpose with any person, firm or corporation, with the Government of the
Philippines or with any foreign government, subject to existing laws [Section 4(h),
R.A. No. 22651; and
c. generally, to exercise all the powers of a corporation under the Corporation Law,
insofar as they are not inconsistent with the provisions of this Act [Section 4(k),
R.A. No. 2265.]
From the foregoing, it is clear that PVTA has been endowed with a personality distinct and
separate from the government which owns and controls it. Accordingly, this Court has heretofore
declared that the funds of the PVTA can be garnished since “funds of public corporation which
can sue and be sued were not exempt from garnishment.
Inasmuch as the Tobacco Fund, a special fund, was by law, earmarked specifically to
answer obligations incurred by PVTA in connection with its proprietary and commercial
operations authorized under the law, it follows that said funds may be proceeded against by
ordinary judicial processes such as execution and garnishment.
Garnishment is considered as a specie of attachment for reaching credits belonging to the

judgment debtor and owing to him from a stranger to the litigation. Under the above-cited rule, the
garnishee [the third person] is obliged to deliver the credits, etc. to the proper officer issuing the
writ and “the law exempts from liability the person having in his possession or under his control
any credits or other personal property belonging to the defendant, …, if such property be delivered
or transferred, …, to the clerk, sheriff, or other officer of the court in which the action is pending.
45. Spouses Abinujar vs. CA

G.R. No. 104133 April 18, 1995
Facts:
Spouses Lana executed a Deed of Sale with Right to Repurchase in favor of Spouses
Ramiro, involving a residential house located at Manila. Due to serious financial and business
reverses, Spouses Lana were not able to redeem the property within four months as agreed upon.
Spouses Ramiro filed a complaint for ejectment in the MTC of Manila against Spouses Lana. The
parties, assisted by their counsels, executed a compromise agreement, which was approved by the
MTC, contained an agreement that Spouses Lana shall pay Spouses Ramiro with P50,000.00 on
Jan. 31, 1990 and P10,000.00 per month thereafter Starting February 28 to September 30, 1990
and that if Spouses Lana shall fail to pay 3 consecutive payments, Spouses Ramiro will be entitled
to a writ of execution, unless the parties agree to extend the period of entitlement to a writ of
execution in writing to be submitted and/or approved by the Court.
On April 15, 1990, Spouses Ramiro filed a motion for execution on the ground that
petitioners failed to pay the first three installments stipulated in the compromise agreement.
Spouses Lana filed an "Urgent Ex-Parte Motion for Reconsideration and/or Correct Order of this
51
Court" calling attention to a typographical error in the Order and asking that the amount of
P10.000.00 payable on September 30, 1990 be corrected and changed to the agreed amount of
P50,000. Spouses Ramiro opposed the Ex-Parte Motion and stated that they would not renew the
compromise agreement with Lana. The MTC issued an order directing the issuance of a writ of
execution to enforce the compromise agreement entered into by the parties. A "Sheriffs' Notice to
Voluntarily Vacate the Premises" was served on Spouses Lana.
Issue:
Whether or not the issuance of notice to voluntarily vacate the premises by way of
enforcing the decision approving the compromise agreement is valid.
Ruling:
No. A compromise agreement is a contract between the parties, which if not contrary to
law, morals or public policy, is valid and enforceable between them. There are two kinds of
compromise agreements, the judicial, which puts an end to a pending litigation, and the
extrajudicial, which is to avoid a litigation. As a contract, a compromise agreement is perfected by
mutual consent. A judicial compromise, however, while binding between the parties upon its
execution, is not executory until it is approved by the court and reduced to a judgment. Inasmuch
as a judicial compromise becomes binding between the parties upon its execution, Spouses Lana
should have paid the installments falling due even before the approval thereof by the trial court.
But assuming that a judicial compromise is not perfected until it is approved by the court, still
Spouses Lana should have paid the compromise agreement installments due on March 31, 1990,
together with the installments due on January 31 and February 28, 1990 on or before March 31,
1990.
When the parties entered into a compromise agreement, the original action for ejectment
was set aside and the action was changed to a monetary obligation. As Spouses Lana’s obligation
under the compromise agreement as approved by the court was monetary in nature, private
respondents can avail only of the writ of execution provided in Section 15, Rule 39 of the Revised
Rules of Court, and not that provided in Section 13. In this case, the Sheriff was directed by the
SC to enforce the execution only of the money judgment in accordance with Section 15, Rule 39
of the Revised Rules of Court.
46. BF Homes v. CA
GR No.76879; October 3, 1990
Facts:
BF Homes, Inc. is a domestic corporation previously engaged in the business of developing
and selling residential lots and houses and other related realty matters. On July 19, 1984, BF
contracted a loan from Rosalinda R. Roa and Vicente Mendoza in the amount of P250,000.00 with
interest at the rate of 33% per annum payable after 32 days.
On September 25, 1984, BF filed a Petition for Rehabilitation and for a Declaration in a
State of Suspension of Payments with a prayer that upon the filing of the petition and in the
meantime, all claims against it for any and all accounts or indebtedness be suspended.
On October 17, 1984, Roa and Mendoza filed a complaint against BF with the RTC of
Quezon City for the recovery of the loan of P250,000.00, with interest and attorney's fees, with a
prayer for the issuance of a writ of preliminary attachment against the properties of BF. The prayer
for the issuance of a writ was granted
On February 13, 1985, BF filed with the CA an original action for certiorari with prayer
for a writ of preliminary injunction against the regional trial court, Roa and Mendoza. On February
14, 1985, the Court of Appeals issued an order temporarily restraining proceedings in Civil Case
No. Q-43104.
52
On March 18, 1985, the SEC, finding an urgent need to rehabilitate BF issued an order
creating a management committee and suspending all actions for claims against BF pending before
any court, tribunal or board.
On June 6, 1986, the Court of Appeals rendered a decision dismissing the complaint in
Civil Case No. Q-43104 and declaring the writ of preliminary attachment null and void. But upon
a motion for reconsideration filed by Roa and Mendoza, the decision was set aside and a new one
was entered upholding the jurisdiction of the regional trial court over the case. At the same time,
however, it suspended the proceedings therein until after the management committee shall have
been impleaded as party defendant. The dissolution of the writ of preliminary attachment was
maintained.
Roa and Mendoza faulted the Court of Appeals for ordering BF to be substituted by the
management committee and for dissolving the writ of preliminary attachment without the filing of
the necessary counter-bond by the defendant.
In sustaining the dissolution of the writ of preliminary attachment, the respondent court
said that Roa and Mendoza were secured in the satisfaction of any judgment they might obtain
against BF since all the properties of the latter were already in the custody of the management
committee.
Issue:
Whether or not the writ of preliminary attachment was properly dissolved.
Ruling:
No. The SC found that the writ must stand despite the suspension of the proceedings in the
Regional Trial Court of Quezon City. The writ was issued prior to the creation of the management
committee and so should not be regarded as an undue advantage of Mendoza and Roa over the
other creditors of BF. Having previously obtained the issuance of the writ in good faith, they should
not be deprived of its protection if the rehabilitation plan does not succeed and the civil action is
resumed.
Under the Rules of Court, a writ of attachment may be dissolved only upon the filing of a
counter-bond or upon proof of its improper or irregular issuance. Neither ground has been
established in the case at bar to warrant the discharge of the writ. No counter-bond has been given.
As for the contention that the writ was improperly issued for lack of notice to BF on the application
for the writ, it suffices to cite Mindanao Savings & Loan Association, Inc. v. Court of Appeals,
where we held:
The only requisites for the issuance of a writ of preliminary attachment under Section 3,
Rule 57 of the Rules of Court are the affidavit and bond of the applicant.
No notice to the adverse party or hearing of the application is required. As a matter of fact
a hearing would defeat the purpose of this provisional remedy. The time which such a hearing
would take, could be enough to enable the defendant to abscond or dispose of his property before
a writ of attachment issues. Nevertheless, while no hearing is required by the Rules of Court for
the issuance of an attachment, a motion to quash the writ may not be granted without "reasonable
notice to the applicant" and only "after hearing".
47. Republic vs. Saludares

G.R. No. 111174; March 9, 2000
Facts:
 2 Apr ’86: PCGG issued a writ of sequestration, based on the ground that the shares of
stocks in LBLC owned by Peter A. Sabido formed part of "illegally acquired wealth."
53
 27 July ’87: The Republic of the Philippines through the PCGG and the Office of the
Solicitor General filed before the Sandiganbayan a complaint for reconveyance, reversion,
accounting, restitution and damages against, among others, Peter A. Sabido.
 12 Aug: Sabido filed a motion to lift the writs of sequestration. Granted. PCGG filed MR.
 11 Feb ’93: Hung Ming Kuk filed a complaint for sum of money against LBLC, with a
prayer for a writ of preliminary attachment. The PCGG was not impleaded by Hung Ming
Kuk as party-defendant nor was the sequestration case referred to the RTC's proceedings.
Thus, the Republic of the Philippines filed a special civil action for certiorari.
 Sandiganbayan denied the MR of PCGG.
 17 Feb ’93: TC granted the writ of preliminary attachment in favor of Hung Ming Kuk.
 Thereafter, Hung Ming Kuk filed a motion to declare LBLC in default for failure to file
responsive pleadings. RTC of Lianga issued an order, declaring LBLC in default.
 Republic’s contention: RTC of Lianga has no jurisdiction over the subject matter of the
case inasmuch as the same are under sequestration by the PCGG. The sequestered assets
have been placed under custodia legis of the PCGG pending the final determination by the
Sandiganbayan that said assets are in fact ill-gotten. Hence, the RTC has no jurisdiction to
order the attachment of said sequestered properties.
 Hung Ming Kuk’s contention: His original complaint was for a sum of money. It was a
demand for payment of a valid obligation owed to him by LBLC. He adds that it would be
unfair and unjust to declare the entire RTC proceedings regarding his claim for sum of
money null and void. Further claimed that the attachment order of the trial court was issued
after the Sandiganbayan had lifted the writ of sequestration against LBLC.
Issue:
Whether or not the provisional remedy of attachment issued by the the court in favor of
Hung Ming Kuk was valid.
Ruling:
No. It bears recalling that when the Sandiganbayan ordered that the writ of sequestration
be lifted, PCGG filed a special civil action for certiorari to contest that order. The Supreme Court
ruled in favor of PCGG when it granted the latter'spetition to declare the lifting of the writ of
sequestration by the Sandiganbayan null and void.
Sequestration is defined as the process, which may be employed as a conservatory writ

whenever the right of the property is involved, to preserve, pending litigation, specific property
subject to conflicting claims of ownership or liens and privileges.
The Court also noted the relationship between attachment and receivership, on one hand,
and sequestration, freeze order and provisional takeover on the other. The latter there are ancillary
remedies in prosecuting the ill-gotten wealth of the previous Marcos regime. The Court observed
that sequestration, freezing and provisional takeover are akin to the provisional remedy of
preliminary attachment or receivership.
By an order of attachment, a sheriff seizes property of a defendant in a civil suit so that it

may stand as security for the satisfaction of any judgment that may be obtained, and not disposed
of, or dissipated, or lost intentionally, or otherwise, pending the action. When a writ of attachment
has been levied on real property or any interest therein belonging to the judgment debtor, the levy
creates a lien which nothing can destroy but its dissolution. This well-settled rule is likewise
applicable to a writ of sequestration.
In our view, the disputed properties of LBLC were already under custodia legis by virtue
of a valid writ of sequestration issued by the PCGG on April 2, 1986, when Judge Saludares issued
the assailed writ of attachment in favor of Hung Ming Kuk. At that time the writ of sequestration
issued by PCGG against LBLC was subsisting. Said writ of the PCGG could not be interfered with
by the RTC of Lianga, because the PCGG is a coordinate and co-equal body. The PCGG had
acquired by operation of law the right of redemption over the property until after the final
determination of the case or until its dissolution.
54
48. The Manila Remnant Co., Inc. v. CA

