SMART G.R. No.

148132
COMMUNICATIONS,
INC.,
Peti SMART
tion COMMUNICATIONS,
er, INC. and ANN
G.R. No.
MARGARET V.
- versus - 151079 SANTIAGO,
Res
REGINA M. pon
ASTORGA, den
Res ts.
pon
den
t. G.R. No.
x------------------------------ 151372

---------------------x
SMART
COMMUNICATIONS, Present:
INC.,
Peti YNARES-
tion SANTIAGO,
er, J.,
Chairperson,
- versus - AUSTRIA-
MARTINEZ, x------------------------------------------------------
CORONA,* ------------------------------x
REGINA M.
ASTORGA, NACHURA,
Res and
REYES, JJ. DECISION
pon
den
Promulgated: NACHURA, J.:
t.
x------------------------------
---------------------x ___________
REGINA M. _________
ASTORGA,
Peti
tion For the resolution of the Court are
er, three consolidated petitions for review
on certiorari under Rule 45 of the Rules
of Court. G.R. No. 148132 assails
the February 28, 2000Decision[1] and
- versus - the May 7, 2001 Resolution[2] of the Court
of Appeals (CA) in CA-G.R. SP. No.
53831. G.R. Nos. 151079 and 151372

1
question the June 11, 2001 Decision[3]and
the December 18, 2001 Resolution[4] in
CA-G.R. SP. No. 57065.
Regina M. Astorga (Astorga) was
employed by respondent Smart
Communications, Incorporated (SMART)
on May 8, 1997 as District Sales Manager
of the Corporate Sales Marketing Group/
Fixed Services Division
(CSMG/FSD). She was receiving a
monthly salary of P33,650.00. As District
Sales Manager, Astorga enjoyed additional
benefits, namely, annual performance
incentive equivalent to 30% of her annual
gross salary, a group life and
hospitalization insurance coverage, and a
car plan in the amount ofP455,000.00.[5]
In February 1998, SMART
launched an organizational realignment to
achieve more efficient operations. This
was made known to the employees
on February 27, 1998.[6]Part of the
reorganization was the outsourcing of the
marketing and sales force. Thus, SMART
entered into a joint venture agreement
with NTT of Japan, and formed SMART-
NTT Multimedia, Incorporated
(SNMI). Since SNMI was formed to do
the sales and marketing work, SMART
abolished the CSMG/FSD, Astorgas
division.
2
To soften the blow of the
realignment, SNMI agreed to absorb the
CSMG personnel who would be
recommended by SMART. SMART then
conducted a performance evaluation of
CSMG personnel and those who garnered
the highest ratings were favorably
recommended to SNMI. Astorga landed
last in the performance evaluation, thus,
she was not recommended by
SMART. SMART, nonetheless, offered
her a supervisory position in the Customer
Care Department, but she refused the offer
because the position carried lower salary
rank and rate.
Despite the abolition of the
CSMG/FSD, Astorga continued reporting
for work. But on March 3, 1998, SMART
issued a memorandum advising Astorga of
the termination of her employment on
ground of redundancy, effective April 3,
1998. Astorga received it on March 16,
1998.[7]
The termination of her
employment prompted Astorga to file a
Complaint[8] for illegal dismissal, non-
payment of salaries and other benefits
with prayer for moral and exemplary
damages against SMART and Ann
Margaret V. Santiago (Santiago). She
claimed that abolishing CSMG and,
consequently, terminating her employment
