Provisional Remedies

G.R. No.
L-252
March 30, 1946
TRANQUILINO CALO and DOROTEO SAN JOSE, petitioners,

vs.
ARSENIO C. ROLDAN, Judge of First Instance of Laguna, REGINO RELOVA and
TEODULA BARTOLOME,respondents.
FERIA, J.:
This is a petition for writ of certiorari against the respondent Judge Arsenio C.
Roldan of the Court First Instance of Laguna, on the ground that the latter has
exceeded his jurisdiction or acted with grave abuse of discretion in appointing a
receiver of certain lands and their fruits which, according to the complainant filed
by the other respondents, as plaintiffs, against petitioners, as defendants, in case
No. 7951, were in the actual possession of and belong to said plaintiffs.
The complaint filed by plaintiffs and respondents against defendants and
petitioners in the Court of First Instance of Laguna reads as follows:
1. That the plaintiffs and the defendants are all of legal age, Filipino
citizens, and residents of Pila, Laguna; the plaintiffs are husband and wife..
2. That the plaintiff spouses are the owners and the possessors of the
following described parcels of land, to wit:.
xxx
xxx
xxx
3. That parcel No. (a) described above is now an unplanted rice land and
parcel No. (b) described in the complaint is a coconut land, both under the
possession of the plaintiffs..
4. That the defendants, without any legal right whatsoever and in
connivance with each other, through the use of force, stealth, threats and
intimidation, intend or are intending to enter and work or harvest whatever
existing fruits may now be found in the lands above-mentioned in violation
of plaintiff's in this case ineffectual..
5. That unless defendants are barred, restrained, enjoined, and prohibited
from entering or harvesting the lands or working therein through ex-parte
injunction, the plaintiffs will suffer injustice, damages and irreparable injury
to their great prejudice..
1|PR OVISIONAL REM EDIES
6. That the plaintiffs are offering a bond in their application for ex-parte
injunction in the amount of P2,000, subject to the approval of this Hon.
Court, which bond is attached hereto marked as Annex A and made an
integral part of this complaint..
7. That on or about June 26, 1945, the defendants, through force,
destroyed and took away the madre-cacao fencer, and barbed wires built
on the northwestern portion of the land designated as parcel No. (b) of this
complaint to the damage and prejudice of the plaintiffs in the amount of at
least P200..
Wherefore, it is respectfully prayed:.
(a) That the accompanying bond in the amount of P2,000 be approved;
(b) That a writ of preliminary injunction be issued ex-parte immediately
restraining, enjoining and prohibiting the defendants, their agents,
servants, representatives, attorneys, and, (or) other persons acting for and
in their behalf, from entering in, interfering with and/or in any wise taking
any participation in the harvest of the lands belonging to the plaintiffs; or in
any wise working the lands above-described;
(c) That judgment be rendered, after due hearing, declaring the preliminary
injunction final;.
(d) That the defendants be condemned jointly and severally to pay the
plaintiffs the sum of P200 as damages; and.
(e) That plaintiffs be given such other and further relief just and equitable
with costs of suit to the defendants.
The defendants filed an opposition dated August 8, 1945, to the issuance of the
writ of preliminary injunction prayed for in the above-quoted complaint, on the
ground that they are owners of the lands and have been in actual possession
thereof since the year 1925; and their answer to the complaint filed on August 14,
1945, they reiterate that they are the owners and were then in actual possession
of said property, and that the plaintiffs have never been in possession thereof.
The hearing of the petition for preliminary injunction was held on August 9, 1945,
at which evidence was introduced by both parties. After the hearing, Judge
Rilloraza, then presiding over the Court of First Instance of Laguna, denied the
petition on the ground that the defendants were in actual possession of said
lands. A motion for reconsideration was filed by plaintiffs on August 20, 1945, but
said motion had not yet, up to the hearing of the present case, been decided
either by Judge Rilloraza, who was assigned to another court, or by the
respondent judge.
The plaintiffs (respondents) filed on September 4, 1945, a reply to defendants'
answer in which, among others, they reiterate their allegation in the complaint
that they are possessors in good faith of the properties in question.
And on December 17, plaintiffs filed an urgent petition ex-parte praying that
plaintiffs' motion for reconsideration of the order denying their petition for
preliminary injunction be granted and or for the appointment of a receiver of the
properties described in the complaint, 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 of the properties in litigation which included their fruits.
Respondents Judge Roldan, on the same date, December 17, 1945, decided that
the court would consider the motion for reconsideration in due time, and granted
the petition for appointment of and appointed a receiver in the case.
The question to be determined in the present special civil action of certiorari is,
whether or not the respondent judge acted in excess of his jurisdiction or with
grave abuse of discretion in issuing the order appointing a receiver in the case No.
7951 of the Court of First Instance of Laguna; for it is evident that there is no
appeal or any other plain, speedy, and adequate remedy in the ordinary course of
the law against the said order, which is an incidental or interlocutory one.
It is a truism in legal procedure that what determines the nature of an action filed
in the courts are the facts alleged in the complaint as constituting the cause of the
action. The facts averred as a defense in the defendant's answer do not and can
not determine or change the nature of the plaintiff's action. The theory adopted
by the plaintiff in his complaint is one thing, and that of the defendant in his
answer is another. The plaintiff has to establish or prove his theory or cause of
action in order to obtain the remedy he prays for; and the defendant his theory, if
necessary, in order to defeat the claim or action of the plaintiff..
According to the complaint filed in the said case No. 7951, the plaintiff's action is
one of ordinary injunction, for the plaintiffs allege that they are the owners of the
lands therein described, and were in actual possession thereof, and that "the
defendants without any legal right whatever and in connivance with each other,
through the use of force, stealth, threat and intimidation, intend or are intending
to enter and work or harvest whatever existing fruits may be found in the lands
above mentioned in violation of plaintiffs' proprietary rights thereto;" and prays
"that the defendants, their agents, servants, representatives, and other persons
acting for or in their behalf, be restrained, enjoined and prohibited from entering
in, interfering with, or in any way taking any participation in the harvest of the
lands above describe belonging to the plaintiffs."
That this is the nature of plaintiffs' action corroborated by the fact that they
petitioned in the same complaint for a preliminary prohibitory injunction, which
was denied by the court in its order dated August 17, 1945, and that the plaintiffs,
in their motion for reconsideration of said order filed on August 20 of the same
year, and in their urgent petition dated December 17, moving the court to grant
said motion for reconsideration, reiterated that they were actual possessors of
the land in question.
The fact that plaintiffs, in their reply dated September 4, after reiterating their
allegation or claim that they are the owners in fee simple and possessors in good
faith of the properties in question, pray that they be declared the owners in fee
simple, has not changed the nature of the action alleged in the complaint or
added a new cause of action thereto; because the allegations in plaintiffs' reply
were in answer to defendants' defenses, and the nature of plaintiffs' cause of
action, as set forth in their complaint, was not and could not be amended or
changed by the reply, which plaintiffs had the right to present as a matter of
course. A plaintiff can not, after defendant's answer, amend his complaint by
changing the cause of action or adding a new one without previously obtaining
leave of court (section 2, Rule 17)..
Respondents' contention in paragraph I of their answer that the action filed by
them against petitioners in the case No. 7951 of the Court of First Instance of
Laguna is not only for injunction, but also to quiet title over the two parcels of
land described in the complaint, is untenable for the reasons stated in the
previous paragraph. Besides, an equitable action to quiet title, in order to prevent
harrassment by continued assertion of adverse title, or to protect the plaintiff's
legal title and possession, may be filed in courts of equity (and our courts are also
of equity), only where no other remedy at law exists or where the legal remedy
invokable would not afford adequate remedy (32 Cyc., 1306, 1307). In the present
case wherein plaintiffs alleged that they are the owners and were in actual
possession of the lands described in the complaint and their fruits, the action of
injunction filed by them is the proper and adequate remedy in law, for a
judgment in favor of plaintiffs would quiet their title to said lands..
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. For that reason a property subject of litigation between
the parties, or claimed by plaintiff as his, can not 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 thestatus 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..
A receiver may be appointed to take charge of personal or real property which is
the subject of an ordinary civil action, when it appears that the party applying for
the appointment of a receiver has an interest in the property or fund which is the
subject of the action or litigation, and that such property or fund is in danger of
being lost, removed or materially injured unless a receiver is appointed to guard

and preserve it (section 1 [b], Rule 61); or when it appears that the appointment
of a receiver is the most convenient and feasible means of preserving,
administering or disposing of the property in litigation (section 1 [e] of said Rule).
The property or fund must, therefore be in litigation according to the allegations
of the complaint, and the object of appointing a receiver is to secure and preserve
the property or thing in controversy pending the litigation. Of course, if it is not in
litigation and is in actual possession of the plaintiff, the latter can not apply for
and obtain the appointment of a receiver thereof, for there would be no reason
for such appointment.
Delivery of personal property as a provisional remedy consists in the delivery, by
order of the court, of a personal property by the defendant to the plaintiff, who
shall give a bond to assure the return thereof or the payment of damages to the
defendant in the plaintiff's action to recover possession of the same property
fails, in order to protect the plaintiff's right of possession of said property, or
prevent the defendant from damaging, destroying or disposing of the same during
the pendency of the suit.
Undoubtedly, according to law, the provisional remedy proper to plaintiffs' action
of injunction is a preliminary prohibitory injunction, if plaintiff's theory, as set
forth in the complaint, that he is the owner and in actual possession of the
premises is correct. But as the lower court found at the hearing of the said
petition for preliminary injunction that the defendants were in possession of the
lands, the lower court acted in accordance with law in denying the petition,
although their motion for reconsideration, which was still pending at the time the
petition in the present case was heard in this court, plaintiffs insist that they are
in actual possession of the lands and, therefore, of the fruits thereof.
From the foregoing it appears evident that the respondent judge acted in excess
of his jurisdiction in appointing a receiver in case No. 7951 of the Court of First
Instance of Laguna. 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 (Exhibit I of the petition) 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 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.
Besides, even if the plaintiffs had amended their complaint and alleged that the
lands and palay harvested therein are being claimed by the defendants, and
consequently the ownership and possession thereof were in litigation, it
appearing that the defendants (now petitioners) were in possession of the lands
and had planted the crop or palay harvested therein, as alleged in paragraph 6 (a)
and (b) of the petition filed in this court and not denied by the respondent in
paragraph 2 of his answer, the respondent judge would have acted in excess of
his jurisdiction or with a grave abuse of discretion in appointing a receiver
thereof. Because relief by way of receivership is equitable in nature, and a court
of equity will not ordinarily appoint a receiver where the rights of the parties
depend on the determination of adverse claims of legal title to real property and
one party is in possession (53 C. J., p. 26). The present case falls within this rule..
In the case of Mendoza vs. Arellano and B. de Arellano, this court said:
Appointments of receivers of real estate in cases of this kind lie largely in
the sound discretion of the court, and where the effect of such an
appointment is to take real estate out of the possession of the defendant
before the final adjudication of the rights of the parties, the appointment
should be made only in extreme cases and on a clear showing of necessity
therefor in order to save the plaintiff from grave and irremediable loss or
damage. (34 Cyc., 51, and cases there cited.) No such showing has been
made in this case as would justify us in interfering with the exercise by trial
judge of his discretion in denying the application for receiver. (36 Phil., 59,
63, 64.).
Although the petition is silent on the matter, as the respondents in their answer
allege that the Court of First Instance of Laguna has appointed a receiver in
another case No. 7989 of said court, instituted by the respondents Relova against
Roberto Calo and his brothers and sisters, children of Sofia de Oca and
Tranquilino Calo (petitioner in this case), and submitted copy of the complaint
filed by the plaintiffs (now respondents) in case No. 7989 (Exhibit 9 of the
respondents' answer), we may properly express and do hereby express here our
opinion, in order to avoid multiplicity of suits, that as the cause of action alleged
in the in the complaint filed by the respondents Relova in the other case is
substantially the same as the cause of action averred in the complaint filed in the
present case, the order of the Court of First Instance of Laguna appointing a
receiver in said case No. 7989 was issued in excess of its jurisdiction, and is
therefore null and void.
In view of all the foregoing, we hold that the respondent Judge Arsenio C. Roldan
of the Court of First Instance of Laguna has exceeded his jurisdiction in appointing
a receiver in the present case, and therefore the order of said respondent judge
appointing the receiver, as well as all other orders and proceedings of the court
presided over by said judge in connection with the receivership, are null and void.
As to the petitioners' petition that respondents Relova be punished for contempt
of court for having disobeyed the injunction issued by this court against the
respondents requiring them to desist and refrain from enforcing the order of
receivership and entering the palay therein, it appearing from the evidence in the
record that the palay was harvested by the receiver and not by said respondents,
the petition for contempt of court is denied. So ordered, with costs against the
respondents.
G.R. No. L-63225
April 3, 1990
ELEAZAR V. ADLAWAN, petitioner,

vs.
HON. JUDGE VALERIANO P. TOMOL, as Presiding Judge of Branch XI of RTC-Cebu
(formerly Branch XI, CFI-Cebu), Branch XXVII of RTC-Cebu, with Station in LapuLapu City (formerly Branch XVI, CFI-Cebu, Presided over by former Judge
Ceferino E. Dulay), and ABOITIZ COMPANY, INC., respondents.
FERNAN, C.J.:
This is a special civil action for certiorari and mandamus seeking to annul : [a] the
Order dated December 20, 1982 of respondent Judge Valeriano P. Tomol, Branch
XI of CFI-Cebu, now Branch XI, RTC-Cebu, in Civil Case No. R-21761, entitled
"Aboitiz and Company, Inc. v. Adlawan, et al" denying the motion of the
defendant to require the Provincial Sheriff of Cebu to deliver to him the
properties seized by the Sheriff of Davao City and [b] the Order dated September
4, 1982 of Judge Ceferino F. Dulay, Branch XVI of the Court of First Instance of
Cebu, now Branch XXVII, RTC-Cebu, Lapu-Lapu City, in Civil Case No. 619-L
between the same parties, denying for lack of merit petitioner's Omnibus Motion
to reconsider, dissolve and set aside the Writ of seizure and Replevin.
The antecedent facts are as follows:
Petitioner Eleazar A. Adlawan, a private contractor, was awarded by the National
Irrigation Administration (NIA) and the Bureau of Public Highways (BPH) contracts
for the construction of various infrastructure projects of the government to
perform his obligations thereunder, petitioner sought financial assistance and
support from private respondent Aboitiz and Company, Inc. For failure of
petitioner to pay the installments and amortizations, private respondent filed on
May 13, 1982 before the Court of First Instance of Cebu a complaint 1 for the
collection of a sum of money and damages including an ex-parte application for
the issuance of a writ of preliminary attachment against the property of petitioner
as defendant therein. The Executive Judge without notice and hearing issued an
order 2 on May 14, 1982 directing the issuance of a writ of preliminary
attachment against all the properties of petitioner, real and personal, upon the
filing of an attachment bond for Four Million Pesos. The case, docketed as Civil
Case No. R21761 was raffled and later assigned to Branch XI of the Court of First
Instance of Cebu, presided by respondent Judge Valeriano P. Tomol. On May 26,

1982, writs of preliminary attachment were issued addressed to the Sheriffs of
Cebu, Davao City, Quezon City, Davao del Sur and Davao del Norte, directing them
to attach the real and personal properties of petitioner within their respective
jurisdictions. On the strength of the writ of preliminary attachment, the bulk of
petitioner's property in Davao City was attached.
Subsequently, private respondent filed an Urgent Ex-parte Motions 3 asking the
court that it be allowed to take possession and custody of the attached properties
to protect its interest and to avoid any damage or deterioration considering that
the sheriff has no proper place to store or deposit said properties. This was
granted by respondent Judge on May 28, 1982 for being meritorious.
Meanwhile, petitioner before submitting an answer to the complaint, filed a
Motion for a Bill of Particulars 4 and to Set Aside the Ex-Parte Writ of Preliminary
Attachment 5 which was opposed by private respondent. Finding that the
discharge of the writ of attachment is unavoidable on the ground that it was
issued ex-parte, without notice and hearing, based principally on the alleged
removal or disposition by the defendants of their properties with intent to
defraud the plaintiff, which allegation was limited to a bare assertion and not
persuasively substantial, respondent Judge issued an Orders 6 dated July 6, 1982,
the dispositive portion of which reads:
Accordingly, the Order of May 14, 1982 granting the writ of preliminary
attachment is lifted and vacated. The writs issued on 26 May 1982, are
dissolved and recalled and the properties levied and seized by the Sheriffs
of Cebu and Davao City are discharged and released.
SO ORDERED. (Emphasis supplied)
In view of the foregoing, private respondent Aboitiz and Company, Inc. filed an
Urgent Ex-Parte Motion 7 dated July 7, 1982 praying for a stay of the July 6, 1982
Order dissolving the writ of preliminary attachment, thus maintaining the status
quo. Private respondent further prayed for the court to direct the sheriff of Davao
City to desist and/or stop the enforcement or implementation of the order lifting
the attachment and to grant them fifteen (15) days to elevate the matter to the
Appellate Court. Consequently, respondent Judge Tomol issued on the same day
an Orders 8 granting the motion prayed for by private respondent Aboitiz and
Company, Inc. Thus, the July 6, 1982 Order was stayed.
10 | P R O V I S I O N A L R E M E D I E S
In the meantime, three (3) Deputy Sheriffs of Cebu implemented the Order lifting
the Writ of Attachment and were able to pull out some personal properties of
petitioner Adlawan. They were not able to take out all the attached properties in
view of the subsequent Order of respondent judge to stay its implementation.
As petitioner's Motion for a Bill of Particulars was not immediately acted upon, he
was not able to file an answer or interpose any counterclaim. For this reason,
petitioner filed an Application for Award of Damages dated July 9, 1982 asking for
a reasonable rental on the attached heavy construction equipment, machineries
and other properties at the rate of P30,000.00 per day from the date of seizure
until said properties are actually returned to his possession and control.9
Before the court a quo could act on the motions of petitioner Adlawan, and
before he could file an answer, his motion for a bill of particulars not having been
acted upon, private respondent Aboitiz and Company, Inc., filed on July 13, 1982 a
Notice of Dismissal or Withdrawal of Complaint 10 as a matter of right in
accordance with Section 1, Rule 17 of the Rules of Court. Respondent Judge
Tomol issued an Order 11 dated July 15, 1982, the dispositive portion of which
reads:
Accordingly, the termination of this case upon the notice of dismissal
voluntarily filed by the plaintiff is hereby confirmed. For emphasis, all
orders of this Court issued prior to the filing of said notice of dismissal are
each and all rendered functus officio. By the same token, all pending
incidents, particularly the defendant's motion for a bill of particulars and
their petition for damages against the Plaintiffs attachment bond, are now
beyond the competence of this Court to consider for being moot and
academic.
SO ORDERED
Petitioner Adlawan filed a Motion 12 dated July 28, 1982 praying for the issuance
of an order to the Provincial Sheriff of Cebu to implement and enforce the Order
of respondent Judge dated July 6, 1982 dissolving the writ of preliminary
attachment and to secure the delivery of the attached properties to the
petitioner. Respondent Judge issued an Order 13 dated December 20, 1982
denying the Motion in view of the institution by private respondent Aboitiz and
Company, Inc. of a civil case (No. 619-L) for delivery of Personal Properties with
Replevin and Damages before the Court of First Instance of Cebu, Branch XVI in
Lapu-Lapu City on July 13, 1982 and the filing of petitioner Adlawan of a case for
damages (Civil Case No. 22265) before the Court of First Instance of Cebu, Branch
X, in connection with the seizure of his properties under the writ of preliminary
attachment.
With regard to the replevin case filed by private respondent Aboitiz and
Company, Inc., the Court of First Instance of Cebu, Branch XVI, Lapu-Lapu City,
issued an Order 14 for the seizure and delivery of the properties described therein
to the private respondent. The seized properties were thus delivered to private
respondent by the Clerk of Court and Ex-officio Provincial Sheriff on July 24, 1982.
Petitioner filed an Omnibus Motion 15 dated July 17, 1982 to reconsider, dissolve
and set aside the Writ of Seizure and Replevin and to direct that the properties
seized be returned to petitioner as well as to dismiss the complaint. In support of
this motion, petitioner alleged, among others, that private respondent's office is
situated in Cebu City while petitioner is a resident of mainland Cebu, particularly
Minglanilla therefore the Court of First Instance of Cebu stationed in Lapu-Lapu
should not accept the case. Furthermore, he alleged that the same personal
properties seized are in custodia legis by virtue of a writ of preliminary
attachment issued by the Court of First Instance of Cebu, Branch XI, presided by
respondent Judge Tomol. The Court of First Instance of Cebu, Branch XVI in LapuLapu City, presided by Judge Ceferino E. Dulay denied the Omnibus Motion for
lack of merit on September 4, 1982. Petitioner Adlawan filed a Motion for
Reconsideration but the same was denied.
Hence, the present petition for certiorari and mandamus impleading respondent
Judge Valeriano P. Tomol as Presiding Judge of Branch XI of the Court of First
Instance of Cebu (now Branch XI, RTC-Cebu) and Branch XVI, CFI-Cebu presided by
Judge Ceferino E. Dulay in Lapu-Lapu City (now Branch XXVII of RTC Cebu in LapuLapu) and private respondent Aboitiz and Company, Inc.
The issues raised by petitioner Adlawan are the following, to wit:
1) After the attachment of petitioner's properties was dissolved and
discharged because it was found by respondent Judge to be wrongful and
illegal, does it not constitute grave and manifest abuse of discretion on the
part of the same respondent judge TO REFUSE to implement his own order
for the return of the attached properties to petitioner simply because
private respondent suddenly dismissed its complaint?
2) On the other hand, the court, after having deprived petitioner possession
and enjoyment of his properties, by reason of an attachment which,
subsequently, was dissolved and discharged, was it not the clear, specific
and inescapable duty of that same court, to order that said properties be
returned and restored to the possession and enjoyment of petitioner?
3) Are not the attached properties of petitioner under the custodia legis of
the attaching court Branch XI, CFI-Cebu (now Branch XI, RTC-Cebu) and,
therefore, subject to its jurisdiction and control? If so, does it not constitute
grave and manifest abuse of discretion on the part of the attaching court to
literally wash his (sic) hands off any duty or responsibility by considering
himself (sic) as having been divested of authority to deal with such
properties?
4) Did not the Lapu-Lapu Branch of CFI-Cebu act, without or in excess of his
(sic) jurisdiction or, at least, with grave abuse of discretion, in taking
cognizance of the replevin case which involves properties already in
custodia legis of Branch XI of CFI-Cebu?
5) On the other hand, was it not the clear, specific and inescapable duty of
the Lapu-Lapu Branch of CFI-Cebu, to dismiss the replevin case and dissolve
the writ of replevin, not only because of the principle of custodia legis but
also because it was in clear violation of Adm. Order No. 6 of this Honorable
Supreme Court, which amends Adm. Orders No. 147 and 328 of the
Department (now Ministry) of Justice? 16
From the recital of facts may be gleamed a series of peculiar events and
circumstances requiring examination and looking into in order that justice and
equity may be subserved.
Petitioner's properties were attached on the strength of the writs of preliminary
attachment issued without notice and hearing by the executive judge. These
attached properties were given to the custody of private respondent, Aboitiz and
Company, Inc. Petitioner then filed a Motion to Dissolve the Writ of Attachment
which was granted by respondent Judge Tomol. Thus, petitioner was able to
recover some of his properties. But on the following day, this order was stayed by
the same respondent judge leaving the rest of petitioner's properties with private
respondent. Later, private respondent withdrew its complaint which was
confirmed by respondent Judge Tomol. Petitioner Adlawan filed a motion to have
the rest of his properties returned but respondent judge refused to act on said
motion due to cases filed by both parties in the different branches of the Court of
First Instance of Cebu relating to the same case.
After a careful examination of the records of the case We rule in favor of

petitioner Adlawan.
There is no question that the order dated July 6, 1982 of respondent Judge
Valeriano P. Tomol, Jr. lifting and vacating the order granting the writ of
preliminary attachment is a valid order, issued while he had jurisdiction over the
case. The execution of aforesaid order of July 6, 1982 was stayed for a period of
fifteen (15) days on motion of the plaintiff to enable the latter to question the
propriety or impropriety of the same in the appellate court. Instead, plaintiff filed
a civil case for delivery of Personal Properties with Replevin and Damages with
another branch of the CFI of Cebu. Accordingly, having failed to appeal or
question the aforementioned order in the appellate court as originally
manifested, the same became final and executory.
Section 1, Rule 39 of the Revised Rules of Court provides:
Execution upon final judgment or orders. Execution shall issue upon a
judgment or order that finally disposes of the action or proceeding. Such
execution shall issue as a matter of right upon the expiration of the period
to appeal therefrom if no appeal has been perfected.
It is basic that once a judgment becomes final, the prevailing party is entitled as a
matter of right to a Writ of Execution, and the issuance thereof is the Court's
ministerial duty."17
But as earlier stated, the reasons advanced by respondent Judge Tomol for
denying the enforcement of his order dated July 6, 1982 which lifted the writ of
attachment and the restoration of the seized properties to the defendant
petitioner herein are: [a] the filing by private respondent of Civil Case No. 619-L
with Branch XVI of CFI-Lapu-Lapu City for delivery of Personal Properties with
Replevin and Damages which as a consequence, the same properties involved in
this case were seized under a writ of replevin upon order of aforesaid court and
[b] the filing by petitioner of Civil Case No. 22265 before Branch X of the Court of
First Instance of Cebu, for damages.
Hence, the issues in this case center on the nature and purpose of the writ of
attachment.
A writ of preliminary attachment is 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. 18
The provisional remedy of attachment is available in order that the defendant
may not dispose of his property attached, and thus secure the satisfaction of any
judgment that may be secured by plaintiff from defendant. 19 The purpose and
function of an attachment or garnishment is two-fold. First, it seizes upon
property of an alleged debtor in advance of final judgment and holds it subject to
appropriation thus prevents the loss or dissipation of the property by fraud or
otherwise. Second, it subjects to the payment of a creditor's claim property of the
debtor in those cases where personal service cannot be obtained upon the
debtor. 20 This remedy is to secure a contingent lien on defendant's property until
plaintiff can, by appropriate proceedings, obtain a judgment and 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. 21
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 pal action. 22
The remedy of attachment is adjunct to the main suit, therefore, it can have no
independent existence apart from a suit on a claim of the plaintiff against the
defendant. In other words, a attachment or garnishment is generally ancillary to,
and dependent on, a principal proceeding, either at law or in equity, which has for
its purpose a determination of the justice of creditor's demand. 23
Thus, this Court ruled that upon levy by attachment of the property in question by
order of the Court, said property fell into custodia legis of that court for purposes
of that civil case only. Any relief against such attachment and the execution an
issuance of a writ of possession that ensued subsequently could be disposed of
only in that case. 24
More specifically, it was held that courts have no jurisdiction to order the delivery
of personal property (replevin) to the plaintiff if the property is under
attachment. 25 Only courts having supervisory control or superior jurisdiction in
the premises, have the right to interfere with and change possession of property
in custodia legis. 26
More recently, this Court ruled that the garnishment of property to satisfy a writ
of execution operates as an attachment and fastens upon the property a lien by
which the property is brought under the jurisdiction of the court issuing the writ.
It is brought into custodia legis under the sole control of such court. 27
During the life of the attachment, the attached property continues in the custody
of the law, the attaching officer being entitled to its possession and liability for its
safe keeping. 28
Based on the above-cited principles, it is obvious that the writ of preliminary
attachment issued is already dissolved and rendered non-existent in view of the
withdrawal of the complaint by Aboitiz and Company, Inc. More importantly,
even if the writ of attachment can be considered independently of the main case,
the same, having been improperly issued as found by respondent Judge Tomol
himself, is null and void and cannot be a justification for holding petitioners'
properties in custodia legis any longer.
To reiterate, an attachment is but an incident to a suit; and unless the suit can be
maintained, the attachment must fall.
When Aboitiz and Company, Inc. withdrew its complaint, the attachment ceased
to have a leg to stand on. The attached properties of petitioner Adlawan which
are in the custody of private respondent Aboitiz should be returned to petitioner.
This is only proper and equitable and in consonance with the rules and principles
of law. The parties, by the withdrawal of the complaint, should be placed in the
same standing as they were before the filing of the same.
Petitioner also questions the jurisdiction of the CFI of Cebu stationed in Lapu-Lapu
City to hear the replevin case filed by private respondent in view of the fact that
petitioner is a resident of Minglanilla, Cebu while private respondent's principal
place of business is in Cebu City. Obviously, the question posed by petitioner is
venue.
A reading of the Omnibus Motion filed by petitioner, then defendant therein,
would reveal that he not only questioned the jurisdiction of the court but likewise
alleged non-jurisdictional grounds for dismissing the replevin case, such as the
amount of the bond put up by Aboitiz & Co. as grossly insufficient and that the
same properties are involved both in the replevin case and in the original
collection case with preliminary attachment. Thus, in so doing, the court acquired
jurisdiction over him. In the case of Wang Laboratories, Inc. vs. Mendoza 29 this
Court held:
Even though the defendant objects to the jurisdiction of the court, if at the
same time he alleges any non-jurisdictional ground for dismissing the
action, the court acquires jurisdiction over him.
Furthermore, in the case of City of Cebu v. Consolacion, 30 We held that:
. . . any of the branches of the Court of First Instance of the Province of
Cebu, whether stationed in the city of the same name or in any of the
municipalities of the province would be proper venue for its trial and
determination, it being admitted that the parties are residents of the
Province of Cebu . . .
Finally, the employment by counsel for private respondent of dubious procedural
maneuvers as what transpired in the case at bar obviously to continue the
wrongful and illegal possession and custody of petitioner's properties even after
the dissolution of the attachment is to say the least, hardly commendable if not a
form of "forum shopping", to seek the court where he may possibly obtain
favorable judgment. 31
It may therefore be stated that the right to come before the Courts to redress a
grievance or right a wrong should be exercised with prudence and good faith. In
the case of Indianapolis v. Chase National Bank, Trustee, 314 U.S. 69, it is opined
that "Litigation is the pursuit of practical ends, not a game of chess."
WHEREFORE, in view of the foregoing, this Court rules that the attached
properties left in the custody of private respondent Aboitiz and Company, Inc. be
returned to petitioner Eleazar V. Adlawan without prejudice to the outcome of
the cases filed by both parties.
SO ORDERED.
G.R. No. L-45720
December 29, 1937
VENTURA GUZMAN, petitioner,

vs.
ALFREDO CATOLICO and SIMEON RAMOS, Judge of First Instance of
Isabela, respondents.
VILLA-REAL, J.:
This is a petition filed by Ventura Guzman, praying this court, after proper
proceedings, to render judgment declaring illegal and void and setting aside the
writ of preliminary attachment issued by the respondent judge, Honorable
Simeon Ramos, as judge of the Court of First Instance of Isabela, and ordering the
dissolution thereof.
The pertinent facts necessary for the resolution of the legal question raised in the
present case are as follows:
On March 8, 1937, the respondent Alfredo Catolico brought an action against the
herein petitioner Ventura Guzman in the Court of First Instance of Isabela, for the
recovery from the latter of the amount of his fees for services rendered by him as
attorney, praying, at the same time, for the issuance of a writ of preliminary
attachment against all of the properties adjudicated to said petitioner in special
proceedings No. 179 of said court. As grounds for the issuance of said writ of
preliminary attachment, he alleged: "That the herein defendant is trying to sell
and dispose of the properties adjudicated to him, with intention to defraud his
creditors, particularly the herein plaintiff, thereby rendering illusory the judgment
that may be rendered against him, inasmuch as he has no other properties
outside the same to answer for the fees the court may fix in favor of the plaintiff,
this case being one of those mentioned by the Code of Civil Procedure warranting
the issuance of a writ of preliminary attachment" (paragraph 8 of the complaint
there appears the following affidavits: "I, Alfredo Catolico, of age, married and
resident of Tuguegarao, Cagayan, after being duly sworn, declare: That I am the
same plaintiff in this case; that I have prepared and read the same (complaint)
and that all the allegations thereof are certain and true, to the best of knowledge
and belief."
In view of the said complaint and affidavit, the respondent judge, on March 10,
1937, issued an order granting the petition and ordering the issuance of a writ of
preliminary attachment, after the filing of the corresponding bond by the plaintiff.
On April 15, 1937, said defendant Ventura Guzman filed a motion for the
cancellation of said writ of preliminary attachment on the ground that it had been
improperly, irregularly and illegally issued, there being no allegation, either in the
complaint or in the affidavit solemnizing it, that there is no other sufficient
security for the claim sought to be enforced by the action; that the amount due to
the plaintiff, above the legal set-off and counterclaim, is as much as the sum of
which the preliminary attachment has been granted, and that the affidavit of the
plaintiff is base in mere information and belief.
Said motion was denied by the respondent judge in an order of July 10, 1937.
The only question to be decided in this case is whether or not the requisites
prescribed by law for the issuance of a writ of preliminary attachment have been
complied with.
Section 426 of the Code of the 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."
The petitioner, in attacking the legality and validity of the writ of preliminary
attachment, which is the subject matter of this petition, relies on the alleged lack
of an allegation in the complaint or in the affidavit to the effect "that there is no
sufficient security for the claim sought to be enforced by the action and that the
amount alleged to be due to the plaintiff above all legal set-offs and
counterclaims is as much as the sum for which the writ has been granted", and on
the fact that the affidavit is based on mere information and belief of the plaintiff.
With respect to the last requisites just stated above, the affidavit is not defective
because in it the therein plaintiff and herein respondent Alfredo Catolico states
"that all the allegations thereof are certain and true, to the best of my knowledge
and belief", and not that they are so according to his information and belief.
As to the other two requisites, there is no allegation, either in the complaint or in