G.R. No. 82978; November 22, 1990
Facts:
Manila Remnant Co., Inc. is the owner of the parcels of land situated in Quezon City
covered by Transfer Certificates of Title Nos. 26400, 26401, 30783 and 31986 and constituting
the subdivision known as Capital Homes Subdivision Nos. I and II. On July 25, 1972, Manila
Remnant and A.U. Valencia & Co. Inc. entered into a written agreement entitled "Confirmation of
Land Development and Sales Contract" to formalize an earlier verbal agreement whereby for a
consideration of 17 and 1/2% fee, including sales commission and management fee, A.U. Valencia
and Co., Inc. was to develop the aforesaid subdivision with authority to manage the sales thereof,
execute contracts to sell to lot buyers and issue official receipts.
On March 3, 1970, Manila Remnant thru A.U. Valencia and Co. executed two "contracts
to sell" covering Lots 1 and 2 of Block 17 in favor of Oscar C. Ventanilla and Carmen Gloria Diaz
for the combined contract price of P66,571.00 payable monthly for ten years.
Ten (10) days after the signing of the contracts with the Ventanillas or on March 13, 1970,
Artemio U. Valencia, as President of Manila Remnant, and without the knowledge of the
Ventanilla couple, sold Lots 1 and 2 of Block 17 again, this time in favor of Carlos Crisostomo,
one of his sales agents without any consideration.
Beginning March 13, 1970, upon orders of Artemio Valencia, the monthly payments of the
Ventanillas were remitted to Manila Remnant as payments of Crisostomo for which the former
issued receipts in favor of Crisostomo. Subsequently, the harmonious business relationship
between Artemio Valencia and Manila Remnant ended.
On June 8, 1973, A.U. Valencia and Co. sued Manila Remnant before Branch 19 of the
then Court of First Instance of Manila 6 to impugn the abrogation of their agency agreement. Since
A.U. Valencia and Co. failed to forward its collections after May 1973, Manila Remnant caused
on August 20, 1976 the publication in the Times Journal of a notice cancelling the contracts to sell
of some lot buyers including that of Carlos Crisostomo in whose name the payments of the
Ventanillas had been credited.
To prevent the effective cancellation of their contracts, Artemio Valencia instigated on

September 22, 1976 the filing by Carlos Crisostomo and seventeen (17) other lot vendees of a
complaint for specific performance with damages against Manila Remnant before the Court of
First Instance of Quezon City.
The Ventanillas thereby leaving a balance of P13,531.58 for Lot 1 and P13,540.22 for Lot
2, went directly to Manila Remnant and offered to pay the entire outstanding balance of the
purchase price. To their shock and utter consternation, they discovered from Gloria Caballes, an
accountant of Manila Remnant, that their names did not appear in the records of A.U. Valencia
and Co. as lot buyers. Caballes showed the Ventanillas copies of the contracts to sell in favor of
Carlos Crisostomo, duly signed by Artemio U. Valencia as President of Manila Remnant.
Issue:
Whether or not petitioner Manila Remnant should be held solidarily liable together with
A.U. Valencia and Co. and Carlos Crisostomo for the payment of moral, exemplary damages and
attorney’s fees in favor of the Ventanillas
Ruling:
Yes. In the case at bar, the Valencia realty firm had clearly overstepped the bounds of its
authority as agent — and for that matter, even the law — when it undertook the double sale of the
disputed lots.
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Article 1897 of the Civil Code which states that" (t)he agent who acts as such is not
personally liable to that party with whom he contracts, unless he expressly binds himself or exceeds
the limits of his authority without giving such party sufficient notice of his powers."
However, the unique relationship existing between the principal and the agent at the time
of the dual sale must be underscored. Bear in mind that the president then of both firms was
Artemio U. Valencia, the individual directly responsible for the sale scam. Hence, despite the fact
that the double sale was beyond the power of the agent, Manila Remnant as principal was
chargeable with the knowledge or constructive notice of that fact and not having done anything to
correct such an irregularity was deemed to have ratified the same.
More in point, we find that by the principle of estoppel, Manila Remnant is deemed to have
allowed its agent to act as though it had plenary powers. Article 1911 of the Civil Code provides:
"Even when the agent has exceeded his authority, the principal is solidarily liable with the agent
if the former allowed the latter to act as though he had full powers."
Firstly, Manila Remnant literally gave carte blanche to its agent A.U. Valencia and Co. in
the sale and disposition of the subdivision lots. Indeed, once Manila Remnant had been furnished
with the usual copies of the contracts to sell, its only participation then was to accept the collections
and pay the commissions to the agent. The latter had complete control of the business arrangement.
Secondly, it is evident from the records that Manila Remnant was less than prudent in the
conduct of its business as a subdivision owner. For instance, Manila Remnant failed to take
immediate steps to avert any damage that might be incurred by the lot buyers as a result of its
unilateral abrogation of the agency contract.
Moreover, Manila Remnant also failed to check the records of its agent immediately after
the revocation of the agency contract despite the fact that such revocation was due to reported
anomalies in Valencia’s collections.
Even assuming that Manila Remnant was as much a victim as the other innocent lot buyers,
it cannot be gainsaid that it was precisely its negligence and laxity in the day to day operations of
the real estate business which made it possible for the agent to deceive unsuspecting vendees like
the Ventanillas.
In essence, therefore, the basis for Manila Remnant’s solidary liability is estoppel which,
in turn, is rooted in the principal’s neglectfulness in failing to properly supervise and control the
affairs of its agent and to adopt the needed measures to prevent further misrepresentation.
49. Calderon vs. IAC

G.R. No. 74696; November 11, 1987
Facts:
Calderon purchased from the Schulze et. al the Luzon Brokerage Corporation (LBC) and
its 5 affiliate companies. Twenty one days thereafter, the Bureau of Customs suspended the
operations of LBC for failure to pay the amount of P1,475,840.00 representing customs taxes and
duties incurred prior to the execution of the sale. In order to lift the suspension Calderon paid the
sum of P606,430.00 to the Bureau of Customs.
Calderon filed a complaint against Schulze et. al to recover said amount of P1,475,840.00,
with damages by reason of breach of warranty. In the same complaint, Calderon prayed for a
preliminary attachment, alleging: that Schulze et. al had deliberately and willfully concealed from
his knowledge such staggering liability of the Calderon for the purpose of misleading him into
buying the six aforesaid companies; and that Schulze is about to depart from the Philippines in
order to defraud his creditors. To support the petition for preliminary attachment, Calderon posted
a surety bond of P1,475,840.00.
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The RTC issued a writ of preliminary attachment, whereupon properties of Schulze et. al
were attached and their bank deposits were garnished. Calderon filed an amended complaint,
alleging that while the liabilities of LBC are reflected in its books, the aforesaid amount was
fraudulently withdrawn and misappropriated by Schulze. On the other hand, Schulze et. al claimed
that the amount of P1,475,840.00 due to the Bureau of Customs represents the duties and taxes
payable out of the advanced payments made by LBC's client, Philippine Refining Company (PRC);
that these deposit payments were properly recorded in the books of the corporation and existing as
part of the corporate funds; Schulze fully disclose and explained to Calderon that these customer's
advanced deposit payments (including those of the PRC) are to be paid to the Bureau of Customs
when their corresponding customs taxes and duties become due; that during this phase of the
negotiation, Calderon and his representatives inspected and studied the corporate books and
records at will and learned the daily operations and management of LBC.
Schulze et. al filed a counterbond, whereupon the RTC issued an order directing the sheriff
to return all real and personal properties already levied upon and to lift the notices of garnishment
issued in connection with the said attachment. After trial, the trial court dismissed the complaint,
holding Calderon and his surety First integrated Bonding and Insurance Co., Inc., jointly and
severally liable to pay the damages prayed for by Schulze et. al. CA affirmed the decision.
Issues:
(1) Whether or not the Preliminary Attachment had been wrongfully sued out.
(2) Whether or not the dissolution of the attachment extinguishes the surety’s obligation under
the bond, for the basis of its liability, which is wrongful attachment, no longer exists, the
attachment bond having been rendered void and ineffective.
Rulings:
(1) Yes. Whether or not the amount of P1,475,840.00 was duly disclosed as an outstanding
liability of LBC or was misappropriated by Schulze is purely a factual issue. That Calderon
was clearly in bad faith when he asked for the attachment is indicated by the fact that he
failed to appear in court to support his charge of misappropriation by Schulze, and in effect,
preventing his being cross-examined, no document on the charges was presented by him.
The record shows that appellant Calderon failed to produce any evidence in support of his
sworn charge that appellee Schulze had deliberately and willfully concealed the liabilities
of LBC. It is evident from the foregoing that the attachment was maliciously sued out and
that as already pointed out Schulze was not in bad faith.
While as a general rule, the liability on the attachment bond is limited to actual damages,
moral and exemplary damages may be recovered where the attachment was alleged to be
maliciously sued out and established to be so.
(2) No. While Section 12, Rule 57 of the Rules of Court provides that upon the filing of a
counterbond, the attachment is discharged or dissolved, nowhere is it provided that the
attachment bond is rendered void and ineffective upon the filing of counterbond. The
liability of the attachment bond is defined in Section 4, Rule 57 of the Rules of Court, as
follows: Sec. 4. Condition of applicant's bond. The party applying for the order must give
a bond executed to the adverse party in an amount to be fixed by the judge, not exceeding
the applicant's claim, conditioned that the latter will pay all the costs which may be
adjudged to the adverse party and all damages which he may sustain by reason of the
attachment, if the court shall finally adjudge that the applicant was not entitled thereto.
It is clear from the above provision that the responsibility of the surety arises "if the court
shall finally adjudge that the plaintiff was not entitled thereto." In Rocco vs. Meads, 96
Phil. Reports 884, we held that the liability attaches if the plaintiff is not entitled to the
attachment because the requirements entitling him to the writ are wanting, or if the plaintiff
has no right to the attachment because the facts stated in his affidavit, or some of them, are
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untrue. It is, therefore, evident that upon the dismissal of an attachment wrongfully issued,
the surety is liable for damages as a direct result of said attachment.
50. Security Pacific Assurance Corporation vs. Judge Amelia Tria-Infante

GR No. 144740; August 31, 2005
Facts:
In 1988, Reynaldo Anzures instituted a complaint against Teresita Villaluz for violation of
BP Blg. 22. In 1989, the trial court issued an order for the issuance of a writ of preliminary
attachment and the sheriff attached certain properties of Villaluz. In 1990, the court acquitted
Villaluz but she was ordered to pay Anzures P2,123,400.00 with legal rate of interest. Villaluz
appealed and posted a counter-bond in the amount of P2,500,000.00 issued by petitioner Security
Pacific Assurance Corporation. She also filed an Urgent Motion to Discharge Attachment. Sheriff
Reynaldo R. Buazon tried to serve the writ of execution, issued by respondent judge Infante, upon
Villaluz, but the latter no longer resided in her given address. The sheriff sent a Notice of
Garnishment upon petitioner insurance corporation; however, the petitioner refused to assume its
obligation on the counter-bond it posted for the discharge of the attachment made by Villaluz. The
petitioner contends that the failure of the Court to approve the counter-bond and to cause the
discharge of the attachment against Villaluz prevented the happening of a condition upon which
the counter-bond’s issuance was premised, such that petitioner should not be held liable thereon.
On the other hand, the respondents assert that the filing of the counter-bond by Villaluz had already
ipso facto discharged the attachment on the properties and made the petitioner liable on the bond.
Upon acceptance of the premium, there was already an express contract for surety between Villaluz
and petitioner in the amount of P2,500,000.00 to answer for any adverse judgment/decision against
Villaluz.
Issue:
Whether or not mere posting of counterbond automatically discharge the writ of
attachment.
Held:
No. A mere posting of a counterbond does not automatically discharge the writ of
attachment. it is only after the hearing and after the judge has ordered the discharge of attachment
that the same is properly discharged. Judgment must be construed as a whole so as to bring all of
its parts into harmony as far as this can be done by fair and reasonable interpretation and so as to
give effect to every word and part.
The Court is not unmindful in Its ruling in the case of Belisle Investment and Finance Co.
where it held t that the mere posting of a counter-bond does not automatically discharge the writ
of attachment. It is only after hearing and after the judge has ordered the discharge of the
attachment if a cash deposit is made or a counterbond is executed to the attaching creditor is filed,
that the writ of attachment is properly discharged under Section 12, Rule 57 of the Rules of Court.
The ruling in Belisle, at first glance, would suggest an error in the assailed ruling of the Court of
Appeals because there was no specific resolution discharging the attachment and approving the
counter-bond. As above-explained, however, consideration of our decision in G.R. No. 106214 in
its entirety will readily show that this Court has virtually discharged the attachment after all the
parties therein have been heard on the matter.
Verily, a judgment must be read in its entirety, and it must be construed as a whole so as
to bring all of its parts into harmony as far as this can be done by fair and reasonable interpretation
and so as to give effect to every word and part, if possible, and to effectuate the intention and
purpose of the Court, consistent with the provisions of the organic law.
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51. Benitez vs. IAC