was illegal for it violated her right to
security of tenure. She also posited that it
was illegal for an employer, like SMART,
to contract out services which will
displace the employees, especially if the
contractor is an in-house agency.[9]
SMART responded that there was
valid termination. It argued that Astorga
was dismissed by reason of redundancy,
which is an authorized cause for
termination of employment, and the
dismissal was effected in accordance with
the requirements of the Labor Code. The
redundancy of Astorgas position was the
result of the abolition of CSMG and the
creation of a specialized and more
technically equipped SNMI, which is a
valid and legitimate exercise of
management prerogative.[10]
In the meantime, on May 18, 1998,
SMART sent a letter to Astorga
demanding that she pay the current market
value of the Honda Civic Sedan which
was given to her under the companys car
plan program, or to surrender the same to
the company for proper disposition.
[11]
Astorga, however, failed and refused to
do either, thus prompting SMART to file a
suit for replevin with the Regional Trial
Court of Makati (RTC) on August 10,
1998. The case was docketed as Civil
Case No. 98-1936 and was raffled to
Branch 57.[12]
3
Astorga moved to dismiss the
complaint on grounds of (i) lack of
jurisdiction; (ii) failure to state a cause of
action; (iii) litis pendentia; and (iv) forum-
shopping. Astorga posited that the regular
courts have no jurisdiction over the
complaint because the subject thereof
pertains to a benefit arising from an
employment contract; hence, jurisdiction
over the same is vested in the labor
tribunal and not in regular courts.[13]
Pending resolution of Astorgas
motion to dismiss the replevin case, the
Labor Arbiter rendered a
Decision[14] dated August 20, 1998,
declaring Astorgas dismissal from
employment illegal. While recognizing
SMARTs right to abolish any of its
departments, the Labor Arbiter held that
such right should be exercised in good
faith and for causes beyond its
control. The Arbiter found the abolition of
CSMG done neither in good faith nor for
causes beyond the control of SMART, but
a ploy to terminate Astorgas
employment. The Arbiter also ruled that
contracting out the functions performed
by Astorga to an in-house agency like
SNMI was illegal, citing Section 7(e),
Rule VIII-A of the Rules Implementing
the Labor Code.
Accordingly, the Labor Arbiter
ordered:
 WHEREFORE, FUEL ALLOWANCE (300
judgment is hereby liters/mo. x
rendered declaring the 4 mos.
dismissal of [Astorga] to be at P12.04/liter) = P 14,457.
illegal and unjust. [SMART 83
and Santiago] are hereby TOTAL = P211,415.52
ordered to:
xxxx
1. Reinstate
[Astorga] to [her] former 3. Jointly and
position or to a severally pay moral
substantially equivalent damages in the amount
position, without loss of of P500,000.00 x x x and
seniority rights and other exemplary damages in the
privileges, with full amount of P300,000.00. x
backwages, inclusive of xx
allowances and other
benefits from the time of 4. Jointly and
[her] dismissal to the date severally pay 10% of the
of reinstatement, which amount due as attorneys
computed as of this date, fees.
are as follows:
SO ORDERED.[15]
(a) Astorga