affidavit solemnizing it, to the effect that there is no other sufficient security for
the claim which the plaintiff seeks to enforce by his action, and that the amount
due him from the defendant, above all legal set-offs and counterclaims, is as
much as the sum for which the writ of preliminary attachment has been granted.
Now then, does the omission of these two requisites constitute a defect
preventing a judge of the Court of First Instance from issuing a writ of preliminary
attachment?lawphil.net
Attachment is a juridical institution which has for its purpose to secure the
outcome of the trial, that is, the satisfaction of the pecuniary obligation really
contracted by a person or believed to have been contracted by him, either by
virtue of a civil obligation emanating from contract or law, or by virtue of some
crime or misdemeanor that he might have committed, and the writ issued,
granting it, is executed by attaching and safely keeping all the movable property
of the defendant, or so much thereof as may be sufficient to satisfy the plaintiff's
demands (sec. 428, Act No. 190), or by filing a copy of said writ with the register
of deeds for the province in which the real property is situated, whether standing
upon the records in the name of the defendant or not appearing at all upon the
record, which constitutes a limitation of ownership or the right to enjoy or
dispose of a thing without further limitations than those established by law (art.
348, Civil Code), since the owner of the property attached cannot dispose of the
same free of all liens and encumbrances. The law authorizing the issuance of a
writ of preliminary attachment should, therefore, be construed strictly in favor of
the judge should require that all the requisites prescribed by law be complied
with, without which a judge acquires no jurisdiction to issue the writ. If he does so
in spite of noncompliance with said requisites, he acts in excess of his jurisdiction
and with the writ so issued by him will be null and void.
The jurisdiction of attachment proceedings being a special one, it cannot be
legitimately exercised unless the attaching creditor pursues substantially
the essential requirements of the statute, and the court can act only under
the special power limited by the statute and according to the forms of
procedures it prescribes. . . . (6 C. J., 88, paragraph 121.)
Where the statutes requires the affidavit to show that defendant is
indebted to plaintiff in an amount specified, or that the latter is entitled to
recover such an amount, over and above all legal payments, set-offs, or
counterclaims, compliance with this requirement is essential to confer
jurisdiction
to
paragraph 201.)
issue
the
writ.
(6
C.
J.,
132,
An affidavit is fatally defective where it fails to comply, at least

substantially, with a statutory requirement that is shall state that the
indebtedness for which the action is brought has not been secured by any
mortgage or lien upon real or personal property, or any pledge of personal
property, or, if so secured, that the security has become valueless. . . . (6 C.
J., 146, paragraph 231.)
For the foregoing consideration, this court is of the opinion and so holds that
failure to allege in a complaint or in the affidavit solemnizing it, or in a separate
one, the requisites prescribed by section 426 of the Code of Civil Procedure for
the issuance of a writ of preliminary attachment 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 sought, renders a writ of preliminary attachments issued
against the property of a defendant fatally defective, and the judge issuing it acts
in excess of his jurisdiction.
Wherefore, the writ of certiorari applied for is granted, and the writ of
preliminary attachment issued by the respondent judge in civil case No. 1460 of
the Court of First Instance of Isabela, wherein the herein respondent Alfredo
Catolico is plaintiff and the herein petitioner Ventura Guzman is defendant, is
declared null and void, with costs to respondent Alfredo Catolico. So ordered.
G.R. No. 55381
March 26, 1984
SPOUSES JULIETA SALGADO and JOSE SALGADO, Petitioners,

v.
HON. COURT OF APPEALS and PHILIPPINE COMMERCIAL & INDUSTRIAL
BANK, Respondents.
SYLLABUS
1. REMEDIAL LAW; PROVISIONAL REMEDIES; ATTACHMENT; PURPOSE. The

chief purpose of the remedy of attachment is to secure a contingent lien on
defendants property until plaintiff can, by appropriate proceedings, obtain a
judgment and 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 (7 C.J.S. 190).
2. ID.; ID.; ID.; REQUISITES FOR ISSUANCE SHALL NOT ISSUE WHERE DEBTS
SUFFICIENTLY SECURED; REASON. The grounds upon which attachment may
issue are set forth in Section 1, Rule 57 of the Rules of Court. But quite apart from
the grounds stated therein, it is further provided in Section 3 of Rule 57 that "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 the facts,
that . . . there is no other sufficient security for the claim sought to be enforced by
the action." The reason for the rule prohibiting attachment where indebtedness
was already secured is to prevent the secured creditors from attaching additional
property and thus tying up more of the debtors property than was necessary to
secure the indebtedness (Blankenship v. Myers, 54 P. 2d 314, 316; 97 Idaho 356
[1975]). Thus, to sustain an order of attachment, "it is incumbent upon plaintiff to
establish either of these two facts, to wit: (a) that the obligation had not been
secured originally, or (b) that, if secured at its beginning, the security later
became valueless." (Giandini v. Ramirez, 54 Pacific Reporter [2d] 91-92).
3. ID.; ID.; ID.; DISCHARGE THEREOF, WHEN PROPER. Section 13, Rule 57 of the
Rules of Court authorizes the discharge of an attachment where the same had
been improperly or irregularly issued. In National Coconut Corporation v. Hon.
Potenciano Pecson, 90 Phil. 809, this Court ruled that when the facts or some of
them, stated in the plaintiffs affidavit, are shown by the defendant to be untrue,
the writ of attachment may be considered as improperly or irregularly issued.
4. ID.; ID.; ID.; ISSUANCE THEREOF STRICTLY CONSTRUED IN FAVOR OF
DEFENDANT. Since attachment is a harsh and rigorous remedy which exposes
the debtor to humiliation and annoyance, the rule authorizing its issuance must
be strictly construed in favor of the defendant. It should not be abused as to
cause unnecessary prejudice. It is the duty of the court before issuing the writ to
ensure that all the requisites of the law has been complied with (Guzman v.
Catolico, 65 Phil. 257; Salas v. Adil, 90 SCRA 125). AQUINO, J.,
dissenting:chanrob1es virtual 1aw library 1. REMEDIAL LAW; PROVISIONAL
REMEDY; ATTACHMENT; MAY ISSUE EVEN IF DEBT IS SECURED; CASE AT BAR. A
writ of attachment may be validly issued although the debt sued upon is secured
by mortgages where such mortgages covered not only the debt sued upon but
also the debtors other obligations; where the debtors failed to assign to the
creditor bank their sugar proceeds which they had given as security for their loan;
and where the writ is supported by a sufficient bond.
DECISION
ESCOLIN, J.:
This is a petition for review filed by the spouses Jose Salgado and Julieta Salgado
to set aside the resolution of the then Court of Appeals in CA-G.R. No. SP-09407R, dated September 18, 1980, which authorized the issuance of a writ of
attachment against the property of said petitioners. The pertinent facts that gave
rise to this petition are as follows: On May 8, 1978, the Philippine Commercial and
Industrial Bank, hereinafter referred to as the Bank, filed an action against
petitioners, docketed as Civil Case No. 29392 of the then Court of First Instance of
Rizal, to recover on a promissory note in the amount of P1,510,905.96, inclusive
of interest and other bank charges. In its verified complaint, the Bank further
prayed for the issuance of a writ of attachment. As grounds therefor it alleged
that petitioners had fraudulently misappropriated and/or converted to their own
personal use and benefit the sugar proceeds given as security for the payment of
the indebtedness; that petitioners are guilty of fraud in contracting their
obligation and have concealed, removed or disposed of the properties mortgaged
or assigned to the plaintiff, or are concealing, removing or disposing or about to
do so, with intent to defraud their creditor; that the obligation sought to be
enforced is genuine and, therefore, a sufficient cause of action exists; and that
there is no sufficient security for the claim sought to be enforced by the action.
Attached to the complaint was the affidavit of Mrs. Helen Osias, Senior Branch
Credit Division Manager of the Bank, wherein she stated, among others, "that
there is no sufficient security for the claim sought to be enforced by this
action."cralaw virtua1aw library On May 9, 1978, the trial court issued an order
granting the Banks prayer for preliminary attachment upon a bond in the sum of
P1,510,905.96. Upon the filing of said bond, the Deputy Provincial Sheriff levied
upon several parcels of land of petitioners situated in the province of Negros
Occidental.
On September 15, 1978, petitioners Salgado moved to quash the writ of
attachment on the ground that respondent Bank made fraudulent
misrepresentation in securing the writ by deleting the words "R E M" or "Real
Estate Mortgage" from the xerox copy of the promissory note attached to the
complaint, thereby "making it appear that the note was unsecured when in truth
and in fact it was fully secured by a series of valid and existing real estate
mortgages duly registered and annotated in the titles of the affected real
properties in favor of the plaintiff Bank." In the same motion, petitioners stressed
the lack of factual basis of the Banks claim as to their alleged fraudulent
misappropriation or conversion of the sugar proceeds given as security for their
obligation.
After due hearing, the trial court issued an order dated January 31, 1979 granting
petitioners motion and lifting the writ of attachment previously issued.
Upon denial of its motion for reconsideration the Bank went to the Court of
Appeals on a petition forcertiorari to annul the order of the trial court lifting the
writ of attachment.cralawnad On November 29, 1979, the respondent Court of
Appeals, finding that the order of the trial court was not arbitrarily issued,
dismissed the petition for lack of merit. However, on motion of the Bank, the
respondent Court reconsidered its decision of November 29, 1979 and issued the
questioned resolution dated September 18, 1980, which authorized the issuance
of a writ of attachment. Hence, the present recourse. We find the petition
impressed with merit, The chief purpose of the remedy of attachment is to secure
a contingent lien on defendants property until plaintiff can, by appropriate
proceedings, obtain a judgment and 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.
1
The grounds upon which attachment may issue are set forth in Section 1, Rule 57
of the Rules of Court. But quite apart from the grounds stated therein, it is further
provided in Section 3 of Rule 57 that "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 the facts, that . . . there is no other sufficient
security for the claim sought to be enforced by the action."cralaw virtua1aw
library
The reason for the rule prohibiting attachment where indebtedness was already
secured is to prevent the secured creditors from attaching additional property
and thus tying up more of the debtors property than was necessary to secure the
indebtedness. 2 Thus, to sustain an order of attachment, "it is incumbent upon
plaintiff to establish either of these two facts, to wit: (a) that the obligation had
not been secured originally, or (b) that, if secured at its beginning, the security
later became valueless."
3
In the instant case, the allegation in the affidavit of the Banks Credit Division
Manager, Mrs. Helen Osias, to the effect that "there is no sufficient security for
the claim sought to be enforced by this action" has been shown to be false. It is
undisputed that the note sued upon "is fully secured by a series of valid and
existing real estate mortgages duly registered and annotated in the titles of the
affected real property in favor of the plaintiff Bank."cralaw virtua1aw library
Section 13, Rule 57 of the Rules of Court authorizes the discharge of an
attachment where the same had been improperly or irregularly issued. In
National Coconut Corporation v. Hon. Potenciano Pecson, 4 this Court ruled that
when the facts or some of them, stated in the plaintiffs affidavit, are shown by
the defendant to be untrue, the writ of attachment may be considered as
improperly or irregularly issued. Since attachment is a harsh and rigorous remedy
which exposes the debtor to humiliation and annoyance, the rule authorizing its
issuance must be strictly construed in favor of the defendant. It should not be
abused as to cause unnecessary prejudice. It is the duty of the court before
issuing the writ to ensure that all the requisites of the law has been complied
with.
5
Accordingly, the resolution of the respondent Court of Appeals, now the
Intermediate Appellate Court, dated September 18, 1980, is hereby set aside. No
costs.
SO ORDERED.
G.R. No. L-12957
October 29, 1918
THE UNITED STATES, plaintiffs-appellee,

vs.
PONCIANO NAMIT, defendant-appellant.
STREET, J.:
This appeal is brought to this Court to reverse a judgment of the Court of First
Instance of the Province of Antique, adjudging the defendant guilty of the crime
of murder and sentencing him to cadena perpetua, with the accessories provided
by law, and requiring him to indemnify the heirs of the deceased in the sum of
P1,000 and to pay the costs.
It appears in evidence that between 6 and 7 o'clock in the evening of February 24,
1917, the deceased Damiano Jordan, and a neighbor, one Fernando Martinez,
were talking with each other while standing in the street immediately in front of
Jordan's house in the municipality o Sibalom, Province of Antique. While they
were so engaged in conversation they were approached by the accused, Ponciano
Namit. The latter was at the time apparently entering upon a duty as guard for
the round in the capacity of substitute for a son whose turn fell upon this night.
As Ponciano Namit came up he stopped and asked Fernando Martinez if he was
on guard that night. Upon receiving an affirmative reply, he asked Damiano
Jordan if he too was on guard, and Damiano replied that he was not as it was not
his turn. Ponciano thereupon at once ordered Damiano to go up into his house,
and as Damiano did not instantly obey, Ponciano in a few moments repeated the
command. Damiano in a few moments repeated the command. Damiano then
replied that he was going and suiting his actions to his words, turned to start for
his house. As he was turning, Ponciano struck him a blow on the left frontal part
of the head with a heavy stick.
The end of this stick was supplied with a hatchet-shaped object, possibly of metal,
and the knob of this instrument crushed into the head of Damiano and
penetrating into the brain, there momentarily remained. Ponciano by giving the
stick a jerk succeeded in freeing it and immediately left the scene of the crime.
When he pulled the stick out, Damiano fell to the ground. Damiano's wife who
was sitting in the door of their house only a short distance away, saw what had
happened and immediately ran down to her husband and told Fernando to aid
her in carrying him to the house, which he did. The injured person lived for about
six days and died as a result of the wound. It was shown by an autopsy performed
on the body that a hole was made in the skull about as large as a half of peso coin.
No motive sufficient to account for this unjustifiable attack was proved, though
there is a suggestion in the evidence that Ponciano may have been drinking.
After a careful review of the evidence we see no reason for discrediting the
testimony of the two eyewitnesses for the prosecution. We find no material
contradiction in their statements made either at the trial of this case or at the
time of the commission of the crime. The story told by the wife of the deceased
Bonifacia Tubigon, appears to be a simple and truthful narrative. The same may
be said with regard to the testimony of Fernando Martinez. Both witness
apparently evidence a desire to tell what happened without exaggeration or
distortion. Another witness for the prosecution. Aurelio Sildo, testified that on the
night in question the accused admitted that he had the misfortune to strike
Damiano Jordan.
At the trial the accused did not directly admit having struck the fatal blow to
Damiano; but he claimed that on the night in question he was passing the place of
this occurrence and was there assaulted by some unknown person with the stick.
He says that the and the assailant struggled for the possession of the stick and
that finally he, Ponciano, kicked his adversary, who fell down, whereupon
Ponciano departed. We consider this story unlikely; and the judge as he did, that
the accused is the person who caused the death of Damiano Jordan.
Although the complaint charges alevosia as a qualifying circumstance in the
commission of the crime, thus elevating the offense to the degree of murder, and
although the judge of the trial court found that this element was present in the
commission of the offense, we are not satisfied with his conclusion on this point.
It is true the two principal witness testify that the blow was given after Damiano
Jordan had turned his bask to the accused; but the blow was truck, evidently with
great force, upon the left frontal side of the head of Damiano, and it is manifest
that this could have been done only if the accused is a left-handed person,
supposing him to be standing behind his victim. There is no evidence, however,
that Ponciano Namit is left handed; and inasmuch as right handedness prevails
among the great majority, it is to be presumed in the absence of the evidence to
the contrary, that the accused is right-handed.
This circumstance raises in our mind a reasonable doubt as to whether the parties
may not have been facing each other when the blow was delivered. If such were
the case, it would be improper to find that the offense was qualified by alevosia.
It must be admitted that the attack was sudden and unexpected to Damiano
Jordan, and it would perhaps be possible to found upon this the conclusion that
the attack was characterized by surprise in such sense as to constitute alevosia.
However, in considering a question of this kind, every case must be judged by its
particular facts; and we find nothing in the evidence to show with certainty that
the aggressor consciously adopted a mode of attack intended to facilitate the
perpetration of a homicide without risk to himself. a more reasonable, though still
doubtful, inference would possibly be that he did not in fact intend to kill
Damiano at all.
In this connection it is worth while to note that Bonifacia Tubigon declares that
immediately after the blow was truck Ponciano Namit exclaimed I have long
desired to strike some one and I have done so." This would seen to indicate, in
the absence of proof of other motive, that the accused was moved by a sudden
desire to use his stick and that he struck in obedience to this unreasoning
impulse, without thinking of the conditions under which he was acting. Upon the
whole we incline to the opinion that the fatal blow was the result of a casual
encounter under conditions not sufficiently defined to enable us to say
that alevosia was certainly present in the case.1awph!l.net
The offense committed is, in our opinion, to be qualified as homicide, under
article 404 of the Penal Code , in the estimation of which no generic circumstance
either of an aggravating or attenuating nature should be taken into consideration;
and the proper penalty is reclusion temporal in its medium degree. The accused
should accordingly be sentence to 14 years 8 months and 1 day, reclusion
temporal with the accessories prescribed in article 59 of the Penal Code.
Another feature of the case of some importance is presented in connection with
an attachment levied upon the property of the accused to secure the satisfaction
of the civil liability incident to the commission of the homicide. It appears that
while the cause was pending in the Court of First Instance an attorney appeared
in the capacity of private prosecutor, representing the widow of the deceased,
and presented an affidavit showing that the accused was selling his property in
order to elude the payment of any indemnity to which he would be liable in case
of conviction. It was accordingly requested that an attachment should be issued
against his property. an order was thereupon made by the court upon April 25,
1917, authorizing an attachment of property to the value of P1,500 unless he

should give bond to answer in that amount. The clerk of the court issued the
order of attachment upon the same date, and three days later the court rendered
its decision finding the accused guilty and ordering him to indemnify the widow
and children of the deceased in the sum of P1,000. The attachment was not
immediately levied; but after an appeal had been taken, the sheriff, on November
28, 1917, levied the same upon five parcels of land and a house belonging to the
accused. It does not appear from the record in this case whether the accused has
ever given the bond necessary to procure the dissolution of this attachment,
although upon December 19, 1917, after the cause had been brought to this
Court by appeal, an order was here entered authorizing the Court of First Instance
to act in the latter of dissolving the attachment, if bond should be given.
It is argued that the attachment granted in this case is sustainable under article
589 of the Law of Criminal Procedure of Spain, which is to the following effect:
ART 589. When from the record of a cause appear circumstances tending to
establish the guilt of a person, the judge shall require him to give a bond
sufficient to secure the pecuniary liabilities which may be finally adjudged,
ordering in the same decree the attachment of sufficient property to cover
such liabilities, should he fail to give bond.
The amount of the bond shall be fixed in the same decree and it shall not
be less than one third of provable amount of the pecuniary liabilities.
We are of the opinion that this provisions and those related to it in the Spanish
Code of Criminal Procedure were abrogated by necessary implication upon the
enactment of General Orders No. 58. It is true that section 107 of this law
recognizes the existence of the civil liability connected with the commission of
crime and reserves the privileges previously secured by law to the person injured
by the commission of an offense to take part in the prosecution and to recover
damages. Nevertheless, we think that the commission of an offense to the
procedure contained in the Spanish Code of Criminal Procedure relating to the
attachment of property and giving of bond.
Upon reading the entire section 107 of General Orders No. 58, it appears obvious
that the right which was intended to be saved by the reservation therein made
was the right of the party injured to appear and to be heard in all stages of the
case with reference to such liability and to obtain a judgment for the damages
occasioned by the wrongful act, as well as the further right to appeal from any
decision of the court denying any legal right connected therewith.
It is to be noted that while the "sumario" of Spanish criminal procedure is in many

respects similar to the preliminary hearing before a committing magistrate
conducted pursuant to section 13 and 14 of General Orders No. 58, there is
nevertheless an important difference, which is that the "sumario" constitutes a
preliminary stage in the criminal prosecution, and is not merely a step
preparatory tot he initiation of the proceedings. The evidence taken in the
"sumario" therefore, capable for being used in the plenary stage of the
prosecution and if ratification was not required, served as the basis of judgment.
(Ley de 18 de junio de 1870 Law of June 18, 1870.) On the contrary, the
proceedings in the preliminary hearing never constitute a basis for a subsequent
judicial declaration of guilt. The "sumario" has been abrogated by the enactment
of General Orders No. 58 above referred to; and the ground expressed in article
589 of the Spanish Code of Criminal Procedure for the attachments of the
property of the accused therefore no longer here exists.
With the adoption of General Orders No. 58, there was necessarily introduced
into these Islands a system of criminal procedure embodying the principles
recognized in the system of criminal procedure generally in vogue in the United
States; and any characteristics or rule of the former system inconsistent with
these principles must be held to have been abrogated. Attachment in American
law is a purely statutory remedy. It does not exist unless expressly given by
statute and as it is an extraordinary and summary remedy, it is unavailable except
in those cases where the statute expressly permits its issuance.
It remains to consider whether or not the attachment can be sustained under the
provisions of section 424, in connection with subsection 5 of section 412 of Code
of Civil Procedure. The affidavit made in this case states substantially, we think,
that the accused was selling his property with the intent to defraud the persons
interested in the enforcement of the civil liability but considered as an application
for an attachment under the provisions above cited, in connection with section
426 for the same Code, the affidavit was several respect defective. Disregarding
these informalities, however, we are of the opinion that the remedy of
attachment there provided is not available as an aide to the enforcement of the
civil liability incident to prosecution for crime. These provisions contemplate the
pendency of a civil action, and the remedy of attachment is merely an auxiliary to
such action. Section 795 of the Code of Civil Procedure in its first paragraph
declared that the procedure in all civil actions shall be in accordance with the
provisions of the said Code and it is quite evident that the legislature in adopting
this Code could not have intended to make its provisions in any respect applicable
to the proceedings in a criminal prosecution. The mere circumstance that a civil

prosecution is in our opinion no sufficient reason for holding that the remedy of
attachment as designated for use in a civil action is available in the criminal
proceeding.
From what has been said result that the attachment effected under the order of
the Court of First Instance dated April 25, 1917. must be considered to have been
improvidently granted. The same is hereby declared to be of no effect, by this
declaration will of course in no wise prejudice the right of the widow and children
of the deceased to enforce the payment of the indemnity for which judgment was
rendered against the accused. The judgment of the trial court in respect to the
penalty imposed upon the accused, is modified by subsisting 14 years 8 months
and 1 day, reclusion temporal, with accessories prescribed in article 59 of the
Penal Code for so much thereof as imposes the penalty of cadena perpetua, with
the accessories prescribed in article 54 of the same Code. As thus modified the
judgment of the lower court is affirmed, with costs against the appellant. So
ordered.
G.R. No. L-894
July 30, 1947
LUIS F. GENERAL, petitioner,

vs.
JOSE R. DE VENECIA, Judge of First Instance of Camarines Sur, and PETRA VDA.
DE RUEDAS, also representing Ernesto, Armando and Gracia
(minors), respondents.
BENGZON, J.:
Petition for certiorari to annul the order of the Court of First Instance of
Camarines Sur denying the motion to dismiss the complaint, and to vacate the
attachment issued, in civil case No. 364 therein entitled, "Ruedas vs. Luis F.
General."
That complaint was filed on June 4, 1946, to recover the value of a promissory
note, worded as follows:
For value received, I promise to pay Mr. Gregorio Ruedas the amount of
four thousand pesos (P4,000), in Philippine currency within six (6) months
after peace has been declared and government established in the
Philippines.
Naga, Camarines Sur, September 25, 1944.
(Sgd.) LUIS F. GENERAL
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).
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.
(Orbeta vs. Sotto, 58 Phil., 505.)
And although it is the general principle that certiorari is not available to correct
judicial errors that could be straightened out in an appeal, we have adopted the
course that where an attachment has been wrongly levied the writ may be
applied for, because the remedy by appeal is either unavailable or inadequate.
(Leung Ben vs.O'Brien, 38 Phil., 182; Director of Commerce and
Industry vs. Concepcion, 43 Phil., 384; Orbeta vs. Sotto, supra.)
Wherefore, the writ of attachment is quashed and the complaint is dismissed.
Costs for petitioner. So ordered.
G. R. No. L-45948
September 10, 1985
MERCEDES GRUENBERG and ALBERT GRUENBERG, petitioners,

vs.
HONORABLE COURT OF APPEALS, HONORABLE LINO L. AOVER and ELDA R.
FLORES, respondents.
GUTIERREZ, JR., J.:

This is a petition to review the decision of the Court of Appeals, now Intermediate
Appellate Court, which affirmed the order for the issuance of a writ of preliminary
attachment, and other related orders of the then Court of First Instance of Rizal in
Civil Case No. Q-18444.
The antecedent facts are summarized by the appellate court as follows:
Petitioners are the defendants and private respondent is the plaintiff in
Civil Case No. Q-18444, Court of First Instance of Rizal, Branch XVII-BQuezon City, for annulment of sale, recovery of ownership and possession
of the house and lot situated at No. 24 Scout Limbaga, Diliman, Quezon
City, the same, allegedly, having been sold in fraud of creditors.
Private respondent filed the complaint in Civil Case No. Q18444, in her
capacity as the administratrix of the intestate estate of the late William
Gruenberg.
It is alleged in the complaint in Civil Case No. Q-18444 that the house and
lot in question, which were sold to defendant Albert Gruenberg (one of the
petitioners), form part of the conjugal partnership of the Gruenberg
spouses, which must answer for the obligations that deceased William
Gruenberg might have incurred during his lifetime in his capacity as
manager and administrator of the conjugal partnership; and that the sale of
the house and lot before the death of William Gruenberg, when at that
time two creditors had already filed suits against him for collection of
unpaid obligations, and the latter had unpaid obligation to plaintiff Elda R,
Flores (private respondent) in the amount of P13,000.00, exclusive of
interest and collection charges, patently and clearly can no longer be paid
or liquidated.
On March 1, 1974, petitioners filed their answer to the complaint.
Under date of February 7, 1976, private respondent filed a 'Motion for

Issuance of Writ of Preliminary Attachment' against the properties of
petitioners, alleging, among others, that the latter are indebted to her in
the principal amount of P13,000.00, which, according to her, she seeks to
recover in Civil Case No. Q-18444.
On March 1, 1976, petitioners filed their opposition to the motion for the
issuance of writ of preliminary attachment, alleging among others, that Civil
Case No. Q-18444 is an action for annulment of sale and recovery of the
house and lot mentioned therein, and not for recovery of sum of money. It
is contended that a writ of preliminary attachment is not the proper
remedy for the protection of the rights of the estate. In the same
opposition, petitioners refuted the allegations of private respondent in her
motion that the complaint in Civil Case No. Q-18444 is one for collection of
a sum of money allegedly contracted fraudulently by petitioners.
On March 26, 1976, respondent Judge issued an order, granting the motion
of private respondent and issuing a writ of preliminary attachment against
the properties of petitioners, respondent Judge stating that no opposition
had been filed to the motion.
In the latter part of July, 1976, respondent Sheriff and/or his deputies
served on petitioners and the managers of the Hollywood Theater, Palace
Theater and Illusion Theatre a writ of preliminary attachment and notice of
garnishment against petitioners and personally in favor of respondent
Flores.
It is alleged that the order of respondent Judge was not received by
petitioners' new counsel but upon being informed by petitioners of the writ
of preliminary attachment and notice of garnishment, petitioners'new
counsel promptly went to the court of respondent Judge and then and
there he discovered that petitioners' opposition to the motion was not
attached to the record, because the same was forwarded to Branch XVIII to
which Civil Case No. Q-18444 was originally assigned,
On July 30, 1976, petitioners filed (a) a motion for reconsideration of the
order granting the motion for the issuance of a writ of preliminary
attachment, and (b) a motion to recall the writ of preliminary attachment
and notice of garnishment, on the ground that it is not true that petitioners
did not oppose the motion of private respondent, and that there is no valid
basis to grant the motion.
On August 16, 1976, respondent Judge issued an order, denying the

motions of petitioners.
On October 28, 1976, respondent Judge issued an order, requiring
petitioners to appear before his court to explain why they should not
be punished for contempt for denying or disobeying the lawful
processes of the court.
The issuance of the "show cause" order prompted the petitioners to file a petition
for certiorari with writ of preliminary injunction in the Court of Appeals. The
petition was dismissed. Hence, the instant petition
The issues raised to us are embodied in the petitioners' assignments of errors as
follows:
I. THE COURT OF APPEALS ERRED IN OVERLOOKING THE FACT THAT WRIT
OF PRELIMINARY ATTACHMENT COULD ONLY BE GRANTED TO SECURE THE
SATISFACTION OF A JUDGMENT IN A CASE IN WHICH SAID WRIT IS PRAYED
FOR;
II. THE COURT ERRED IN SUSTAINING THE ISSUANCE OF THE WRIT OF
PRELIMINARY ATTACHMENT FOR THE PERSONAL BENEFIT OF PRIVATE
RESPONDENT IN CIVIL CASE NO. Q-18444, NOTWITHSTANDING THE FACT
THAT SAID RESPONDENT INSTITUTED SAID ACTION NOT IN HER PERSONAL
CAPACITY, BUT AS ADMINISTRATRIX OF THE ESTATE OF THE LATE WILLIAM
GRUENBERG, SR.;
III. THE COURT OF APPEALS ERRED IN RULING THAT PETITIONERS CAN BE
CITED FOR CONTEMPT FOR THE ALLEGED FAILURE TO COMPLY WITH THE
NOTICE OF GARNISHMENT ADDRESSED TO THIRD PARTIES.
The issues are interrelated and may be discussed together. They all focus on the
proprietary of the writ of attachment and garnishment against the petitioners'
properties issued by the trial court and affirmed by the appellate court.
In her affidavit supporting the motion for a writ of preliminary attachment, the
private respondent stated that her case "... is one of the situations covered by
Section 1 (d), Rule 57 of the Rules of Court whereby a writ of preliminary
attachment may issue." Section 1 (d), Rule 57 provides:
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:
xxx xxx xxx
(d) In an action against a party who has been guilty of a fraud in contracting
the debt or incurring the obligation upon which the action is brought, or in
concealing or disposing of the property for the taking, detention or
conversion of which the action is brought.
xxx xxx xxx
There are various reasons why this petition should prosper.
Private respondent Elda R. Flores, as a claimant for P13,000.00 against the estate
of William Gruenberg, Sr., was appointed administratrix of the estate of the
deceased. In her capacity as administratrix, she filed Civil Case No. Q-18444
against the petitioners. This main case was for the annulment of a deed of sale
executed by the late William Gruenberg, Sr., in favor of Albert Gruenberg and for
the recovery of possession and ownership of the house and lot involved in that
sale.
The motion for a writ of preliminary attachment filed by Flores, however, states:
1. Defendants are indebted to plaintiff in the amount of P13,000.00
exclusive of accrued interest and collection charges, which plaintiff seeks to
recover in the instant action; and
2. Defendants are guilty of fraud in contracting the debt or incurring the
obligation due plaintiff in that they conspired and confederated with each
other as mother End son to defraud other creditors one of whom is
plaintiff, by simulating the sale of house and lot situated at No. 24 Scout
Limbaga Street, Quezon City ... .
While the respondent filed the motion in her capacity as administratrix of the
Gruenberg estate, the motion for a writ of attachment and its supporting affidavit
show that the attachment was intended to secure only her P13,000.00 claim
against the estate. Obviously, this cannot be done.
A writ of attachment is a remedy ancillary to the principal proceeding. The wellentrenched principle is that:
Attachment is a juridical institution which has for its purpose to secure the
outcome of the trial, that is, the satisfaction of the pecuniary obligation
really contracted by a person or believed to have been contracted by him,
either by virtue of a civil obligation emanating from contract or from law, or

by virtue of some crime or misdemeanor that he might have committed,
and the writ issued, granted it, is executed by attaching and safely keeping
all the movable property of the defendant, or so much thereof as may be
sufficient to satisfy the plaintiff's demands ... . (Guzman v. Catolico, et al.,
65 Phil. 257).
The purpose behind the filing of the complaint was to recover a piece of property
allegedly belonging to the intestate estate of the deceased. Hence, any writ of
attachment necessary to secure the judgment must be related to the protection
of the estate. The writ may not issue if only to protect the personal interests of
the private respondent as a creditor of that estate.
The records show that the private respondent's interest in the estate is to recover
a debt based on a contract with the deceased Gruenberg, For this reason, she
instituted the special proceedings for the settlement of the intestate estate
resulting to her appointment as administratrix. Under these circumstances, the
private respondent's remedy to recover the outstanding debt of the deceased is
to follow the procedure in Rule 86 on claims against an estate. As a matter of fact,
if an administrator has a claim against an estate, Section 8 of Rule 86 calls for the
appointment of a special administrator to defend the estate against such claim.
A court order which violates the Rules constitutes grave abuse of discretion as it
wrecks the orderly procedure prescribed for the settlement of claims against
deceased persons designed to protect the interests of the creditors of the
decedent. (See Dy v. Enage, 70 SCRA 96). Allowing the private respondent in the
annulment case to attach the petitioners' properties for the benefit of her
P13,000.00 claim against the estate would give her an undue advantage over
other creditors against the estate,
Moreover, the P13,000.00 claim of the respondent cannot be settled in the case
for annulment of the deed of sale, wherein the writ of attachment is sought.
What she seeks to be secured is not the judgment in the main case but a mere
claim against the estate which is still to be considered and adjudicated by the
court.
The rules on the issuance of a writ of attachment must be construed strictly in
favor of the defendant. The remedy of attachment is harsh, extraordinary, and
summary in nature. If all the requisites for the issuance of the writ are not
present, the court which issues it acts in excess of its jurisdiction.
In Salas v. Adil (90 SCRA 121), we stated:

A preliminary attachment is a rigorous remedy, which exposes the
debtor to humiliation and annoyance, such it should not be abused
as to cause unnecessary prejudice. It is, therefore, the duty of the
court, before issuing the writ, to ensure that all the requisites of the
law have been complied with; otherwise the judge acts in excess of
his jurisdiction and the writ so issued shall be null and void. (Guzman
v. Catolico, 65 Phil. 257, 261).
xxx xxx xxx
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 preliminary attachment merely states such
ground in general terms, without specific allegations of
circumstances 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 them to present their position at a hearing wherein
evidence is to be received.
Following the principle of strict compliance with all requisites, this Court has also
ruled that "when the facts, or some of them, stated in the plaintiff's affidavit are
shown by the defendant to be untrue, the writ may be considered as improperly
or irregularly issued." (National Coconut Corporation V. Pecson, et al., 90 Phil.
809).
The February 7, 1976 motion for issuance of a writ of preliminary attachment and
the affidavit of preliminary attachment are misleading. First, the private
respondent states that the "defendants are indebted to plaintiff in the amount of
P13,000.00" exclusive of interests and collection charges. Then, she avers that the
"defendants are guilty of fraud in contracting the debt or incurring the obligation
due plaintiff ".
The facts in the motion and the affidavit are deceptively framed. The obligation
which the respondent seeks to secure by an attachment was between her and the
late William Gruenberg, Sr. What she seeks to establish as fraudulent was the sale
between the late Mr. Gruenberg and his son. These are two entirely distinct
transactions.
One of the reasons for granting the motion for the issuance of a writ of
preliminary attachment was the court's finding that the petitioners' failed to file
an opposition thereto. It turns out, however, that the petitioners filed a timely
opposition to the motion but it was filed in another branch of the court where the
case had earlier been assigned. Nevertheless, despite this timely opposition, the
motion for reconsideration of the order for the issuance of a writ of preliminary
attachment, was summarily denied for lack of merit.
We also note that the order which directed the issuance of a writ of preliminary
attachment merely recited the grounds alleged in the private respondent's
motion without any specific details as to the supposed fraud committed by the
petitioners when they contracted the debt and the alleged disposition or
concealment by the petitioners of their properties. The order of the trial court
disregards the rule that attachment being a harsh remedy, it must be issued on
concrete and specific grounds and not on general averments merely quoting the
words of the pertinent rules. (Dy v. Enage, supra). The absence of specific grounds
highlights the fact that the petitioners are not indebted to respondent Flores. It
was the late William Gruenberg who incurred the alleged indebtedness and it is
his estate which owes Flores. The validity of the claim of Flores will have to be
threshed out in the special proceedings, not in the case for annulment of the
deed of sale.
Finally, the transaction sought to be annulled in the main case refers to a
questioned sale of a house and lot. It would have been sufficient to annotate a
notice of lis pendens in the title to that property. Assuming the trial court could
validly attach the house and lot involved in the sale, we see no justification why
the attachment should reach out to the petitioners' interests in the Hollywood
Theatre, the Palace Theatre, and the Illusion Theatre. The petitioners also point
out that there is no showing of any attempt on their part to conceal or to dispose
of the house and lot nor of any change in the title or condition of the property.
Considering all the foregoing, we find the writ of preliminary attachment to have
been improvidently issued.
WHEREFORE, the petition is hereby GRANTED. The decision of the former Court of
Appeals is SET ASIDE. The writ of preliminary attachment and the notice of
garnishment issued in Civil Case No. Q-18444 are DISSOLVED. The other related
orders issued in connection with the writ of attachment are SET ASIDE.
SO ORDERED.
G.R. No. L-35351
March 17, 1976
ROGELIO DY, SY JIAN AND DY CHING ENG, petitioners,

vs.
THE HONORABLE JUDGE MANUEL LOPEZ ENAGE AND HEIRS OF EMMANUEL O.
TOLENTINO, represented by MARIA DUGOS VDA. DE TOLENTINO, respondents.
BARREDO, J.:
Petition for "certiorari, prohibition and mandamus, with preliminary injunction"
asking the Court to declare null and void the orders of respondent judge of July
18, 1972 and July 25, 1972 in Civil Case No. 1251 of the Court of First Instance of
Agusan del Norte and Butuan City and to enjoin said respondent from further
taking cognizance of the case except to dismiss the same by command of this
Court, which prayer was enlarged in a supplemental petition to include the order
of attachment of September 28, 1972 and the decision of September 20, 1972,
and all implementing orders thereof, among the actuations sought to be annulled.
Later, a second supplemental petition was filed to impugn other subsequent
orders of respondent judge to be specifically referred to later in this decision.
After issues were joined, a special motion dated February 10, 1973 was filed by
private respondents praying that the Court of First Instance of Cebu, Branch XIV,
be enjoined to dismiss Civil Case No. R-13062 therein filed by Atty. Elias Q. Tan,
counsel of herein petitioners in the above-mentioned case in Agusan del Norte,
against said respondents, for damages, and that the writ of preliminary
attachment issued therein be quashed, and after comment thereon was filed by
petitioners, the Court issued the following' resolution on May 4, 1973:
L-35351 (Rogelio Dy, et al. vs. Hon. Manuel Lopez Enage, etc., et al.).
Considering the urgent motion of the respondents for the issuance of a
temporary restraining order to enjoin the Court of First Instance of Cebu
from taking further proceedings in Civil Case No. R13062 during the
pendency in this Court of respondents' motion to dismiss said civil case or
for the issuance of injunction or restraining order with quashal of
preliminary attachment, the Court Resolved: (a) to issue a TEMPORARY
RESTRAINING ORDER effective immediately and until further orders from
this Court, and (b) to require both the petitioners and private respondents
within ten (10) days from notice hereof, to file such pleadings as may be
necessary so as to properly implead the Court of First Instance of Cebu City

taking cognizance of Civil Case No. R-13062. (Page 562, Record.)
Voluminous representations have been filed by the parties relative to this
resolution but none of them adequately amounts to any of the pleadings called
for by the situation and required by the resolution. And considering that the
matters treated in said motion of February 10, 1973 are not procedurally related
to the petition in this case, the Court will not resolve the merits of said motion,
without prejudice to the private respondents filing the proper separate petition
so that issues may be regularly joined and resolved albeit the restraining order
issued by the Court shall continue in force until the court in which respondents
might file their action acts one way or the other in the premises, but if no such
separate action is filed by respondents within ten (10) days from notice hereof,
the said restraining order shall be deemed automatically lifted. In other words,
this decision will deal exclusively on the original and supplemental petitions
herein.
It appears that on October 10, 1968, petitioners filed with respondent court Civil
Case No. 1251 against one Emmanuel O. Tolentino, predecessor in interest of
private respondents. Pertinently, the complaint alleged as follows:
FOR FIRST CAUSE OF ACTION
1 That plaintiffs are of legal ages and residents of the municipality of
Cabadbaran, province of Agusan, Philippines and the defendant is likewise
of legal age and a resident of sgd municipality and province where he may
be served with summons.
2 That after the liberation plaintiffs spouses Dy Ching Eng and Sy Jean
resumed their general merchandise and copra business in the municipality
of Cabadbaran, province of Agusan, continued their aforesaid general
merchandise business until the present time and closed their copra
business in the year 1966, will their son, plaintiff Rogelio Dy engaged in the
copra business in said municipality and province beginning 1966 and
continues it until the present time.
3 That the defendant who is the younger brother of plaintiff Sy Jean is
likewise engaged in the general merchandise and copra business in said
municipality and province and during the period from 1960 or thereabouts
until 1964 bought from plaintiffs Dy Ching Eng and Sy Jean copra on credit
basis and the said plaintiffs Dy Ching Eng and Sy Jian delivered on credit
basis to the defendant on July 24, 1964, 288 sacks of copra weighing 11,679
kilos net at P48.00 per 100 kilos worth P5,605-92; on July 26, 1964, 146
sacks of copra weighing 5,749 kilos net at P48.00 per 100 kilos, worth
P2,759.52; on July 31, 1964, 144 sacks of copra weighing 5,716 kilos net at
P48.00 per 100 kilos worth P2,858.00; on August 6, 1964, 343 sacks of
copra weighing 14,187 kilos net at P48.00 per 100 kilos worth P5,296.00; on
August 14, 1964, 126 SACKS OF COPRA WEIGHING 5,296 KILOS net at
P46.00 per 100 kilos worth P5,296.00; on August 14, 1964, 75 sacks of
copra weighing 2,867 kilos net at P46.00 per 100 kilos worth P1,318.82; on
August 20, 1964, 225 sacks of copra weighing 8,659 kilos net at P44.00 per
100 kilos worth P3,809.96; and on August 27, 1964 303 sacks of copra
wishing 12,514 Idlos net at P44-00 per 100 kilos worth P5,506.16, as shown
by corresponding Statements of deliveries, copies of which are hereto
attached, marked as annex "A", "B", "C", "D", "E", "P", "G", and "H" and
made integral parts hereof, valued in all at P31,104.30.
4 That the defendant made partial payments for said plaintiffs' copra in
checks drawn against the Philippine Bank of Communications, Cebu Branch,
Cebu in the total sum of P10,000.00, among which was check No. T-W253
dated November 13, 1967 for P2,000.00 which check could not be collected
and cashed by plaintiffs spouse for the reason that defendant stopped
payment of the same, n shown on the face and reverse sides of said check
No. T-445253, photostat copies of which face and reverse sides are hereto
attached, marked as Annexes "I" and "A" and made integral parts hereof,
and also in cash for P6,000.00 as shown by a "vale" dated November 18,
1967 signed by plaintiff Sy Jean, copy of which is hereto attached as Annex
"J" and made an integral part hereof, all which partial payments amounted
to P16,000.00, thereby leaving an unpaid balance of P15,104.30, and
despite earnest efforts exerted by plaintiffs spouses towards a compromise
and extra-judicial amicable settlement of said defendant's indebtedness,
the same have failed and despite repeated demands made by said plaintiffs
upon the defendant to pay said unpaid balance, the latter failed and
refused and still continues to do so without valid and justifiable cause
therefore, thereby committing breach of contract in evident bad faith and
fraudulently for which defendant should be held liable to said plaintiffs for
actual damages in the amount of P3,3562.03 until the present time and for
moral damages in the amount of P5,000.00
FOR SECOND CAUSE OF ACTION
Plaintiffs respectfully allege:

1 That the plaintiffs hereby reproduce and incorporate as part hereof the
averments contained in paragraphs 1, 2, 3, and 4 under the first cause of
action hereof.
2 That in 1966 to 1967 defendant used to buy from plaintiff Rogelio Dy
copra at most at P68.00 per kilo, but considering that the current market
price of copra at that time was much higher than the price per kilo paid by
the defendant for said plaintiffs copra, the said plaintiff Rogelio Dy stopped
in 1967 to sell his copra to the defendant.
3 That by reason of plaintiff Rogelio Dy's refused to continue selling his
copra to the defendant, the defendant on or about November 22, 1967
after plaintiff Sy Jean had received from him the amount of P6,000.00
shown in the receipt, Annex 'J' sent for plaintiffs Sy Jean and Rogelio Dy to
go his store at Cabadbaran, Agusan; that while plaintiff Sy Jian was in the
said store ahead of Rogelio Dy, the defendant scolded her on account of
their failure to sell copra to him; that when Sy Jean explained that she could
not interfere and control her son Rogelio Dy in connection with the
management of his business, the defendant threated to cause bodily harm
to her and sent for plaintiff Rogelio Dy to go to his store; that once the said
plaintiff Rogelio Dy was in defendant's store and saw his mother being
treated by the defendant, the defendant began to scold plaintiff Rogelio Dy
for not having continued to sell copra to him, threatened to kill him and
under threats and intimidation with a pistol compelled without any lawful
authority the said plaintiff Rogelio Dy to sign a blank form on said date, the
printed recitals of which blank form tend to show that plaintiff Rogelio Dy
supposedly received from the defendant on the date stated therein the
amount of P16,000.00 in trust for the purpose of buying copra with the
supposed obligation of delivering to him the copra and or of returning the
said amount, when in truth and in fact, the said plaintiff Rogelio Dy never at
all prior to the date mentioned in said defendants printed form received
from the defendant the sum of P16,000.00 nor did said plaintiff Rogelio Dy
ever act as supposed purchasing agent for copra for the defendant; that by
reason of the threats and intimidation made by the defendant to kill not
only Sy Jean but also him, the plaintiff Rogelio Dy by reason of fear was
compelled to affix against his will his signature on the said printed form.
4 That the supposed contract of agency prepared by the defendant

without the intervention, consent or authority of any one of herein
plaintiffs, mentioned the sum of P16,000.00 which was the partial
payments made by the defendant for the said deliveries of copra belonging
to the plaintiffs spouses; that, as a matter of fact and in truth, after the
defendant had succeeded through threats and intimidation to make
plaintiff Rogelio Dy sign the said supposed contract of agency, the
defendant delivered to Sy Jean the receipt for P6,000.00 annex X hereof.
5 That the said supposes contract of agency is null and void, illegal and
invalid, is fraudulent and constitutes a falcification of a private document.
6 That by reason of the unlawful, malicious, wrongful, and fraudulent
acts of the defendant, the plaintiffs have suffered actual damages in the
amount of P16,000.00 and moral damages for mental anguish, serious
anxiety, social humiliation and wounded feelings in the amount that the
court may fix.
7 That despite earnest efforts exerted by the plaintiffs towards a
compromise, the same have failed and despite repeated demands made by
plaintiff Rogelio Dy to cancel the supposed contract of agency and to desist
from enforcing it in any manner, the defendant refused to do so and
continues to threaten to to prosecute plaintiff Rogelio Dy for supposed
estafa for the purpose of harrassing, oppressing and humiliating the said
plaintiff Rogelio Dy in particular and his parents in general. (Pages 137-141,
Record.)
In his answer, the defendant made specific denials and alleged affirmative
defenses and in addition interposed counterclaims as follows:
COMES NOW the defendant in the above-entitled case, thru counsel, and in
answer to the complaint, to this Honorable Court most respectfully alleges:
1. That defendant admits the allegation contained in paragraph 1 for the
fust cause of action in the complaint.
2. That defendant has no infomation as to the truth of the allegations
contained in paragraph 2 of the complaint (first cause of action). But
whether plaintiffs had license to engage in the copra business or not the
fact is that plaintiffs were acting only as copra purchasing agents for the
defendant.
3. That defendant admits that he is engaged in the general merchandise

and copra business in the municipality of Cabadbaran and province of
Agusan; but specifically denies the information that he is a younger brother
of plaintiff Sy Jean; the truth of the matter is Sy Jean was an adopted
daughter of defendant's father and coincidentally when they happened to
reside together in Agusan they considered themselves as brother and
sister, and 0 they were known as such in the community of Agusan.
Defendant further denies that he had business relation on credit basis with
plaintiffs' son. The truth being that all the plaintiffs were merely copra
purchasing agents of the defendant. And the defendant has no knowledge
or information to form a belief as to the truth of the matter alleged in the
remaining Portion of paragraph 3 of the fust cause of action of the
complaint, and, therefore denies the same, and further denies under oath
the selfserving annexes attached to the complaint and marked as annexes
"A", "B", "C", "D", "E", "F", "G", and "H" which apparently are tally saheets
for being manufactured documents and inadmissible evidence.
4. That the allegation contained in paragraph 4 are hereby denied. The
truth of the matter is hereinafter alleged in the special and affirmative
defenses.
5. That the allegations contained in paragraph 5 are hereby denied. The
truth of the matter is hereinafter alleged in the special and affirmative
defenses, and that further defendant is not obligated in anyway to pay any
amount of actual damages, much less is defendant liable for moral
damages.
6. That Paragraph 1 of the second cause of action, being a mere
reproduction of the previous allegations, is also hereby denied and the
allegations contained in the previous paragraph i of this answer are hereby
reproduced and replead.
7. That the allegations contained in paragraph 2 of the sand cause of action
are hereby denied. The truth of the matter being that in no time as far as
defendants recollection is concerned the exagerated price of P68 per kilo of
copra has ever been obtaining in Agusan or elsewhere. And further it is
denied that defendant has ever purchased copra from the plaintiff Rogelio
Dy. The truth being that plaintiff Rogelio Dy has been a copra purchasing
agent for the defendant.
8. That the allegations contained in paragraphs 3 and 4 of the second cause

of action of the complaint are hereby denied. It is specifically denied that
plaintiffs Sy Jean and Rogelio Dy were ever threatened of bodily harm much
less threatening Rogelio Dy to be killed. It is further specifically denied that
Rogelio Dy was compelled to sign a blank form. The truth of the matter
further is hereinafter alleged in the special and affirmative defeses With
respect to the receipt for P6,000.00 marked in the complaint at Annex "J" is
admitted that it was returned to Sy Jean together with another receipt for
P10,000.00 after the receipt for P16,000.00 was signed by plaintiff Rogelio
Dy who appeared to have in his ion the P16,000.00 and who was the
licensed copra dealer. And the truth of the matter further is hereinafter
alleged in the special and affirmative defenses.
9. That the allegations contained in paragraph 5 am conclusions of law. But
it is denied that the contract agency is null and void, illegal and invalid,
much less, fraudulent and constitutes a falsification of private document.
The trust of the matter is that said contract of agency is legal and valid, not
fraudulent nor falsification, it having been executed in due course and for
value.
10. That the allegations contained in paragraph 6 of the second cause of
action are again conclusions of fact and consclusions of law. But if plaintiffs
have suffered actual damages in the amount of P16,000.00 and
undetermined moral damages plaintiffs alone are responsible therefor and
defendant is not liable of the same.
11. That the allegations contained in paragraph 7 of the second cause of
action are hereby denied. The truth of the matter is that it was the
defendant who exerted earnest efforts to secure payment of plaintiffs'
obligations, but despite such efforts exerted by defendant plaintiffs have
remained adamant and entirely disregarded the repeated request of the
defendant, and due to this refusal of the plaintiff Rogelio Dy to pay his
obligation to the defendant the latter was compelled to seek the
intervention of the Office of the Provincial Fiscal in order to legally enforce
the agency contract sometime in August 18, 1968. But until now no
payment was effected by said plaintiff. And the truth of the matter further
is that in sinking the intervention of the Provincial Fiscal of Agusan it was
not the purpose of defendant to harass, oppress and humiliate plaintiff
Rogelio Dy but merely in the legitimate exercise of legal rights of the

defendant.
12. That as to the allegations common to first and sand causes of action,
particularly paragraph 7 and 8 affecting petition for injunction, said
allegations are untenable. because merits of the criminal action involved
are to be determined by proper authorities vested with powers and
jurisdiction to act on the matter. If criminal action has merits and at least
PRIMA FACIE evidence shown, the exercise of such power is vested with the
Provincial Fiscal in this particular case; and with respect to the civil action
involved the same is hereinafter incorporated in a counterclaim. Both
criminal and civil action cannot be prevented by injunction.
SPECIAL AND AFFIRMATIVEE DEFENSES
defendant respectfully alleges:
13. That prior to August 26, 1964, Mr. and Mrs. Dy Ching Eng of
Cabadbaran, Agusan had been copra purchasing agents of the defendant,
by virtue of which agency they were accorded by the defendant cash
advances.
14. That the liquidation of cash advances and value of copra delivered were
effected at the end of every month.
15. That on August 26, 1964 a liquidation of cash advances and value of
copra delivered was made, and plaintiffs spouses Dy Ching Eng and Sy Jean
had an outstanding balance payable to the defendant in the amount of
P10,386.69.
16. That sometime on September 1, 1964 a big fire occured in Cabadbaran,
Agusan in which the spouses Dy Ching Eng and Sy Jean suffered heavy
losses.
17. That due to the losses suffered by said spouses Dy Ching Eng and Sy
Jean both spouses were not required to liquidate immediately their
account of P10,368.69, and on the contrary they were further given
Pl,000.00 on September 3, 1964 covered by mere vales signed in chinese
characters by Sy Jean, and in order to further help them rehabilitate
themselves from the fire losses both spouses were not pressed for payment
of their total outstanding account in the sum of P12,368.69 leaving the
matter for future liquidation at their own request.
18. That sometime in 1966 plaintiff Dy Ching Eng transferred his copra
business to his son Rogelio Dy who eventually took over the business of his
parents from that time on until now, although plaintiffs Dy Ching Eng and
Sy Jean continued to help their son Rogelio Dy in running the copra
business.
19. That on two (2) occasions, particularly November 13 and 17, 967
plaintiff Sy Jean came to defendant's store and requested for advance
amount of P10,000.00, and P6,000.00 respectively. She specifically
requested and so the defendant accommodated that the amounts be
covered by checks of P2,000.00 each to facilitate her and her son Rogelio
Dy's purchases of copra as agent of defendant. The November 13 checks
were five (5) in number for the total amount of P10,000.00 and the
November 17 checks were three (3) in number for a total of P6,000,00.
20. That the above eight (8) checks were covered by two (2) provincial
receipts or values, one dated November 13, 1967 and the other dated
November 18, 1967. The latter value is now Annex "J" of the complaint.
21. That late in the afternoon of November 18, 1967 plaintiff Rogelio Dy
came to the store and after confirming the values of plaintiff Sy Jean he
prepared in his own handwriting a cash advance receipt which is partly
printed and partly handwritten receipt for P16,000.00. This is a requisite
which had to be effected in view of the fat, that it was plaintiff Rogelio Dy
who was and still is the licensed copra dealer
22. That after preparing the partly printed and partly handwritten cash
advance receipt for P16,000.00, and after the same was handed over by
Rogelio Dy to the defendant and in turn defendant returned to Sy Jian thru
Rogelio Dy two previous values signed by Sy Jean.
23. That during that period of time between November 13 up to and
including November 18, 1967 defendant noticed that there were
accumulations of the stock of copra in the bodega of the plaintiffs, which
bodega incidentally is located just across the street where defendant's
store is situated.
24. That on the 19th of November 1967 defendant came to Cebu and had
only returned to Cabadbaran on the 22nd day of November 1967.
25. That upon his return to Cabadbaran, Agusan he noticed that the bodega
of plaintiffs was already empty. So, he went to confront Plaintiff Rogelio Dy
and his mother Sy Jean why was it that their bodega was empty. They
replied to the defendant that the copra was sold to a purchaser in Surigao
because according to them said purchaser paid a better price for the copra.
26. That defendant told plaintiffs Rogelio Dy and Sy Jean that at least they
should have advised the defendant because defendant was also willing to
pay an increased price. But both plaintiffs answered that the matter is
already closed and there was nothing they could do about it. So, defendant
asked for the return of his money. But plaintiffs could not readily do it. So,
defendant wired the Philippine Bank of Communications of Cebu City to
stop payment of the eight (8) checks above-mentioned, but unfortunately
four (4) checks were already cashed and stopping paying was only effected
on the other four (4) checks.
27. That in view of the fact that no payment of the amount was made,
much less a delivery of copra effected . despite the lapse of considerable
length of time and notwithstanding repeated demands, defendant was
compelled to seek the intervention of the Provincial Fiscal, but still no
payment was effected until now.
28. That the filing of the present case is a plain harassment and a clear
retaliation for what defendant has done in seeking the intervention of the
Provincial Fiscal.
As
FIRST COUNTER-CLAIM
Defendant respectfully alleges:
29. That for the sake of brevity defendant hereby reproduces and repleads
all the allegations contained in the previous paragraphs of this answer and
special and affirmative defense.
30. That defendant has ascertained that out of the eight (8) checks at the
rate of P2,000.00 each, four (4) checks were already cashed, particularly
cheeks
Nos.
T-445251, T-445255 and T-445269 or a total amount of P8,000.00, and the
other four (4) cheeks totalling P8,000.00 were not effectively cashed
because payment of the same was accordingly stopped.
31. That the cash advance receipt of P16,000.00 is therefore reduced to

only P8,000.00 if and when the four (4) other checks shall be returned by
the plaintiffs to the defendant.
As
SECOND COUNTER-CLAIM
special and affirmative defenses, including the allegations contained in the
first counterclaim.
33. That plaintiffs are indebted to the defendant in the total sum of
P12,368.69 as acknowledged by Sy Jean, particularly in her cash advance of
August 26, 1964 and values of September 2 and September 3, 1964
respectively, which account totalling P12,868.69 remains unpaid and
outstanding until now, despite repeated demands subsequently made by
the defendant for its payment.
As
THIRD COUNTER-CLAIM
special and affirmative defenses including the allegations contained in the
first and second counterclaims.
35. That defendant is a businessman of good standing in the Municipality of
Cabadbaran and Province of Agusan with quite a considerable gross
negotiations every year.
36. That defendant also enjoys good standing in the community of
Cabadbaran, Agusan having been President since 1966 and he is still
President of the Cabadbaran Lions Club until now.
37. That defendant has been maligned by the plaintiffs by 'bringing this
clearly unfounded civil action against him in gross and bad faith, and as a
consequence defendant suffered actual losses in his business and also
suffered moral damages, and in view of the fact that plaintiffs have acted in
gross bad faith and evident malice in filing the complaint they should be
made to pay actual, moral and exemplary damages in such amount as to
this Honorable court may determine in the exercise of its sound discretion.
38. That plaintiffs, by maliciously filing the instant complaint against the
defendant, have compelled the latter, for the protection of his interest, to
incur litigation expenses, and engage the services of undersigned counsel
with whom he has agrhe time the orders of attachment complained of
were issued, respondent court acted with grave abuse of discretion, and
the writs issued thereunder and all subsequent proceedings related thereto
must consequently be as they are hereby set aside.
On November 14, 1971, the defendant Tolentino died. This was before he had
completed the formal presentation of his evidence in support of his
counterclaims. Whereupon, Atty. Vicentey Jayme for the respondents, after their
proper Vicente Jayme for the respondents, after their proper substitution as heris
of defendant Tolentino, filed a so-called "Jurisdictional Motion for Dismissal of
Plaintiffs' Complaint" on December 13, 1971, asking however that
notwithstanding the dismissal of the complaint prayed for, the court proceed with
the trial and final disposition of the cournterclaims. The motin was based on the
ground that inasmuch as the plaintiff's case was a claimfor money, under Section
21 of Rule 3, it should be dismissed as an action and filed as a claim inthe special
proceedings for the settlement of the estate of the deceased defendant.
Petitioners opposed said motion contending that the second cause of action was
for damages and that their defense to the counterclaims of the defendant was in
the complaint and citing the case of Javier vs. Araneta, L-4369, August 31, 1953, in
support of their opposition. On January 5, 1972, respondent judge denied the
motion to dismiss thus:
"For not being well-founded, the motion filed by Atty. Vicente Jayme, counsel for
the defendants, dated Decembr 13, 1971 based onthe grounds threin stated (See:
pp. 470-471, Recods) is hreby ordered DENIED.
SO ORDERED." (Page 9, Record.)
Threeafter, the court porceeded with the trial and on May 4 1972 ordered the
admission of the documentary evidence of defendants listed inthe order of even
date, and upon manifestationof plaintiffs that they have rebuttal evidence to
present, set the case for hearing for the purpose of receiving the same, but
instead of agreeing to thedats porposed by them: July 11, 12 and 13, 1972, the
court, in its order of May 22, 1972, set the reception of said evidence on July 3,
1972, only to change this later or on June 28, 1972, to July 5, 1972 for fear that
July 3, 1972 might be declared a public holiday, and still later to July 25, 1972
might be declared a public holiday, and still later to July 25, 1972 upon motion of
plaintiffs' counsel.
In the meanwhile, on June 27, 1972, plaintiffs filed the following motion, which
they set for hearing on July 3, 1972, albeit no hearing appears to have beenheld
onsaid date:
"COME NOW the plaintiffs, thorugh counsels, and to this Honorable Court
respectully allege:
1. That the reception of plaintiffs' rebuttal evidence inthe above-entitled case has
been set for July 3rd, 1972, at 8:30 A.M.
2. That as defendant Emmanuel O. Tolentino died before completion of plaintiffs'
cross-examination and before finality of judgment on plaintiffs' respective money
claims against him, and as the substituted defendants have filed jurisdictional
motion for dismissal of this case, the ;laintiffs hreby withdreaw their opposition to
said jurisdictional motion by reason of the fact that, as pointed out therein, this
Honorable Court is divested of jurisdiction to continuetaking cognizance of
plaintiffs' money claim and said money claim should be filed with the proper
probate court.
3. That in the interest of justice and in order not to render judgment on said
money claim null and void for lack of jurisdiction, the plaintiffs desire to present
completely competent, relevant and material evidence before the proper probate
court to substantiate their aforesaid money claims and for this reason they are
constrained to move this Honorable Court to dismiss provisionally this case to
move this Honorable Court to dismiss provisionally this case without prejudice of
refiling same with the proper probate court and of reproducing therein the
evidence and presenting rebuttal evidence according as the nature of defendants'
evidence may demand.
4. That in view of the foregoing considerations, the plaintiffs hereby manifest that
they no longer will present rebuttal evidence resrving same to be adduced instead
in the proper probate court.
WHEREFORE, this Honorable Court is most respectfully prayed to dismiss
provisionally the above-entitled case without prejudice of refiing same with the
proper probate court and of presenting and reproducing therein plaintiffs'
evidence for final determination and decision by said probate court."
On Juy 13, 1972, defendants filed the following:

DEFENDANTS COUNTER-MANIDFESTATION AND OPPOSITION TO THE MOTION
DATED JUNE 27, 1972
COME the defendants in the above-entitled case, thru the undersigned counsel,
and to this Honorable Court most respectfully manifest and submit an opposition
to the dismissal of defendants' counterclaim on the following grounds:
1. That copy of plaintiffs' Manifestation and Motion dated June 27, 1972 appears
to have been mailed from Butuan City on June 28, 1972, and received by us after
July 3, 1972.
2. That as far back as December 13, 1971 we have submitted to this Honorable
Court a pleading entitled "JURISDICTIONAL MOTION FOR DISMISSAL OF
PLAINTIFFS' COMPLAINT (PRIVILEGED AND URGENT)'.
3. What our grounds therein alleged are hereto replead and reproduced IN TOTO.
4. That said motionhas beenopposed by the plaintiffs under a pleaing entitled
'OPPOSITION TO JURISDICTIONAL MOTION FOR DISMISSAL OF PLAINTIFFS'
COMPLAINT' dated December 29, 1971.
5. That an order dated January 5, 1972 was issued by this Honorable Court
denying our motion.
6. That in the meantime and in due course continuation of the trial was held and
the formal offer in evidence of all the exhibits of the defendants was effected
under date of February 19, 1972, which exhibits were admited by the Court inits
order of May 4, 1972.
7. That as it is the case of the defendants is completed with their counterclaim
duly substantiated.
8. That the counterclaim is in itself an independent action, not subject to
suspension or dismissal because it survives the deceased Don Emmanuel O.
Tolentino.
9. That as a matter of fact is is now deemed submitted to the decision of the
Honorable Court without any strings attached to said counterclaim.
WHEREFORE, in reiteration, this Honorable Court is most respectfully prayed to
grant the motion to dismiss plaintiffs' complaint, and to declare the case of the
defendants as far as their counterclaim is concerned, submitted for the decisionof

this Honorable Court." (Pp. 12-13, Recod.)
And on July 18, 1972, the court issued the following order:
"For lack of merit, the manifestation and motion filed by Atty. Cipriano C. Alvizo,
Sr. for the plaintiffs (See: pp. 543-544, Records), and the counter-manifestation
and opposition filed by Atty. Vicente Jayme for the defendants (See: pp. 547-548
Records) are hereby ordered DENIED.
ASprayed of (for) by Atty. Alvizo, Sr., set this case for the reception of the rebuttal
and surrebuttal evidence on July 25, 1972 from 8:30 A.M. to P.M. with due notice
to all counsel." (Page 14, Record.)
A motion dated July 23, 1972 for reconsideration of thir order was filed by
plaintiffs but on July 25, 1972, what happened is narrated in the order of the
court of said date as follows:
"When this case was called for the reception of plaintiffs' rebuttal evidence for
the second time at exactly 11:23 A.M. today, Atty. Cipriano C. Alvizo, Sr., counsel
for the plaintiffs, together with all the plaintiffs themeslves, failed to appear in
court despite due notice to them in open court the first time this case was called
at 8:30 A.M., and in spite of the two personal notices given to said Atty. Alvizo,
Sr., who was by then withinthe sala of Branch 1 of this court sitting, whre no
sessions were yet had, first by Court Proces Server Rodrigo T. Macion and second,
by CIC Raymundo C. Morgadez minutes before the second call as above said.
The reception of plantiffs reguttal evidence was previously set by the court, upon
previous prayer of plaintiffs, thru counsel, in their Manifestaion and Motion dated
May 15, 1972 (See: p. 537, Records), on July 3, 1972 in anorder dated May 22,
1972 (See: p. 541, Records). Later, plaintiffs, thru counsel, prayed the court again
in their Urgent Ex Parte Motion dated June 30, 1972
'to reset for July 25, 1972 the hearing of this case.' (See: p. 545, Records.)
Again plaintiffs' above said motion was granted by the court as prayed for by
them in an Order dated July 18, 1972 resetting the reception of plaintiffs' rebuttal
evidence today, July 25, 1972 from 8:30 A.M. to 7:00 P.M., with due notice to said
Atty. Cipriano C. Alvizo, Sr. by personal service on July 22, 1972 (See: p. 550,
Records).
First call of the case was had Atty. Alvizo, Sr. appeared and presented plaintiffs'
Urgent Motion for Reconsideratio dated July 23, 1972 but only filed today 25
minutes before the first call. The court intimated to said Atty. Alvizo, Sr. that it
could not entertain the said motion on grounds which the court would give in an
Order to be issued later and insisted on plaintiffs' presentationof their promised
rebuttal evidence. The court, however, in fairness to plaintifs who were absent in
court, gave said Atty. Alvizo, Sr. until 11:00 A.M. to present his rebuttal witnesses.
The the second call came at exactly 11:23 A.M. as above said and what happened
was what was already narrated by the court at the opening of this Order.
By reason of all the foregoing, it is the sense of the court that plaintiffs have
elected to waive their right to present rebuttal evidence, prompting the cort to
consider, as it hereby HOLDS that this case is now considered reglementarily
submitted fo rdecisonon the merits. There being no rebuttal evidence to sur-rebt,
a Atty. Lydio J. Cataluna, counsel for the defendants, presented no objection to
the foregoing.
Plaintiffs' Urgent Motion for Reconsideration filed only today, 25, minutes before
8:30 A.M. (See: p. 553, Recods) when this case was caled for the reception of their
promised rebuttall evidence as prayed for them thru said Atty. Alvizo, Sr. as above
said (See: pp. 553-555, Records), is hreby ordered, for bieng unreglementary and
dilatory in nature andtiming, DENIED, pursuant to Section 4, Rule 15 of the
Revised Rules of Court." (Pp. 18-20, Record.)
On July 29, 1972, plaintiffs
PREMISES CONSIDERED, judgment is hereby rendered granting the instant
petition. The trial court's decision of September 20, 1972 as well as its orders of
July 18 and 25, 1972, together with all its orders of preliminary attachment
against the properties of the petitioners are hereby set aside and rendered
without force and effect. Respondent court is enjoined to dismiss the subject case
before it (Civil Case No. 1251) in so far as petitioners' first cause of action is
concerned, without prejudice to its being filed as a money claim in special
proceedings for the settlement of the estate of the deceased Emmanuel O.
Tolentino. Respondent court is further ordered to proceed with the trial of
respondents' counter-claims by allowing the petitioners to present their evidence
in defense thereto, after which another decision should be rendered as the facts
and the law may warrant.
The incident of contempt shall be continued upon appropriate motion of the
interested parties. With respect to the matter of alleged irregular and illegal
attachment secured by Atty. Elias Q. Tan from the Court of First Instance of Cebu,
the Court rules that it should be made the subject of a separate action, albeit the
restraining order issued by this Court on May 4, 1973 is hereby maintained until
such appropriate action is filed, in which event, the court taking cognizance
thereof may act as it may deem proper in regard to said restraining order which
was issued only to maintain the status quo, for the purpose of avoiding that the
controversy between the parties should be more complicated in the instant
proceeding.
G.R. No. L-825
July 20, 1948
ROMAN MABANAG, plaintiff-appellant,

vs.
JOSEPH M. GALLEMORE, defendant-appellee.
TUASON, J.:
This case, here on appeal from an order dismissal by the Court of First Instance of
Occidental Misamis, raises the question of the court's jurisdiction. More
specifically, the question is whether the action is in personam or one in rem. The
trial court opined that it is the first and that it "has no authority nor jurisdiction to
render judgment against the herein defendant, Joseph M. Gallemore for being a
non-resident.
The purpose of the action is to recover P735.18, an amount said to have been
paid by the plaintiff to the defendant for two parcels of land whose sale was
afterward annulled. The defendant is said to be residing in Los Angeles, California,
U. S. A. He has no property in the Philippine except an alleged debt owing him by
a resident of the municipality of Occidental Misamis. This debt, upon petition of
the plaintiff, after the filing of the complaint and before the suit was dismissed,
was attached to the extent of plaintiff's claim for the payment of which the action
was brought. But the attachment was dissolved in the same order dismissing the
case.
It was Atty. Valeriano S. Kaamino who has amicus curi filed the motion to
dismiss and to set aside the attachment. There is no appearance before this Court
to oppose the appeal.
Section 2, Rule 5, of the Rules of Court provides:
If any of the defendants does not reside and is not found in the Philippines,
and the action effects the personal status of the plaintiff, or any property of
the defendant located in the Philippines, the action may be commenced
and tried in the province where the plaintiff resides or the property, or any
portion thereof, is situated or found.
The Philippine leading cases in which this Rule, or its counterpart in the former
Code of Civil Procedure, section 377 and 395, were cited and applied, are Banco
Espaol-Filipino vs. Palanca, 37 Phil. 921, and Slade Perkins vs. Dizon, 40 Off. Gaz.,
[3d Suppl.], No. 7, p. 216. The gist of this Court's ruling in these cases, in so far as
it is relevant to the present issues, is given in I Moran's Comments on the Rules of
Court, 2d Ed., 105:
As a general rule, when the defendant is not residing and is not found in
the Philippines, the Philippine courts cannot try any case against him
because of the impossibility of acquiring jurisdiction over his person, unless
he voluntarily appears in court. But, when the action affects the personal
status of the plaintiff residing in the Philippines, or is intended to seize or
dispose of any property, real or personal, of the defendant, located in the
Philippines, it may be validly tried by the Philippine courts, for then, they
have jurisdiction over the res, i.e., the personal status of the plaintiff or the
property of the defendant, and their jurisdiction over the person of the
non-resident defendant is not essential. Venue in such cases may be laid in
the province where the plaintiff whose personal status is in question
resides, or where the property of the defendant or a part thereof involved
in the litigation is located.
Literally this Court said:
Jurisdiction over the property which is the subject of litigation may result
either from a seizure of the property under legal process, whereby it is
brought into the actual custody of the law, or it may result from the
institution of legal proceedings wherein, under special provisions of law,
the power of the court over the property is recognized and made effective.
In the latter case the property, though at all times within the potential
power of the court, may never be taken into actual custody at all. An
illustration of the jurisdiction acquired by actual seizure is found in
attachment proceedings, where the property is seized at the beginning of
the action, or some subsequent stage of its progress, and held to abide the
final event of the litigation. An illustration of what we term potential
jurisdiction over the res, is found in the proceeding to register the title of
land under our system for the registration of land. Here the court, without
taking actual physical control over the property assumes, at the instance of
some person claiming to be owner, to exercise a jurisdiction in rem over the
property and to adjudicate the title in favor of the petitioner against all the
world. (Banco Espaol-Filipino vs. Palanca, supra, 927-928.).
In an ordinary attachment proceeding, if the defendant is not personally
served, the preliminary seizure is to be considered necessary in order to
confer jurisdiction upon the court. In this case the lien on the property is
acquired by the seizure; and the purpose of the proceeding is to subject the
property to that lien. If a lien already exists, whether created by mortgage,
contract, or statute, the preliminary seizure is not necessary; and the court
proceeds to enforce such lien in the manner provided by law precisely as
though the property had been seized upon attachment. (Roller vs. Holly,
176 U.S., 398, 405; 44 Law. ed., 520.) It results that the mere circumstance
that in an attachment the property may be seized at the inception of the
proceedings, while in the foreclosure suit it is not taken into legal custody
until the time comes for the sale, does not materially affect the
fundamental principle involved in both cases, which is that the court is here
exercising a jurisdiction over the property in a proceeding directed
essentially in rem. (Id., 929-930.).
When, however, the action relates to property located in the Philippines,
the Philippine courts may validly try the case, upon the principles that a
"State, through its tribunals, may subject property situated within its limit
owned by non-residents to the payment of the demand of its own citizens
against them; and the exercise of this jurisdiction in no respect infringes
upon the sovereignty of the State were the owners are domiciled. Every
State owes protection to its own citizens; and, when non-residents deal
with them, it is a legitimate and just exercise of authority to hold any
appropriate any property owned by such non-residents to satisfy the claims
of its citizens. It is in virtue of the State's jurisdiction over the property of
the non-resident situated within its limits that its tribunals can inquire into
the non-resident's obligations to its own citizens, and the inquiry can then
be carried only to the extent necessary to control disposition of the
property. If the non-resident has no property in the State, there is nothing
upon which the tribunals can adjudicate. (Slade Perkins vs. Dizon, 40 Off.
Gaz. [3d Supplement], No. 7, p. 216.).
A fuller statement of the principle whereunder attachment or garnishment of
property of a non-resident defendant confers jurisdiction on the court in an
otherwise personal action, appears in two well known and authoritative works:
The main action in an attachment or garnishment suit is in rem until
jurisdiction of the defendant is secured. Thereafter, it is in personam and
also in rem, unless jurisdiction of the res is lost as by dissolution of the
attachment. If jurisdiction of the defendant is acquired but jurisdiction of
the res is lost, it is then purely in personam. . . a proceeding against

property without jurisdiction of the person of the defendant is in substance
a proceeding in rem; and where there is jurisdiction of the defendant, but
the proceedings against the property continues, that proceedings is none
the less necessarily in rem, although in form there is but a single
proceeding. (4 Am. Jur., 556-557.)
As the remedy is administered in some states, the theory of an attachment,
whether it is by process against or to subject the property or effects of a
resident or non-resident of the state, is that it partakes essentially of the
nature and character of the proceeding in personam and not of a
proceeding in rem. And if the defendant appears the action proceeds in
accordance with the practice governing proceedings in personam. But were
the defendant fails to appear in the action, the proceeding is to be
considered as one in the nature of a proceeding in rem. And where the
court acts directly on the property, the title thereof being charged by the
court without the intervention of the party, the proceeding unquestionably
is one in rem in the fullest meaning of the term.
In attachment proceedings against a non-resident defendant where
personal service on him is lacking, it is elementary that the court must
obtain jurisdiction of the property of the defendant. If no steps have been
taken to acquire jurisdiction of the defendant's person, and he has not
appeared and answered or otherwise submitted himself to the jurisdiction
of the court, the court is without jurisdiction to render judgment until there
has been a lawful seizure of property owned by him within the jurisdiction
of the court. (2 R. C. L., 800-804.).
Tested by the foregoing decisions and authorities, the Court has acquired
jurisdiction of the case at bar by virtue of the attachment of the defendant's
credit. Those authorities and decisions, so plain and comprehensive as to make
any discussion unnecessary, are in agreement that though no jurisdiction is
obtained over the debtor's person, the case may proceed to judgment if there is
property in the custody of the court that can be applied to its satisfaction.
It is our judgment that the court below erred in dismissing the case and dissolving
the attachment; and it is ordered that, upon petition of the plaintiff, it issue a new
writ of attachment and then proceed to trial. The costs of this appeal will be
charged to defendant and appellee.
G.R. No. 102448
August 5, 1992
RICARDO CUARTERO, petitioner,

vs.
COURT OF APPEALS, ROBERTO EVANGELISTA and FELICIA
EVANGELISTA, respondents.
GUTIERREZ, JR., J.:

This is a petition for review on certiorari seeking to annul the decision of the Court
of Appeals promulgated on June 27, 1991 as well as the subsequent resolution
dated October 22, 1991 denying the motion for reconsideration in CA-G.R. SP No.
23199 entitled "Spouses Roberto and Felicia Evangelista v. Honorable Cezar C.
Peralejo, Presiding Judge Regional Trial Court of Quezon City, Branch 98, and
Ricardo Cuartero," which nullified the orders of the trial court dated August 24,
1990 and October 4, 1990 and cancelled the writ of preliminary attachment
issued on September 19, 1990.
Following are the series of events giving rise to the present controversy.
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. The complaint was docketed as Civil Case No. Q-906471.
On August 24, 1990, the lower court issued an order granting ex-parte the
petitioner's 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.
Subsequently, the spouses Evangelista filed motion to set aside the order dated
August 24, 1990 and discharge the writ of preliminary attachment for having been
irregularly and improperly issued. On October 4, 1990, the lower court denied the
motion for lack of merit.
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. Hence, the present recourse to this Court.
The petitioner raises the following assignment of errors:
I
THE COURT OF APPEALS ERRED AND COMMITTED A GRAVE ABUSE OF
DISCRETION, AMOUNTING TO LACK OF JURISDICTION WHEN IT HELD THAT
THE REGIONAL TRIAL COURT DID NOT ACQUIRE JURISDICTION OVER
RESPONDENT SPOUSES.
II
THE COURT OF APPEALS ERRED AND ACTED WITH GRAVE ABUSE OF
DISCRETION WHEN IT HELD THAT THE REGIONAL TRIAL COURT COULD NOT
VALIDLY ISSUE THE SUBJECT WRIT OF PRELIMINARY ATTACHMENT WHICH
IS AN ANCILLARY REMEDY. (Rollo, p. 13)
The Court of Appeals' decision is grounded on its finding that the trial court did
not acquire any jurisdiction over the person of the defendants (private
respondents herein). It declared that:
. . . the want of jurisdiction of the trial court to proceed in the main case as
well as the ancillary remedy of attachment is quite clear. It is not disputed
that neither service of summons with a copy of the complaint nor voluntary
appearance of petitioners was had in this case before the trial court issued
the assailed order dated August 24, 1990, as well as the writ of preliminary
attachment dated September 19, 1990. This is reversible error and must be
corrected on certiorari. (Rollo, p. 24)
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 (Sievert v. Court of Appeals, 168 SCRA 692). (Rollo,
p. 24)
The private respondents, in their comment, adopted and reiterated the
aforementioned ruling of the Court of Appeals. They added that aside from the
want of jurisdiction, no proper ground also existed for the issuance of the writ of
preliminary attachment. They stress that the fraud in contracting the debt or
incurring the obligation upon which the action is brought which comprises a
ground for attachment must have already been intended at the inception of the
contract. According to them, there was no intent to defraud the petitioner when
the postdated checks were issued inasmuch as the latter was aware that the same
were not yet funded and that they were issued only for purposes of creating an
evidence to prove a pre-existing obligation.
Another point which the private respondents raised in their comment is the
alleged violation of their constitutionally guaranteed right to due process when
the writ was issued without notice and hearing.
In the later case of Davao Light and Power Co., Inc. v. Court of Appeals, G.R. No.
93262, November 29, 1991, we had occasion to deal with certain misconceptions
which may have arisen from our Sievert ruling. The question which was resolved
in the Davao Light case is whether or not a writ of preliminary attachment may
issue ex-parteagainst a defendant before the court acquires jurisdiction over the
latter's person by service of summons or his voluntary submission to the court's
authority. The Court answered in the affirmative. This should have clarified the
matter but apparently another ruling is necessary.
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, 184
SCRA 31 [1990] citing Virata v. Aquino, 53 SCRA 30-31 [1973]).
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 ruling remains good law. There is, thus, no merit in the private respondents'
claim of violation of their constitutionally guaranteed right to due process.
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. The Court added that
. . . after an action is properly commenced by filing of the complaint and
the payment of all requisite docket and other fees the plaintiff may apply
and obtain a writ of preliminary attachment upon the fulfillment of the
pertinent requisites laid down by law, and that he may do so at any time,
either before or after service of summons on the defendant. And this,
indeed, has been the immemorial practice sanctioned by the courts: for the
plaintiff or other proper party to incorporate the application for attachment
in the complaint or other appropriate pleading (counter-claim, cross-claim,
third-party-claim) and for the Trial Court to issue the writ ex-parte at the
commencement of the action if it finds the application otherwise sufficient
in form and substance.
The Court also pointed out that:
. . . It is incorrect to theorize that after an action or proceeding has been
commenced and jurisdiction over the person of the plaintiff has been
vested in the Court, but before acquisition of jurisdiction over the person of
the defendant (either by service of summons or his voluntary submission to
the Court's authority), nothing can be validly done by the plaintiff or the
Court. It is wrong to assume that the validity of acts done during the period
should be dependent on, or held in suspension until, the actual obtention
of jurisdiction over the defendants person. The obtention by the court of
jurisdiction over the person of the defendant is one thing; quite another is
the acquisition of jurisdiction over the person of the plaintiff or over the
subject matter or nature of the action, or the res or object thereof.
It is clear from our pronouncements that a writ of preliminary attachment may
issue even before summons is served upon the defendant. However, we have
likewise ruled that the writ cannot bind and affect the defendant. However, we
have likewise ruled that the writ cannot bind and affect the defendant until
jurisdiction over his person is eventually obtained. Therefore, it is required that
when the proper officer commences implementation of the writ of attachment,
service of summons should be simultaneously made.
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.
It is appropriate to reiterate this Court's exposition in the Davao Light and
Power case cited earlier, to wit:
. . . writs of attachment may properly issue ex-parte provided that

the Court is satisfied that the relevant requisites therefore have been
fulfilled by the applicant, although it may, in its discretion, require
prior hearing on the application with notice to the defendant, but
that levy on property pursuant to the writ thus issued may not be
validly effected unless preceded, or contemporaneously
accompanied by service on the defendant of summons, a copy of the
complaint (and of the appointment of guardian ad litem, if any), the
application for attachment (if not incorporated in but submitted
separately from the complaint), the order of attachment, and the
plaintiff's attachment bond.
The question as to whether a proper ground existed for the issuance of the writ is
a question of fact the determination of which can only be had in appropriate
proceedings conducted for the purpose (Peroxide Philippines Corporation V.
Court of Appeals, 199 SCRA 882 [1991]). It must be noted that the spouses
Evangelista's motion to discharge the writ of preliminary attachment was denied
by the lower court for lack of merit. There is no showing that there was an abuse
of discretion on the part of the lower court in denying the motion.
Moreover, an attachment may not be dissolved by a showing of its irregular or
improper issuance if it is upon a ground which is at the same time the applicant's
cause of action in the main case since an anomalous situation would result if the
issues of the main case would be ventilated and resolved in a mere hearing of a
motion (Davao Light and Power Co., Inc. v. Court of Appeals, supra, The
Consolidated Bank and Trust Corp. (Solidbank) v. Court of Appeals, 197 SCRA 663
[1991]).
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 (Annex "B"). The issue of fraud, then, is
clearly within the competence of the lower court in the main action.
WHEREFORE, premises considered, the Court hereby GRANTS the petition. The
challenged decision of the Court of Appeals is REVERSED, and the order and writ
of attachment issued by Hon. Cezar C. Peralejo, Presiding Judge of Branch 98,
Regional Trial Court of Quezon City against spouses Evangelista are hereby
REINSTATED. No pronouncement as to costs.
SO ORDERED.
G.R. No. L-46009
May 14, 1979
RICARDO T. SALAS and MARIA SALAS, petitioners,

vs.
HON. MIDPANTAO L. ADIL, as Judge of Branch II, Court of First Instance of Iloilo,
ROSITA BEDRO and BENITA YU, respondents.
Castro Law Office for petitioners.
ANTONIO, J.:
Certiorari to nullify the Order of Attachment of May 13, 1977, as well as the Writ
of Attachment dated May 16, 1977, issued by respondent Judge in Civil Case No.
10770 of the Court of First Instance of Iloilo, entitled "Rosita Bedro and Benita Yu
v. Spouses Ricardo T. Salas and Maria Salas, et al.
On September 10, 1976, respondents Rosita Bedro and Benita Yu filed the aforementioned 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. The action
for annulment was predicated upon the averment that Lot No. 5, being a
subdivision road, is intend for public use and cannot be sold or disposed of by the
Hodges Estate. The claim for damages was based on the assertion that after
defendant spouses purchased Lots Nos. 2 and 3, they also purchased Lot No. 5
and thereafter "erected wooden posts, laid and plastered at the door of the
house on Lot No. 3, with braces of hardwood, lumber and plywood nailed to the
post", thereby preventing Rosita Bedro and Benita Yu from using the road on the
afore-mentioned lot, Lot No. 5, and that as a result of such obstruction, private
respondents Rosita Bedro and Benita Yu sustained actual damages in the amount
of P114,000.00, plus the sum of Pl,000.00 as damages daily from June 30, 1976
due to the stoppage in the construction of their commercial buildings on Lot No.
3, and moral damages in the amount of P200,000.00.
In their answer to the complaint, the Salas spouses, after specifically denying the
material allegations in the complaint, stated that Lot No. 5 had been registered in
the name of the C. N. Hodges as their exclusive private property and was never
subjected to any servitude or easement of right of way in favor of any person;
that any occupants of Lots Nos. 2 and 3 have direct access to Bonifacio Drive, a
National Highway, hence, Lot No. 5 is neither needed nor required for the egress
or ingress of the occupants thereof; and that private respondents, as a matter of
fact, since 1964 had excluded and separated completely their property (Lots
Nos. 2 and 3) from Lot No. 5 by building a concrete wall on the boundary
thereon without providing any gate as entrance or exit towards Lot No. 5; and
that private respondents have no personality to question the validity of the
deed of sale over Lot No. 5 since they were not parties to the same and the sale
was duly approved by the probate court.
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 Psc2157 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.
Contending that respondent Judge gravely abused his discretion in issuing the
said Writ of Attachment, petitioners filed the present petition.
In certiorari proceedings, the cardinal rule is that the court must be given the
opportunity to correct itself, Thus, for the special civil action of certiorari to
prosper, there must be no appeal nor any plain, speedy and adequate remedy in
the ordinary course of law. Petitioners, therefore, must exhaust all available
remedies in the lower court before filing a petition for certiorari, otherwise the
petition shall be held to be premature.
In the instant case, it appears that petitioners have adequate remedy under the
law. They could have filed an application with the court a quo for the discharge
of the attachment for improper or irregular issuance under section 13, Rule 57,
of the Revised Rules of Court, which provides the following
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 Salas vs. Adil 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 counteraffidavits or other evidence in addition to that on which the attachment
was made. After 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.
Considering that petitioners have not availed of this remedy, the instant
petition is premature.
We deem it necessary, however, for the guidance of respondent Court and of
the parties, to stress herein the nature of attachment as an extraordinary
provisional remedy.
A preliminary attachment is a rigorous remedy, which exposes the debtor to
humiliation and annoyance, such it should not be abused as to cause
unnecessary prejudice. It is, therefore, the duty of the court, before issuing the
writ, to ensure that all the requisites of the law have been complied with;
otherwise the judge acts in excess of his jurisdiction and the so issued shall be
null and void . 1
In Carpio v. Macadaeg, 2 this Court said:
Respondent Judge should not have issued the two writs of preliminary
attachment (Annexes C and C-1) on Abaya's simple allegation that the
petitioner was about to dispose of his property, thereby leaving no
security for the satisfaction of any judgment. Mere removal or disposal of
property, by itself, is not ground for issuance of preliminary attachment,
notwithstanding absence of any security for the satisfaction of any
judgment against the defendant. The removal or disposal, to justify
preliminary attachment, must have been made with intent to defraud

defendant's creditors.
Respondent Judge in fact corrected himself. Acting on petitioner's motion
to discharge attachment and apparently believing the correctness of the
grounds alleged therein, he set aside the orders of attachment (Order of
March 11, 1960, Annex F)
But reversing himself again, he set aside his order of March 11, 1960
(Annex K, dated March 29, 1960). This he did apparently on Abaya's
contention that petitioner was about to remove or dispose of his property
in order to defraud his creditors, as examples of which disposals he
pointed to the alleged sale of the horses and of petitioner's office
furniture. ... These averments of fraudulent disposals were controverted
by petitioner who ... reiterated the defenses against preliminary
attachment which he had previously enumerated in his petition to
discharge the two orders of attachment. Thus the question of fraudulent
disposal was put in issue; and respondent Judge, before issuing the pre
attachment anew, should have given the parties opportunity to prove
their respective claims or, at the very least should have provided
petitioner with the chance to show that he had not been disposing of his
property in fraud of creditors. (citing National Coconut Corporation v.
Pecson L-4296, Feb. 25, 1952, Villongco v. Panlilio, 6214, Nov. 20, 1953).
And in Garcia v. Reyes, 3 considering the allegation that the debtors were
removing or disposing of some of their properties with intent to defraud their
creditors, 'this Court said that "(a)ll in all due process would seem to require
that both parties further ventilate their respective contentions in a hearing that
could indeed reveal the truth. Fairness would be served thereby, the demand of
reason satisfied."
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.
We think, however, that a rule sufficient for the determination of this
case has been suggested and acted upon, and that the remedy does
not exist where unliquidated damages were demanded. ... InWarwick
v. Chase, 23 Md 161, it is said: 'It is necessary that the standard for
ascertaining the amount of damages claimed should not only appear,
but that it should be fixed and certain, and in no degree dependent
on facts either speculative or Uncertain ... The general rule is, that
unliquidated damages, ... cannot be recovered by attachment, unless
the contract affords a certain measure or standard for ascertaining
the amount of the damages ... 4
Further.
The statute authorizing the issuance of the writ of garnishment and
that relating to the issuance of the writ of attachment ... have not
been construed as authorizing the writs to be issued when the
plaintiff's suit is technically an action for debt. Neither of the writs
may be issued when the suit is for damages for tort, but they may be
issued when the plaintiff's claim arises out of contract either express
or implied, and the demand is liquidated, that is, the amount of the
claim is not contingent, is capable of being definitely ascertained by
the usual means of evidence, and does not rest in the discretion of
the jury. 5
WHEREFORE, the instant petition is hereby DENIED, in order to enable petitioners
to move before respondent Court for the discharge of the attachment on the
ground of its improper and irregular issuance, pursuant to section 13, Rule 57, of
the Revised Rules of Court, and for the aforesaid Court to act thereon in
accordance with the foregoing.
G.R. No. 55272
April 10, 1989
JARDINE-MANILA FINANCE, INC., petitioner,

vs.
COURT OF APPEALS, IMPACT CORPORATION, RICARDO DE LEON and EDUARDO
DE LEON, respondents.
FERNAN, C.J.:
This is a petition for review on certiorari seeking to reverse and set aside: (a) the
August 29, 1980 decision of the Court of Appeals 1 in Special Proceedings CA-G.R.
No. SP-09972-R entitled "Impact Corporation, et al. v. Hon. Buenaventura
Guerrero, etc., et al." annulling the order and the writ of attachment issued by the
Court of First Instance of Rizal in Civil Case No. 34617 entitled "Jardine-Manila
Finance, Inc. v. Impact Corporation, et al." 2 and (b) the Resolution dated October
7, 1980 denying herein petitioners motion for reconsideration. 3
On September 28, 1979, petitioner Jardine-Manila Finance, Inc. (JARDINE) filed a
complaint in the then Court of First Instance (CFI) of Rizal, docketed as Civil Case
No. 34617, against private respondents Impact Corporation (IMPACT), Ricardo de
Leon and Eduardo de Leon, to collect various sums of money allegedly due from
therein defendant IMPACT under a credit accomodation by way of a discounting
line agreement. 4 Herein private respondents Ricardo de Leon and Eduardo de
Leon were included as defendants by virtue of their undertaking covered by a
Surety Agreement under which they bound themselves jointly and severally with
defendant IMPACT to pay herein petitioner all of IMPACT's obligations under the
aforesaid agreement. 5
It was alleged that in April and May 1979, 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; 6 but despite the fact that IMPACT had collected the
amounts due on said receivables, it failed or refused to turn over the amounts so
collected to JARDINE.
JARDINE thus demanded payment of P 1,000,212.64, the total amount due under
said various deeds of assignment, plus interest of P 16,614.64 as of September 6,
1979 and 25 % of the aforesaid amount as attorney's fees, exemplary damages

and other expenses of litigation.
Likewise contained in said complaint is petitioner's application for a writ of
preliminary attachment against private respondents. The allegations in support of
said petition for a writ of preliminary attachment are quoted in full:
Special Allegations for Preliminary Attachment
A. The foregoing allegations are hereby repleaded and made integral
parts hereof.
B. The defendant corporation at the time of the execution of the
aforesaid deeds of assignment had reservation not to remit to
plaintiff the proceeds of the receivables assigned to plaintiff as
confirmed by their refusal to remit the same to plaintiff although the
issuers of the receivables assigned to plaintiff had already paid to
defendant corporation their obligations on said receivables to the
latter.
C. Defendants Ricardo de Leon and Eduardo de Leon who are
likewise officers of defendant corporation in order to elicit plaintiffs
approval to enter into said deeds of assignment with defendant
corporation, executed the aforesaid surety agreement (Annex L),
likewise, with reservation in their minds not to honor their
obligations under the same as what they actually did when they
refused to pay the obligations of defendant corporation to plaintiff
pursuant to the provisions of said surety agreement. (Annex L)
D. Defendant corporation, Ricardo de Leon and Eduardo de Leon
have no visible other sufficient security for the claim sought to be
enforced by this action of plaintiff other than their real and personal
properties which are located in Metro Manila and in the province of
Rizal, Province of Nueva Ecija or elsewhere. (Emphasis supplied)
E. Plaintiffs action against defendant corporation is based upon
documents and therefrom a sufficient cause of action exists.
F. Plaintiff is willing to post a bond in an amount to be fixed by the
Honorable Court, not exceeding plaintiffs claim which will be
conditioned to the effect that plaintiff will pay all the costs which
may be adjudged to the adverse party and all damages which they
may sustain by reason of attachment, if the Honorable Court should

finally adjudge that the applicant plaintiff is not entitled thereto.7
On the basis of the foregoing allegations, the lower court granted JARDINE's
petition for the issuance of a writ of preliminary attachment on October 16,
1979. 8
On October 19, 1979, therein defendants filed a motion to set aside the writ of
preliminary attachment. They also submitted to the court a quo a memorandum
in support of their motion to dissolve the attachment contending that the
grounds alleged by the plaintiff in its application for a writ of attachment are
not among the grounds specified under Section 1 of Rule 57; that the
defendants have other sufficient security; that there was no affidavit of merit to
support the application for attachment as required by Section 3 of Rule 57 and
that the verification of the complaint was defective as it did not state that the
amount due to the plaintiff above all legal set-ups or counterclaims is as much
as the sum for which the order is sought. 9
JARDINE opposed the motion arguing that the mental reservation of defendants
at the time of the execution of the deeds of assignment constituted fraud; that
such fraud was further confirmed by the fact that defendants actually failed to
remit the proceeds of the collection of receivables assigned by them; that
defendants failed to disclose to the plaintiff the fact that they had already
collected the receivables assigned by them; that the amounts collected by
defendant corporation were received by defendants in trust for plaintiff and
defendant corporation appropriated for itself said collection. 10
On November 7, 1979, the trial court denied defendant's motion to annul the
writ of preliminary attachment. Thereupon, defendant Impact Corporation went
to the appellate court on a petition for certiorari seeking to annul said writ. 11
The findings of the Court of Appeals are as follows:
To our mind there is no question that the allegations of the complaint
proper which were repleaded and made integral part of the application
for preliminary attachment (paragraph A) made out a case of conversion
or misappropriation of property held in trust which is the subject of the
complaint for the allegations stated that IMPACT had assigned to JARDINE
certain receivables with the understanding that it was to collect the same
from the issuers of said receivables and deliver the amounts collected to
JARDINE, but in spite of the fact that IMPACT had actually collected said
amounts, it failed to turn over said receivables to JARDINE. There was,