G.R. No. 71535; Sept. 15, 1987
Facts:
Private respondent Casa Filipina Development Corp., filed a complaint against herein
petitioner Helena Benitez for recission of contract, plus damages, with a prayer for preliminary
attachment. As alleged, Casa Filipina and Benitez entered into a verbal contract whereby the latter
agreed to undertake to purchase/convey land for Casa Filipina in the total value of P 1, 000, 000.00
within the period of 4 months from receipt of the total amount. Casa Filipina, in 2 instances, issued
checks covering the total value for the land. However, 4 months elapsed, Benitez failed to purchase
and convey any real estate. Accordingly, Benitez converted the entrusted money for her own use.
Repeated demands for refund went unheeded, which gives rise to the complaint with preliminary
attachment. Respondent court granted the writ of attachment ex parte. Benitez filed an answer with
counterclaim and a motion to discharge writ of preliminary attachment under sec. 13 Rule 57 of
the ROC on the ground that the same was improperly or irregularly issued. Respondent court
denied the motion. Hence this petition.
Issue:
Whether or not the issue of propriety of the issuance of the writ may be resolved without
going into the merits of the principal action.
Ruling:
No. As the Court found merits in the petition, It was grave abuse of discretion on the part
of respondent Judge Rosario Veloso to deny petitioner's Urgent Motion to Discharge Writ of
Preliminary Attachment, without conducting a hearing and requiring the plaintiff to substantiate
its allegation of fraud. Neither can respondent Judge avoid deciding the issue raised in petitioner's
urgent motion by ruling that "the issue cannot be determined without adducing evidence at the
same time going into the merits of the case." Having issued the writ of preliminary attachment ex
parte, it was incumbent on the respondent court, upon proper challenge of its order, to determine
whether or not the same was improvidently issued. A preliminary attachment is a rigorous remedy
which exposes the debtor to humiliation and annoyance, such that it should not be abused to cause
unnecessary prejudice and, if wrongfully issued on the basis of false allegation, should at once be
corrected.
We agree with petitioner that a writ of attachment may be discharged pursuant to Section
13, Rule 57, without the necessity of filing a cash deposit or counterbond. The provisions of the
aforesaid section grants an aggrieved party relief from baseless and unjustifiable attachments
procured, among others, upon false allegations, without having to file any cash deposit or
counterbond.
52. Peroxide Philippines Corporation vs. CA

G.R. No. 92813 July 31, 1991
Facts:
Private respondent Bank of the Philippine Islands sued herein petitioners Peroxide
Philippines Corporation, Eastman Chemical Industries, Inc., and the spouses Edmund O. Mapua
and Rose U. Mapua for the collection of an indebtedness of Peroxide wherein Eastman and the
Mapuas bound themselves to be solidarily liable.
The trial court presided over by Judge Gregorio G. Pineda, ordered the issuance of a writ
of preliminary attachment after BPI filed an attachment bond in the amount of P32,700,000.00.
Petitioners' properties were accordingly attached by the sheriff.
Thereafter, Eastman and the Mapuas moved to lift the attachment which was granted by
Judge Pineda. BPI filed a motion for reconsideration but the case was re-raffled and assigned to
the sala of Judge Pastor Reyes. Judge Reyes issued an order with an explicit finding that the
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attachment against the properties of Eastman and the Mapuas was proper on the ground that they
had disposed of their properties in fraud of BPI.
After a motion for partial reconsideration by BPI and some exchanges between the parties,
the trial court, this time with Judge Eficio B. Acosta presiding, issued an order granting BPI's
motion on the ground that "considering the lapse of more than a year since the Order of November
28, 1983 and the nature and purpose of attachment, the writ of attachment revived in the Order of
November 28, 1983 and hereby re-affirmed may be executed immediately”.
Contending that said order was rendered with grave abuse of discretion, petitioners sought
the annulment thereof. The court rendered its decision dismissing the petition and holding that
there is nothing wrong with the attachment of the properties of Peroxide.
Issue:
Whether or not the writ of attachment was validly lifted and suspended by the lower court's
orders.
Held:
When the attachment is challenged for having been illegally or improperly issued, there
must be a hearing with the burden of proof to sustain the writ being on the attaching creditor. That
hearing embraces not only the right to present evidence but also a reasonable opportunity to know
the claims of the opposing parties and meet them. As provided by the aforecited Section 13 of Rule
57, the attaching creditor should be allowed to oppose the application for the discharge of the
attachment by counter-affidavit or other evidence, in addition to that on which the attachment was
made.
Respondent court was, therefore, correct in holding that, the attachment of the properties
of Eastman and the Mapuas remained valid from its issuance since the judgment had not been
satisfied, nor has the writ been validly discharged either by the filing of a counter bond or for
improper or irregular issuance.
The writ of attachment is continuing and uninterrupted, valid and enforceable since the
order of discharge and the order of suspension of the trial court were void. The cancellation of the
annotations regarding the levy on attachment of petitioners' properties, procured by the sheriff
pursuant to the aforesaid invalid orders, is likewise a nullity and another levy thereon is not
required.
The proceeding in the issuance of a writ of preliminary attachment, as a mere provisional

remedy, is ancillary to an action commenced at or before the time when the attachment is sued out.
Accordingly the attachment does not affect the decision of the case on the merits, the right to
recover judgment on the alleged indebtedness and the right to attach the property of the debtor
being entirely separate and distinct. As a rule, the judgment in the main action neither changes the
nature nor determines the validity of the attachment. At any rate, whether said petitioners are
guarantors or sureties, there exists a valid cause of action against them and their properties were
properly attached on the basis of that indubitable circumstance.
53. Filinvest vs. Relova

G.R. No. L-50378; September 30, 1982
Facts:
On August 2, 1977, Filinvest Credit Corporation filed a complaint in the lower court
against defendants Rallye Motor Co., Inc. and Emesto Salazar for the collection of a sum of money
with damages and preliminary writ of attachment. From the allegations of the complaint, it appears
that in payment of a motor vehicle, Salazar executed a promissory note in favor of RALLYE for
the amount of P99,828.00. To secure the note, Salazar also executed in favor of RALLYE a deed
of chattel mortgage over the above described motor vehicle. On May 7, 1977, RALLYE, for
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valuable consideration, assigned all its rights, title and interest to the aforementioned note and
mortgage to FILINVEST. Thereafter, FILINVEST came to know that RALLYE had not delivered
the motor vehicle subject of the chattel mortgage to Salazar, "as the said vehicle (had) been the
subject of a sales agreement between the co defendants." Salazar defaulted in complying with the
terms and conditions of the aforesaid promissory note and chattel mortgage. RALLYE, as assignor
who guaranteed the validity of the obligation, also failed and refused to pay FILINVEST despite
demand. According to FILINVEST, the defendants intentionally, fraudulently and with malice
concealed from it the fact that there was no vehicle delivered under the documents negotiated and
assigned to it, otherwise, it would not have accepted the negotiation and assignment of the rights
and interest covered by the promissory note and chattel mortgage. Praying for a writ of preliminary
attachment, FILINVEST submitted with its complaint the affidavit of one Gil Mananghaya,
Judge Jorge R. Coquia, then presiding Judge of the lower court, granted the prayer for a
writ of attachment. More than a year later, in an Urgent Motion dated December 11, 1978,
defendant Salazar prayed that the writ of preliminary attachment issued ex parte and implemented
solely against his property be recalled and/or quashed.
Respondent Judge, ordered the dissolution and setting aside of the writ of preliminary
attachment issued on August 17, 1977 and the return to defendant Salazar of all his properties
attached by the Sheriff by virtue of the said writ.
Issues:
(1) Whether or not writ of preliminary attachment was improperly or irregularly issued, in that
it was issued ex parte without notice to him and without hearing.
(2) Whether or not a writ of attachment may be discharged without the necessity of filing the
cash deposit or counter-bond
(3) The last sentence of the said provision, however, indicates that a hearing must be conducted
by the judge for the purpose of determining whether or not there reality was a defect in the
issuance of the attachment. The question is: At this hearing, on whom does the burden of
proof lie?
Rulings:
(1) No. Nothing in the Rules of Court makes notice and hearing indispensable and mandatory
requisites for the issuance of a writ of attachment. A writ of attachment may be issued ex
parte. Sections 3 and 4, Rule 57, merely require that an applicant for an order of attachment
file an affidavit and a bond: the affidavit to be executed by the applicant himself or some
other person who personally knows the facts and to show that (1) there is a sufficient cause
of action, (2) the case is one of those mentioned in Section 1 of Rule 57, (3) there is no
other sufficient security for the claim sought to be enforced, and (4) the amount claimed in
the action is as much as the sum for which the order is granted above all legal
counterclaims; and the bond to be "executed to the adverse party in an amount fixed by the
judge, not exceeding the applicant's claim, conditioned that the latter will pay all the costs
which may be adjudged to the adverse party and all damages which he may sustain by
reason of the attachment, if the court shall finally adjudge that the applicant was not entitled
thereto."
(2) a writ of attachment may be discharged without the necessity of filing the cash deposit or
counter-bond required by Section 12, Rule 57, cited by petitioner. The following provision
of the same Rule allows it: Sec. 13. Discharge of attachment for improper or irregular
issuance.—The party whose property has been attached may also, at any time either before
or after the release of the attached property, or before any attachment shall have been
actually levied, upon reasonable notice to the attaching creditor, apply to the judge who
granted the order, or to the judge of the court in which the action is pending, for an order
to discharge the attachment on the ground that the same was improperly or irregularly
issued. If the motion be made on affidavits on the part of the party whose property has been
attached, but not otherwise, the attaching creditor may oppose the same by counter-
affidavits or other evidence in addition to that on which the attachment was made. After
61
hearing, the judge shall order the discharge of the attachment if it appears that it was
improperly or irregularly issued and the defect is not cured forthwith."
In the instant case the order of attachment was granted upon the allegation of petitioner, as
plaintiff in the court below, that private respondent RALLYE, the defendants, had
committed "fraud in contracting the debt or incurring the obligation upon which the action
is brought," covered by Section i(d), Rule 57, earlier quoted. Subsequent to the issuance of
the attachment order on August 17, 1977, private respondent filed in the lower court an
"Urgent Motion for the Recall and Quashal of the Writ of Preliminary Attachment on (his
property)" dated December 11, 1978 precisely upon the assertion that there was "absolutely
no fraud on (his) part" in contracting the obligation sued upon by petitioner. Private
respondent was in effect claiming that petitioner's allegation of fraud was false, that hence
there was no ground for attachment, and that therefore the attachment order was
"improperly or irregularly issued." This Court was held that "(i)f the grounds upon which
the attachment was issued were not true ..., the defendant has his remedy by immediately
presenting a motion for the dissolution of the same. We find that private respondent's
abovementioned Urgent Motion was filed under option 13, Rule 57.
(3) Under the circumstances of the present case, we sustain the ruling of the court a quo in its
questioned Order dated February 2, 1979 that it should be the plaintiff (attaching creditor),
who should prove his allegation of fraud. This pronouncement finds support in the first
sentence of Section 1, Rule 131, which states that: "Each party must prove his own
affirmative allegations." The last part of the same provision also provides that: "The burden
of proof lies on the party who would be defeated if no evidence were given on either side."
It must be brne in mind that in this jurisdiction, fraud is never presumed. FRAUS EST
IdIOS ET NON PRAESUMENDA. Indeed, private transactions are presumed to have
been fair and regular. Likewise, written contracts such as the documents executed by the
parties in the instant case, are presumed to have been entered into for a sufficient
consideration.
54. Kimpang vs. Javier, et al.