BACKWAG Subsequently, on March 29, 1999,

ES; (P33,650.00 x 4
months) = P134,60 the RTC issued an Order[16] denying
0.00 Astorgas motion to dismiss
UNPAID the replevin case. In so ruling, the RTC
SALARIES
ratiocinated that:
(February 15, 1998-
April 3,
1998 Assessing the
February 15-28, [submission] of the parties,
1998 = P 16,823.00 the Court finds no merit in
March 1-31, the motion to dismiss.
[1998] = P 33,650.00
April 1-3, As correctly
1998 = P 3,882.69 pointed out, this case is to
CAR enforce a right of
MAINTENANCE possession over a company
ALLOWANCE car assigned to the
(P2,000.00 x defendant under a car plan
4) = P 8,000.00 privilege arrangement. The
car is registered in the
name of the

4
 plaintiff. Recovery thereof
via replevin suit is allowed
by Rule 60 of the 1997
Rules of Civil Procedure,
which is undoubtedly
within the jurisdiction of
the Regional Trial Court.
In the Complaint,
plaintiff claims to be the
owner of the company car
and despite demand,
defendant refused to return
said car. This is clearly
sufficient statement of
plaintiffs cause of action.
Neither is there
forum shopping. The
element of litis penden[t]ia
does not appear to exist
because the judgment in
the labor dispute will not
constitute res judicata to
bar the filing of this case.
WHEREFORE, the
Motion to Dismiss is
hereby denied for lack of
merit.
SO ORDERED.[17]
Astorga filed a motion for reconsideration,
but the RTC denied it on June 18, 1999.[18]
Astorga elevated the denial of her
motion via certiorari to the CA, which, in
its February 28, 2000 Decision,
[19]
reversed the RTC ruling. Granting the
petition and, consequently, dismissing
the replevin case, the CA held that the
5
case is intertwined with Astorgas
complaint for illegal dismissal; thus, it is
the labor tribunal that has rightful
jurisdiction over the complaint. SMARTs
motion for reconsideration having been
denied,[20] it elevated the case to this
Court, now docketed as G.R. No. 148132.
Meanwhile, SMART also appealed
the unfavorable ruling of the Labor
Arbiter in the illegal dismissal case to the
National Labor Relations Commission
(NLRC). In itsSeptember 27,
1999 Decision,[21] the NLRC sustained
Astorgas dismissal. Reversing the Labor
Arbiter, the NLRC declared the abolition
of CSMG and the creation of SNMI to do
the sales and marketing services for
SMART a valid organizational action. It
overruled the Labor Arbiters ruling that
SNMI is an in-house agency, holding that
it lacked legal basis. It also declared that
contracting, subcontracting and
streamlining of operations for the purpose
of increasing efficiency are allowed under
the law. The NLRC further found
erroneous the Labor Arbiters disquisition
that redundancy to be valid must be
impelled by economic reasons, and upheld
the redundancy measures undertaken by
SMART.
The NLRC disposed, thus:
WHEREFORE, the
Decision of the Labor
 Arbiter is hereby reversed
and set aside. [Astorga] is
further ordered to
immediately return the
company vehicle assigned
to her. [Smart andSantiago]
are hereby ordered to pay
the final wages of
[Astorga] after [she] had
submitted the required
supporting papers therefor.
SO ORDERED.[22]
not essentially a labor concern, but is civil
in nature, and thus, within the competence
of the regular court to decide. It added that
the matter had not been fully ventilated
before the NLRC, but in the regular court.
Astorga filed a motion for
reconsideration, while SMART sought
partial reconsideration, of the
Decision. On December 18, 2001, the CA
resolved the motions, viz.:

WHEREFORE, [Astorgas]
motion for reconsideration
Astorga filed a motion for
is hereby PARTIALLY
reconsideration, but the NLRC denied it GRANTED. [Smart] is
on December 21, 1999.[23] hereby ordered to pay
[Astorga] her backwages
from 15 February
Astorga then went to the CA 1998 to 06 November
via certiorari. On June 11, 2001, the CA 1998. [Smarts] motion for
rendered a Decision[24] affirming with reconsideration is
outrightly DENIED.
modification the resolutions of the
NLRC. In gist, the CA agreed with the SO ORDERED.[25]
NLRC that the reorganization undertaken
by SMART resulting in the abolition of
Astorga and SMART came to us
CSMG was a legitimate exercise of
with their respective petitions for review
management prerogative. It rejected
assailing the CA ruling, docketed as G.R
Astorgas posturing that her non-
Nos. 151079 and 151372. On February
absorption into SNMI was tainted with
27, 2002, this Court ordered the
bad faith. However, the CA found that
consolidation of these petitions with G.R.
SMART failed to comply with the
No. 148132.[26]
mandatory one-month notice prior to the
intended termination. Accordingly, the CA
In her Memorandum, Astorga
imposed a penalty equivalent to Astorgas
argues:
one-month salary for this non-
compliance. The CA also set aside the
I
NLRCs order for the return of the
company vehicle holding that this issue is