therefore, in the allegations of said complaint true conversion of the
amounts received by defendant in trust for plaintiff. Defendants in their
motion to discharge the attachment and the memorandum filed by them
in support of said motion had in effect, admitted the conversion of the
amounts collected by defendant IMPACT, but justified the use of said
amounts to meet its operational expenses to prevent a complete
shutdown of its operations.
While we find that the grounds alleged by plaintiff, the herein private
respondent, to support its application for preliminary attachment are
among those enumerated in Section 1 of Rule 57 as grounds upon which
an attachment may be issued, we are constrained nonetheless to rule
against the regularity or legality of the attachment issued by respondent
Court because there was no allegation made by plaintiff in its application
for the issuance of a writ of attachment to the effect 'that there is no
sufficient security for the claim sought to be enforced, by the action, and
the amount due to the applicant or the value of the property on the basis
of which is entitled to recover, is as much as the sum for which the order
is granted above all legal counterclaims, a requirement for the granting of
an order of attachment under Section 3 of Rule 57. 12
Thus, on August 29, 1980, the Court of Appeals annulled the assailed writ of
attachment for having been issued improperly and irregularly, the dispositive
portion of which reads:
IN VIEW OF THE FOREGOING, the petition to annul the order and the writ of
attachment issued by respondent Court is hereby GRANTED and judgment is
rendered declaring said order and writ of attachment null and void for
having been issued improperly and regularly. The restraining order issued by
this Court on November 9, 1979 restraining respondents from enforcing the
writ of attachment issued by respondent Judge on October 16, 1979 is
hereby made PERMANENT. With costs against private respondents. 13
Hence this recourse.
Reduced to bare essentials, the records show that in the exercise of its
discretion, the lower court found justification in the issuance of the attachment.
On the other hand, the Court of Appeals while in accord with the lower court
that a sufficient cause of action exists for petitioner and that the ground for its
application for attachment is one of those mentioned in Section 1, Rule 57 of
the Rules of Court, found the issuance of the attachment irregular or illegal in
the absence of the following allegations in the application for attachment: (1)
that "there is no sufficient security for the claim sought to be enforced by the
action; and (2) 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."
Ultimately, the issue therefore, is whether or not non-compliance with the
formal requirements invalidate the writ of attachment.
On both counts, petitioner admits not having used the exact words of the Rules
in making the requisite allegations, but nonetheless it alleged that it presented
ultimate and specific facts, first-in showing that there is indeed no other
sufficient security for the claim sought to be enforced as shown in paragraph D
of the Complaint earlier quoted; and second-while it did not specifically state
that the sum due is above all legal counterclaims, such conclusion of fact is no
longer necessary in the face of actual proof in the answer which did not carry
any counterclaim. In fine, petitioner stresses that mere forms must not be given
more weight than substance. 14
In excusing the deficiencies of its application for a writ of preliminary
attachment, petitioner relies heavily on the case of De Borja v. Platon, 15 where
this Court sustained the writ of attachment issued by the lower court in favor of
the defendants based on the counterclaim of the latter despite the lack of
allegations in the affidavit attached to the petition for the issuance of the writ
of attachment that the amount due the counterclaim was as much as the sum
for which the order is granted above all legal counterclaims.
It will be noted however, that the trial court found that the counterclaim of the
defendants exceeded the claims of the plaintiff. Thus, this Court held that "as
the trial court had before it the evidence adduced by both sides, the petition for
a writ of preliminary attachment having been filed four years after the trial
court had begun, we presume that the lower court having in mind such
evidence, ordered the attachment accordingly." 16
In sharp contrast, in the case at bar, where the records undeniably reveal that:
(1) the complaint was filed on September 28, 1979; 17 (2) the writ of
preliminary attachment was issued on October 16, 1979; 18 (3) the motion to
annul preliminary attachment dated October 19, 1979 was filed on the same
day; 19 (4) the answer of defendant IMPACT dated October 30, 1979 20 was
received by the RTC Pasig only on November 5, 1979, 21 it is evident that the
questioned writ was issued ex parte; and at a time when the Court a quo had yet no
basis for concluding that the amount due to petitioner is as much as the sum for
which the order is granted above all legal counterclaims.
It is therefore, readily apparent that the conclusions in the De Borja case cannot be
applied to the case at bar. In fact even petitioner's plea for liberality as it vigorously
invokes the doctrine on said case which refused "to sanction that formalism and that
technicality which are discountenanced by the modern laws of procedure" is an
obvious misreading of the ruling of this Court which states:
On the first point, we believe a writ of preliminary attachment may be issued
in favor of a defendant who sets up a counterclaim. For the purpose of the
protection afforded by such attachment, it is immaterial whether the
defendants Borja and wife simply presented a counterclaim or brought a
separate civil action against Jose de Borja, plaintiff in the previous case and
petitioner herein. To lay down a subtle distinction would be to sanction that
formalism and that technicality which are discountenanced by the modern
laws of procedure for the sake of speedy and substantial justice. . . .22
as a liberal approach to the required allegations in the application for a writ of
preliminary attachment when what this Court actually allowed was the presentation
of a counterclaim by the defendant instead of a separate civil action in compliance
with one of the basic requirements for the issuance of said writ.
The authority to issue an attachment, like the jurisdiction of the court over such
proceedings 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.23 In fact, "(E)ven where liberal construction is the rule,
the statute or the right to attachment thereby granted may not be extended by
judicial interpretation beyond the meaning conveyed by the words of the
statute." 24Petitioner'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.
The stringent conditions for the issuance of the writ have been echoed in all
subsequent cases, even as late asK.O. Glass Construction Co. Inc. vs.
Valenzuela, 25 wherein the writ of preliminary attachment issued was annulled and
set aside on the findings that while the plaintiff "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 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. 26 In fact, in such cases, the defect cannot even be cured by
amendment. 27
Since the attachment is a harsh and rigorous remedy which exposes the debtor to
humiliation and annoyance, the rule authorizing its issuance must be strictly
construed in favor of defendant. It is the duty of the court before issuing the writ to
ensure that all the requisites of the law have been complied with. 28 Otherwise, a
judge acquires no jurisdiction to issue the writ.
The general rule is that the affidavit is the foundation of the writ, and if none be filed
or one be filed which wholly fails to set out some facts required by law to be stated
therein, there is no jurisdiction and the proceedings are null and void. Thus, while
not unmindful of the fact that the property seized under the writ and brought into
court is what the court finally exercises jurisdiction over, the court cannot subscribe
to the proposition that the steps pointed out by statutes to obtain such writ are
inconsequential, and in no sense jurisdictional. 29
Considering that petitioner's application for the subject writ of preliminary
attachment did not fully comply with the requisites prescribed by law, said writ is, as
it is hereby declared null and void and of no effect whatsoever.
This conclusion renders a discussion of petitioner's other argument unnecessary.
WHEREFORE, the decision of the Court of Appeals dated August 29, 1980 is hereby
AFFIRMED. Costs against petitioner.
SO ORDERED.
G.R. No. 40054
September 14, 1933
LA
GRANJA,
INC., petitioner,
vs.
FELIX SAMSON, Judge of First Instance of Cagayan, CHUA BIAN, CHUA YU LEE
and CHUA KI,respondents.
VILLA-REAL, J.:
In this original petition for mandamus filed by the corporate entity, La Granja,
Inc., against Felix Samson, as Judge of the Court of First Instance of Cagayan, Chua
Bian, Chua Yu Lee and Chua Ki, the petitioner herein, for the reasons stated in its
petition, prays that a writ of mandamus be issued against the respondent Judge
compelling him to issue a writ of attachment against the properties of the other
respondents herein, who are defendants in civil case No. 1888 of the Court of
First Instance of Cagayan. The pertinent facts necessary for the solution of the
questions raised in the present case are as follows:
On July 5, 1932, the petitioner herein, La Granja, Inc., filed a complaint in the
Court of First Instance of Cagayan, against Chua Bian, Chua Yu Lee and Chua Ki,
for the recovery of the sum of P2,418.18 with interest thereon at the rate of 12
per cent per annum, which case was docketed as civil case No. 1888. The plaintiff
at the same time, 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. The respondent judge, wishing to ascertain or
convince himself of the truth of the alleged disposal, required the petitioner
herein to present evidence to substantiate its allegation, before granting its
petition. Inasmuch as the petitioner refused to comply with the court's
requirement, alleging as its ground that was not obliged to do so, the respondent
judge dismissed said petition for an order of attachment.
The only question to decide in the present case is whether or not the mere filing
of an affidavit executed in due form is sufficient to compel a judge to issue an
order of attachment.
Section 426 of the Code of Civil procedure provides the following:

SEC. 426. Granting order of attachment. 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.
It will be seen that the legal provision just cited orders the granting of a writ of
attachment when it has been made to appear by affidavit that the facts
mentioned by law as sufficient to warrant the issuance thereof, exist. 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 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.
Hence, the respondent judge, in requiring the presentation of evidence to
establish the truth of the allegation of the affidavit that the defendants had
disposed or were disposing of their property to defraud their creditors, has done
nothing more than exercise his sound discretion in determining the sufficiency of
the affidavit.
In view of the foregoing considerations, we are of the opinion and so hold that
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.
Wherefore, the petition for a writ of mandamus is hereby denied and the same is
dismissed, with costs against the petitioner. So ordered.
G.R. No. L-11390
March 26, 1918
EL BANCO ESPAOL-FILIPINO, plaintiff-appellant,

vs.
VICENTE PALANCA, administrator of the estate of Engracio Palanca
Tanquinyeng, defendant-appellant.
STREET, J.:
This action was instituted upon March 31, 1908, by "El Banco Espanol-Filipino" to
foreclose a mortgage upon various parcels of real property situated in the city of
Manila. The mortgage in question is dated June 16, 1906, and was executed by
the original defendant herein, Engracio Palanca Tanquinyeng y Limquingco, as
security for a debt owing by him to the bank. Upon March 31, 1906, the debt
amounted to P218,294.10 and was drawing interest at the rate of 8 per centum
per annum, payable at the end of each quarter. It appears that the parties to this
mortgage at that time estimated the value of the property in question at
P292,558, which was about P75,000 in excess of the indebtedness. After the
execution of this instrument by the mortgagor, he returned to China which
appears to have been his native country; and he there died, upon January 29,
1810, without again returning to the Philippine Islands.
As the defendant was a nonresident at the time of the institution of the present
action, it was necessary for the plaintiff in the foreclosure proceeding to give
notice to the defendant by publication pursuant to section 399 of the Code of Civil
Procedure. An order for publication was accordingly obtained from the court, and
publication was made in due form in a newspaper of the city of Manila. At the
same time that the order of the court should deposit in the post office in a
stamped envelope a copy of the summons and complaint directed to the
defendant at his last place of residence, to wit, the city of Amoy, in the Empire of
China. This order was made pursuant to the following provision contained in
section 399 of the Code of Civil Procedure:
In case of publication, where the residence of a nonresident or absent
defendant is known, the judge must direct a copy of the summons and
complaint to be forthwith deposited by the clerk in the post-office, postage
prepaid, directed to the person to be served, at his place of residence
Whether the clerk complied with this order does not affirmatively appear. There
is, however, among the papers pertaining to this case, an affidavit, dated April 4,
1908, signed by Bernardo Chan y Garcia, an employee of the attorneys of the
bank, showing that upon that date he had deposited in the Manila post-office a
registered letter, addressed to Engracio Palanca Tanquinyeng, at Manila,
containing copies of the complaint, the plaintiff's affidavit, the summons, and the
order of the court directing publication as aforesaid. It appears from the
postmaster's receipt that Bernardo probably used an envelope obtained from the
clerk's office, as the receipt purports to show that the letter emanated from the
office.
The cause proceeded in usual course in the Court of First Instance; and the
defendant not having appeared, judgment was, upon July 2, 1908, taken against
him by default. Upon July 3, 1908, a decision was rendered in favor of the
plaintiff. In this decision it was recited that publication had been properly made in
a periodical, but nothing was said about this notice having been given mail. The
court, upon this occasion, found that the indebtedness of the defendant
amounted to P249,355. 32, with interest from March 31, 1908. Accordingly it was
ordered that the defendant should, on or before July 6, 1908, deliver said amount
to the clerk of the court to be applied to the satisfaction of the judgment, and it
was declared that in case of the failure of the defendant to satisfy the judgment
within such period, the mortgage property located in the city of Manila should be
exposed to public sale. The payment contemplated in said order was never made;
and upon July 8, 1908, the court ordered the sale of the property. The sale took
place upon July 30, 1908, and the property was bought in by the bank for the sum
of P110,200. Upon August 7, 1908, this sale was confirmed by the court.
About seven years after the confirmation of this sale, or to the precise, upon June
25, 1915, a motion was made in this cause by Vicente Palanca, as administrator of
the estate of the original defendant, Engracio Palanca Tanquinyeng y Limquingco,
wherein the applicant requested the court to set aside the order of default of July
2, 1908, and the judgment rendered upon July 3, 1908, and to vacate all the
proceedings subsequent thereto. The basis of this application, as set forth in the
motion itself, was that the order of default and the judgment rendered thereon
were void because the court had never acquired jurisdiction over the defendant
or over the subject of the action.
At the hearing in the court below the application to vacate the judgment was
denied, and from this action of the court Vicente Planca, as administrator of the
estate of the original defendant, has appealed. No other feature of the case is
here under consideration than such as related to the action of the court upon said
motion.
The case presents several questions of importance, which will be discussed in
what appears to be the sequence of most convenient development. In the first
part of this opinion we shall, for the purpose of argument, assume that the clerk
of the Court of First Instance did not obey the order of the court in the matter of
mailing the papers which he was directed to send to the defendant in Amoy; and
in this connection we shall consider, first, whether the court acquired the
necessary jurisdiction to enable it to proceed with the foreclosure of the
mortgage and, secondly, whether those proceedings were conducted in such
manner as to constitute due process of law.
The word "jurisdiction," as applied to the faculty of exercising judicial power, is
used in several different, though related, senses since it may have reference (1) to
the authority of the court to entertain a particular kind of action or to administer
a particular kind of relief, or it may refer to the power of the court over the
parties, or (2) over the property which is the subject to the litigation.
The sovereign authority which organizes a court determines the nature and
extent of its powers in general and thus fixes its competency or jurisdiction with
reference to the actions which it may entertain and the relief it may grant.
Jurisdiction over the person is acquired by the voluntary appearance of a party in
court and his submission to its authority, or it is acquired by the coercive power of
legal process exerted over the person.
Jurisdiction over the property which is the subject of the litigation may result
either from a seizure of the property under legal process, whereby it is brought
into the actual custody of the law, or it may result from the institution of legal
proceedings wherein, under special provisions of law, the power of the court over
the property is recognized and made effective. In the latter case the property,
though at all times within the potential power of the court, may never be taken
into actual custody at all. An illustration of the jurisdiction acquired by actual
seizure is found in attachment proceedings, where the property is seized at the
beginning of the action, or some subsequent stage of its progress, and held to
abide the final event of the litigation. An illustration of what we term potential
jurisdiction over the res, is found in the proceeding to register the title of land
under our system for the registration of land. Here the court, without taking
actual physical control over the property assumes, at the instance of some person
claiming to be owner, to exercise a jurisdiction in rem over the property and to

adjudicate the title in favor of the petitioner against all the world.
In the terminology of American law the action to foreclose a mortgage is said to
be a proceeding quasi in rem, by which is expressed the idea that while it is not
strictly speaking an action in rem yet it partakes of that nature and is substantially
such. The expression "action in rem" is, in its narrow application, used only with
reference to certain proceedings in courts of admiralty wherein the property
alone is treated as responsible for the claim or obligation upon which the
proceedings are based. The action quasi rem differs from the true action in rem in
the circumstance that in the former an individual is named as defendant, and the
purpose of the proceeding is to subject his interest therein to the obligation or
lien burdening the property. All proceedings having for their sole object the sale
or other disposition of the property of the defendant, whether by attachment,
foreclosure, or other form of remedy, are in a general way thus designated. The
judgment entered in these proceedings is conclusive only between the parties.
In speaking of the proceeding to foreclose a mortgage the author of a well known
treaties, has said:
Though nominally against person, such suits are to vindicate liens; they
proceed upon seizure; they treat property as primarily indebted; and, with
the qualification above-mentioned, they are substantially property actions.
In the civil law, they are styled hypothecary actions, and their sole object is
the enforcement of the lien against the res; in the common law, they would
be different in chancery did not treat the conditional conveyance as a mere
hypothecation, and the creditor's right ass an equitable lien; so, in both, the
suit is real action so far as it is against property, and seeks the judicial
recognition of a property debt, and an order for the sale of
the res. (Waples, Proceedings In Rem. sec. 607.)
It is true that in proceedings of this character, if the defendant for whom
publication is made appears, the action becomes as to him a personal action and
is conducted as such. This, however, does not affect the proposition that where
the defendant fails to appear the action is quasi in rem; and it should therefore be
considered with reference to the principles governing actions in rem.
There is an instructive analogy between the foreclosure proceeding and an action
of attachment, concerning which the Supreme Court of the United States has
used the following language:
If the defendant appears, the cause becomes mainly a suit in personam,

with the added incident, that the property attached remains liable, under
the control of the court, to answer to any demand which may be
established against the defendant by the final judgment of the court. But, if
there is no appearance of the defendant, and no service of process on him,
the case becomes, in its essential nature, a proceeding in rem, the only
effect of which is to subject the property attached to the payment of the
defendant which the court may find to be due to the plaintiff. (Cooper vs.
Reynolds, 10 Wall., 308.)
In an ordinary attachment proceeding, if the defendant is not personally served,
the preliminary seizure is to, be considered necessary in order to confer
jurisdiction upon the court. In this case the lien on the property is acquired by the
seizure; and the purpose of the proceedings is to subject the property to that lien.
If a lien already exists, whether created by mortgage, contract, or statute, the
preliminary seizure is not necessary; and the court proceeds to enforce such lien
in the manner provided by law precisely as though the property had been seized
upon attachment. (Roller vs. Holly, 176 U. S., 398, 405; 44 L. ed., 520.) It results
that the mere circumstance that in an attachment the property may be seized at
the inception of the proceedings, while in the foreclosure suit it is not taken into
legal custody until the time comes for the sale, does not materially affect the
fundamental principle involved in both cases, which is that the court is here
exercising a jurisdiction over the property in a proceeding directed essentially in
rem.
Passing now to a consideration of the jurisdiction of the Court of First Instance in
a mortgage foreclosure, it is evident that the court derives its authority to
entertain the action primarily from the statutes organizing the court. The
jurisdiction of the court, in this most general sense, over the cause of action is
obvious and requires no comment. Jurisdiction over the person of the defendant,
if acquired at all in such an action, is obtained by the voluntary submission of the
defendant or by the personal service of process upon him within the territory
where the process is valid. If, however, the defendant is a nonresident and,
remaining beyond the range of the personal process of the court, refuses to come
in voluntarily, the court never acquires jurisdiction over the person at all. Here the
property itself is in fact the sole thing which is impleaded and is the responsible
object which is the subject of the exercise of judicial power. It follows that the
jurisdiction of the court in such case is based exclusively on the power which,
under the law, it possesses over the property; and any discussion relative to the
jurisdiction of the court over the person of the defendant is entirely apart from
the case. The jurisdiction of the court over the property, considered as the
exclusive object of such action, is evidently based upon the following conditions
and considerations, namely: (1) that the property is located within the district; (2)
that the purpose of the litigation is to subject the property by sale to an obligation
fixed upon it by the mortgage; and (3) that the court at a proper stage of the
proceedings takes the property into custody, if necessary, and expose it to sale for
the purpose of satisfying the mortgage debt. An obvious corollary is that no other
relief can be granted in this proceeding than such as can be enforced against the
property.
We may then, from what has been stated, formulated the following proposition
relative to the foreclosure proceeding against the property of a nonresident
mortgagor who fails to come in and submit himself personally to the jurisdiction
of the court: (I) That the jurisdiction of the court is derived from the power which
it possesses over the property; (II) that jurisdiction over the person is not acquired
and is nonessential; (III) that the relief granted by the court must be limited to
such as can be enforced against the property itself.
It is important that the bearing of these propositions be clearly apprehended, for
there are many expressions in the American reports from which it might be
inferred that the court acquires personal jurisdiction over the person of the
defendant by publication and notice; but such is not the case. In truth the
proposition that jurisdiction over the person of a nonresident cannot be acquired
by publication and notice was never clearly understood even in the American
courts until after the decision had been rendered by the Supreme Court of the
United States in the leading case of Pennoyer vs. Neff (95 U. S. 714; 24 L. ed.,
565). In the light of that decision, and of other decisions which have subsequently
been rendered in that and other courts, the proposition that jurisdiction over the
person cannot be thus acquired by publication and notice is no longer open to
question; and it is now fully established that a personal judgment upon
constructive or substituted service against a nonresident who does not appear is
wholly invalid. This doctrine applies to all kinds of constructive or substituted
process, including service by publication and personal service outside of the
jurisdiction in which the judgment is rendered; and the only exception seems to
be found in the case where the nonresident defendant has expressly or impliedly
consented to the mode of service. (Note to Raher vs. Raher, 35 L. R. A. [N. S. ],
292; see also 50 L .R. A., 585; 35 L. R. A. [N. S.], 312
The idea upon which the decision in Pennoyer vs. Neff (supra) proceeds is that the
process from the tribunals of one State cannot run into other States or countries
and that due process of law requires that the defendant shall be brought under
the power of the court by service of process within the State, or by his voluntary
appearance, in order to authorize the court to pass upon the question of his
personal liability. The doctrine established by the Supreme Court of the United
States on this point, being based upon the constitutional conception of due
process of law, is binding upon the courts of the Philippine Islands. Involved in this
decision is the principle that in proceedings in rem or quasi in rem against a
nonresident who is not served personally within the state, and who does not
appear, the relief must be confined to the res, and the court cannot lawfully
render a personal judgment against him. (Dewey vs. Des Moines, 173 U. S., 193;
43 L. ed., 665; Heidritter vs. Elizabeth Oil Cloth Co., 112 U. S., 294; 28 L. ed., 729.)
Therefore in an action to foreclose a mortgage against a nonresident, upon whom
service has been effected exclusively by publication, no personal judgment for the
deficiency can be entered. (Latta vs. Tutton, 122 Cal., 279; Blumberg vs. Birch, 99
Cal., 416.)
It is suggested in the brief of the appellant that the judgment entered in the court
below offends against the principle just stated and that this judgment is void
because the court in fact entered a personal judgment against the absent debtor
for the full amount of the indebtedness secured by the mortgage. We do not so
interpret the judgment.
In a foreclosure proceeding against a nonresident owner it is necessary for the
court, as in all cases of foreclosure, to ascertain the amount due, as prescribed in
section 256 of the Code of Civil Procedure, and to make an order requiring the
defendant to pay the money into court. This step is a necessary precursor of the
order of sale. In the present case the judgment which was entered contains the
following words:
Because it is declared that the said defendant Engracio Palanca
Tanquinyeng y Limquingco, is indebted in the amount of P249,355.32, plus
the interest, to the 'Banco Espanol-Filipino' . . . therefore said appellant is
ordered to deliver the above amount etc., etc.
This is not the language of a personal judgment. Instead it is clearly intended
merely as a compliance with the requirement that the amount due shall be
ascertained and that the evidence of this it may be observed that according to the
Code of Civil Procedure a personal judgment against the debtor for the deficiency
is not to be rendered until after the property has been sold and the proceeds
applied to the mortgage debt. (sec. 260).
The conclusion upon this phase of the case is that whatever may be the effect in
other respects of the failure of the clerk of the Court of First Instance to mail the
proper papers to the defendant in Amoy, China, such irregularity could in no wise
impair or defeat the jurisdiction of the court, for in our opinion that jurisdiction
rest upon a basis much more secure than would be supplied by any form of notice
that could be given to a resident of a foreign country.
Before leaving this branch of the case, we wish to observe that we are fully aware
that many reported cases can be cited in which it is assumed that the question of
the sufficiency of publication or notice in a case of this kind is a question affecting
the jurisdiction of the court, and the court is sometimes said to acquire
jurisdiction by virtue of the publication. This phraseology was undoubtedly
originally adopted by the court because of the analogy between service by the
publication and personal service of process upon the defendant; and, as has
already been suggested, prior to the decision of Pennoyer vs. Neff (supra) the
difference between the legal effects of the two forms of service was obscure. It is
accordingly not surprising that the modes of expression which had already been
molded into legal tradition before that case was decided have been brought down
to the present day. But it is clear that the legal principle here involved is not
effected by the peculiar language in which the courts have expounded their ideas.
We now proceed to a discussion of the question whether the supposed
irregularity in the proceedings was of such gravity as to amount to a denial of that
"due process of law" which was secured by the Act of Congress in force in these
Islands at the time this mortgage was foreclosed. (Act of July 1, 1902, sec. 5.) In
dealing with questions involving the application of the constitutional provisions
relating to due process of law the Supreme Court of the United States has
refrained from attempting to define with precision the meaning of that
expression, the reason being that the idea expressed therein is applicable under
so many diverse conditions as to make any attempt ay precise definition
hazardous and unprofitable. As applied to a judicial proceeding, however, it may
be laid down with certainty that the requirement of due process is satisfied if the
following conditions are present, namely; (1) There must be a court or tribunal
clothed with judicial power to hear and determine the matter before it; (2)
jurisdiction must be lawfully acquired over the person of the defendant or over
the property which is the subject of the proceeding; (3) the defendant must be
given an opportunity to be heard; and (4) judgment must be rendered upon

lawful hearing.
Passing at once to the requisite that the defendant shall have an opportunity to
be heard, we observe that in a foreclosure case some notification of the
proceedings to the nonresident owner, prescribing the time within which
appearance must be made, is everywhere recognized as essential. To answer this
necessity the statutes generally provide for publication, and usually in addition
thereto, for the mailing of notice to the defendant, if his residence is known.
Though commonly called constructive, or substituted service of process in any
true sense. It is merely a means provided by law whereby the owner may be
admonished that his property is the subject of judicial proceedings and that it is
incumbent upon him to take such steps as he sees fit to protect it. In speaking of
notice of this character a distinguish master of constitutional law has used the
following language:
. . . if the owners are named in the proceedings, and personal notice is
provided for, it is rather from tenderness to their interests, and in order to
make sure that the opportunity for a hearing shall not be lost to them, than
from any necessity that the case shall assume that form. (Cooley on
Taxation [2d. ed.], 527, quoted in Leigh vs. Green, 193 U. S., 79, 80.)
It will be observed that this mode of notification does not involve any absolute
assurance that the absent owner shall thereby receive actual notice. The
periodical containing the publication may never in fact come to his hands, and the
chances that he should discover the notice may often be very slight. Even where
notice is sent by mail the probability of his receiving it, though much increased, is
dependent upon the correctness of the address to which it is forwarded as well as
upon the regularity and security of the mail service. It will be noted, furthermore,
that the provision of our law relative to the mailing of notice does not absolutely
require the mailing of notice unconditionally and in every event, but only in the
case where the defendant's residence is known. In the light of all these facts, it is
evident that actual notice to the defendant in cases of this kind is not, under the
law, to be considered absolutely necessary.
The idea upon which the law proceeds in recognizing the efficacy of a means of
notification which may fall short of actual notice is apparently this: Property is
always assumed to be in the possession of its owner, in person or by agent; and
he may be safely held, under certain conditions, to be affected with knowledge
that proceedings have been instituted for its condemnation and sale.
It is the duty of the owner of real estate, who is a nonresident, to take

measures that in some way he shall be represented when his property is
called into requisition, and if he fails to do this, and fails to get notice by the
ordinary publications which have usually been required in such cases, it is
his misfortune, and he must abide the consequences. (6 R. C. L., sec. 445 [p.
450]).
It has been well said by an American court:
If property of a nonresident cannot be reached by legal process upon the
constructive notice, then our statutes were passed in vain, and are mere
empty legislative declarations, without either force, or meaning; for if the
person is not within the jurisdiction of the court, no personal judgment can
be rendered, and if the judgment cannot operate upon the property, then
no effective judgment at all can be rendered, so that the result would be
that the courts would be powerless to assist a citizen against a nonresident.
Such a result would be a deplorable one. (Quarl vs. Abbett, 102 Ind., 233;
52 Am. Rep., 662, 667.)
It is, of course universally recognized that the statutory provisions relative to
publication or other form of notice against a nonresident owner should be
complied with; and in respect to the publication of notice in the newspaper it may
be stated that strict compliance with the requirements of the law has been held
to be essential. In Guaranty Trust etc. Co. vs. Green Cove etc., Railroad Co. (139 U.
S., 137, 138), it was held that where newspaper publication was made for 19
weeks, when the statute required 20, the publication was insufficient.
With respect to the provisions of our own statute, relative to the sending of
notice by mail, the requirement is that the judge shall direct that the notice be
deposited in the mail by the clerk of the court, and it is not in terms declared that
the notice must be deposited in the mail. We consider this to be of some
significance; and it seems to us that, having due regard to the principles upon
which the giving of such notice is required, the absent owner of the mortgaged
property must, so far as the due process of law is concerned, take the risk
incident to the possible failure of the clerk to perform his duty, somewhat as he
takes the risk that the mail clerk or the mail carrier might possibly lose or destroy
the parcel or envelope containing the notice before it should reach its destination
and be delivered to him. This idea seems to be strengthened by the consideration
that placing upon the clerk the duty of sending notice by mail, the performance of
that act is put effectually beyond the control of the plaintiff in the litigation. At
any rate it is obvious that so much of section 399 of the Code of Civil Procedure as
relates to the sending of notice by mail was complied with when the court made
the order. The question as to what may be the consequences of the failure of the
record to show the proof of compliance with that requirement will be discussed
by us further on.
The observations which have just been made lead to the conclusion that the
failure of the clerk to mail the notice, if in fact he did so fail in his duty, is not such
an irregularity, as amounts to a denial of due process of law; and hence in our
opinion that irregularity, if proved, would not avoid the judgment in this case.
Notice was given by publication in a newspaper and this is the only form of notice
which the law unconditionally requires. This in our opinion is all that was
absolutely necessary to sustain the proceedings.
It will be observed that in considering the effect of this irregularity, it makes a
difference whether it be viewed as a question involving jurisdiction or as a
question involving due process of law. In the matter of jurisdiction there can be
no distinction between the much and the little. The court either has jurisdiction or
it has not; and if the requirement as to the mailing of notice should be considered
as a step antecedent to the acquiring of jurisdiction, there could be no escape
from the conclusion that the failure to take that step was fatal to the validity of
the judgment. In the application of the idea of due process of law, on the other
hand, it is clearly unnecessary to be so rigorous. The jurisdiction being once
established, all that due process of law thereafter requires is an opportunity for
the defendant to be heard; and as publication was duly made in the newspaper, it
would seem highly unreasonable to hold that failure to mail the notice was fatal.
We think that in applying the requirement of due process of law, it is permissible
to reflect upon the purposes of the provision which is supposed to have been
violated and the principle underlying the exercise of judicial power in these
proceedings. Judge in the light of these conceptions, we think that the provision
of Act of Congress declaring that no person shall be deprived of his property
without due process of law has not been infringed.
In the progress of this discussion we have stated the two conclusions; (1) that the
failure of the clerk to send the notice to the defendant by mail did not destroy the
jurisdiction of the court and (2) that such irregularity did not infringe the
requirement of due process of law. As a consequence of these conclusions the
irregularity in question is in some measure shorn of its potency. It is still
necessary, however, to consider its effect considered as a simple irregularity of
procedure; and it would be idle to pretend that even in this aspect the irregularity
is not grave enough. From this point of view, however, it is obvious that any
motion to vacate the judgment on the ground of the irregularity in question must
fail unless it shows that the defendant was prejudiced by that irregularity. The
least, therefore, that can be required of the proponent of such a motion is to
show that he had a good defense against the action to foreclose the mortgage.
Nothing of the kind is, however, shown either in the motion or in the affidavit
which accompanies the motion.
An application to open or vacate a judgment because of an irregularity or defect
in the proceedings is usually required to be supported by an affidavit showing the
grounds on which the relief is sought, and in addition to this showing also a
meritorious defense to the action. It is held that a general statement that a party
has a good defense to the action is insufficient. The necessary facts must be
averred. Of course if a judgment is void upon its face a showing of the existence
of a meritorious defense is not necessary. (10 R. C. L., 718.)
The lapse of time is also a circumstance deeply affecting this aspect of the case. In
this connection we quote the following passage from the encyclopedic treatise
now in course of publication:
Where, however, the judgment is not void on its face, and may therefore
be enforced if permitted to stand on the record, courts in many instances
refuse to exercise their quasi equitable powers to vacate a judgement after
the lapse of the term ay which it was entered, except in clear cases, to
promote the ends of justice, and where it appears that the party making
the application is himself without fault and has acted in good faith and with
ordinary diligence. Laches on the part of the applicant, if unexplained, is
deemed sufficient ground for refusing the relief to which he might
otherwise be entitled. Something is due to the finality of judgments, and
acquiescence or unnecessary delay is fatal to motions of this character,
since courts are always reluctant to interfere with judgments, and
especially where they have been executed or satisfied. The moving party
has the burden of showing diligence, and unless it is shown affirmatively
the court will not ordinarily exercise its discretion in his favor. (15 R. C. L.,
694, 695.)
It is stated in the affidavit that the defendant, Engracio Palanca Tanquinyeng y
Limquingco, died January 29, 1910. The mortgage under which the property was
sold was executed far back in 1906; and the proceedings in the foreclosure were
closed by the order of court confirming the sale dated August 7, 1908. It passes
the rational bounds of human credulity to suppose that a man who had placed a
mortgage upon property worth nearly P300,000 and had then gone away from
the scene of his life activities to end his days in the city of Amoy, China, should
have long remained in ignorance of the fact that the mortgage had been
foreclosed and the property sold, even supposing that he had no knowledge of
those proceedings while they were being conducted. It is more in keeping with
the ordinary course of things that he should have acquired information as to what
was transpiring in his affairs at Manila; and upon the basis of this rational
assumption we are authorized, in the absence of proof to the contrary, to
presume that he did have, or soon acquired, information as to the sale of his
property.
The Code of Civil Procedure, indeed, expressly declares that there is a
presumption that things have happened according to the ordinary habits of life
(sec. 334 [26]); and we cannot conceive of a situation more appropriate than this
for applying the presumption thus defined by the lawgiver. In support of this
presumption, as applied to the present case, it is permissible to consider the
probability that the defendant may have received actual notice of these
proceedings from the unofficial notice addressed to him in Manila which was
mailed by an employee of the bank's attorneys. Adopting almost the exact words
used by the Supreme Court of the United States in Grannis vs. Ordeans (234 U. S.,
385; 58 L. ed., 1363), we may say that in view of the well-known skill of postal
officials and employees in making proper delivery of letters defectively addressed,
we think the presumption is clear and strong that this notice reached the
defendant, there being no proof that it was ever returned by the postal officials as
undelivered. And if it was delivered in Manila, instead of being forwarded to
Amoy, China, there is a probability that the recipient was a person sufficiently
interested in his affairs to send it or communicate its contents to him.
Of course if the jurisdiction of the court or the sufficiency of the process of law
depended upon the mailing of the notice by the clerk, the reflections in which we
are now indulging would be idle and frivolous; but the considerations mentioned
are introduced in order to show the propriety of applying to this situation the
legal presumption to which allusion has been made. Upon that presumption,
supported by the circumstances of this case, ,we do not hesitate to found the
conclusion that the defendant voluntarily abandoned all thought of saving his
property from the obligation which he had placed upon it; that knowledge of the
proceedings should be imputed to him; and that he acquiesced in the
consequences of those proceedings after they had been accomplished. Under