G.R. No. L-43461 December 16, 1937
Facts:
A writ of execution was issued by the Court of First Instance of Antique on August 8, 1933
to enforce the payment to the plaintiff of the sum of P6,678.84 plus interest and costs against
Javier, et al. However, in view of the fact that the proceeds of the public auction was not sufficient
to cover the full value of the judgment and that the defendants failed to deliver to the sheriff the
properties which were released from the attachment, the plaintiff moved the court to again order
the execution of the aforesaid judgement, but this time against the properties of two sureties.
The surety Juan Autajay objected to the plaintiff's motion on the ground (as applied in our topic)
that the attachment of the properties of the defendants was null and void because it does not appear
that they were served with a copy of the writ ordering the same.
Issue:
Whether or not the writ was improperly issued because they were not given a copy of the
order of attachment and that the motion was not sworn to as required by law.
Ruling:
No, it was rather properly issued. The Inference must be drawn that they were notified of
said order; otherwise, they would not have stated in their counter obligation that: "The defendant
having prayed for the discharge of the attachment levied upon his properties in an action pending
in the Court of First Instance of the Province of Antique, Philippines Island, in which J. Uy
Kimpang & Co. is plaintiff and Vicente Javier and Others, defendant, . . . ."
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The other contention that the plaintiff's motion praying for the issuance of a attachment
was not sworn to as required by law, is likewise disposed of. It was unnecessary that the same
should be under oath because it was merely a repetition or renewal of what was already prayed for
in the complaint which was verified. In order not to nullify the purposes of the law, technicalities
should be disregarded, especially when, as in the case under advisement, there was substantial
compliance therewith. On the other hand, the law enjoins that the provisions of the Code of Civil
Procedure shall be liberally construed in order to promote its object and assist the parties in
obtaining speedy justice, bearing in mind, in construing and applying them, their spirit and
purpose, rather than their strict .
What is the effect of filing a motion to set aside the attachment on other grounds? Under
these circumstances, we believe we should adhere to the rule that: All objections to the writ will
be waived by moving to set aside the attachment on other grounds and failing to make the
objections before bond for the release of the property because, After issue made and trial begun
upon the merits of a case, it is too late for an objection of the petition or attachment for want of
verification.
55. Ching vs. CA

GR No. 124642; February 23, 2004
Facts:
PBMCI obtained a loan from private respondent Allied Bank. The said loan was secured
by a continuing guaranty and suretyship agreement with Alfredo Ching. PBMCI defaulted in the
payment of the loan, so Allied Bank filed an action for collection of money with prayer for writ of
preliminary attachment. One of the properties attached is the 100,000 shares of stock in Citycorp
under the name of Alfredo Ching. Encarnacion Ching wife of Alfredo Ching filed a motion to
quash the writ of preliminary attachment contending that the 100,000 shares of stock in Citycorp
belong to conjugal partenership. The RTC granted the motion filed by Encarnacion Ching but
reversed by Court of Appeal (CA) on the ground that there is no proof that the money used to buy
the subject shares of stock coming from conjugal partnership. It was also raised by Allied Bank
that Encarnacion Ching is not a real party in the civil suit filed by the former hence it has no right
to file a motion to quash the writ of preliminary attachment.
Issue:
Whether or not the petitioner wife has the right to file a motion to quash the levy on
attachment on the 100,000 shares of stock in the Citycorp?
Ruling:
Yes. The Supreme Court held that the petitioner-wife had a right to file the said motion
even though she is not a party to a case. The court which issued the writ of preliminary attachment
may revoke the same if it found that the properties levied by the sheriff do not belong to the
defendant-debtor and order for the return of the said properties to the aggrieved third party.
The aggrieved third party may also file an action to annul the writ of preliminary
attachment separate from the main action. Any of these remedies may be resorted to by the third
party claimant without availing of the other remedies.
The conjugal property is not responsible to answer for the debt of any of the spouses unless
such debt redounded to the benefit of the conjugal partnership. It is also provided in Article 160
of the New Civil Code (NCC), the properties acquired during the marriage are presumed belong
to the conjugal partnership unless it is proved that it pertains exclusively to the husband or the
wife.
In this case, the 100,000 shares of stock in Citycorp acquired during the marriage of the
petitioner spouses and private respondent Allied Bank failed to prove that it belongs exclusively
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to Alfred Ching. The presumption cited in NCC will still apply in the absence of clear satisfactory
and convincing evidence to overcome the same.
56. Uy vs. CA
G.R. No. 83897; November 9, 1990
Facts:
A writ of preliminary attachment was implemented by sheriff Cabang for the satisfaction
of the debt of Sy Yuk Tat from Uy. However, there were third party claimants over the property
attached. Thus, these third party claimants filed a writ of preliminary injunction in a different CFI
branch against Uy and Sheriff Cabang alleging that the properties attached by the sheriff belong
to them. Since according to the CFI it would take a while before such writ of prelim injunction can
be issued, the judge ordered the parties to maintain the status quo of the subject properties. Hence,
Uy and Cabang filed a motion to dissolve the status quo order on the ground that the court had no
jurisdiction to interfere with properties under custodio legis on orders of a court of co-equal
jurisdiction. Subsequently, third party claimants filed a motion for prelim attachment which was
granted.
Issue:
Whether or not properties levied and seized by virtue of a writ of attachment and later by
a writ of execution, were under custodia legis and therefore not subject to the jurisdiction of
another co-equal court where a third party claimant claimed ownership of the same properties.
Ruling:
Yes, properties levied and seized by virtue of a writ of attachment and later by a writ of
execution were under custodia legis and therefore not subject to the jurisdiction of another co-
equal court where a third party claimant claimed ownership of the same properties. However, this
rule is confined to cases where the property belongs to the defendant or one in which the defendant
has proprietary interests. But when the Sheriff, acting beyond the bounds of his office seizes a
stranger’s property, the rule does not apply and interference with his custody is not interference
with another court’s order of attachment.
57. Philippine Airlines, Inc. vs. CA

G.R. No. L-49188; January 30, 1990
Facts:
Respondent Amelia Tan, under the name and style of Able Printing Press commenced a
complaint for damages before the Court of First Instance of Manila.
The CFI of Manila decided in favor of private respondent Amelia Tan and against petitioner
Philippine Airlines, Inc. (PAL). On July 28, 1972, the petitioner filed its appeal with the Court of
Appeals. The CA rendered a judgment with the modification that PAL is condemned to pay
plaintiff the sum of P25,000.00 as damages and P5,000.00 as attorney's fee, judgment is affirmed,
with costs. Notice of judgment was sent by the Court of Appeals to the trial court and on dates
subsequent thereto, a motion for reconsideration was filed by respondent Amelia Tan, duly
opposed by petitioner PAL, however the Court of Appeals rendered its resolution denying the
respondent's motion for reconsideration for lack of merit. The case was remanded to the trial court
for execution and respondent Amelia Tan filed a motion praying for the issuance of a writ of
execution of the judgment rendered by the Court of Appeals.
On October 11, 1977, the trial court, presided over by Judge Galano, issued its order of
execution with the corresponding writ in favor of the respondent. The writ was duly referred to
Deputy Sheriff Emilio Z. Reyes of Branch 13 of the Court of First Instance of Manila for
enforcement.
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Four months later, on February 11, 1978, respondent Amelia Tan moved for the issuance of an
alias writ of execution stating that the judgment rendered by the lower court, and affirmed with
modification by the Court of Appeals, remained unsatisfied.
On March 1, 1978, the petitioner PAL filed an opposition to the motion for the issuance of
an alias writ of execution stating that it had already fully paid its obligation to plaintiff through the
deputy sheriff of the respondent court, Emilio Z. Reyes, as evidenced by cash vouchers properly
signed and receipted by said Emilio Z. Reyes. The Court of Appeals denied the issuance of the
alias writ for being premature, ordering the executing sheriff Emilio Z. Reyes to appear with his
return and explain the reason for his failure to surrender the amounts paid to him by petitioner
PAL. However, the order could not be served upon Deputy Sheriff Reyes who had absconded or
disappeared.
On May 18, 1978, the petitioner received a copy of the first alias writ of execution issued
on the same day directing Special Sheriff Jaime K. del Rosario to levy on execution in the sum of
P25,000.00 with legal interest thereon from July 20,1967 when respondent Amelia Tan made an
extra-judicial demand through a letter. Levy was also ordered for the further sum of P5,000.00
awarded as attorney's fees.
On May 23, 1978, the petitioner filed an urgent motion to quash the alias writ of execution
stating that no return of the writ had as yet been made by Deputy Sheriff Emilio Z. Reyes and that
the judgment debt had already been fully satisfied by the petitioner as evidenced by the cash
vouchers signed and receipted by the server of the writ of execution, Deputy Sheriff Emilio Z.
Reyes.
Issue:
Can an alias writ of execution be issued without a prior return of the original writ by the
implementing officer?
Ruling:
Yes. An alias writ of execution be issued without a prior return of the original writ by the
implementing officer. The Court held that The issuance of the questioned alias writ of execution
under the circumstances here obtaining is justified because even with the absence of a Sheriffs
return on the original writ, the unalterable fact remains that such a return is incapable of being
obtained (sic) because the officer who is to make the said return has absconded and cannot be
brought to the Court despite the earlier order of the court for him to appear for this purpose. (Order
of Feb. 21, 1978, Annex C, Petition). Obviously, taking cognizance of this circumstance, the order
of May 11, 1978 directing the issuance of an alias writ was therefore issued. (Annex D. Petition).
The need for such a return as a condition precedent for the issuance of an alias writ was
justifiably dispensed with by the court below and its action in this regard meets with our
concurrence. A contrary view will produce an abhorent situation whereby the mischief of an erring
officer of the court could be utilized to impede indefinitely the undisputed and awarded rights
which a prevailing party rightfully deserves to obtain and with dispatch. The final judgment in this
case should not indeed be permitted to become illusory or incapable of execution for an indefinite
and over extended period, as had already transpired. (Rollo, pp. 35-36)
Judicium non debet esse illusorium; suum effectum habere debet (A judgment ought not to
be illusory it ought to have its proper effect). Indeed, technicality cannot be countenanced to defeat
the execution of a judgment for execution is the fruit and end of the suit and is very aptly called
the life of the law (Ipekdjian Merchandising Co. v. Court of Tax Appeals, 8 SCRA 59 [1963];
Commissioner of Internal Revenue v. Visayan Electric Co., 19 SCRA 697, 698 [1967]). A
judgment cannot be rendered nugatory by the unreasonable application of a strict rule of procedure.
Vested rights were never intended to rest on the requirement of a return, the office of which is
merely to inform the court and the parties, of any and all actions taken under the writ of execution.
Where such information can be established in some other manner, the absence of an executing
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officer's return will not preclude a judgment from being treated as discharged or being executed
through an alias writ of execution as the case may be.
More so, as in the case at bar. Where the return cannot be expected to be forthcoming, to
require the same would be to compel the enforcement of rights under a judgment to rest on an
impossibility, thereby allowing the total avoidance of judgment debts. So long as a judgment is
not satisfied, a plaintiff is entitled to other writs of execution (Government of the Philippines v.
Echaus and Gonzales, 71 Phil. 318). It is a well known legal maxim that he who cannot prosecute
his judgment with effect, sues his case vainly.
58. Luzon Steel Corporation vs. Sia