6
THE COURT OF
APPEALS ERRED IN
UPHOLDING THE On the other hand, Smart in its
VALIDITY OF
ASTORGAS DISMISSAL Memoranda raises the following issues:
DESPITE THE FACT
THAT HER DISMISSAL I
WAS EFFECTED IN
CLEAR VIOLATION OF WHETHER THE
THE CONSTITUTIONAL HONORABLE COURT
RIGHT TO SECURITY OF APPEALS HAS
OF TENURE, DECIDED A QUESTION
CONSIDERING THAT OF SUBSTANCE IN A
THERE WAS NO WAY PROBABLY NOT
GENUINE GROUND IN ACCORD WITH LAW
FOR HER DISMISSAL. OR WITH APPLICABLE
DECISION OF THE
II HONORABLE SUPREME
COURT AND HAS SO
SMARTS REFUSAL TO FAR DEPARTED FROM
REINSTATE ASTORGA THE ACCEPTED AND
DURING THE USUAL COURSE OF
PENDENCY OF THE JUDICIAL
APPEAL AS REQUIRED PROCEEDINGS AS TO
BY ARTICLE 223 OF CALL FOR AN
THE LABOR CODE, EXERCISE OF THE
ENTITLES ASTORGA TO POWER OF
HER SALARIES SUPERVISION WHEN IT
DURING THE RULED THAT SMART
PENDENCY OF THE DID NOT COMPLY
APPEAL. WITH THE NOTICE
REQUIREMENTS PRIOR
III TO TERMINATING
ASTORGA ON THE
THE COURT OF GROUND OF
APPEALS WAS REDUNDANCY.
CORRECT IN HOLDING
THAT THE REGIONAL II
TRIAL COURT HAS NO
JURISDICTION OVER WHETHER THE
THE COMPLAINT FOR NOTICES GIVEN BY
RECOVERY OF A CAR SMART TO ASTORGA
WHICH ASTORGA AND THE
ACQUIRED AS PART OF DEPARTMENT OF
HER EMPLOYEE (sic) LABOR AND
BENEFIT.[27] EMPLOYMENT ARE

7
SUBSTANTIAL REGIONAL TRIAL
COMPLIANCE WITH COURT DOES NOT
THE NOTICE HAVE JURISDICTION
REQUIREMENTS OVER THE COMPLAINT
BEFORE FOR REPLEVIN FILED
TERMINATION. BY SMART TO
RECOVER ITS OWN
III COMPANY VEHICLE
FROM A FORMER
WHETHER THE RULE EMPLOYEE WHO WAS
ENUNCIATED IN LEGALLY DISMISSED.
SERRANO VS.
NATIONAL LABOR V
RELATIONS
COMMISSION FINDS WHETHER THE
APPLICATION IN THE HONORABLE COURT
CASE AT BAR OF APPEALS HAS
CONSIDERING THAT IN FAILED TO
THE SERRANO CASE APPRECIATE THAT THE
THERE WAS SUBJECT OF THE
ABSOLUTELY NO REPLEVIN CASE IS NOT
[28]
NOTICE AT ALL. THE ENFORCEMENT OF
A CAR PLAN
IV PRIVILEGE BUT
SIMPLY THE
WHETHER THE RECOVERY OF A
HONORABLE COURT COMPANY CAR.
OF APPEALS HAS
DECIDED A QUESTION VI
OF SUBSTANCE IN A
WAY PROBABLY NOT WHETHER THE
IN ACCORD WITH LAW HONORABLE COURT
OR WITH APPLICABLE OF APPEALS HAS
DECISION[S] OF THE FAILED TO
HONORABLE SUPREME APPRECIATE THAT
COURT AND HAS SO ASTORGA CAN NO
FAR DEPARTED FROM LONGER BE
THE ACCEPTED AND CONSIDERED AS AN
USUAL COURSE OF EMPLOYEE OF SMART
JUDICIAL UNDER THE LABOR
PROCEEDINGS AS TO CODE.[29]
CALL FOR AN
EXERCISE OF THE
POWER OF The Court shall first deal with the
SUPERVISION WHEN IT
RULED THAT THE propriety of dismissing the replevin case