these circumstances it is clear that the merit of this motion is, as we have already
stated, adversely affected in a high degree by the delay in asking for relief. Nor is
it an adequate reply to say that the proponent of this motion is an administrator
who only qualified a few months before this motion was made. No disability on
the part of the defendant himself existed from the time when the foreclosure was
effected until his death; and we believe that the delay in the appointment of the
administrator and institution of this action is a circumstance which is imputable to
the parties in interest whoever they may have been. Of course if the minor heirs
had instituted an action in their own right to recover the property, it would have
been different.
It is, however, argued that the defendant has suffered prejudice by reason of the
fact that the bank became the purchaser of the property at the foreclosure sale
for a price greatly below that which had been agreed upon in the mortgage as the
upset price of the property. In this connection, it appears that in article nine of
the mortgage which was the subject of this foreclosure, as amended by the
notarial document of July 19, 1906, the parties to this mortgage made a
stipulation to the effect that the value therein placed upon the mortgaged
properties should serve as a basis of sale in case the debt should remain unpaid
and the bank should proceed to a foreclosure. The upset price stated in that
stipulation for all the parcels involved in this foreclosure was P286,000. It is said in
behalf of the appellant that when the bank bought in the property for the sum of
P110,200 it violated that stipulation.
It has been held by this court that a clause in a mortgage providing for a tipo, or
upset price, does not prevent a foreclosure, nor affect the validity of a sale made
in the foreclosure proceedings. (Yangco vs. Cruz Herrera and Wy Piaco, 11 Phil.
Rep., 402; Banco-Espaol Filipino vs. Donaldson, Sim and Co., 5 Phil. Rep., 418.) In
both the cases here cited the property was purchased at the foreclosure sale, not
by the creditor or mortgagee, but by a third party. Whether the same rule should
be applied in a case where the mortgagee himself becomes the purchaser has
apparently not been decided by this court in any reported decision, and this
question need not here be considered, since it is evident that if any liability was
incurred by the bank by purchasing for a price below that fixed in the stipulation,
its liability was a personal liability derived from the contract of mortgage; and as
we have already demonstrated such a liability could not be the subject of
adjudication in an action where the court had no jurisdiction over the person of
the defendant. If the plaintiff bank became liable to account for the difference
between the upset price and the price at which in bought in the property, that
liability remains unaffected by the disposition which the court made of this case;
and the fact that the bank may have violated such an obligation can in no wise
affect the validity of the judgment entered in the Court of First Instance.
In connection with the entire failure of the motion to show either a meritorious
defense to the action or that the defendant had suffered any prejudice of which
the law can take notice, we may be permitted to add that in our opinion a motion
of this kind, which proposes to unsettle judicial proceedings long ago closed, can
not be considered with favor, unless based upon grounds which appeal to the
conscience of the court. Public policy requires that judicial proceedings be upheld.
The maximum here applicable is non quieta movere. As was once said by Judge
Brewer, afterwards a member of the Supreme Court of the United States:
Public policy requires that judicial proceedings be upheld, and that titles
obtained in those proceedings be safe from the ruthless hand of collateral
attack. If technical defects are adjudged potent to destroy such titles, a
judicial sale will never realize that value of the property, for no prudent
man will risk his money in bidding for and buying that title which he has
reason to fear may years thereafter be swept away through some occult
and not readily discoverable defect. (Martin vs. Pond, 30 Fed., 15.)
In the case where that language was used an attempt was made to annul certain
foreclosure proceedings on the ground that the affidavit upon which the order of
publication was based erroneously stated that the State of Kansas, when he was
in fact residing in another State. It was held that this mistake did not affect the
validity of the proceedings.
In the preceding discussion we have assumed that the clerk failed to send the
notice by post as required by the order of the court. We now proceed to consider
whether this is a proper assumption; and the proposition which we propose to
establish is that there is a legal presumption that the clerk performed his duty as
the ministerial officer of the court, which presumption is not overcome by any
other facts appearing in the cause.
In subsection 14 of section 334 of the Code of Civil Procedure it is declared that
there is a presumption "that official duty has been regularly performed;" and in
subsection 18 it is declared that there is a presumption "that the ordinary course
of business has been followed." These presumptions are of course in no sense
novelties, as they express ideas which have always been recognized. Omnia
presumuntur rite et solemniter esse acta donec probetur in contrarium. There is
therefore clearly a legal presumption that the clerk performed his duty about
mailing this notice; and we think that strong considerations of policy require that
this presumption should be allowed to operate with full force under the
circumstances of this case. A party to an action has no control over the clerk of
the court; and has no right to meddle unduly with the business of the clerk in the
performance of his duties. Having no control over this officer, the litigant must
depend upon the court to see that the duties imposed on the clerk are
performed.
Other considerations no less potent contribute to strengthen the conclusion just
stated. There is no principle of law better settled than that after jurisdiction has
once been required, every act of a court of general jurisdiction shall be presumed
to have been rightly done. This rule is applied to every judgment or decree
rendered in the various stages of the proceedings from their initiation to their
completion (Voorhees vs. United States Bank, 10 Pet., 314; 35 U. S., 449); and if
the record is silent with respect to any fact which must have been established
before the court could have rightly acted, it will be presumed that such fact was
properly brought to its knowledge. (The Lessee of Grignon vs. Astor, 2 How., 319;
11 L. ed., 283.)
In making the order of sale [of the real state of a decedent] the court are
presumed to have adjudged every question necessary to justify such order
or decree, viz: The death of the owners; that the petitioners were his
administrators; that the personal estate was insufficient to pay the debts of
the deceased; that the private acts of Assembly, as to the manner of sale,
were within the constitutional power of the Legislature, and that all the
provisions of the law as to notices which are directory to the administrators
have been complied with. . . . The court is not bound to enter upon the
record the evidence on which any fact was decided. (Florentine vs. Barton,
2 Wall., 210; 17 L. ed., 785.) Especially does all this apply after long lapse of
time.
Applegate vs. Lexington and Carter County Mining Co. (117 U. S., 255) contains an
instructive discussion in a case analogous to that which is now before us. It there
appeared that in order to foreclose a mortgage in the State of Kentucky against a
nonresident debtor it was necessary that publication should be made in a
newspaper for a specified period of time, also be posted at the front door of the
court house and be published on some Sunday, immediately after divine service,
in such church as the court should direct. In a certain action judgment had been
entered against a nonresident, after publication in pursuance of these provisions.

Many years later the validity of the proceedings was called in question in another
action. It was proved from the files of an ancient periodical that publication had
been made in its columns as required by law; but no proof was offered to show
the publication of the order at the church, or the posting of it at the front door of
the court-house. It was insisted by one of the parties that the judgment of the
court was void for lack of jurisdiction. But the Supreme Court of the United States
said:
The court which made the decree . . . was a court of general jurisdiction.
Therefore every presumption not inconsistent with the record is to be
indulged in favor of its jurisdiction. . . . It is to be presumed that the court
before making its decree took care of to see that its order for constructive
service, on which its right to make the decree depended, had been obeyed.
It is true that in this case the former judgment was the subject of collateral , or
indirect attack, while in the case at bar the motion to vacate the judgment is
direct proceeding for relief against it. The same general presumption, however, is
indulged in favor of the judgment of a court of general jurisdiction, whether it is
the subject of direct or indirect attack the only difference being that in case of
indirect attack the judgment is conclusively presumed to be valid unless the
record affirmatively shows it to be void, while in case of direct attack the
presumption in favor of its validity may in certain cases be overcome by proof
extrinsic to the record.
The presumption that the clerk performed his duty and that the court made its
decree with the knowledge that the requirements of law had been complied with
appear to be amply sufficient to support the conclusion that the notice was sent
by the clerk as required by the order. It is true that there ought to be found
among the papers on file in this cause an affidavit, as required by section 400 of
the Code of Civil Procedure, showing that the order was in fact so sent by the
clerk; and no such affidavit appears. The record is therefore silent where it ought
to speak. But the very purpose of the law in recognizing these presumptions is to
enable the court to sustain a prior judgment in the face of such an omission. If we
were to hold that the judgment in this case is void because the proper affidavit is
not present in the file of papers which we call the record, the result would be that
in the future every title in the Islands resting upon a judgment like that now
before us would depend, for its continued security, upon the presence of such
affidavit among the papers and would be liable at any moment to be destroyed by
the disappearance of that piece of paper. We think that no court, with a proper
regard for the security of judicial proceedings and for the interests which have by
law been confided to the courts, would incline to favor such a conclusion. In our
opinion the proper course in a case of this kind is to hold that the legal
presumption that the clerk performed his duty still maintains notwithstanding the
absence from the record of the proper proof of that fact.
In this connection it is important to bear in mind that under the practice
prevailing in the Philippine Islands the word "record" is used in a loose and broad
sense, as indicating the collective mass of papers which contain the history of all
the successive steps taken in a case and which are finally deposited in the
archives of the clerk's office as a memorial of the litigation. It is a matter of
general information that no judgment roll, or book of final record, is commonly
kept in our courts for the purpose of recording the pleadings and principal
proceedings in actions which have been terminated; and in particular, no such
record is kept in the Court of First Instance of the city of Manila. There is, indeed,
a section of the Code of Civil Procedure which directs that such a book of final
record shall be kept; but this provision has, as a matter of common knowledge,
been generally ignored. The result is that in the present case we do not have the
assistance of the recitals of such a record to enable us to pass upon the validity of
this judgment and as already stated the question must be determined by
examining the papers contained in the entire file.
But it is insisted by counsel for this motion that the affidavit of Bernardo Chan y
Garcia showing that upon April 4, 1908, he sent a notification through the mail
addressed to the defendant at Manila, Philippine Islands, should be accepted as
affirmative proof that the clerk of the court failed in his duty and that, instead of
himself sending the requisite notice through the mail, he relied upon Bernardo to
send it for him. We do not think that this is by any means a necessary inference.
Of course if it had affirmatively appeared that the clerk himself had attempted to
comply with this order and had directed the notification to Manila when he
should have directed it to Amoy, this would be conclusive that he had failed to
comply with the exact terms of the order; but such is not this case. That the clerk
of the attorneys for the plaintiff erroneously sent a notification to the defendant
at a mistaken address affords in our opinion very slight basis for supposing that
the clerk may not have sent notice to the right address.
There is undoubtedly good authority to support the position that when the record
states the evidence or makes an averment with reference to a jurisdictional fact,
it will not be presumed that there was other or different evidence respecting the
fact, or that the fact was otherwise than stated. If, to give an illustration, it
appears from the return of the officer that the summons was served at a
particular place or in a particular manner, it will not be presumed that service was
also made at another place or in a different manner; or if it appears that service
was made upon a person other than the defendant, it will not be presumed, in
the silence of the record, that it was made upon the defendant also (Galpin vs.
Page, 18 Wall., 350, 366; Settlemier vs. Sullivan, 97 U. S., 444, 449). While we
believe that these propositions are entirely correct as applied to the case where
the person making the return is the officer who is by law required to make the
return, we do not think that it is properly applicable where, as in the present case,
the affidavit was made by a person who, so far as the provisions of law are
concerned, was a mere intermeddler.
The last question of importance which we propose to consider is whether a
motion in the cause is admissible as a proceeding to obtain relief in such a case as
this. If the motion prevails the judgment of July 2, 1908, and all subsequent
proceedings will be set aside, and the litigation will be renewed, proceeding again
from the date mentioned as if the progress of the action had not been
interrupted. The proponent of the motion does not ask the favor of being
permitted to interpose a defense. His purpose is merely to annul the effective
judgment of the court, to the end that the litigation may again resume its regular
course.
There is only one section of the Code of Civil Procedure which expressly
recognizes the authority of a Court of First Instance to set aside a final judgment
and permit a renewal of the litigation in the same cause. This is as follows:
SEC. 113. Upon such terms as may be just the court may relieve a party or
legal representative from the judgment, order, or other proceeding taken
against him through his mistake, inadvertence, surprise, or excusable
neglect; Provided, That application thereof be made within a reasonable
time, but in no case exceeding six months after such judgment, order, or
proceeding was taken.
An additional remedy by petition to the Supreme Court is supplied by section 513
of the same Code. The first paragraph of this section, in so far as pertinent to this
discussion, provides as follows:
When a judgment is rendered by a Court of First Instance upon default, and
a party thereto is unjustly deprived of a hearing by fraud, accident, mistake
or excusable negligence, and the Court of First Instance which rendered the
judgment has finally adjourned so that no adequate remedy exists in that
court, the party so deprived of a hearing may present his petition to the
Supreme Court within sixty days after he first learns of the rendition of such
judgment, and not thereafter, setting forth the facts and praying to have
judgment set aside. . . .
It is evident that the proceeding contemplated in this section is intended to
supplement the remedy provided by section 113; and we believe the conclusion
irresistible that there is no other means recognized by law whereby a defeated
party can, by a proceeding in the same cause, procure a judgment to be set aside,
with a view to the renewal of the litigation.
The Code of Civil Procedure purports to be a complete system of practice in civil
causes, and it contains provisions describing with much fullness the various steps
to be taken in the conduct of such proceedings. To this end it defines with
precision the method of beginning, conducting, and concluding the civil action of
whatever species; and by section 795 of the same Code it is declared that the
procedure in all civil action shall be in accordance with the provisions of this Code.
We are therefore of the opinion that the remedies prescribed in sections 113 and
513 are exclusive of all others, so far as relates to the opening and continuation of
a litigation which has been once concluded.
The motion in the present case does not conform to the requirements of either of
these provisions; and the consequence is that in our opinion the action of the
Court of First Instance in dismissing the motion was proper.
If the question were admittedly one relating merely to an irregularity of
procedure, we cannot suppose that this proceeding would have taken the form of
a motion in the cause, since it is clear that, if based on such an error, the came to
late for relief in the Court of First Instance. But as we have already seen, the
motion attacks the judgment of the court as void for want of jurisdiction over the
defendant. The idea underlying the motion therefore is that inasmuch as the
judgment is a nullity it can be attacked in any way and at any time. If the
judgment were in fact void upon its face, that is, if it were shown to be a nullity by
virtue of its own recitals, there might possibly be something in this. Where a
judgment or judicial order is void in this sense it may be said to be a lawless thing,
which can be treated as an outlaw and slain at sight, or ignored wherever and
whenever it exhibits its head.
But the judgment in question is not void in any such sense. It is entirely regular in
form, and the alleged defect is one which is not apparent upon its face. It follows
that even if the judgment could be shown to be void for want of jurisdiction, or
for lack of due process of law, the party aggrieved thereby is bound to resort to
some appropriate proceeding to obtain relief. Under accepted principles of law
and practice, long recognized in American courts, a proper remedy in such case,
after the time for appeal or review has passed, is for the aggrieved party to bring
an action to enjoin the judgment, if not already carried into effect; or if the
property has already been disposed of he may institute suit to recover it. In every
situation of this character an appropriate remedy is at hand; and if property has
been taken without due process, the law concedes due process to recover it. We
accordingly old that, assuming the judgment to have been void as alleged by the
proponent of this motion, the proper remedy was by an original proceeding and
not by motion in the cause. As we have already seen our Code of Civil Procedure
defines the conditions under which relief against a judgment may be productive
of conclusion for this court to recognize such a proceeding as proper under
conditions different from those defined by law. Upon the point of procedure here
involved, we refer to the case of People vs. Harrison (84 Cal., 607) wherein it was
held that a motion will not lie to vacate a judgment after the lapse of the time
limited by statute if the judgment is not void on its face; and in all cases, after the
lapse of the time limited by statute if the judgment is not void on its face; and all
cases, after the lapse of such time, when an attempt is made to vacate the
judgment by a proceeding in court for that purpose an action regularly brought is
preferable, and should be required. It will be noted taken verbatim from the
California Code (sec. 473).
The conclusions stated in this opinion indicate that the judgment appealed from is
without error, and the same is accordingly affirmed, with costs. So ordered.
G.R. No. L-49140
November 19, 1982
QUASHA ASPERILLA ANCHETA VALMONTE PEA & MARCOS, petitioner,

vs.
THE HONORABLE CELESTINO P. JUAN, FILIPINAS CARRIERS, INC., represented by
its President, FEDERICO TABORA, JR., APOLLO KOKIN TRADING CO., LTD., et
al., respondents.
DE CASTRO, J.:
In this petition for certiorari and prohibition with preliminary injunction,
petitioner seeks the annulment of the order of respondent Judge of the Court of
First Instance of Manila in Civil Case No. 105048 dated August 25, 1978 which
approved the sale of the subject cargo and prays instead that the writ of
preliminary attachment over the same property issued by Hon. Gregorio Pineda
of the Court of First Instance of Rizal in Civil Case No. 28710 be allowed to remain
in force.
It appears that on October 22, 1976, respondent Filipinas Carriers, hereinafter
referred to as Filcar, filed a complaint for sum of money, enforcement of lien and
damages with the Court of First Instance of Manila, and the same was assigned to
Branch X, which was presided by respondent Judge, against AB Charles Thorburn
& Co., through its receiver Sjoegren and Winstrand; Estero Shipping and Trading;
Bank of Melli of Iran, Jeddah Branch; Perstorp AB; Skogshgarnas Industries;
Ekman and Company AB; and Abdullah Baroom. In the complaint which was
docketed as Civil Case No. 105048, Filcar alleged that it is the disponent owner of
a vessel, MV San Vicente, which was duly registered with the Republic of the
Philippines; that on April 2, 1976, defendant Carles Thorburn & Co. chartered said
vessel by time charter for two or three months for a voyage from Sweden to
Jeddah, Saudi Arabia at three thousand two hundred US dollars (US $3,200.00) a
day, that Abdullah Baroom was impleaded as defendant for being the agent of
Charles Thorburn & Co. at Jeddah and Sjoegren and Winstrand of Sweden for
being the receiver of Charles Thorburn & Co.; that the vessel left Sweden with
construction materials as cargoes belonging to the following shippers and
consignees, namely, defendants Bank of Melli of Iran, Jeddah Branch; the National
Commercial Bank, Jeddah Branch; Perstorp AB of Perstorp, Sweden; Skogshgarnas
Industries of Sweden; Ekman and Company of Sweden; that after the second
month, Charles Thorburn failed to pay the daily hire, that the vessel has been in
Jeddah since May 19, 1976 and is now in international waters; that in view of
Thorburn's failure to pay the charter hire, it had struck a lien through the vessel's
captain; that the charter party has expired but the vessel has not yet discharged
the cargoes due to inadequate port facilities and failure of the shippers,
consignees and charterer to pay the charter hire; that Filcar demanded from
Charles Thorburn the payment of the charter hire but Thorburn failed to pay and
instead declared bankruptcy and is now under receivership in Sweden; that on
demand, Baroom, the agent of Thorburn in Jeddah, and the consignees and
shippers refused to pay; that consequently, Filcar was forced to exercise its lien
on the cargoes consistent with Clause 18 of the Charter Party, notice of which was
sent to defendants. The plaintiff thus prayed, among others, that the defendants
pay the daily charter hire from the time they were in arrears until payment is
made and that the Court allow the sale of the cargoes to satisfy its claims.
On November 25, 1976, Sierra Madre Wood Industries, Inc., hereinafter called
Sierra Madre, the alleged owner, end-user and operator of MV San Vicente filed a
motion to intervene in the Court of First Instance of Manila (Civil Case No.
105048) for the purpose of enforcing its lien over the cargo, claiming that it had
chartered the vessel to Filcar for six months renewable every six months at
agreed charter hire fee (US $825,000.00 per year). Respondent Judge allowed the
intervention of Sierra Madre as plaintiff-intervenor.
On December 2, 1976, Filcar filed an extra-parte motion to sell the goods subject
of lien, alleging among others, that the MV San Vicente had arrived in the
Philippines, and was due for dry-docking and needed urgent repairs; and that the
goods subject of its lien were in danger of deteriorating and losing their market
value and if the goods were not sold immediately, the plaintiff would have to pay
a staggering amount for warehousing so that the value of the goods would not
even be enough to pay for warehousing expenses.
Thereafter, respondent Judge conducted hearings in Civil Case No. 105048 and an
ocular inspection of the vessel. On April 18, 1977, respondent Judge, convinced
that the vessel as well as the cargoes were in a very bad condition, issued an
order, the dispositive portion of which reads:
WHEREFORE, in view of all the above and due to the condition of the vessel
and/or its cargo, while we are not convinced as asserted that Section 17,
Rule 14 and 15 of the Rules of Court, do not apply, for we still believe that
one of the four modes of service must at least be observed, yet on the
ground of extreme necessity, this Court believes that somehow, somebody

must act boldly in order to protect the interest of parties and of the owner
of the vessel which is believed to be the government of the Philippines. On
the ground of extreme necessity and partly by virtue of the provisions of
Rule 57, Section 1 1, the cargo on board the MV San Vicente, is ordered
sold privately, so that the vessel may immediately be sent for drydock,
subject to the following conditions:
l. That the negotiations for the sale of the cargo shall be the sole
responsibility of plaintiff Filcar subject to the supervision by this Court and
the intervention of plaintiff-intervenor, the Sierra Madre Wood Industries,
Inc.;
2. That the Court and the plaintiff-intervenor be fully informed regarding
the progress of the negotiations and that the sale shall not be finalized
without first securing the approval of this Court is to the selling price;
3. The proceeds of the sale shall be deposited with a banking institution as
approved by this Court and shall be disposed of only upon order of this
Court, subject to the first lien of plaintiff-intervenor; and
4. Defendant AB Charles Thorburn & Co., etc. shall be notified of the Order
of this Court together with a copy of the amended complaint and the
complaint in intervention, thru the Department of Foreign Affairs, and the
Philippine Embassy at Jeddah, Saudi Arabia. Proof of Service shall be
submitted to this Court. After such time afforded the defendant, in order to
enable them to answer or appear in this Court or make any claim
whatsoever, and still they fail to make any manifestation, hearing of this
case shall resume regarding the final disposition of the proceeds to all
concerned.
On June 27, 1977, respondent Judge approved tentatively the sale of the cargo to
Bengzon's Industries. This Order was followed by another dated July 19, 1977,
approving the Deed of Absolute Sale of the cargo. 1
On August 15, 1977, petitioner law firm filed with respondent Judge a special
appearance for defendant Ahmed Baroom contesting the Court's jurisdiction over
Baroom's person and property and a Motion to Dismiss on the ground that the
Court had not acquired jurisdiction over Baroom's 'person or property aboard the
MV San Vicente. 2
On August 29, 1977, respondent Judge issued an Order directing petitioner law
firm to show on or before September 20, 1977 a written authorization signed by
its client, Baroom, "since the latter is a foreigner". 3
On November 15, 1977, petitioner, as Baroom's counsel, filed an answer with
compulsory counterclaim, claiming that defendant Baroom is not an agent of
Charles Thorburn since the cargoes belong to him, and denying the validity of
plaintiff's lien over the cargo. Petitioner reiterates the defense that plaintiff's
action being in personam involving defendant who is not a resident within the
territorial jurisdiction of the Court, and there is no showing in the records that the
provisions of Section 17, Rule 14 in relation to Section 1, Rule 57, of the Rules of
Court have been complied with to convert the action in rem, the Court had no
jurisdiction over the case. Baroom, through petitioner, prayed that plaintiff be
directed to deliver the cargoes to Jeddah, pay damages corresponding to the full
value of the goods and to the lost income and profits he could have realized had
plaintiff delivered the cargo to him. Baroom, likewise, filed a cross-claim against
Sierra Madre, plaintiff-intervenor.
On January 23, 1978, petitioner filed with respondent Judge a manifestation and
motion that it be "allowed to withdraw from this case and charging lien be
recorded against the properties of Mr. Baroom now aboard MV San Vicente for
unpaid professional fees and reimbursement expenses. " 4
Thereafter, on February 17, 1978, petitioner filed before the Court of First
Instance of Rizal a complaint with a prayer for a writ of preliminary attachment
for the recovery of professional fees and reimbursement of expenses against
Baroom whom it alleged to have represented in Civil Case No. 105048, CFI,
Manila. The case was docketed as Civil Case No. 28710 and the same was
assigned to Branch XXI presided over by Judge Gregorio C. Pineda.
By virtue of the order dated February 28, 1978 issued by Judge Pineda in the new
case, petitioner obtained a writ of preliminary attachment against Baroom's
alleged cargoes which is the subject matter in Civil Case No. 105048.
Meanwhile, in Civil Case No. 105048, on August 2, 1978, respondent Judge gave
Attys. Quasha and Valmonte ten (10) days from receipt of order within which to
explain why they should not be held in contempt of court for filing a case entitled
"Quasha Asperilla Ancheta Valmonte Pea and Marcos vs. AlSayed Abdullah
Mohammed Baroom" docketed as Civil Case No. 28710 in the Court of First
Instance of Rizal, Branch XXI, where they obtained a writ of preliminary
attachment over the cargoes, which they knew to be subject matter of Civil Case
No. 105048 pending before his sala." 5 A compliance with said order was filed on
August 24, 1978, with petitioner alleging that their cause of action against
Baroom was for payment of professional fees and reimbursement of expenses
while Case No. 105048 before Judge Juan was for alleged unpaid charter hire fees.
On August 25, 1978, respondent Judge issued an order approving the sale of the
cargo in question to Apollo Kokin Trading Co., Ltd. In accordance with the earlier
order of April 28, 1977, respondent Judge directed the deposit of the sale
proceeds with a banking institution to be approved by the Court and its
disposition only on orders of the Court. 6
On September 8, 1978, Filcar filed with the Court of First Instance of Rizal an
urgent omnibus motion to be allowed to appear and to dismiss the case and to lift
the writ of preliminary attachment and set aside the order to auction the cargo,
attaching thereto the order of respondent Judge dated August 25, 1978,
approving the sale in favor of Apollo Kokin Trading Co., Ltd. of the subject cargo,
the proceeds of which after deducting all expenses shall be deposited with the
court.
Thus, petitioner, on October 23, 1978, filed before this Court the instant petition.
Petitioner assails the order of August 25, 1978, not the earlier order of April 28,
1977 approving the sale in favor of Apollo Kokin Trading Co., Ltd. of the
questioned cargo for having been issued in grave abuse of discretion considering
that subject cargo was allegedly earlier attached by the Court of First Instance of
Rizal.
Without giving due course to the petition and pending the filing of comments by
respondents, this Court issued on October 24, 1978 a temporary restraining
order,
enjoining respondents to immediately cease and desist from taking,
unloading, transferring, conveying, transporting or disposing of the
cargoes or any part thereof aboard the MC San Vicente and Dong
Myung, * or from taking the cargoes away, subject matter of Civil
Case No. 105048 entitled 'Filipinas Carriers, Inc. vs. AB Charles
Thorburn & Co., et al.' of the Court of First Instance of Manila, Branch
X." 7
On October 30, 1978, petitioner filed a manifestation and motion informing this
Court that notwithstanding the restraining order, the MV Don Myung, with the
cargo aboard left surreptitiously at midnight of October 24, 1978 without the
assistance of any pilot in violation of Harbor rules. The goods were then allegedly
sold for US $220,200.43 under irrevocable letters of credit issued by the Fuji Bank
of Osaka, Japan. Petitioner, thus, prayed that several persons, namely, Mr.
Federico Tabora, Jr., President of Filipinas Carriers, Inc., Mr. Gregorio Gatchalian,
allegedly operations manager of the American Steamship Agencies, Inc. being the
agent representing the MV Dong Myung, Lt. JG Godofredo Orcullo of the
Operations Center and Seaman 1st Class Avelino Lontoc of the Philippine Coast
Guard be cited for contempt.
In the meanwhile, a compromise agreement dated October 16, 1978 and filed on
November 2, 1978 wherein Filcar assigned its interests and rights in the proceeds
of the sale of the subject cargoes to Sierra Madre which the latter accepted was
approved by the respondent court in its decision of November 3, 1978. An
amended petition was thus filed in this Court impleading Sierra Madre as partly
respondent in his case with prayer that a writ of garnishment be issued on the
proceeds of the sale of the cargoes which are in the possession of Sierra Madre,
and an order be issued directing Sierra Madre and all those to whom such
proceeds may subsequently be reassigned to deliver to petitioner such portion of
the proceeds of the sale as would satisfy the attorney's lien in the interest of
justice.
Coming back to the omnibus motion of Filcar for the lifting of the preliminary
attachment issued by the Court of First Instance of Rizal, the said court on
December 7, 1978 dismissed petitioner's case and lifted the preliminary
attachment issued therein. Upon motion for reconsideration dated April 7, 1979,
the said preliminary attachment was reinstated by the Court of First Instance of
Rizal in its order dated July 5, 1979. 8
After several pleading were filed in this Court, We gave due course to the
petition. 9
Petitioner contends that respondent court did not acquire jurisdiction neither
over any of the defendants as they have not voluntarily submitted themselves to
the jurisdiction of respondent court, nor over the res, since there had been no
seizure of the property under a legal process, as by a writ of attachment or other
process of similar effect. The instant case is allegedly neither a proceeding in rem
as would place the property under its potential power citing the leading case
of Banco Espaol v. Palanca 10 which held:
Jurisdiction over the property which is the subject of litigation may result
either from a seizure of the property under legal process, whereby it is
brought into the actual custody of the law, or it may result from the
institution of legal proceedings wherein under special provisions of law, the
power of the court over the property is recognized and made effective. In
the latter case the property, though at all times within the potential power
of the court, may never be taken into actual custody at all. An illustration of
the jurisdiction acquired by actual seizure is found in attachment
proceedings, where the property is seized at the beginning of the action, or
some subsequent stage of its progress and held to abide the final event of
the litigation. An illustration of what we term potential jurisdiction over
the res is found in the proceeding to register the title of land under our
system for the registration of land. Here the court, without taking actual
physical control over the property assumes, at the instance of some person
claiming to be the owner, to exercise a jurisdiction in rem over the property
and to adjudicate the title in favor of the petitioner against all the world.
Claiming that it was the Court of First Instance of Pasig that first acquired
jurisdiction over the res to the exclusion of respondent court, petitioner insists
that the latter court's act is undue interference which cannot be countenanced.
There is no pretense that respondent court has jurisdiction over the cause of
action. It is much too obvious to merit a fuller discussion. Suffice it to say that an
action based upon an oral contract of transportation of goods by water is an
action in admiralty which comes under the original and exclusive jurisdiction of
the Court of First Instance irrespective of the value of the cargo. 11
As to the person of Baroom, it is to be conceded that at the initial stage of the
proceeding in the Court of First Instance of Manila prior to the issuance of the
order of April 28, 1977 directing the sale of the property and petitioner's firing of
various pleadings, said court did not have jurisdiction over Baroom. Baroom was a
non-resident alien and he was beyond the reach of the court's legal processes.
But since the action is brought principally for the enforcement of maritime lien
against the property of defendants who failed to pay the charter hire fee, and
therefore the same is in the nature and character of a proceeding quasi in
rem, jurisdiction over defendant Baroom is not essential. An action quasi in
rem has been defined as "an action between parties where the direct object is to
reach and dispose of property owned by them or of some interest therein." As
such the properties allegedly owned by him are primarily made liable. In
elucidating the characteristic of a proceeding where a non-resident defendant
fails to appear, this Court in the aforecited leading case of Banco Espaol Filipino
v. Palanca said:
If however, the defendant is a non-resident and, remaining beyond the
range of the personal process of the court, refuses to come in voluntarily,
the court never acquires jurisdiction over the person at all. Here the
property itself is in fact the sole thing which is impleaded and is the
responsible object which is the subject of the exercise of judicial power. It
follows that the jurisdiction of the court in such case is based exclusively on
the power which, under the law, it possesses over the property; and any
discussion relative to the jurisdiction of the court over the person of the
defendant is entirely apart from the case.
The foregoing ruling was applied in Mabanag vs. Ganimore: 12
As a general rule, when the defendant is not residing and is not found in
the Philippines, the Philippine courts cannot try any case against him
because of impossibility of acquiring jurisdiction over his person, unless he
voluntarily appears in court. But when the action ... is intended to seize or
dispose of any property, real or personal, of the defendant, located in the
Philippines, it may validly be tried by the Philippine courts, for then, they
have jurisdiction over the res, i.e. ... the property of the defendant, and
their jurisdiction over the person of the non-resident is not essential ... .
(Citing I Moran's Comments on the Rules of Court, 2d Ed., 105).
At any rate, defendant Baroom filed later, aside from a motion to dismiss, an
answer with counterclaim praying that plaintiff be directed to deliver the cargoes
of defendant Baroom to Jeddah and to pay damages, etc. and a cross-claim
against Sierra Madre, thereby abandoning any question on jurisdiction over the
person and submitting himself to the jurisdiction of the court. In Tenchavez vs.
Escao, 13 this Court quoted with approval the ruling in Merchant's Heat and Light
Co. vs. Clow & Sons, 204 U. S. 286, 51 Law Ed. 488:
We assume that the defendant lost no rights by pleading to the merits, as
required, after saving its rights. Harkness vs. Hyde, 98 U.S. 476, 25 L. ed.
237; Southern P. Co. vs. Denton, 146 U.S. 202, 36 L. ed. 943, 13 Sup. Ct.
Rep. 44. But by setting up its counterclaim the defendant became a plaintiff
in its turn, invoked the jurisdiction of the court in same action, and, by
invoking submitted to it. It is true that the counterclaim seems to have
arisen wholly out of the same transaction that the plaintiff sued upon, and
so to have been in recoupment rather than in set-off proper. But, even at
common law, since the doctrine has been developed, as demand in