G.R. No. L-26449; May 15, 1969
Facts:
Luzon Steel Corporation has sued Metal Manufacturing of the Philippines and Jose O. Sia,
the former's manager, for breach of contract and damages. It obtained a writ of preliminary
attachment of the properties of Sia and Times Surety, but the attachment was lifted upon a
P25,000.00 counterbond executed by Sia, as principal, and the Times Surety & Insurance Co., Inc.
as solidary guarantor. Luzon Steel entered into a compromise whereby Sia agreed to settle the
former’s claim by paying P500 monthly for the first 6 months to be paid at the end of every month
and to commence in January, 1965, and within one month after paying the last installment of
P500.00, the balance of P22,000.00 shall be paid in lump sum, without interest. It is understood
that failure of Sia to pay one or any installment will make the whole obligation immediately due
and demandable and that a writ of execution will be issued immediatelyagainst Sia’s bond.
For Sia’s failure to comply, moved for and obtained a writ of execution against Sia. Times
Suretyhowever, moved to quash the writ of execution against it, averring that it was not a party to
the compromise, and that the writ was issued without giving the surety notice and hearing.
Issues:
(1) WON the judgment upon the compromise discharged the surety from its obligation under
its attachment counterbond.
(2) WON the writ of execution could be issued against the surety without previous exhaustion
of the debtor's properties.
Rulings:
(1) No. It was, therefore, error on the part of the court below to have ordered the surety bond
cancelled, on the theory that the parties' compromise discharged the obligation of the
surety. The counterbond contemplated in the rule (R57S17) is evidently an ordinary
guaranty where the sureties assume a subsidiary liability. This is not the case here, because
the surety in the present case bound itself "jointly and severally" (in solidum) with Sia; and
it is prescribed in Article 2059, paragraph 2, of the Civil Code of the Philippines that
excusion (previous exhaustion of the property of the debtor) shall not take place "if he (the
guarantor) has bound himself solidarily with the debtor". The rule heretofore quoted cannot
be construed as requiring that an execution against the debtor be first returned unsatisfied
even if the bond were a solidary one; for a procedural rule may not amend the substantive
law expressed in the Civil Code, and further would nullify the express stipulation of the
parties that the surety's obligation should be solidary with that of the defendant.
(2) Yes. A second reason against the stand of the surety and of the court below is that even if
the surety's undertaking were not solidary with that of the principal debtor, still he may not
demand exhaustion of the property of the latter, unless he can point out sufficient leviable
property of the debtor within Philippine territory. There is no record that Times Surety has
done so. Says Article 2060 of the Civil Code of the Philippines: Art. 2060. In order that the
guarantor may make use of the benefit of excussion, he must set it up against the creditor
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upon the latter's demand for payment from him, and point out to the creditor available
property of the debtor within Philippine territory, sufficient to cover the amount of the debt.
A third reason against the thesis of Times Surety is that, under the rule and its own terms,
the counter-bond is only conditioned upon the rendition of the judgment. Payment under
the bond is not made to depend upon the delivery or availability of the property previously
attached, as it was under Section 440 of the old Code of Civil Procedure. Where under the
rule and the bond the undertaking is to pay the judgment, the liability of the surety or
sureties attaches upon the rendition of the judgment, and the issue of an execution and its
return nulla bonais not, and should not be, a condition to the right to resort to the bond.
It is true that under Section 17 recovery from the surety or sureties should be "after notice
and summary hearing in the same action". But this requirement has been substantially
complied with from the time the surety was allowed to move for the quashal of the writ of
execution and for the cancellation of their obligation.
59. Spouses Yu vs. Te

GR No. 155868; February 6, 2007
Facts:
Spouses Gregorio and Josefa Yu (Spouses Yu) purchased from Ngo Yet Te (Te) bars of
detergent soap worth P594,240.00, and issued to the latter three postdated checks as payment of
the purchase price. When Te presented the checks at maturity for encashment, said checks were
returned dishonored and stamped "ACCOUNT CLOSED".
Te demanded payment from Spouses Yu but the latter did not heed her demands. Acting
through her son and attorney-in-fact, Charry Sy, Te filed with the RTC, for Collection of Sum of
Money and Damages with Prayer for Preliminary Attachment. Upon Tes posting of an attachment
bond, the RTC issued an Order of Attachment/Levy dated March 29, 1993 on the basis of which
Sheriff Alimurung of RTC, Branch 19, Cebu City levied and attached Spouses Yus properties in
Cebu City consisting of one parcel of land and four units of motor vehicle.
On April 21, 1993, Spouses Yu filed an Answer with counterclaim for damages arising
from the wrongful attachment of their properties. On the same date, Spouses Yu filed an Urgent
Motion to Dissolve Writ of Preliminary Attachment.
The RTC issued an Order dated May 3, 1993, discharging from attachment the Toyota Ford
Fierra, jeep, and Canter delivery van on humanitarian grounds, but maintaining custody of Lot No.
11 and the passenger bus. Spouses Yu filed a Motion for Reconsideration which the RTC denied.
Dissatisfied, they filed with the CA a Petition for Certiorari, in which a Decision was rendered
lifting the RTC Order of Attachment on their remaining properties. The CA held that insolvency
is not a ground for attachment especially when defendant has not been shown to have committed
any act intended to defraud its creditors.
Spouses Yu contend that they are entitled to their counterclaim for damages as a matter of
right in view of the finality of SC June 8, 1994 Resolution in G.R. No. 114700 which affirmed the
finding of the CA in its September 14, 1993 Decision in CA-G.R. SP No. 31230 that respondent
Te had wrongfully caused the attachment of their properties. Citing Javellana v. D.O. Plaza
Enterprises, Inc., they argue that they should be awarded damages based solely on the CA finding
that the attachment was illegal for it already suggests that Te acted with malice when she applied
for attachment, and that even if we were to assume that Te did not act with malice, still she should
be held liable for the aggravation she inflicted when she applied for attachment even when she was
clearly not entitled to it.
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Issue:
Whether or not the appellate court erred in not holding that the writ of attachment was
procured in bad faith, after it was established by final judgment that there was no true ground
therefor.
Ruling:
No. As early as in Lazatin v. Twaño, the SC laid down the rule that where there is wrongful
attachment, the attachment defendant may recover actual damages even without proof that the
attachment plaintiff acted in bad faith in obtaining the attachment. However, if it is alleged and
established that the attachment was not merely wrongful but also malicious, the attachment
defendant may recover moral damages and exemplary damages as well. Either way, the
wrongfulness of the attachment does not warrant the automatic award of damages to the attachment
defendant; the latter must first discharge the burden of proving the nature and extent of the loss or
injury incurred by reason of the wrongful attachment.
In fine, the CA finding that the attachment of the properties of Spouses Yu was wrongful
did not relieve Spouses Yu of the burden of proving the factual basis of their counterclaim for
damages.
Here, it is not difficult to understand why Te concluded that Spouses Yu never intended to
pay their obligation for they had available funds in their bank but chose to transfer said funds
instead of cover the checks they issued. Thus, we cannot attribute malice nor bad faith to Te in
applying for the attachment writ. We cannot hold her liable for moral and exemplary damages.
60. Stronghold Insurance Co., Inc. vs. CA

G.R. No. 89020 May 5, 1992
Facts:
FCP Credit Corp. filed a complaint against Jose Orosa, praying that a writ of replevin be
issued against Orosa. The Court ordered the seizure of the motor vehicle covered by a chattel
mortgage executed in favor of FCP. A replevin bond put up by Stronghold Insurance in the amount
of P210k was filed. A writ of replevin was issued. Complaint was dismissed for lack of merit. As
to Orosa’s counterclaim, Court ordered FCP to pay him P400k moral damages, P100k exemplary
damages, and P50k attorney’s fees. Copy of the decision was received by Orosa on April 11, 1988
while FCP received a copy thereof on April 13, 1988.
14 Apr ’88: Orosa filed a motion for execution of the judgment pending appeal, alleging
that the judgment in the case may be rendered ineffective because FCP Credit Corporation was
already liquidating its business affairs. He expressed his willingness to file a bond for such
purpose. FCP opposed said motion through a "Motion for Partial Reconsideration of the Decision
and Opposition to the Motion for Execution" filed on April 26, 1988. 26 Apr ’88: Orosa filed an
application for judgment on the bond. Opposition was filed by FCP, alleging that appeal had been
perfected hence the TC had already lost jurisdiction to hear Orosa’s motion; that the application
for damages does not set forth the facts showing his right thereto and the amount thereof; and that
the motion is fatally defective for lack of the requisite 3 days notice.
Hearing on the application was scheduled on 29 Apr 1988 but Orosa and counsel failed to
appear. In the meantime, action on FCP’s notice of appeal and motion to elevate the records to
CA, which were earlier filed on April 14, 1988, was held in abeyance by the court. In a special
order, the TC ordered the issuance of a writ of execution pending appeal upon Orosa's filing of a
bond in the amount of P500k, reasoning "Orosa's willingness to file a required bond to answer for
damages in the case of reversal of the judgment" and (2) "FCP is in imminent danger of insolvency
or dissolution."
6 Jun ’88: Court upheld Orosa’s right to recover damages on the replevin bond and the
liability of FCP for said damages and for all the sums of money recovered in the case in the lower
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court. Following day, Court designated a supplemental decision, ordering Stronghold to be jointly
and severally liable with FCP, and to pay Orosa the damages specified in the decision which is
P210k. Deputy Sheriff Jaime Del Rosario, by virtue of the order of execution pending appeal,
levied upon the properties of Stronghold and garnished its funds with Far East Bank and United
Coconut Planters Bank on June 17, 1988. A few days thereafter, on June 22, 1988, Stronghold
filed a petition for certiorari, with a prayer for preliminary injunction and/or restraining order.
On the same day of the filing of said petition, an order was issued by the trial court supplementing
its order of execution pending appeal dated June 3, 1988 by ordering Orosa to file an additional
bond in the amount of P200k. An "Urgent Omnibus Motion for Reconsideration with Prayer for
Restraining Order," dated June 24, 1988, was filed by Stronghold with, alleging that "there exists
no good and valid reasons to justify execution pending appeal against SICI considering that it is
very solvent and any final judgment against it would surely be satisfied." Denied.
11 Jul ’88: Upon an ex parte motion, TC directed the enforcement of the writ of execution
pending appeal against FCP alone. Later, on 5 Aug ‘88, another order was issued this time
directing its enforcement against Stronghold. Stronghold moved for the reconsideration of said
order and in the hearing of said motion, its counsel adduced additional arguments in support
thereof. The court was informed that its application for a writ of injunction was already submitted
for resolution by the Court of Appeals.
Eventually, the application for a writ of injunction referred to by Stronghold was granted by the
CA on August 26, 1988. Nevertheless, the same writ was lifted and set aside when the petition for
certiorari was dismissed.
Issue:
Whether or not the decision should be set aside and annulled
Ruling:
The rule is clear that where the judgment in an action is in favor of the party against whom
the writ of replevin was issued, he may recover damages resulting therefrom and the replevin bond
required under Section 2, Rule 60 may be held to answer for this purpose. The procedure to hold
the surety liable upon the replevin bond is provided for under Section 10 of the same rule in relation
to Section 20 of Rule 57. Compliance with the following requisites is essential: (1) the filing of an
application therefor with the Court having jurisdiction of the action; (2) the presentation thereof
before the judgment becomes executory (or before the trial or before appeal is perfected); (3) the
statement in said application of the facts showing the applicant's right to damages and the amount
thereof; (4) the giving of due notice of the application to the attaching creditor and his surety or
sureties and (5) the holding of a proper hearing at which the attaching creditor and sureties may be
heard on the application.
These requisites apply not only in cases of seizure or delivery under Rule 60, but also in
cases of preliminary injunctions under Rule 58, and receiverships under Rule 59. To avoid
multiplicity of suits, all incidents arising from the same controversy must be settled in the same
court having jurisdiction of the main action. Thus, the application for damages must be filed in the
court which took cognizance of the case, with due notice to the other parties.
The timeliness of the application for judgment on the bond in this case, as well as the
motion for immediate execution, is apparent because it was filed before the appeal was perfected.
The fact that one of the parties had filed a notice of appeal does not perfect such appeal. An appeal
is perfected upon the lapse of the last day for all parties to appeal.
It should also be noted that the filing of the application for judgment on the bond by Orosa
was in the nature of a motion for reconsideration under Section 1(c), Rule 37, which consequently
had the effect of interrupting the period to appeal. This being so, the order holding in abeyance
FCP's notice of appeal was not even necessary and was an apparent superfluity.
Stronghold’s contention: There was a failure to hold a proper hearing.
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Such requirement, however, has been held to mean that the hearing will be summary and
will be limited to such new defenses, not previously set up by the principal, as the surety may
allege and offer to prove. The oral proof of damages already adduced by the claimant may be
reproduced without the necessity of retaking the testimony, but the surety should be given an
opportunity to cross-examine the witness or witnesses if he so desires.
In the present case, Stronghold did not allege and offer to prove any new defense not
previously set up by the principal. Furthermore, the grounds relied upon in its opposition to the
application requires no hearing for their proper consideration by the court a quo, aside from the
fact that the trial court adequately and particularly resolved them in its order of June 6, 1988.
The alleged imminent danger of insolvency of FCP Credit Corp. does not also constitute a
good reason for immediate execution. The obligation of FCP and Stronghold in the case at bar is
in solidum. Their agreement states that the principal and the surety therein jointly and severally
bound themselves "in the sum of P210k for the prosecution of the action, for the return of the
property to defendant, if the return thereof be adjudged, and for the payment ... of such sum as may
in the cause be recovered against the plaintiff, and costs of the action."
61. Zenith Insurance vs CA

GR. No. L-57957; December 29, 1982
Facts:
William B. Murphy filed a case for collection of a sum of money, accounting and damages,
in the Court of First Instance of Rizal, Branch VI, Pasig, against private respondent Pedro
Mejorada . Murphy likewise prayed for a Writ of Preliminary Attachment, which the Trial Court
granted upon a bond of P250,000.00 issued by petitioner Zenith Insurance Corporation in favor of
Murphy. RTC dismissed the plaintiff's Complaint. Petitioner filed with the Court of Appeals, a
Petition for "Certiorari and Prohibition with Preliminary Mandatory Injunction" (CA-G.R. No. SP-
12295) imputing grave abuse of discretion to respondent Judge in the issuance of the Order of
April 9, 1981 granting the Alias Writ.
On May 21, 1981, respondent Court of Appeals upheld the Alias Writ of Execution,
petitioner's "solidary liability (having) been clearly pronounced by this Court in case CA-G.R. No.
53497-R" when it held that petitioner is equally liable for all the damages that resulted from the
wrongful issuance of the writ (of attachment)." Petitioner moved for reconsideration arguing that
liability on the attachment bond is not to be confounded with liability on the judgment, and that its
liability cannot exceed the amount of the attachment bond. Reconsideration was denied for lack of
merit.
Issue:
Whether or not respondent Court committed grave abuse of discretion in ordering the
issuance of the Alias Writ of Execution making petitioner solidarily liable for all costs and
damages, or, for more than the amount of its bond.
Ruling :
Yes. Paragraph " 6 " of the dispositive portion of the Trial Court's Decision, which states:
6. On the action of the defendant against the attachment bond, ordering the plaintiff and the
respondent Zenith Insurance Corporation to pay defendant, jointly and severally against the
attachment bond but not exceeding the amount secured thereby in the sum of P250,000.00 the
following amounts:
xxx xxx xxx
is clear and correct. There is no ambiguity that would "justify resort to the entire contents
of the decision in order to determine the extent of the liability of a party litigant". The
liability of petitioner is expressly limited to P250,000.00, the amount of the attachment
bond. "A guaranty is not presumed, it must be express and cannot extend to more than what
is stipulated therein."
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It is true that in CA-G.R. No. 53497-R (the appeal from the Trial Court's Decision),
petitioner was pronounced "equally liable with its principal for all damages sustained resulting
from the wrongful issuance of the Writ (of Preliminary Attachment)". The phrase "all damages"
refers to those resulting from the undertaking itself. It does not mean that the surety is answerable
for all costs and damages that may be adjudged against its principal over the above what is
adjudged against it in the dispositive portion of the Decision, as it would be unreasonable to expand
debtor."
When a surety executes a bond, it does not guarantee that the plaintiff's cause of action is
meritorious, and that it will be responsible for all the costs that may be adjudicated against its
principal in case the action fails. The extent of a surety's liability is determined only by the clause
of the contract of suretyship. It cannot be extended by implication, beyond the terms of the
contract.
62. Paramount vs. CA

G.R. No. 110086; July 19, 1999
Facts:
McAdore Finance and Investment, Inc. (McADORE) was the owner and operator of the
McAdore International Palace Hotel in Dagupan City. Private respondent Dagupan Electric
Corporation (DECORP), on the other hand, was the grantee of a franchise to operate and maintain
electric services in the province of Pangasinan, including Dagupan City.
On February 2, 1978, McADORE and DECORP entered into a contract whereby DECORP
shall provide electric power to McADORE's Hotel. During the term of their contract for power
service, DECORP noticed discrepancies between the actual monthly billings and the estimated
monthly billings of McADORE. Upon inspection, it was discovered that the terminal in the
transformers connected to the meter had been interchanged resulting in the slow rotation of the
meter. Consequently, DECORP issued a corrected bill but McADORE refused to pay. As a result
of McADORE's failure and continued refusal to pay the corrected electric bills, DECORP
disconnected power supply to the hotel on November 27, 1978.
Aggrieved, McADORE commenced a suit against DECORP for damages with prayer for
a writ of preliminary injunction. McADORE posted injunction bonds from several sureties, one of
which was herein petitioner PARAMOUNT, which issued an injunction bond on July 7, 1980 with
a face amount of P500,000.00. Accordingly, a writ of preliminary injunction was issued wherein
DECORP was ordered to continue supplying electric power to the hotel and restrained from further
disconnecting it.
After due hearing, the Regional Trial Court of Quezon City, Branch 106, rendered
judgment in favor of DECORP and that Paramount is jointly and severally liable with McAdore
to the extent of the value of the bond, to pay the damages adjudged to Decorp.
PARAMOUNT contended that it was not given its day in court because it was not notified by
DECORP of its intention to present evidence of damages against its injunction bond, as mandated
by Sec. 9 of Rule 58, in relation to Sec. 20 of Rule 57 of the Revised Rules of Court.
Issue:
Whether or not the mandatory procedure in Sec. 20, Rule 57, in relation to Sec 9, rule 58,
rules of court was not observed in this case.
Ruling:
No. A preliminary injunction or temporary restraining order may be granted only when,
among others, the applicant, unless exempted by the court, files with the court where the action or
proceeding is pending, a bond executed to the party or person enjoined, in an amount to be fixed
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by the court, to the effect that the applicant will pay such party or person all damages which he
may sustain by reason of the injunction or temporary restraining order if the court should finally
decide that the applicant was not entitled thereto. Upon approval of the requisite bond, a writ of
preliminary injunction shall be issued. 9 At the trial, the amount of damages to be awarded to either
party, upon the bond of the adverse party, shall be claimed, ascertained, and awarded under the
same procedure prescribed in Section 20 of Rule 57
The above rule comes into play when the plaintiff-applicant for injunction fails to sustain
his action, and the defendant is thereby granted the right to proceed against the bond posted by the
former. In the case at bench, the trial court dismissed McADORE's action for damages with prayer
for writ of preliminary injunction and eventually adjudged the payment of actual, moral, and
exemplary damages against plaintiff-applicant. Consequently, private respondent DECORP can
proceed against the injunction bond posted by plaintiff-applicant to recover the damages
occasioned by the issuance by the trial court of the writ of injunction.
The records of the case disclose that during the trial of the case, PARAMOUNT was
present and represented by its counsel Atty. Nonito Q. Cordero as shown in the trial court's order
dated March 22, 1985. In the said order, PARAMOUNT was duly notified of the next hearing
which was scheduled on April 26, 1985. Evidently, PARAMOUNT was well-apprised of the next
hearing and it cannot feign lack of notice. Having been given an opportunity to be heard during
the main hearing for the matter of damages, PARAMOUNT therefore, cannot bewail that it was
not given an opportunity to be heard upon denial of its motion to cancel its injunction bond. Of
what use, therefore, is there to conduct another hearing when the issue of damages has been the
subject of the main action of which PARAMOUNT had been duly notified? A new notice and
hearing prescribed by Sec. 20, Rule 57, is therefore a repetition and a superfluity.
63. Malayan Insurance vs. Salas

G.R. No. L-48820; May 25, 1979
Facts:
This case is about Malayan Insurance’s liability on its replevin bond which was not
included in the final judgment against the principal in the bond. It is undisputed that in 1970,
Makati Motor Sales, as vendor mortgagee, sued Rosendo Fernando for the recovery of four diesel
trucks and the connection of the balance of his obligation plus damages.
Makati Motors Sales posted a replevin bond executed by the Malayan Insurance. In that
bond, the surety bound itself to pay P362,775.92 "for the return of the property to the defendant,
if the return thereof be adjudged, and for the payment of such sum as may in the cause be recovered
against the plaintiff ". Pursuant to the order of the court, the sheriff seized the four trucks. Later,
two of the trucks were returned to Fernando.
2 Mar ’73: After trial, the lower court rendered judgment, ordering Makati Motor to return
to Fernando the other 2 trucks and to pay him for the seizure of each of them in the sum of 300
daily from Sep 25 and 26, 1970 until return plus P26k as actual and moral damages. In turn,
Fernando was ordered to pay Makati Motor the sum of P66,998.34 as the balance of the price of
the 2 trucks.
Makati Motor appealed. Affirmed. Meanwhile, 11 May ’73: Before elevation of the record
to the CA, Fernando filed in the TC an application for damages against the replevin bond. Malayan
Insurance opposed on the ground that the TC had lost jurisdiction over the case because of the
perfection of the appeal. Application was denied. 27 May: Fernando filed in the CA his claim for
damages against the replevin bond and prayed that the same be included in the judgment.
CA did not act immediately on that claim but in its 1977 decision, it observed that
Fernando's motion or claim "was correct" and it ordered that his claim against Malayan Insurance
"be heard before the trial court". That decision affirming the lower court's judgment became final
and executory on March 18, 1977. 6 Apr ’77: After remand of the record to the TC, Fernando filed
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motion to set for hearing his application for damages against the surety on its replevin bond.
Malayan Insurance moved to quash the proceeding regarding the claim for damages, contending
that TC has no jurisdiction to alter or modify the final judgment of the CA.
14 Jul ’78: TC denied the motion to quash and directed Malayan Insurance to pay Fernando
the damages which it had adjudged. Malayan Insurance’s contention: TC’s judgment against it is
not warranted under section 20 of Rule 57. Assailed the TC’s competence to render judgment
against the surety after the decision of the CA against the surety's principal had become final and
executory.
Issues:
Whether or not the trial court has jurisdiction to hear the Fernando’s application
Ruling:
Yes. The TC has jurisdiction to pass upon Fernando's application for the recovery of
damages on the surety's replevin bond. The reason is that Fernando seasonably filed his application
for damages in the CA. It was not his fault that the damages claimed by him against the surety
were not included in the judgment of the CA affirming the trial court's award of damages to
Fernando payable by the principal in the replevin bond. The peculiar factual situation of this case
makes it an exception to the settled rule that the surety's liability for damages should be included
in the final judgment to prevent duplicity of suits or proceedings.
As may be gathered from section 20 of Rule 57, the application for damages against the
surety must be filed (with notice to the surety) in the CFI before the trial or before appeal is
perfected or before the judgment becomes executory.
If an appeal is taken, the application must be filed in the appellate court but always before
the judgment of that court becomes executory so that the award may be included in its judgment.
But it is not always mandatory that the appellate court should include in its judgment the award of
damages against the surety. Thus, it was held that where the application for damages against the
surety is seasonably made in the appellate court, "the latter must either proceed to hear and decide
the application or refer "it" to the trial court and allow it to hear and decide the same".
In the case at bar, Fernando in 1974 made a timely claim in the CA for an award of damages
against Malayan Insurance enforceable against its replevin bond. The surety was notified of that
application. It registered an opposition to the claim. The CA did not resolve the claim immediately
but in its 1977 decision it directed TC to hear that claim. Obviously, the lower court has no choice
but to implement that directive which is the law of the case.
64. Zaragoza vs. Fidelino