recoupment is recognized as a cross demand, as distinguished from a
defense. Therefore, although there has been a difference of opinion as to
whether a defendant, by pleading it, is concluded by the judgment from
bringing a subsequent suit for the residue of his claim, a judgment in his
favor being impossible at common law, the authorities agree that he is not
concluded by the judgment if he does not plead his cross demand, and that
whether he shall do so or not is left wholly to his choice. Davis vs. Hedges,
L.R. 6 Q.B. 687; Mondel vs. Steel, 8 Mees & W. 858, 872; O'Connor vs.
Varney, 10 Gray, 231. This single fact shows that the defendant, if he elects
to sue upon his claim in the action against him, assumes the position of an
actor and must take the consequence. The right to do so is of modern
growth, and is merely a convenience that saves bringing another suit, not a
necessity of the defense.
In the aforecited case, the Court explains that the rule is such because "it cannot
look with favor upon a party adopting not merely inconsistent, but actually
contradictory; positions in one and the same suit, claiming that a court has no
jurisdiction to render judgment against it, but has such jurisdiction to give a
decision its favor. 14
It may be noted that if the defendant voluntarily appears, the action becomes as
to him a personal action and is conducted as such. Even then, the court does not
lose its jurisdiction over the res, assuming that it has indeed jurisdiction over the
res. The res still remains under its control and disposition.
As regards jurisdiction over the res, We hold that respondent acquires jurisdiction
over it. Where a property is burdened by a lien, a writ of attachment is no longer
necessary in order that jurisdiction over the property may be obtained by the
court. In the same cited case by petitioner, in the Banco Espaol case, it was
clarified:
In an ordinary attachment proceeding, if the defendant is not personally
served, the preliminary seizure is to be considered necessary in order to
confer jurisdiction upon the court. In this case the lien on the property is
acquired by seizure; and the purpose of the proceeding is to subject the
property to that lien. If a lien already exists, whether created by mortgage,
contract, or statute, the preliminary seizure is not necessary, and the court
proceeds to enforce such lien in the manner provided by law precisely as
though the property had been seized upon attachment. (Roller v. Holly, 176
U.S. 398, 405; 44 L. ed. 520).
The reason for the rule is obvious. An attachment proceeding is for the purpose of
creating a lien on the property to serve as security for the payment of the
creditors' claim. Hence, where a lien already exists, as in this case a maritime lien,
the same is already equivalent to an attachment. Moreover, since the property
subject of the action for the enforcement of the maritime liens was already in the
possession of private respondent, there is no need for seizure for the court to
obtain jurisdiction over the rest.
Where a party in actual possession of the res subject to the lien is before
the court, the res is within the jurisdiction of the court for the enforcement
of the lien A suit may be maintained to foreclose a lien on property within
the jurisdiction of the court, although some interest or claim therein is held
by a non-resident. 15
The other argument posed by petitioner to challenge respondents' right over the
property is that there is no privity of contract between Baroom and respondents.
It avers that Baroom is not merely the agent of Thorburn but himself the owner of
some of the cargoes and whose contract to ship the same is with sub-charterer
Thorburn. It avers further that neither Thorburn could attach a lien on the
property since Baroom had allegedly paid fully for the shipment even before the
vessel sailed, as evidenced by the clean freight pre-paid bills of lading.
Claiming right over the cargo to answer for the unpaid professional fees,
petitioner submits to this Court the required written authority from Baroom
claiming that due to snag in communication and unreliability of the mailing
system it did not receive the documents from its client on time.
The foregoing entails determination of facts. It would be highly irregular if this
Court would have to resolve those questions, this Court not being a trier of facts.
The several documents mentioned by petitioner and attached to its pleadings
before this Court were never presented before the lower court. After Baroom had
abandoned his defense which created the presumption that he had no defense,
that he is not the owner of the cargo, petitioner should have pursued the same
argument before respondent court in claiming the alleged professional fee. This is
in accordance with Article 1177 of the New Civil Code which provides:
Art. 1177. The creditors having pursued the property in possession of the
debtor to satisfy their claims may exercise all the rights and bring all the
actions of the latter for the same purpose, save those which are inherent in
his person, they may also impugn the acts which the debtor may have done
to defraud them.
Indeed, petitioner should have maintained its action in respondent's court. After
all, a court which has in its possession, control or equivalent dominion, property
or funds involved in litigation may exercise exclusive jurisdiction over such
property or funds to determine the rights therein, such as questions respecting
the title, possession or control, management and disposition thereof and another
court of concurrent or coordinate jurisdiction cannot interfere with such
possession or control. 16 The rights to be determined by said court necessarily
include the attorney's fees due to the lawyers who represented the parties.
Significantly, the lower court which undoubtedly has in its favor the presumption
of regularity and which was never restrained by this Court from proceeding with
the ease issued an order dated January 25, 1979 17 making the following findings
of fact:
1. Thorburn fails to pay the freight so that respondent Filcar had the right
to impose its lien on the cargo including sub-freights.
Paragraph 16 of the time charter contract provides:
That the owners shall have a lien upon all cargoes and all sub-freights
for any amounts due under this Charter including General Average
contributions and the charterers to have a lien on the ship for all
monies paid in advance and not earned, and any'overpaid hire or
excess deposit to be returned at once. Charterers will not suffer nor
permit to be continued, any lien or encumbrance incurred by them
or their agents, which might have priority over the title and interest
of the owners of the vessel.
2. Thorburn executed a liner term contract with Baroom who was playing
the double role of agent of said Thorburn and agent of three consignee
banks in Jeddah.
3. Baroom appealed to Filcar to be its agent, but when it was discovered
that he was the agent of Charles Thorburn and the three (3) consignee
banks, the application was rejected due to conflict of interest.
4. The pre-paid freight representation of Baroom is false because the
condition of the L/C issued by the 3 consignee banks provides a C/F
arrangement which means payment of the goods, insurance and freight can
only be made upon physical delivery of the goods in Jeddah.
5. Baroom intervened in the case (before respondent court) using the
Quasha law office. He later withdrew upon knowing he has no defense. In
fact, he did not even give Quasha written authority to appear for him as his
lawyer.
6. The court of respondent Judge "has jurisdiction over the person of
defendant and subject cargo of the vessel.
7. The Quasha law office is not entitled to any claim for attorney's lien
Prescinding from the foregoing, We find no abuse of discretion in issuing the
questioned order of August 25, 1978, and therefore the instant petition should be
dismissed. It could not be claimed that the act of respondent Judge in issuing the
said order amounts to interference with the writ of attachment dated February
28, 1978 issued by Judge Pineda, for by the time the said writ was issued,
respondent Judge had already control and disposition of the case. The order of
August 25, 1978 was but an implementation of the earlier order of April 28, 1977
directing the sale of the cargoes on the ground of extreme necessity as the
cargoes as found by respondent Judge upon ocular inspection were in danger of
deteriorating and losing their market value and the vessel was also in danger of
sinking. By then, respondent Judge had also issued the order dated July 19, 1977
approving a Deed of Sale of subject cargoes.
It should be noted that at the time petitioner filed the action before Judge Pineda,
it has already submitted itself to the jurisdiction of respondent court and in fact
its "charging lien" which is the same cause of action before Judge Pineda was still
pending before respondent court. Pending also before respondent Judge were
petitioner's answer with counterclaim, cross claim, motion to dismiss and motion
to withdraw from the case.
Petitioner may not enforce its attorney's lien, which accordingly is based on
Section 37 of Rule 138 which provides:
Sec. 37. Attorney's lien. An attorney shall have a lien upon the funds,
documents and papers of his client which have lawfully come into his
possession and may retain the same until his lawful fees and disbursements
have been paid and may apply such funds to the satisfaction thereof. He
shall also have a lien to the same extent upon all judgments for the
payment of money, and executions issued in pursuance of such judgments,
which he has secured in a litigation of his client, from and after the time
when he shall have caused a statement's of his claim of such lien to be
entered upon the records of the court rendering such judgment, or issuing
such execution, and shad have caused written notice thereof to be
delivered to his client and to the adverse party; and he shall have the same
right and power over such judgments and executions as his client would
have to enforce his lien and secure the payment of his just fees and
disbursements.
Based on the foregoing provision, the liens for attorney's fees and expenses apply
only on the funds or documents of clients which lawfully come to the possession
of the counsel (called retaining lien) and to all judgments secured by the counsel
(called charging lien). In his manifestation and motion before respondent Judge,
petitioner is claiming for his charging lien But it should be noted that at the time
of its filing, the orders of April 27, 1977 ordering the sale of the cargoes and July
19, 1977 approving the Deed of Sale of cargoes were already in existence and
both were in fact in favor of private respondent. It is curious to note that
petitioner never questioned said orders on appeal or by a special civil action.
Petitioner's client in fact even abandoned its case. Hence, having no favorable
judgment that could be anticipated, the charging lien has no leg to stand on.
Perhaps because it was aware of its predicament that petitioner filed an
independent action for recovery of its professional fees and for reimbursement of
expenses which would have been proper, except that the ownership of the
property sought to be attached was questionable and the same was already sold
by respondent court. But just as We had said before, petitioner should have filed
its claim for professional fees in respondent's court for said court has the
exclusive jurisdiction to determine the real owner of the cargoes. We hasten to
add, however, that the action should not be for a charging lien, but a simple
complaint in intervention for recovery of professional services and
reimbursement of expenses, thus avoiding multiplicity of suits.
On October 24, 1978, We issued a temporary restraining order enjoining the
disposition or unloading of the cargoes. It turned out, however, that before the
said order could be served upon the private respondents, all the cargoes subject
of the petition had been loaded into the M.V. Dong Myung, of which this Court
has no jurisdiction being a foreign vessel. When the vessel sailed and the cargoes
eventually sold, everything became fait accompliand the case before Us moot and
academic.
Petitioner prays for the garnishment of the proceeds, but to allow the same, there
must first be a determination of the ownership of the cargo. Again, We say We
are not in a position to do so. Petitioner failed to file motion for reconsideration
of the order of August 25, 1978 approving the sale of the cargo, and it abandoned
its own case before respondent Judge. The result of its negligence in allowing
considerable period to lapse before claiming right over the cargo, and resorting to
injunctive relief must be borne by it. Petitioner is not entitled to any relief and the
instant petition must be dismissed. We shall also dismiss petitioner's charge of
contempt against respondent since as We said before, before the temporary
restraining or order could be served everything was already fait accompli .
Likewise, We also dismiss the respondents' charge against petitioner for direct
contempt for allegedly omitting material facts vital to the fun appreciation of this
Court. In De Midgely vs. Ferandos, 18 this Court ruled that such tactic is generally
tolerated because understandably lawyers are apt to slant the presentation of
their clients' case so that they would have favorable judgments. "Courts are not
deceived by the exaggerations and distortions in a counsel's lopsided submission
of his client's case especially where, as in this case, the alert opposing counsel
calls the court's attention to that fact. "
Indeed, "contempt of court presupposes a contumacious attitude, a flouting of
arrogant belligerence, a defiance of the court. 19 It is an offense against the
authority and dignity of the court.
WHEREFORE, the petition is hereby dismissed.
SO ORDERED.
G.R. Nos. 65957-58
July 5, 1994
ELEAZAR V. ADLAWAN and ELENA S. ADLAWAN, petitioners,

vs.
Hon. Judge RAMON AM. TORRES, as Presiding Judge of Branch 6, Regional Trial
Court Cebu City, ABOITIZ & COMPANY, INC. and THE PROVINCIAL SHERIFFS OF
CEBU, DAVAO, RIZAL and METRO MANILA, Respectively, respondents.
QUIASON, J.:
This is a petitioner for certiorari and mandamus with preliminary injunction or
restraining order to nullify: (1) the Order dated September 14, 1983 of
respondent Judge Ramon Am. Torres of the Regional Trial Court, Branch 6, Cebu
City, in Civil Case No. CEB-1185 and the Order dated September 26, 1983 of Judge
Emilio A. Jacinto of Branch 23 of the same court in Civil Case No. CEB-1186, which
granted the motion for the issuance of writs of preliminary attachment for the
seizure of the property of petitioners by respondent Provincial Sheriffs; and (2)
the Order dated December 12, 1983 of respondent Judge Ramon Am. Torres in
the consolidated cases, Civil Case No. CEB-1185 and Civil Case No. CEB-1186.
I
In a complaint dated April 24, 1982 filed with the Court of First Instance of Cebu,
now Regional Trial Court, (Civil Case No. R-21761), respondent Aboitiz and
Company, Inc. (Aboitiz) sought to collect from petitioners a sum of money
representing payments for: (1) the unpaid amortizations of a loan; (2) technical
and managerial services rendered; and (3) the unpaid installments of the
equipment provided by respondent Aboitiz to petitioners (Rollo, p. 37).
Acting on the ex parte application for attachment, the Executive Judge of the
Court of First Instance of Cebu, issued on May 14, 1982, an order directing the
issuance of the writ of preliminary attachment against the property of petitioners
upon the filing by respondent Aboitiz of an attachment bond.
Subsequently, the case was raffled to Branch 11 of the Court of First Instance of
Cebu, which issued a writ of attachment addressed to the Provincial Sheriffs of
Cebu and the City Sheriff of Davao City. It was the Sheriff of Davao City who
enforced the writ of attachment, resulting in the seizure of heavy construction
equipment, motor vehicle spare parts, and other personal property with the
aggregate value of P15,000,000.00. The said court also granted the motion of
respondent Aboitiz to take possession and custody of the attached property of
petitioners and ordered the Provincial Sheriff of Davao to deliver the property to
respondent Aboitiz.
Petitioners moved for a bill of particulars and to set aside the ex parte writ of
attachment. Finding merit in the motion to set aside the writ, Branch 11 ordered
on July 6, 1982 the lifting of the writ and, consequently, the discharge of the
property levied upon.
Respondent Aboitiz filed an urgent ex parte motion, praying for the stay of the
July 6, 1982 Order for a period of 15 days for it to be able to appeal the order. The
motion was favorably acted upon.
However, on July 13, 1982, respondent Aboitiz filed a notice of dismissal of its
complaint in accordance with Section 1, Rule 17 of the Revised Rules of Court.
Consequently, Branch 11 issued an order confirming the notice of dismissal,
emphasizing that all orders of the court issued prior to the filing of said notice of
dismissal had been rendered functus oficio, and considering all pending incidents
in the case as moot and academic.
Petitioner Eleazar Adlawan filed a motion praying that the July 6, 1982 Order be
implemented and enforced. On December 20, however, Branch 11 denied the
motion on account of the filing by respondent Aboitiz before Branch 16 of the
Court of First Instance of Cebu in Lapu-lapu City of an action for delivery of
personal property (Civil Case No. 619-L), and the filing by petitioner Eleazar
Adlawan before Branch 10 of the same court of an action for damages in
connection with the seizure of his property under the writ of attachment.
In the replevin suit, Branch 16 ordered the seizure and delivery of the property
described in the complaint. Said property were later delivered by the provincial
sheriff to respondent Aboitiz. Alleging that while his office was situated in Cebu
City, Adlawan was a resident of Minglanilla, and therefore, the Lapu-lapu City
court should not entertain the action for replevin. Petitioner Eleazar Adlawan filed
an omnibus motion praying for the reconsideration and dissolution of the writ of
seizure, the retrieval of the property seized, and the dismissal of the complaint.
He also averred that the property seized were in custodia legis by virtue of the
writ of attachment issued by Branch 11. His omnibus motion was denied.
Subsequently, he filed a motion for reconsideration which was not granted.
The denial of his omnibus motion led petitioner Eleazar Adlawan to file a petition
for certiorari and mandamus in the Supreme Court (G.R. No. 63225). The Third
Division of this Court ruled on April 3, 1990 that since attachment is an ancillary
remedy, the withdrawal of the complaint left it with no leg to stand on. Thus, the
Court disposed of the case as follows:
WHEREFORE, in view of the foregoing, this Court rules that the attached
properties left in the custody of private respondent Aboitiz and Company,
Inc. be returned to petitioner Eleazar V. Adlawan without prejudice to the
outcome of the cases filed by both parties (Rollo, p. 324).
Respondent Aboitiz filed a motion for reconsideration of the decision, contending
that the replevin case was distinct and separate from the case where the writ of
attachment was issued. It argued that the writ of replevin, therefore, remained in
force as the Third Division of the Supreme Court had not found it illegal. The
motion was, however, denied with finality in the Resolution of July 11, 1990.
Undaunted, respondent Aboitiz filed a second motion for reconsideration with a
prayer that the dispositive portion of the decision be clarified. It asserted that
because the writ of preliminary attachment was different from the writ of
replevin, we should rule that the property subject of the latter writ should remain
in custodia legis of the court issuing the said writ.
In the Resolution dated September 10, 1990, the Third Division stated that "the
properties to be returned to petitioner are only those held by private respondent
(Aboitiz) by virtue of the writ of attachment which has been declared nonexistent." Accordingly, the dispositive portion of the April 3, 1990 decision of the
Third Division of this Court was modified to read as follows:
WHEREFORE, in view of the foregoing, this Court rules that the properties
in the custody of the private respondent Aboitiz & Company by virtue of
the writ of attachment issued in Civil Case No. R-21761 be returned to the
petitioner, but properties in the custody of the private respondent by virtue
of the writ of replevin issued in Civil Case No. 619-L be continued
in custodia legis of said court pending litigation therein.
The Decision in G.R. No. 63225 having become final and executory, entry of
judgment was made on November 15, 1990. This should have terminated the
controversy between petitioners and respondent Aboitiz insofar as the Supreme
Court was concerned, but that was not to be. On September 9, 1983 respondent
Aboitiz filed against petitioners two complaints for collection of sums of money
with prayers for the issuance of writs of attachment in the Regional Trail Court,
Branch 23, Cebu City, docketed as Civil Cases Nos. CEB-1185 and CEB-1186. The
complaint in Civil Case No. CEB-1185 alleged that petitioner Eleazar Adlawan
(defendant therein) was awarded a contract for the construction of the Tago
Diversion Works for the Tago River Irrigation Project by the National Irrigation
Administration and that respondent Aboitiz (plaintiff therein) loaned him money
and equipment, which indebtedness as of June 30, 1983 totaled P13,430,259.14.
Paragraph 16 of the complaint states:
16. That, in view of the enormous liabilities which the defendants have with
the plaintiff, defendants executed a real estate mortgage covering eleven
(11) parcels of land in favor of Philippine Commercial and Industrial Bank
(PCIB) to secure a P1,000,000.00 loan with said bank and was able to
remove, conceal and dispose of their properties, obviously to defraud the
plaintiff, . . . (Rollo, pp. 65-66).
The complaint in Civil Case No. CEB-1186 alleged that petitioner Eleazar Adlawan
(defendant therein) was awarded a contract for the construction of the Lasang
River Irrigation Project by the National Irrigation Administration and that
respondent Aboitiz (plaintiff therein) loaned him money and equipment, which
indebtedness as of June 30, 1983 totalled P5,370,672.08. Paragraph 15 of the
complaint is similarly worded as paragraph 16 of the complaint in Civil Case No.
CEB-1185.
Civil Case No. CEB-1185 was raffled to the Regional Trial Court, Branch 6, presided
by respondent Judge Ramon Am. Torres. On September 14, 1983, respondent
Judge ordered the issuance of a writ of attachment upon respondent Aboitiz'
filing of a bond of P5,000,000.00. Similarly, in Civil Case No. CEB-1186, which was
raffled to Branch 23, presiding Judge Emilio A. Jacinto ordered the issuance of a
writ of attachment upon the filing of a bond of P2,500,000.00. Accordingly, in Civil
Case No. CEB-1185, the Acting Provincial Sheriff of Cebu issued separate writs
dated September 26, 1983 addressed to the Sheriffs of Cebu, Davao and Metro
Manila. No writ of preliminary attachment was, however, issued in Civil Case No.
CEB-1186.
Petitioners then filed in Civil Cases Nos. CEB-1185 and CEB-1186 urgent motions
to hold in abeyance the enforcement of the writs of attachments. They alleged in
the main that since their property had been previously attached and said
attachment was being questioned before the Supreme Court in G.R. No. 63225,
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.
Upon motion of respondent Aboitiz, Branch 23 issued on October 13, 1983, an
order directing the transfer to Branch 6 of Civil Case No. CEB-1186 for
consolidation with Civil Case No. CEB-1185.
Meanwhile, in its comment on petitioners' motion to withhold the enforcement
of the writs of attachment, respondent Aboitiz alleged that the voluntary
dismissal of Civil Case No. R-21761 under Section 1, Rule 17 of the Revised Rules
of Court was without prejudice to the institution of another action based on the
same subject matter. It averred that the issuance of the writ of attachment was
justified because petitioners were intending to defraud respondent Aboitiz by
mortgaging 11 parcels of land to the Philippine Commercial and Industrial Bank
(PCIB) in consideration of the loan of P1,100,000.00, thereby making PCIB a
preferred creditor to the prejudice of respondent Aboitiz, which had an exposure
amounting to P13,430,259.14.
Petitioners then filed a rejoinder to said comment, contending that since the
property subject of the writ of attachment have earlier been attached or
replevied, the same property were under custodia legis and therefore could not
be the subject of other writs of attachment.
On December 12, 1983, respondent Judge issued an order finding no merit in
petitioners' motion for reconsideration and directing the sheriffs of Cebu, Davao
and Metro Manila "to proceed with the enforcement and implementation of the
writs of preliminary attachment." Respondent Judge ruled that the writs of
attachment were issued on the basis of the supporting affidavits alleging that
petitioner had removed or disposed of their property with intent to defraud
respondent Aboitiz (Rollo, pp. 109-113).
On December 15, petitioners filed an ex parte motion praying: (1) that the
December 12, 1983 Order be set for hearing; (2) that they be given 15 days within
which to either file a motion for reconsideration or elevate the matter to this
Court or the then Intermediate Appellate Court; and (3) that within the same 15day period the implementation or enforcement of the writs of attachment be
held in abeyance.
On the same day, respondent Judge issued an order holding in abeyance the
enforcement of the writs of preliminary attachment in order to afford petitioners
an opportunity to seek their other remedies (Rollo, p. 116).
On
December
27,
petitioners
filed
the
instant
petition
for certiorari and mandamus. They alleged that respondent Judge gravely abused
his discretion in ordering the issuance of the writs of preliminary attachment
inasmuch as the real estate mortgage executed by them in favor of PCIB did not
constitute fraudulent removal, concealment or disposition of property. They
argued that granting the mortgage constituted removal or disposition of property,
it was not per se a ground for attachment lacking proof of intent to defraud the
creditors of the defendant.
Petitioners contended that in Civil Case No. 21761, Branch 11 had ruled that the
loan for which the mortgage was executed was contracted in good faith, as it was
necessary for them to continue their business operations even after respondent
Aboitiz had stopped giving them financial aid.
Petitioners also contended that respondent Judge exceeded his jurisdiction when
he issued the Order of December 12, 1983, without first hearing the parties on
the motion for attachment and the motion to dissolve the attachment. Moreover,
they argued that respondent Judge gravely abused his discretion in proceeding
with the case, notwithstanding that his attention had been called with regard to
the pendency of G.R. No. 63225 in this Court.
As prayed for by petitioners, we issued a temporary restraining order on January
6, 1984 "enjoining the respondents from enforcing or implementing the writs of
preliminary attachment against the property of petitioners, all dated September
26, 1983 and issued in Civil Cases Nos. CEB 1185 and 1186" (Rollo, p. 118).
II
The resolution of this case centers on the issue of the legality of the writ of
attachment issued by respondent Judge in the consolidated cases for collection of
sums of money.
The affidavit submitted by respondent 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. The affidavit submitted by respondent Aboitiz states:
REPUBLIC OF THE PHILIPPINES
CITY OF CEBU ...............) S.S.
I, ROMAN S. RONQUILLO, of legal age, married and a resident of Cebu City,
after being sworn in accordance with law, hereby depose and say:
That I am the Vice-President of the plaintiff corporation in the aboveentitled case;
That a sufficient cause of action exists against the defendants named
therein because the said defendants are indebted to the plaintiffs in the
amount of P13,430,259.14 exclusive of interests thereon and damages
claimed;
That the defendants have removed or disposed of their properties with
intent to defraud the plaintiff, their creditor, because on May 27, 1982 they
executed a real estate mortgage in favor of Philippine Commercial and
Industrial Bank (PCIB) covering eleven (11) of their fifteen (15) parcels of
land in Cebu to secure a P1,000,000.00 loan with the same bank;
That this action is one of those specifically mentioned in Section 1, Rule 57
of the Rules of Court, whereby a writ preliminary attachment may lawfully
issue because the action therein is one against parties who have removed
or disposed of their properties with intent to defraud their creditor,
plaintiff herein;
That there is no sufficient security for the claims sought to be enforced by
the present action;
That the total amount due to the plaintiff in the above-entitled case is
P13,430,259.14, excluding interests and claim for damages and is as much
the sum for which an order of attachment is herein sought to be granted;
above all legal counter-claims on the part of the defendants.
IN VIEW WHEREOF, I hereunto set my hand this 24th day of August 1983 at
Cebu City, Philippines.
(Sgd.)
RAMON S. RONQUILLO
Affiant
(Rollo, pp. 171-172)
It is evident from said affidavit that the prayer for attachment rests on the
mortgage by petitioners of 11 parcels of land in Cebu, which encumbrance
respondent Aboitiz considered as fraudulent concealment of property to its
prejudice. We find, however, that there is no factual allegation which may
constitute as a valid basis for the contention that the mortgage was in fraud of
respondent Aboitiz. As this Court said in Jardine-Manila Finance, Inc. v. Court of
Appeals, 171 SCRA 636 (1989), "[T]he general rule is that the affidavit is the
foundation of the writ, and if none be filed or one be filed which wholly fails to set
out some facts required by law to be stated therein, there is no jurisdiction and
the proceedings are null and void."
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]).
Consequently, when petitioners filed a motion for the reconsideration of the
order directing the issuance of the writ of attachment, respondent Judge should
have considered it as a motion for the discharge of the attachment and should
have conducted a hearing or required submission of counter-affidavits from the
petitioners, if only to gather facts in support of the allegation of fraud (Jopillo, Jr.
v. Court of Appeals, 167 SCRA 247 [1988]). This is what Section 13 of Rule 57
mandates.
This procedure should be followed because, as the Court has time and again said,
attachment is a harsh, extraordinary and summary remedy and the rules
governing its issuance must be construed strictly against the applicant. Verily, a
writ of attachment can only be granted on concrete and specific grounds and not
on general averments quoting perfunctorily the words of the Rules (D.P. Lub Oil
Marketing Center, Inc. v. Nicolas, 191 SCRA 423 [1990]).
The judge before whom the application is made exercises full discretion in
considering the supporting evidence proffered by the applicant. One overriding
consideration is that a writ of attachment is substantially a writ of execution
except that it emanates at the beginning, instead of at the termination of the suit
(Santos v. Aquino, Jr., 205 SCRA 127 [1992]; Tay Chun Suy v. Court of Appeals, 212
SCRA 713 [1992]).
We need not discuss the issue of whether or not Civil Cases Nos. CEB-1185 and
CEB-1186 constituted undue interference with the proceedings in G.R. No. 63225
in view of the entry of judgment in the latter case.
WHEREFORE, the petition is GRANTED and the Temporary Restraining Order
issued on January 6, 1984 is made PERMANENT. Respondent Judge or whoever is
the presiding judge of the Regional Trial Court, Branch 6, Cebu City, is DIRECTED
to PROCEED with the resolution of Civil Cases Nos. CEB-1185 and CEB-1186 with
deliberate dispatch.
SO ORDERED.
G.R. No. 73976
May 29, 1987
THE CONSOLIDATED BANK and TRUST CORPORATION (SOLIDBANK), petitioner,

vs.
HON. INTERMEDIATE APPELLATE COURT, GOLDEN STAR INDUSTRIAL
CORPORATION, NICOS INDUSTRIAL CORPORATION and THE PROVINCIAL
SHERIFF OF BULACAN, respondents.
GUTIERREZ, JR., J.:

The basic issue for resolution in this petition for review of the December 13, 1985
decision of the Intermediate Appellate Court, now the Court of Appeals, as well as
the resolution of March 13, 1986 denying the motion for reconsideration, is
whether or not an attaching creditor acquires the right of redemption of a debtor
over the attached properties of the latter which are subsequently extrajudicially
foreclosed by third parties.
Briefly, the facts are as follows: Originally, petitioner Consolidated Bank and Trust
Corporation (SOLIDBANK) loaned private respondent NICOS Industrial
Corporation (NICOS) sums of money in the total amount of FOUR MILLION
SEVENTY SIX THOUSAND FIVE HUNDRED EIGHTEEN AND 64/100 PESOS
(P4,076,518.64).
Subsequently, NICOS failed to pay back the loan prompting SOLIDBANK to file a
collection case before the Court of First Instance of Manila, Branch XXIX. The case
was docketed as Civil Case No. 82-11611.
On August 30, 1982, the court in the aforecited case issued an order of
attachment " ... upon the rights, interests and participation of which defendants
NICOS Industrial Corporation ... may have in Transfer Certificate of Title No. T210581 (T-32.505 M) and Transfer Certificate of Title No. T-10580 (T-32.504 M)
(Annexes "B", "B-1", "B-2" and "B-3" of petition).
On September 1, 1982, pursuant to the writ of attachment issued by the Court
and upon petitioner's posting of sufficient bond, the Sheriff of Manila levied and
attached the two real properties described by the foregoing order of attachment,
including the buildings and other improvements thereon. Afterwards, the Sheriff
sent separate Notices of Levy Upon Realty to the Registrar of Deeds of Malolos,
Bulacan, dated September 1, 1982 requesting him "to make the proper
annotation in the books of your office" by virtue of the order of attachment dated
August 30,1982 issued by the Manila Court in Civil Case No. 82-11611.
Accordingly, on September 7, 1982, the Registrar of Deeds of Malolos, Bulacan,
pursuant to the request of the Manila Sheriff, inscribed and annotated the
Notices of Levy Upon Real Property at the back of Transfer Certificates of Title
Nos. T-210581 (T-32.505 M) and T-210580 (T-32.504 M).
Pursuant to the foregoing ng inscription and annotations, guards were deputized
by the Manila Sheriff to secure the premises of the two attached realties.
A year later, however, on July 11, 1983, the attached properties which had been
mortgaged by NICOS to the United Coconut Planters Bank (UCPB) on March 11,
1982, were extrajudicially foreclosed by the latter. As the highest bidder therein,
a certificate of sale was issued to it by the Sheriff of Bulacan over the subject
realties including the buildings and improvements thereon.
Surprisingly, two transactions occurred soon thereafter, both on August 29, 1983.
First, UCPB sold all of its rights, interests, and participation over the properties in
question to a certain Manuel Go; Second, Manuel Go sold all the rights he
acquired from UCPB over the same lots on that very same day to private
respondent Golden Star Industrial Corporation (GOLDEN STAR).
Barely a month later, on October 5, 1983, respondent NICOS, though fully aware
that it still had the right to redeem the auctioned properties within the one year
period of redemption from July 11, 1983, suddenly executed a document entitled
"Waiver of Right of Redemption" in favor of respondent GOLDEN STAR.
On September 15, 1983, GOLDEN STAR filed a petition for the issuance of a writ of
possession over the subject realties before the Regional Trial Court, Branch VI of
Malolos, Bulacan.
On November 4, 1983, the Malolos Court granted GOLDEN STAR's petition for a
writ of possession and issued the writ. In accordance with these orders, armed
men of GOLDEN STAR forcibly took over the possession of the properties in
dispute from the guards deputized by the Sheriff of Manila to secure the
premises.
Thus on November 21, 1983, petitioner SOLIDBANK, on the strength of its prior
attachment over the lands in question filed with the Malolos court an omnibus
motion to annul the writ of possession issued to GOLDEN STAR and to punish for
contempt of court the persons who implemented the writ of possession with the
use of force and intimidation.
The respondents NICOS and GOLDEN STAR, filed oppositions to the foregoing
omnibus motion, the former on the basis of the waiver of its right of redemption
to GOLDEN STAR, and the latter on its alleged ignorance that the lands in question
were under custodia legis, having been attached by the Sheriff of Manila.
On June 9, 1984, the Malolos Court issued an order denying the omnibus motion,
the decretal portion of which is as follows:
WHEREFORE, the Omnibus Motion of movant Consolidated Bank and Trust
Corporation to annul the writ of possession issued by this Court in favor of
Golden Star Industrial Corporation and to cite for contempt those who
fraudulently secured and unlawfully implemented the writ of possession is
hereby DENIED for lack of merit. (p. 8 of the Brief for the ComplainantOppositor-Appellant in AC-G.R. CV No. 04398 [p.118, Rollo])
The petitioner SOLIDBANK forthwith interposed an appeal before the
Intermediate Appellate Court arguing inter alia that the properties were
under custodia legis, hence the extrajudicial foreclosure and the writ of
possession were null and void, and that the right of NICOS to redeem the
auctioned properties had been acquired by SOLIDBANK.
On December 13, 1985, the Intermediate Appellate Court rendered its assailed
decision "finding no merit in this appeal and affirming in toto the appealed order
of June 9, 1984, ruling that "the properties in issue ... were not incustodia legis at
the time of the extrajudicial foreclosure."
The petitioner moved for reconsideration, arguing that its writ of attachment over
the properties in question was duly registered in the Register of Deeds of Malolos,
Bulacan, and that the right to redeem said properties should be retained or given
back to SOLIDBANK as attaching creditor.
On March 13, 1986, the Intermediate Appellate Court promulgated its resolution
denying the motion for reconsideration for lack of merit.
Hence this petition for review, on the grounds that respondent appellate court
decided the case contrary to law and applicable decisions of the Supreme Court,
and has departed from the accepted and usual course of judicial proceedings as
to call for an exercise of the power of supervision of this Court.
The fundamental question herein, which is determinative of the other issues, is
whether or not the subject properties were under custodia legis by virtue of the
prior annotation of a writ of attachment in petitioner's favor at the time the
properties were extrajudicially foreclosed.
We rule in the affirmative on the following grounds:

First of all, the records show (specifically Annexes "B," "B-1" to "B-3" of the
petition) that on September 1, 1982, the Sheriff of Branch XXIX of the Court of
First Instance of Manila, sent separate Notices of Levy Upon Realty to the
Registrar of Deeds of Malolos Bulacan, requesting him "to make the proper
annotation in the books of your office," "by virtue of an order of attachment
issued in Civil Case No. 82-11611 dated August 30, 1982, ... upon the rights,
interests, and participation of which defendant NICOS Industrial Corporation in
this case may have in ... ."Transfer Certificate of Title No. T-210581 (T-32.505 M)
and Transfer Certificate of Title No. T-210580 (T-32,505 M).
Secondly, and more significant, the records clearly show (page 4, Annex "D" of
petition) that the Registrar of Deeds of Malolos, Bulacan, on September 7, 1982,
inscribed and annotated the foregoing Notices of Levy at the back of Transfer
Certificate of Title Nos. 210580 and 210581, to wit:
TRANSFER CERTIFICATE OF TITLE
No. T-210580 (T-32.504 M)
Entry No. 79524 (M): Kind; NOTICE OF LEVY UPON REALTY, Executed in
favor of the CONSOLIDATED BANK AND TRUST CORPORATION
(SOLIDBANK);-Plaintiff; Conditions: Notice is hereby given that by virtue of
an Order of Attachment issued by the C.F.I. of Manila, Branch XXIX, in Civil
Case No. 82-11611, all the rights, interest and participation of NICOS
INDUSTRIAL CORPORATION-Defendant over the herein described lot is
hereby levied upon attached.; Date of Instrument: September 1, 1982; Date
of Inscription: September 7, 1982 at 2:35.
Meycauayan, Bulacan.
(SGD.) VIOLETA R. LINCALLO GARCIA
Branch Register of Deeds
TRANSFER CERTIFICATE OF TITLE
No. T-210581 (T-32.505 M)
Entry No. 79524 (M); Kind: NOTICE OF LEVY UPON REALTY, Executed in
favor of THE CONSOLIDATED BANK AND TRUST CORPORATION
(SOLIDBANK) Plaintiff; Conditions: Notice is hereby given that by virtue
of an Order of Attachment issued by the C.F.I. of Manila, Branch XXIX, in
Civil Case No. 82-11611, all the rights, interest and participation of NICOS
INDUSTRIAL CORPORATION Defendants over the herein described lot is

hereby levied upon attached.; Date of Instrument; September 1, 1982; Date
of Inscription: September 7, 1982 at 2:35.
Meycauayan, Bulacan.
(SGD.) VIOLETA R.
LINCALLO GARCIA
Branch Register of Deeds
(pp. 91-92, Rollo)
Based on the foregoing evidence on record, the conclusion is clear that the
disputed real properties were undercustodia legis by virtue of a valid attachment
at the time the same were extrajudicially foreclosed by a third party mortgagee.
The rule is well settled that when a writ of attachment has been levied on real
property or any interest therein belonging to the judgment debtor, the levy thus
effected creates a lien which nothing can destroy but its dissolution (Chua Pua
Hermanos v. Register of Deeds of Batangas, 50 Phil. 670; Government, et. al. v.
Mercado, 67 Phil. 409).
The foregoing conclusion has two necessary consequences.
Firstly, it follows that the writ of possession issued by the Malolos court in favor
of respondent GOLDEN STAR is nun and void ab initio because it interfered with
the jurisdiction of a co-ordinate and co-equal court (See De Leon v. Salvador, 36
SCRA 567):
While property or money is in custodia legis, the officer holding it is
the mere hand of the court, his possession is the possession of the
court, and to interfere with it is to invade the jurisdiction of the court
itself (Gende v. Fleming, 371 N.E. 2d. 191; Bishop v. Atlantic
Smokeless Coal Co., 88F. Supp. 27, 7 CJS 320).
Of equal importance is the fact that the transactions on which respondent
GOLDEN STAR's right to a writ of possession are based are highly irregular and
questionable, to say the least, considering the following circumstances:
On July 11, 1983, the Sheriff of Bulacan executed a certificate of sale over the two
lots in question in favor of UCPB.
On August 29, 1983, or about a month and a half later, UCPB sold its rights,
interests and participation over the lands to Manuel Go.
On that very same day, August 29, 1983, Manuel Go sold the same properties to
respondent GOLDEN STAR.
On October 5, 1983, respondent NICOS which had a one year right of redemption
over the lands in question executed a "Waiver of Right of Redemption in favor of
respondent GOLDEN STAR." The attempts to bring the disputed properties out of
the petitioner's reach, inspite of the attachment, are plain and apparent.
Based on the foregoing facts, we find that respondents NICOS and GOLDEN STAR
conspired to defeat petitioner's lien on the attached properties and to deny the
latter its right of redemption.
It appears that in issuing the writ of possession, the Malolos court relied on copies
of documents (which did not show the memorandum of encumbrance) submitted
to it by GOLDEN STAR. It was thus led into the error of ruling that the petitioner's
attachment was not properly annotated.
Secondly, it likewise follows that the petitioner has acquired by operation of law
the right of redemption over the foreclosed properties pursuant to Sec. 6 of Act
No. 3135, to wit:
In all such cases in which an extrajudicial sale is made ... any person
having a lien on the property subsequent to the mortgage ... may
redeem the same at any time within the term of one year from and
after the date of sale.
It has been held that "an attaching creditor may succeed to the incidental rights
to which the debtor was entitled by reason of his ownership of the property, as
for example, a right to redeem from a prior mortgage" (Lyon v. Stanford, 5 Conn.
541, 7 SJS 505).
The fact that respondent NICOS executed a waiver of right of redemption in favor
of respondent GOLDEN STAR on October 5, 1983 is of no moment as by that time
it had no more right which it may waive in favor of another,
Finally, GOLDEN STAR argues that even if the attachment in issue was duly
registered and the petitioner has a right of redemption, the certificate of sale of
the lands in question was registered on September 6, 1983. It claims that the
period to redeem therefore lapsed on September 6, 1984 without the petitioner
bank ever exercising any right of redemption.
This argument is untenable. Well settled is the rule that the pendency of an action
tolls the term of the right of redemption. Specifically, tills Court in Ong Chua v.
Carr, (53 Phil. 975, 983) categorically ruled that:
xxx xxx xxx
... Neither was it error on the part of the court to hold that the
pendency of the action tolled the term for the right of redemption;
that is an old and well established rule.
This was reiterated in Fernandez v. Suplido (96 Phil. 541, 543), as follows:
xxx xxx xxx
... As pointed out in Ong Chua v. Carr, 53 Phil. 975, the pendency of
an action brought in good faith and relating to the validity of a sale
with pacto de retro tolls the term for the right of redemption. ...
Not only that. It has been held that "under a statute limiting the time for
redemption ... the right of redemption continues after perfection of an appeal ...
until the decision of the appeal (Philadelphia Mortgage Co. v. Gustus, 75 N.W.
1107).
In the case at bar, the petitioner commenced the instant action by way of an
omnibus motion before the Bulacan Court on November 21, 1983 or barely two
months after the certificate of sale was registered on September 6, 1983, well
within the one year period of redemption.
WHEREFORE, IN VIEW OF THE FOREGOING, the petition is granted and judgment
is hereby rendered:
1) declaring as valid and binding the levy and attachment by the Manila Sheriff on
the two realties in question including the buildings and improvements thereon;
2) declaring that petitioner has acquired the right of redemption over the
aforesaid properties which it may exercise within one year from notice of entry of
judgment in this case; and
3) declaring as null and void (a) the order of the Bulacan Court dated November 4,
1983 granting the writ of possession to respondent GOLDEN STAR, (b) its order of
June 9, 1984 denying the petitioner's omnibus motion, and (c) the Waiver of Right
of Redemption executed by respondent NICOS in favor of respondent GOLDEN
STAR.
SO ORDERED.
G.R. No. L-37682
November 26, 1932
CLAUDE NEON LIGHTS, FEDERAL INC., U. S. A., petitioner,

vs.
PHILIPPINE ADVERTISING CORPORATION and FRANCISCO SANTAMARIA, Judge
of First Instance of Manila, respondents.
BUTTE, J.:
This case is to be determined upon the petition for writ of certiorari and the
demurrer thereto filed by the respondents. The petition sets up two causes of
action: one attacking the validity of a writ of attachment issued by the respondent
judge on the petition and affidavit of the respondent Philippine Advertising
Corporation, on April 6, 1932; the second, attacking the validity of the order of
the respondent judge issued the same day on the petition of the respondent
Philippine Advertising Corporation, appointing a receiver of the property which
was seized by the sheriff under said writ of attachment.
On April 5, 1932, the respondent Philippine Advertising Corporation filed suit
against the petitioner in the Court of First Instance of Manila, claiming P300,000
as damages for alleged breach of the agency contract existing between the said
respondent and the petitioner. At the same time, said respondent filed in said
court an application for writ of attachment duly verified in which it is stated that
the defendant (petitioner herein) 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 the defendant, Claude Neon Lights, Inc. (the petitioner
herein) 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 in the court below and in this court for the issuance of the writ of
attachment against the petitioner 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".
On April 6, 1932, the respondent judge issued the writ of attachment as prayed
for, and the sheriff has attached all the properties of the petitioner in the
Philippine Islands. On the same date, on the ex parte petition and nomination of
the respondent, the respondent judge appointed Manuel C. Grey receiver of said
properties of the petitioner, fixing his bond at P3,000.
Motions to dissolve said writ of attachment and receivership were fled in the
court below, supported by affidavits of the attorney in fact for the petitioner in
which it is recited, among other things, that the petitioner is not indebted to the
respondent in any sum whatever nor has it in any way breached any contracts
with the respondent or at any time interfered in the management of its business
in the Philippine Islands as carried on by its agent, the respondent, and it has
faithfully complied with every condition of said contract; that the attachment of
the machinery and plants of the petitioner, as well as its other assets, is highly
prejudicial to it as it is unable to proceed with its business in the Philippine Islands
and irreparable loss will result to it unless such attachment be raised; that the
filing of said suit was malicious, without foundation, and intended only to injure
the petitioner and to depreciate the value of its holdings in the Philippine Islands.
It does not appear that any answer was made to said motion in which said
allegations were denied or that any refuting evidence was offered.
On June 20 1932, the court denied said motions to vacate the attachment and
receivership, declaring that the writ of attachment conforms to section 424 of the
Code of Civil Procedure.
The petitioner for certiorari prays that the writ of attachment issued by the
respondent judge on April 6, 1932, as well as the order of the same date,
appointing Manuel C. Grey receiver of the property of the petitioner, be annulled.
The sufficiency of the application for the writ of attachment assailed by the
petitioner upon several grounds but we shall confine ourselves to the
consideration of the question whether or not paragraph 2 of section 424 of the
Code of Civil Procedure is applicable to this petitioner.
The petitioner 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. The petitioner 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 contracts, all of which property was in the possession and under the
control and management of the respondent Philippine Advertising Corporation, as
the agent of the petitioner, 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.
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).
The question arises whether this petitioner, a foreign corporation, shall, in a
metaphorical sense, be deemed as "not residing in the Philippine Islands" in the
sense in which that expression would apply to a natural person.
Having regard to the reason for the statute which is the protection of the
creditors of a non-resident, we are of the opinion that there is not 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. (Section 72, ibid.)
Corporations, as a rule, are less mobile than individuals. This is a specially true of
foreign corporations that are carrying on business by proper authority in these
Islands. They possess, as a rule, great capital which is seeking lucrative and more
or less permanent investment in young and developing countries like our
Philippines. Some of them came here as far back as the Spanish regime and are
still important factors in our financial and industrial life. They are anything but
"fly-by-night" concerns. The latter, we believe, are effectually excluded from our
Islands both by our laws and by our geographical and economic situation.
If, as we believe, section 424, paragraph 2, should not be held applicable to
foreign corporations duly licensed to do business in the Philippine Islands both
because the language and the reason of the statute limit it to natural persons, we
sustain and reinforce the provisions of section 71 of the Corporation Law, Act No.
1459, which provides in substance that if the Secretary of Finance or the
Secretary of Commerce and Communications and the Governor-General find a
duly licensed foreign corporation to be insolvent or that its continuance in
business will involve probable loss to its creditors, they may revoke its license and
"the Attorney-General shall take such proceedings as may be proper to protect
creditors and the public". Section 71, supra, contemplates that the proceedings
instituted by the Attorney-General shall effect the protection of all creditors and
the public equally. Obviously, the benefit of that section will be minimized, if not
entirely defeated, if a creditor or a few creditors can obtain privileged liens by
writs of attachment based on the sole allegation, which is easily and safely made,
that the corporation is "not residing in the Philippine Islands". (Cf. Kuenzle &
Streiff vs. Villanueva, 41 Phil., 611.)lawphil.net
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 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 especially of foreign corporations, but in addition with every
requirement of law made of domestic corporations. (Section 73, supra.)
It is true that the majority of the states in the American Union hold the contrary
rule. But our situation is obviously very dissimilar from that of a state in the
American Union. There forty-eight states and the central government, all creating
corporations which do a tremendous interstate business, are contiguous and
separated by imaginary lines. A higher degree of protection against irresponsible
corporations may be more necessary there than here. We have no interstate
business. Only the central government grants charters to corporations. But even
in the American Union there is a minority rule which we regard as the better
reasoned and the better suited to our conditions, both geographical and
economical, and more nearly in harmony with the policy of our law both under
the Spanish regime and since the American occupation. This minority rule is
supported by the following authorities: Brand vs. Auto Service Co. (New Jersey,
1907), 67 Atl., 19, 20; Mellor vs. Edward V. Hartford, Inc. (New Jersey, 1929), 146
Atl., 206; Charles Friend & Co. vs. Gold Smith & Co. (Illinois, 1923), 138 N. E., 185;
Fullilove vs. Central State Bank (Louisiana, 1926), 107 So., 590.
In the present instance, a particularly monstrous result has followed as s
consequence of the granting of the writ attaching all of the property of the
petitioner on the sole allegation that it "is not residing in the Philippine Islands".
As the petitioner's business was a going concern, which the sheriff, who levied the
writ, obviously could not manage, it became necessary on the same day for the
court to appoint a receiver. This receiver, as the demurrer admits, "was and is an
employee working under the president of the respondent Philippine Advertising
Corporation, so that to all intents and purposes, all the property of the petitioner
in the Philippine Islands was seized and delivered into the hands of the
respondent Philippine Advertising Corporation."
The prayer of the petitioner is granted. The order and writ of attachment
complained of are annulled and set aside and the court below is directed to
vacate the order appointing Manuel C. Grey receiver of the property of the
petitioner and to require said Manuel C. Grey to submit his final report at the
earliest practicable date. Costs in both instances to be borne by the respondent,
Philippine Advertising Corporation. So ordered.
G.R. No. L-35990
June 17, 1981
ABOITIZ & COMPANY, INC., HONORABLE VICENTE N. CUSI JR., Judge of the Court of
First Instance of Davao, and the PROVINCIAL SHERIFF OF DAVAO DEL
SUR, petitioners,
vs.
COTABATO BUS COMPANY, INC., respondent.
DE CASTRO, J.:
The instant petition stemmed from Civil Case No. 7329 of the Court of First Instance
of Davao (Branch 1) in which a writ of preliminary attachment was issued ex-parte by
the Court on the strength of an affidavit of merit attached to the verified complaint
filed by petitioner herein, Aboitiz & Co., Inc., on November 2, 1971, as plaintiff in said
case, for the collection of money in the sum of P 155,739.41, which defendant
therein, the respondent in the instant case, Cotabato Bus Co., owed the said
petitioner.
By virtue of the writ of preliminary attachment, the provincial sheriff attached
personal properties of the defendant bus company consisting of some buses,
machinery and equipment. The ground for the issuance of the writ is, as alleged in
the complaint and the affidavit of merit executed by the Assistant Manager of
petitioner, that the defendant "has removed or disposed of its properties or assets,
or is about to do so, with intent to defraud its creditors."
Respondent company filed in the lower court an "Urgent Motion to Dissolve or
Quash Writ of Attachment" to which was attached an affidavit executed by its
Assistant Manager, Baldovino Lagbao, alleging among other things 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". An opposition and a
supplemental opposition were filed to the urgent motion. The lower court denied
the motion stating in its Order that "the testimony of Baldovino Lagbao, witness for
the defendant, corroborates the facts in the plaintiff's affidavit instead of disproving
or showing them to be untrue."
A motion for reconsideration was filed by the defendant bus company but the lower
court denied it. Hence, the defendant went to the Court of Appeals on a petition for
certiorari alleging grave abuse of discretion on the part of herein respondent Judge,
Hon. Vicente R. Cusi Jr. On giving due course to the petition, the Court of Appeals
issued a restraining order restraining the trial court from enforcing further the writ of
attachment and from proceeding with the hearing of Civil Case No. 7329. In its
decision promulgated on October 3, 1971, the Court of Appeals declared "null and
void the order/writ of attachment dated November 3, 1971 and the orders of
December 2, 1971, as well as that of December 11, 1971, ordered the release of the
attached properties, and made the restraining order originally issued permanent.
The present recourse is an appeal by certiorari from the decision of the Court of
Appeals reversing the assailed orders of the Court of First Instance of Davao, (Branch
I), petitioner assigning against the lower court the following errors:
ERROR I
THE COURT OF APPEALS ERRED IN HASTILY AND PERFUNCTORILY RENDERING,
ON OCTOBER 3, 1971, A DECISION WITHOUT CONSIDERING MOST OF THE
EVIDENCE SUCH THAT
l) EVEN AN IMPORTANT FACT, ESTABLISHED BY DOCUMENTARY EVIDENCE
AND NOT DENIED BY RESPONDENT, IS MENTIONED ONLY AS A "CLAIM" OF
PETITIONER COMPANY;
2) THE DECISION CONTAINS NO DISCUSSION AND APPRECIATION OF THE
FACTS AS PROVED, ASSEMBLED AND PRESENTED BY PETITIONER COMPANY
SHOWING IN THEIR TOTALITY THAT RESPONDENT HAS REMOVED,
DIVERTED OR DISPOSED OF ITS BANK DEPOSITS, INCOME AND OTHER LIQUID
ASSETS WITH INTENT TO DEFRAUD ITS CREDITORS, ESPECIALLY ITS
UNSECURED SUPPLIERS;
3) THE DECISION IGNORES THE SIGNIFICANCE OF THE REFUSAL OF
RESPONDENT TO PERMIT, UNDER REP. ACT NO. 1405, THE METROPOLITAN
BANK & TRUST CO. TO BRING, IN COMPLIANCE WITH A subpoena DUCES
TECUM TO THE TRIAL COURT ALL THE RECORDS OF RESPONDENT'S DEPOSITS
AND WITHDRAWALS UNDER ITS CURRENT AND SAVINGS ACCOUNTS (NOW
NIL) FOR EXAMINATION BY PETITIONER COMPANY FOR THE PURPOSE OF
SHOWING DIRECTLY THE REMOVAL, DIVERSION OR DISPOSAL OF
RESPONDENT'S DEPOSITS AND INCOME WITH INTENT TO DEFRAUD ITS
CREDITORS.
ERROR II
THE COURT OF APPEALS ERRED IN NOT APPRECIATING THE FACTS THAT
RESPONDENT'S BANK DEPOSITS ARE NIL AS PROOF WHICH - TOGETHER WITH
RESPONDENT'S ADMISSION OF AN INCOME OF FROM P10,000.00 to P
14,000.00 A DAY AND THE EVIDENCE THAT IT CANNOT PRODUCE P 634.00
WITHOUT USING A PERSONAL CHECK OF ITS PRESIDENT AND MAJORITY
STOCKHOLDER, AND OTHER EVIDENCE SHOWS THE REMOVAL OR

CHANNELING OF ITS INCOME TO THE LATTER.
ERROR III
THE COURT OF APPEALS ERRED IN NOT APPRECIATING THE RESCUE AND
REMOVAL BY RESPONDENT OF FIVE ATTACHED BUSES, DURING THE
DEPENDENCY OF ITS MOTION TO DISSOLVE THE ATTACHMENT IN THE, TRIAL
COURT, AS A FURTHER ACT OF REMOVAL OF PROPERTIES BY RESPONDENT
WITH INTENT TO DEFRAUD PETITIONER COMPANY, FOR WHOSE BENEFIT SAID
BUSES HAD BEEN ATTACHED.
The questions raised are mainly, if not solely, factual revolving on whether
respondent bus company has in fact removed its properties, or is about to do so, in
fraud of its creditors. This being so, the findings of the Court of Appeals on said
issues of facts are generally considered conclusive and final, and should no longer be
disturbed. However, We gave due course to the petition because it raises also a legal
question of whether the writ of attachment was properly issued upon a showing that
defendant is on the verge of insolvency and may no longer satisfy its just debts
without issuing the writ. This may be inferred from the emphasis laid by petitioner
on the fact that even for the measly amount of P 634.00 payment thereof was made
with a personal check of the respondent company's president and majority
stockholder, and its debts to several creditors, including secured ones like the DBP,
have remained unpaid, despite its supposed daily income of an average of P
12,000.00, as declared by its assistant manager, Baldovino Lagbao. 1
Going forthwith to this question of whether insolvency, which petitioners in effect
claims to have been proven by the evidence, particularly by company's bank account
which has been reduced to nil, may be a ground for the issuance of a writ of
attachment, the respondent Court of Appeals correctly took its position in the
negative on the strength of the explicit ruling of this Court in Max Chamorro & Co. vs.
Philippine Ready Mix Concrete Company, Inc. and Hon. Manuel P. Barcelona. 2
Petitioner, however, disclaims any intention of advancing the theory that insolvency
is a ground for the issuance of a writ of attachment , 3 and insists that its evidence -is
intended to prove his assertion that respondent company has disposed, or is about
to dispose, of its properties, in fraud of its creditors. Aside from the reference
petitioner had made to respondent company's "nil" bank account, as if to show
removal of company's funds, petitioner also cited the alleged non-payment of its
other creditors, including secured creditors like the DBP to which all its buses have
been mortgaged, despite its daily income averaging P12,000.00, and the rescue and
removal of five attached buses.
It is an undisputed fact that, as averred by petitioner itself, the several buses

attached are nearly junks. However, upon permission by the sheriff, five of them
were repaired, but they were substituted with five buses which were also in the
same condition as the five repaired ones before the repair. 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 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 of from
P10,000.00 to P14,000.00 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 is only one of the suppliers.
It is, indeed, extremely hard to remove the buses, machinery and other equipments
which respondent company have to own and keep to be able to engage and continue
in the operation of its transportation business. 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.
In the main, therefore, We find that the respondent Court of Appeals has not
committed any reversible error, much less grave abuse of discretion, except that the
restraining order issued by it should not have included restraining the trial court
from hearing the case, altogether. Accordingly, the instant petition is hereby denied,
but the trial court is hereby ordered to immediately proceed with the hearing of Civil
Case No. 7329 and decide it in accordance with the law and the evidence. No special
pronouncement as to costs.
SO ORDERED.
G.R. No. L-33112
June 15, 1978
PHILIPPINE NATIONAL BANK, petitioner,

vs.
HON. JUDGE JAVIER PABALAN, Judge of the Court of First Instance, Branch III, La
Union, AGOO TOBACCO PLANTERS ASSOCIATION, INC., PHILIPPINE VIRGINIA
TOBACCO ADMINISTRATION, and PANFILO P. JIMENEZ, Deputy Sheriff, La
Union, respondents.
FERNANDO, Acting C.J.:

The reliance of petitioner Philippine National Bank in this certiorari and
prohibition proceeding against respondent Judge Javier Pabalan who issued a writ
of execution, 1 followed thereafter by a notice of garnishment of the funds of
respondent Philippine Virginia Tobacco Administration, 2 deposited with it, is on
the fundamental constitutional law doctrine of non-suability of a state, it being
alleged that such funds are public in character. This is not the first time petitioner
raised that issue. It did so before in Philippine National Bank v. Court of industrial
Relations, 3 decided only last January. It did not meet with success, this Court
ruling in accordance with the two previous cases of National Shipyard and Steel
Corporation 4and Manila Hotel Employees Association v. Manila Hotel
Company, 5 that funds of public corporations which can sue and be sued were not
exempt from garnishment. As respondent Philippine Virginia Tobacco
Administration is likewise a public corporation possessed of the same
attributes, 6 a similar outcome is indicated. This petition must be dismissed.
It is undisputed that the judgment against respondent Philippine Virginia Tobacco
Administration had reached the stage of finality. A writ of execution was,
therefore, in order. It was accordingly issued on December 17, 1970. 7There was a
notice of garnishment for the full amount mentioned in such writ of execution in
the sum of P12,724,66. 8 In view of the objection, however, by petitioner
Philippine National Bank on the above ground, coupled with an inquiry as to
whether or not respondent Philippine Virginia Tobacco Administration had funds
deposited with petitioner's La Union branch, it was not until January 25, 1971 that
the order sought to be set aside in this certiorari proceeding was issued by
respondent Judge. 9 Its dispositive portion reads as follows: Conformably with the
foregoing, it is now ordered, in accordance with law, that sufficient funds of the
Philippine Virginia Tobacco Administration now deposited with the Philippine

National Bank, La Union Branch, shall be garnished and delivered to the plaintiff
immediately to satisfy the Writ of Execution for one-half of the amount awarded
in the decision of November 16, 1970." 10 Hence this certiorari and prohibition
proceeding.
As noted at the outset, petitioner Philippine National Bank would invoke the
doctrine of non-suability. It is to be admitted that under the present Constitution,
what was formerly implicit as a fundamental doctrine in constitutional law has
been set forth in express terms: "The State may not be sued without its
consent." 11 If the funds appertained to one of the regular departments or offices
in the government, then, certainly, such a provision would be a bar to
garnishment. Such is not the case here. Garnishment would lie. Only last January,
as noted in the opening paragraph of this decision, this Court, in a case brought
by the same petitioner precisely invoking such a doctrine, left no doubt that the
funds of public corporations could properly be made the object of a notice of
garnishment. Accordingly, this petition must fail.
1. The alleged grave abuse of discretion, the basis of this certiorari proceeding,
was sought to be justified on the failure of respondent Judge to set aside the
notice of garnishment of funds belonging to respondent Philippine Virginia
Tobacco Administration. This excerpt from the aforecited decision of Philippine
National Bank v. Court of Industrial Relations makes manifest why such an
argument is far from persuasive. "The premise that the funds could be spoken as
public character may be accepted in the sense that the People Homesite and
Housing Corporation was a government-owned entity. It does not follow though
that they were exempt. from garnishment. National Shipyard and Steel
Corporation v. Court of Industrial Relations is squarely in point. As was explicitly
stated in the opinion of the then Justice, later Chief Justice, Concepcion: "The
allegation to the effect that the funds of the NASSCO are public funds of the
government, and that, as such, the same may not be garnished, attached or levied
upon, is untenable for, as a government owned and controlled corporation, the
NASSCO has a personality of its own. distinct and separate from that of the
Government. It has pursuant to Section 2 of Executive Order No. 356, dated
October 23, 1950 ... , pursuant to which The NASSCO has been established all
the powers of a corporation under the Corporation Law ... ." Accordingly, it may
be sue and be sued and may be subjected to court processes just like any other
corporation (Section 13, Act No. 1459, as amended.)" ... To repeat, the ruling was
the appropriate remedy for the prevailing party which could proceed against the
funds of a corporate entity even if owned or controlled by the government." 12
2. The National Shipyard and Steel Corporation decision was not the first of its
kind. The ruling therein could be inferred from the judgment announced in Manila
Hotel Employees Association v. Manila Hotel Company, decided as far back as
1941. 13 In the language of its ponente Justice Ozaeta "On the other hand, it is
well-settled that when the government enters into commercial business, it
abandons its sovereign capacity and is to be treated like any other corporation.
(Bank of the United States v. Planters' Bank, 9 Wheat. 904, 6 L.ed. 244). By
engaging in a particular business thru the instrumentality of a corporation, the
government divests itself pro hac vice of its sovereign character, so as to render
the corporation subject to the rules of law governing private corporations." 14 It is
worth mentioning that Justice Ozaeta could find support for such a
pronouncement from the leading American Supreme Court case of united States
v. Planters' Bank, 15 with the opinion coming from the illustrious Chief Justice
Marshall. It was handed down more than one hundred fifty years ago, 1824 to be
exact. It is apparent, therefore, that petitioner Bank could it legally set forth as a
bar or impediment to a notice of garnishment the doctrine of non-suability.
WHEREFORE, this petition for certiorari and prohibition is dismissed. No costs.

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G.R. No.

March 30, 1946

TRANQUILINO CALO and DOROTEO SAN JOSE, petitioners,

1|PR OVISIONAL REM EDIES

4|PR OVISIONAL REM EDIES

being lost, removed or materially injured unless a receiver is appointed to guard

is whether or not defendants intend or were intending to enter or work or

8|PR OVISIONAL REM EDIES

G.R. No. L-63225

ELEAZAR V. ADLAWAN, petitioner,

Instance of Cebu, presided by respondent Judge Valeriano P. Tomol. On May 26,

After a careful examination of the records of the case We rule in favor of

G.R. No. L-45720

December 29, 1937

VENTURA GUZMAN, petitioner,

As to the other two requisites, there is no allegation, either in the complaint or in

An affidavit is fatally defective where it fails to comply, at least

G.R. No. 55381

March 26, 1984

SPOUSES JULIETA SALGADO and JOSE SALGADO, Petitioners,

1. REMEDIAL LAW; PROVISIONAL REMEDIES; ATTACHMENT; PURPOSE. The

G.R. No. L-12957

October 29, 1918

THE UNITED STATES, plaintiffs-appellee,

1917, authorizing an attachment of property to the value of P1,500 unless he

It is to be noted that while the "sumario" of Spanish criminal procedure is in many

to the proceedings in a criminal prosecution. The mere circumstance that a civil

G.R. No. L-894

July 30, 1947

LUIS F. GENERAL, petitioner,

September 10, 1985

MERCEDES GRUENBERG and ALBERT GRUENBERG, petitioners,

GUTIERREZ, JR., J.:

Under date of February 7, 1976, private respondent filed a 'Motion for

On August 16, 1976, respondent Judge issued an order, denying the

either by virtue of a civil obligation emanating from contract or from law, or

In Salas v. Adil (90 SCRA 121), we stated:

G.R. No. L-35351

March 17, 1976

ROGELIO DY, SY JIAN AND DY CHING ENG, petitioners,

necessary so as to properly implead the Court of First Instance of Cebu City

Plaintiffs respectfully allege:

4 That the supposed contract of agency prepared by the defendant

3. That defendant admits that he is engaged in the general merchandise

8. That the allegations contained in paragraphs 3 and 4 of the second cause

Rogelio Dy but merely in the legitimate exercise of legal rights of the

31. That the cash advance receipt of P16,000.00 is therefore reduced to

On Juy 13, 1972, defendants filed the following:

defendants as far as their counterclaim is concerned, submitted for the decisionof

G.R. No. L-825

July 20, 1948

ROMAN MABANAG, plaintiff-appellant,

the res is lost, it is then purely in personam. . . a proceeding against

G.R. No. 102448

RICARDO CUARTERO, petitioner,

GUTIERREZ, JR., J.:

thereof as may be sufficient to satisfy the petitioner's principal claim in the

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

. . . writs of attachment may properly issue ex-parte provided that

G.R. No. L-46009

May 14, 1979

RICARDO T. SALAS and MARIA SALAS, petitioners,

preliminary attachment, must have been made with intent to defraud

G.R. No. 55272