GR No. L-29723, July 14, 1988
Facts:
Petitioner Antonio Zaragosa filed an action for replevin in the CFI at Quezon City for the
car he sold to respondent Maria Fidelino since the latter failed to pay the price in the manner
stipulated in the contract. The car was taken from Fidelino’s possession by the sheriff on the
strength of a writ of delivery but was promptly returned when a surety bond for the car’s release
was posted in her behalf by Mabini Insurance & Fidelity Co., Inc. (herein referred as surety). The
lower court ruled in favor of Zaragoza ordering Fidelino and her surety to pay jointly and severally
the balance of the car sold. The surety filed a motion for reconsideration arguing that the lower
court never acquired jurisdiction over it since no summons was ever served on it, its filing of a
counter-bond not being equivalent to voluntary submission to the Court's jurisdiction.
Issue:
Whether or not the lower court acquires jurisdiction over the person of the surety making
liable to pay the balance of the car sold.
73
Ruling:
Yes. The terms of the counter-bond voluntarily filed by a surety in defendant's behalf leave
no doubt of its assent to be bound by the court's adjudgment of the defendant's liability, i.e., its
acceptance of the court's jurisdiction. . For in that counter bond, it implicitly prayed for affirmative
relief; the release of the seized car, in consideration of which it explicitly bound itself solidarily
with said defendant to answer for the delivery of the car subject of the action "if such delivery is
adjudged," i.e., commanded by the Court's judgment, or "for the payment of such sum as may be
recovered against the defendant and the costs of the action," the reference to a possible future
judgment against the defendant, and necessarily against itself, being certain and unmistakable. The
filing of that bond was clearly an act of voluntary submission to the Court's authority, which is one
of the modes for the acquisition of jurisdiction over a party.
Further, the enforcement of a surety's liability on a counter-bond given for the release of property
seized under a writ of preliminary attachment is governed by Section 17, Rule 57 of the Rules of
Court, which reads as follows: SEC. 17. When execution returned unsatiated, recovery had upon
bond. — If the execution be returned unsatisfied in whole or in part, the surety or sureties on any
counter-bond given pursuant to the provisions of this rule to secure the payment of the judgment
shall become charged on such counter-bond, and bound to pay to the judgment creditor upon
demand, the amount due under the judgment, which amount may be recovered from such surety
or sureties after notice and summary hearing in the same action."
In this case, the record shows that the surety bounds itself to “jointly and severally” with
the defendant. This being so, the appellant surety's liability attached upon the promulgation of the
verdict against Fidelino. All that was necessary to enforce the judgment against it was, as
aforestated, an application therefor with the Court, with due notice to the surety, and a proper
hearing.
65. Phil-Air Conditioning Center cs. RCJ Lines

G.R. No. 193821; November 23, 2015
Facts:
For failure of RCJ Lines to pay the balance for the purchase of four Carrier Paris 240 air-
conditioning units for buses to Phil-Air despite its demand, the latter filed a complaint for sum of
money with prayer for the issuance of a writ of preliminary attachment. The RTC granted the
application for the issuance of a writ of preliminary attachment after Phil-Air posted an attachment
bond. Two buses of RCJ Lines were attached pursuant to the writ. However, the attachment was
later lifted when the RTC granted RCJ Lines' urgent motion to discharge the writ of attachment
and upon posting of a counter-bond in the same amount as the attachment bond.
In its answer to the complaint, RCJ Lines refused to pay the balance because Phil-Air
allegedly breached its warranty. RCJ Lines averred that the units did not sufficiently cool the buses
despite repeated repairs. Further, RCJ Lines claimed that it was also entitled to be reimbursed on
the lost profits for nine days resulting from the attachment of its two buses.
The RTC ruled in favor of RCJ Lines. The CA affirmed the RTC decision in toto. It ordered
Phil-Air to reimburse the premium payment for the counter-bond and the alleged losses suffered
by RCJ Lines.
Issue:
Whether or not Phil-Air should reimburse RCJ Lines for the counter- bond premium and
its alleged unrealized profits.
Ruling:
No. Phil-Air is not directly liable for the counter-bond premium and RCJ Lines' alleged
unrealized profits. Section 4 of Rule 57 of the Rules of Civil Procedure (Rules) provides that "the
74
party applying for the order must...give a bond executed to the adverse party in the amount fixed
by the court, in its order granting the issuance of the writ, conditioned that the latter will pay all
the costs that may be adjudged to the adverse party and all damages that he may sustain by reason
of the attachment, if the court shall finally adjudge that the applicant was not entitled thereto."
The discharge of the attachment by depositing cash or posting a counter-bond under

Section 12 should not be confused with the discharge sanctioned under Section 13. Section 13
speaks of discharge on the ground that the writ was improperly or irregularly issued or enforced,
or that the attachment bond is insufficient, or that the attachment is excessive. The discharge of
the preliminary attachment either through Section 12 or Section 13 has no effect on and does not
discharge the attachment bond. The dissolution of the preliminary attachment does not result in
the dissolution of the attachment bond.
Phil-Air cannot be held directly liable for the costs adjudged to and the damages sustained
by RCJ Lines because of the attachment. Section 4 of Rule 57 positively lays down the rule that
the attachment bond will pay "all the costs which may be adjudged to the adverse party and all
damages which he may sustain by reason of the attachment, if the court shall finally adjudge that
the applicant was not entitled thereto."
The RTC, instead of declaring Phil-Air liable for the alleged unrealized profits and counter-
bond premium, should have ordered the execution of the judgment award on the attachment bond.
To impose direct liability to Phil-Air would defeat the purpose of the attachment bond, which was
not dissolved despite the lifting of the writ of preliminary attachment.
66. Watercraft Venture Corporation vs. Wolfe

G.R. No. 181721; September 9, 2015
Facts:
For failure to pay an unpaid boat storage fees despite repeated demands, Watercraft
Venture Corporation (Watercraft) filed against Alfred Raymond Wolfe (Wolfe) a Complaint for
Collection of Sum of Money with Damages with an Application for the Issuance of a Writ of
Preliminary Attachment. Finding Watercraft's ex-parte application for writ of preliminary
attachment sufficient in form and in substance, the RTC granted the same. Wolfe filed a Motion
to Discharge the Writ of Attachment, arguing that Watercraft failed to show the existence of fraud
and that the mere failure to pay or perform an obligation does not amount to fraud. The motion
was denied by the RTC. However, the CA ruled that the act of issuing the writ of preliminary
attachment ex-parte constitutes grave abuse of discretion on the part of the RTC because the
affidavit submitted by Watercraft failed to show fraudulent intent on the part of Wolfe to defraud
the company. It merely enumerated the circumstances tending to show the alleged possibility of
Wolfe's flight from the country.
Stressing that its application for such writ was anchored on two (2) grounds under Section
1, Rule 57, Watercraft insists that, contrary to the CA ruling, its affidavit of merit sufficiently
averred with particularity the circumstances constituting fraud as a common element of said
grounds.
Issue:
Whether or not the ex-parte issuance of the preliminary attachment in favor of Watercraft
Venture Corporation is valid.
Ruling:
No. A writ of preliminary attachment is defined as a provisional remedy issued upon order
of the court where an action is pending to be levied upon the property or properties of the defendant
therein, the same to be held thereafter by the sheriff as security for the satisfaction of whatever
judgment that might be secured in the said action by the attaching creditor against the defendant.
However, it should be resorted to only when necessary and as a last remedy because it exposes the
75
debtor to humiliation and annoyance. It must be granted only on concrete and specific grounds and
not merely on general averments quoting the words of the rules. Since attachment is harsh,
extraordinary, and summary in nature, the rules on the application of a writ of attachment must be
strictly construed in favor of the defendant. the court in which the action is pending. Such bond
executed to the adverse party in the amount fixed by the court is subject to the conditions that the
applicant will pay: (1) all costs which may be adjudged to the adverse party; and (2) all damages
which such party may sustain by reason of the attachment, if the court shall finally adjudge that
the applicant was not entitled thereto. As to the requisite affidavit of merit, Section 3, Rule 57of
the Rules of Court states that an order of attachment shall be granted only when it appears in the
affidavit of the applicant, or of some other person who personally knows the facts: 1. that a
sufficient cause of action exists; 2. that the case is one of those mentioned in Section 1 hereof; 3.
that there is no other sufficient security for the claim sought to be enforced by the action; and 4.
that the amount due to the applicant, or the value of the property the possession of which he is
entitled to recover, is as much as the sum for which the order is granted above all legal
counterclaims.
The mere filing of an affidavit reciting the facts required by Section 3, Rule 57, however,
is not enough to compel the judge to grant the writ of preliminary attachment. Whether or not the
affidavit sufficiently established facts therein stated is a question to be determined by the court in
the exercise of its discretion.
67. Excellent Quality Apparel, Inc. vs. Visayan Surety & Insurance Corporation
G.R. No. 212025; July 1, 2015
Facts:
Win Multi-Rich filed a complaint for sum of money and damages with prayer for the
issuance of writ of attachment against Excellent Quality Apparel, Inc. (petitioner) and Max L.F.
Ying (Ying), Vice-President for Productions, before the RTC in relation to the construction of a
garment factory. It claimed that Ying was about to abscond and that petitioner had an impending
closure.
Win Multi-Rich secured the necessary bond from Visayan Surety and Insurance
Corporation (Visayan Surety) and the RTC then issued a writ of preliminary attachment. To
prevent the enforcement of the writ, petitioner issued a check payable to the Clerk of Court of the
RTC. Win Multi-Rich then filed a motion to release petitioner’s cash deposit to it which was
granted by the RTC after posting a Surety Bond issued by Far Eastern Surety and Insurance Co.,
Inc. (FESICO). However, when the case was elevated to the Supreme Court, in G.R. No. 175048,
it ordered Win Multi-Rich to return the garnished amount.
Petitioner moved for execution thereof, praying for the return of its cash deposit and, in the
event of refusal of Win Multi-Rich to comply, to hold Visayan Surety and FESICO liable under
their respective bonds because the Supreme Court ruled that it cannot allow Win Multi-Rich to
retain the garnished amount turned over by the RTC. Also, petitioner claims that the surety bond
of FESICO is not covered by Section 20, Rule 57 because it did not pertain to the writ of attachment
itself, but on the withdrawal of the cash deposit.
Visayan Surety asserted that no application for damages was filed before the Court to hear
and decide in G.R. No. 175048. Thus, there is a violation of its right to due process. Also, Visayan
Surety contended that Section 20, Rule 57 provided a mandatory rule that an application for
damages must be filed before the judgment becomes final and executory. FESICO, on the other
hand, averred that petitioner failed to comply with Section 20, Rule 57 of the Rules of Court
because the hearing on the motion for execution was conducted after the decision in G.R. No.
175048 had already become final and executory. It also stated that petitioner failed to implead the
surety Visayan Surety and FESICO as parties in G.R. No. 175048. Petitioner stressed that because
the highest court of the land had directed the return of the wrongfully garnished amount,
proceedings on the application under Section 20, Rule 57, became no longer necessary.
76
Issues:
(1) Whether or not Visayan Surety can be held liable under Section 20, Rule 57 of the Rules
of Court
(2) Whether or not FESICO’s bond is covered by Section 20, Rule 57 of the Rules of Court
Rulings:
(1) No. By its nature, preliminary attachment, under Rule 57 of the Rules of Court, "is an
ancillary remedy applied for not for its own sake but to enable the attaching party to realize
upon relief sought and expected to be granted in the main or principal action; it is a measure
auxiliary or incidental to the main action. As such, it is available during the pendency of
the action which may be resorted to by a litigant to preserve and protect certain rights and
interests therein pending rendition and for purposes of the ultimate effects, of a final
judgment in the case. In addition, attachment is also availed of in order to acquire
jurisdiction over the action by actual or constructive seizure of the property in those
instances where personal or substituted service of summons on the defendant cannot be
effected."
The party applying for the order of attachment must thereafter give a bond executed to the
adverse party in the amount fixed by the court in its order granting the issuance of the writ.
The purpose of an attachment bond is to answer for all costs and damages which the adverse
party may sustain by reason of the attachment if the court finally rules that the applicant is
not entitled to the writ. In this case, the attachment bond was issued by Visayan Surety in
order for Win Multi-Rich to secure the issuance of the writ of attachment.
Section 20, Rule 57 of the 1997 Rules of Civil Procedure covers application for damages
against improper attachment, preliminary injunction, receivership, and replevin. The Court
has cited the requisites under Section 20, Rule 57 in order to claim damages against the
bond, as follows: 1. The application for damages must be filed in the same case where the
bond was issued; 2. Such application for damages must be filed before the entry of
judgment; and 3. After hearing with notice to the surety.
The purpose of requiring the application for damages to be filed in the same proceeding is
to avoid the multiplicity of suit and forum shopping. It is also required to file the application
against the bond before the finality of the decision to prevent the alteration of the
immutable judgment.
Petitioner failed to comply with the requisites under Section 20, Rule 57 because Visayan
Surety was not given due notice on the application for damages before the finality of
judgment. The subsequent motion for execution, which sought to implicate Visayan Surety,
cannot alter the immutable judgment anymore.
(2) No. Strictly speaking, the surety bond of FESICO is not covered by any of the provisions
in Rule 57 of the Rules of Court because, in the first place, Win Multi-Rich should not
have filed its motion to release the cash deposit of petitioner and the RTC should not have
granted the same. The release of the cash deposit to the attaching party is anathema to the
basic tenets of a preliminary attachment.
The chief purpose of the remedy of attachment is to secure a contingent lien on defendant’s
property until plaintiff can, by appropriate proceedings, obtain a judgmentand have such
property applied to its satisfaction, or to make some provision for unsecured debts in cases
where the means of satisfaction thereof are liable to be removed beyond the jurisdiction,
or improperly disposed of or concealed, or otherwise placed beyond the reach of creditors.
The garnished funds or attached properties could only be released to the attaching party
after a judgment in his favor is obtained.Under no circumstance, whatsoever, can the
garnished funds or attached properties, under the custody of the sheriff or the clerk of court,
be released to the attaching party before the promulgation of judgment.
77
Cash deposits and counterbonds posted by the defendant to lift the writ of attachment is a
security for the payment of any judgment that the attaching party may obtain; they are,
thus, mere replacements of the property previously attached. Nevertheless, the Court must
determine the nature of the surety bond of FESICO. The cash deposit or the counter-bond
was supposed to secure the payment of any judgment that the attaching party may recover
in the action. In this case, however, Win Multi-Rich was able to withdraw the cash deposit
and, in exchange, it posted a surety bond of FESICO in favor of petitioner to answer for
the damages that the latter may sustain. Corollarily, the surety bond of FESICO substituted
the cash deposit of petitioner as a security for the judgment. Thus, to claim damages from
the surety bond of FESICO, Section 17, Rule 57 could be applied. FESICO cannot simply
escape liability by invoking that it was not a party in G.R. No. 175048. From the moment
that FESICO issued Surety Bond No. 10198 to Win Multi-Rich and the same was posted
before the RTC, the court has acquired jurisdiction over the surety, and the provisions of
Sections 12 and 17 of Rule 57 became operational. Thus, the Court holds that FESICO is
solidarily liable under its surety bond with its principal Win Multi-Rich.
Note: The question remains, in contrast to Section 20, why does Section 17 sanction the
notice and hearing to the surety after the finality of judgment? The answer lies in the kind
of damages sought to be enforced against the bond.
Under Section 20, Rule 57, in relation to Section 4 therein, the surety bond shall answer
for all the costs which may be adjudged to the adverse party and all damages which he may
sustain by reason of the attachment. In other words, the damages sought to be enforced
against the surety bond are unliquidated. Necessarily, a notice and hearing before the
finality of judgment must be undertaken to properly determine the amount of damages that
was suffered by the defendant due to the improper attachment. These damages to be
imposed against the attaching party and his sureties are different from the principal case,
and must be included in the judgment.
On the other hand, under Section 17, Rule 57, in relation to Section 12 therein, the cash
deposit or the counter-bond shall secure the payment of any judgment that the attaching
party may recover in the action. Stated differently, the damages sought to be charged
against the surety bond are liquidated. The final judgment had already determined the
amount to be awarded to the winning litigant on the main action. Thus, there is nothing left
to do but to execute the judgment against the losing party, or in case of insufficiency,
against its sureties.
68. Ligon vs. Laigo, et al.

G.R. No. 190028; February 26, 2014
Facts:
In order to secure the satisfaction of a favorable judgment in the Quezon City Case against
Spouses Rosario and Saturnino Baladjay (Sps. Baladjay), et al., Leticia P. Ligon (Ligon) applied
for and was eventually able to secure a writ of preliminary attachment over TCT No. 9273 in the
name of Polished Arrow, which was later annotated on the dorsal portion of the said title. On the
other hand, Makati City RTC issued a decision rescinding the transfer of the subject property from
Sps. Baladjay to Polished Arrow upon a finding that the same was made in fraud of creditors which
resulted to the cancellation of TCT No. 9273 and the restoration of TCT No. 8502 in its previous
condition.
A decision in favor Ligon has been rendered but when the latter sought its execution, it
was discovered that the attachment annotation had been deleted from TCT No. 9273 when the
subject property was sold by way of public auction to the highest bidder, Leonardo J. Ting, during
the execution proceedings in the Makati City Case. Ligon filed a certiorari petition alleging that
the Makati City RTC committed grave abuse of discretion. The RTC of Makati explained that it
78
could not allow the LRA to carry over all annotations previously annotated on TCT No. 9273 as
said course of action would run counter to its decision which specifically cancels the said title.
Issue:
Whether or not the deletion of attachment annotation from TCT No. 9273 is proper.
Ruling:
No. Attachment is defined as a provisional remedy by which the property of an adverse
party is taken into legal custody, either at the commencement of an action or at any time thereafter,
as a security for the satisfaction of any judgment that may be recovered by the plaintiff or any
proper party. Case law instructs that an attachment is a proceeding in rem, and, hence, is against
the particular property, enforceable against the whole world. Accordingly, the attaching creditor
acquires a specific lien on the attached property which nothing can subsequently destroy except
the very dissolution of the attachment or levy itself. Such a proceeding, in effect, means that the
property attached is an indebted thing and a virtual condemnation of it to pay the owner’s debt.
The lien continues until the debt is paid, or sale is had under execution issued on the judgment, or
until the judgment is satisfied, or the attachment discharged or vacated in some manner provided
by law. Thus, a prior registration of an attachment lien creates a preference, such that when an
attachment has been duly levied upon a property, a purchaser thereof subsequent to the attachment
takes the property subject to the said attachment. As provided under PD 1529, said registration
operates as a form of constructive notice to all persons.
Ligon’s attachment lien over the subject property continued to subsist since the attachment she
had earlier secured binds the property itself, and, hence, continues until the judgment debt of Sps.
Baladjay to Ligon as adjudged in the Quezon City Case is satisfied, or the attachment discharged
or vacated in some manner provided by law. The grave abuse of discretion of the Makati City RTC
lies with its directive to issue a new certificate of title in the name of Ting (i.e., TCT No. 19756),
free from any liens and encumbrances. This course of action clearly negates the efficacy of Ligon’s
attachment lien and, also, defies the legal characterization of attachment proceedings. It bears
noting that Ligon’s claim, secured by the aforesaid attachment, is against Sps. Baladjay whose
ownership over the subject property had been effectively restored in view of the RTC’s rescission
of the property’s previous sale to Polished Arrow.
79

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CASE DIGESTS

Atty. Carell Ryza Nartatez- Pendatun

Chester Bryan P. Pelaez

1. Reyes vs. Lim, et al.

G.R. No. 134241; August 11, 2003

2. Davao Light v. Court of Appeals

3. Calo and San Jose vs. Roldan, et al.

The provisional remedies denominated attachment, preliminary injunction, receivership,

Hence, Judge Roldan acted in excess of his jurisdiction in appointing a receiver.

4. K.O. Glass Construction Co., Inc. vs. Valenzuela

6. General vs. de Venecia

It prayed additionally for preliminary attachment of defendant's property, upon the

7. Miailhe vs. Lencquesaing

8. Insular Savings Bank vs. CA

10. Olsen & Co. vs. Olsen

(2) It is admitted by the defendant-appellant that he is indebted to the plaintiff-appellee

11. Santos vs Bernabe

12. State Investment House vs. CA

13. Aboitiz & Company, Inc vs. Cotabato Bus Company

15. Spouses Adlawan vs. Torres

Attachment. — A plaintiff may, at the commencement of his action, or at any time

17. State Investment vs. Citibank

Obviously, the assimilation of foreign corporations authorized to do business in the

18. Sievert vs. CA

Ordinarily, the prayer in a petition for a writ of preliminary attachment is embodied or

19. Cuartero vs. CA

A writ of preliminary attachment is defined as a provisional remedy issued upon order of

20. Northwest Airlines vs CA

The fundamental rule is that jurisdiction in personam over nonresidents, so as to sustain a

xxx xxx xxx

21. Salas vs. Adil

22. La Granja, Inc. vs. Samson

23. Jardine vs. CA

24. Ting vs. Villarin

25. Carlos vs. Sandoval

26. H.B. Zachry Company International vs. CA

27. Siari Valley Estates, Inc. vs. Lucasan, et al.

28. Ravanera vs. Imperial

29. Obaña vs. CA

On appeal CA dismissed petitioner Obaña’s complaint on the grounds of lack of cause of

30.) Du vs. Stronghold Insurance

31. Valdevieso vs. Damalerio

RTC ruled in favor of Valdevieso. Citing Manliguez v. Court of Appealsand Santos v.

32. Walker vs. Mcmicking

33. National Bureau Of Investigation vs. Tuliao

Again, a verbal declaration of seizure or service of a writ of attachment is not sufficient.

That he exerted efforts in going to the creditor's residence in Tuguegarao, Cagayan to

34. Villanueva-Fabella vs. Lee

expected" of an employee, thus signifying a "disregard of a duty resulting from carelessness or

35. Sebastian vs. Valino

36. Villareal vs. Rarama

37. Balantes vs Ocampo

Respondent Judge issued a Writ of Execution and Demolition pending an appeal on

38. Elipe vs. Fabre

Petitioners’ remedy was to ventilate their claims of ownership in a separate and

40. Summit Trading vs. Avendano

41. Chemphil Export & Import Corporation vs. CA

A notice of garnishment covering Garcia's shares in CIP/Chemphil (including the disputed

42) Gotauco vs. Registry of Deeds

43. Engineering vs. NPC

payment to ECI of P1,114,543.23, thus in effect subjecting MERALCO to double liability.

Garnishment is considered as a specie of attachment for reaching credits belonging to the

44. RCBC v de Castro