8
filed with the RTC of Makati City
allegedly for lack of jurisdiction, which is
the issue raised in G.R. No. 148132.
Replevin is an action whereby the
owner or person entitled to repossession
of goods or chattels may recover those
goods or chattels from one who has
wrongfully distrained or taken, or who
wrongfully detains such goods or
chattels. It is designed to permit one
having right to possession to recover
property in specie from one who has
wrongfully taken or detained the property.
[30]
The term may refer either to the action
itself, for the recovery of personalty, or to
the provisional remedy traditionally
associated with it, by which possession of
the property may be obtained by the
plaintiff and retained during the pendency
of the action.[31]
That the action commenced by
SMART against Astorga in the RTC of
Makati City was one for replevin hardly
admits of doubt.
In reversing the RTC ruling and
consequently dismissing the case for lack
of jurisdiction, the CA made the following
disquisition, viz.:
[I]t is plain to see
that the vehicle was issued
to [Astorga] by [Smart] as
part of the employment
package. We doubt that
9
[SMART] would extend [to
Astorga] the same car plan
privilege were it not for her
employment as district
sales manager of the
company. Furthermore,
there is no civil contract for
a loan between [Astorga]
and [Smart]. Consequently,
We find that the car plan
privilege is a benefit
arising out of employer-
employee
relationship. Thus, the
claim for such falls
squarely within the original
and exclusive jurisdiction
of the labor arbiters and the
NLRC.[32]
We do not agree. Contrary to the
CAs ratiocination, the RTC rightfully
assumed jurisdiction over the suit and
acted well within its discretion in denying
Astorgas motion to dismiss. SMARTs
demand for payment of the market value
of the car or, in the alternative, the
surrender of the car, is not a labor, but a
civil, dispute. It involves the relationship
of debtor and creditor rather than
employee-employer relations.[33] As such,
the dispute falls within the jurisdiction of
the regular courts.
In Basaya, Jr. v. Militante,[34] this
Court, in upholding the jurisdiction of the
RTC over the replevin suit, explained:
Replevin is a possessory
action, the gist of which is
the right of possession in Code. So also with
the plaintiff. The primary petitioners right to
relief sought therein is the picket. But the
return of the property in determination of the
specie wrongfully detained question of who has the
by another person. It is an better right to take
ordinary statutory possession of the Vessel
proceeding to adjudicate and whether petitioners can
rights to the title or deprive the Charterer, as
possession of personal the legal possessor of the
property. The question of Vessel, of that right to
whether or not a party has possess in addressed to the
the right of possession over competence of Civil
the property involved and Courts.
if so, whether or not the
adverse party has In thus ruling, this
wrongfully taken and Court is not sanctioning
detained said property as to split jurisdiction but
require its return to defining avenues of
plaintiff, is outside the pale jurisdiction as laid down by
of competence of a labor pertinent laws.
tribunal and beyond the
field of specialization of
Labor Arbiters. The CA, therefore, committed reversible
xxxx error when it overturned the RTC ruling
and ordered the dismissal of
The labor dispute the replevin case for lack of jurisdiction.
involved is not intertwined
with the issue in the
Replevin Case. The Having resolved that issue, we
respective issues raised in proceed to rule on the validity of Astorgas
each forum can be resolved dismissal.
independently on the other.
In fact in 18 November
1986, the NLRC in the case Astorga was terminated due to
before it had issued an redundancy, which is one of the
Injunctive Writ enjoining
the petitioners from authorized causes for the dismissal of an
blocking the free ingress employee. The nature of redundancy as an
and egress to the Vessel authorized cause for dismissal is
and ordering the petitioners
explained in the leading case of Wiltshire
to disembark and
vacate. That aspect of the File Co., Inc. v. National Labor Relations
controversy is properly Commission,[35] viz:
settled under the Labor

10
 x x x redundancy in an
employers personnel force
necessarily or even
ordinarily refers to
duplication of work. That
no other person was
holding the same position
that private respondent held
prior to termination of his
services does not show that
his position had not
become redundant. Indeed,
in any well organized
business enterprise, it
would be surprising to find
duplication of work and
two (2) or more people
doing the work of one
person. We believe that
redundancy, for purposes
of the Labor Code, exists
where the services of an
employee are in excess of
what is reasonably
demanded by the actual
requirements of the
enterprise. Succinctly put, a
position is redundant where
it is superfluous, and
superfluity of a position or
positions may be the
outcome of a number of
factors, such as overhiring
of workers, decreased
volume of business, or
dropping of a particular
product line or service
activity previously
manufactured or
undertaken by the
enterprise.
The characterization of an employees
services as superfluous or no longer
11
necessary and, therefore, properly
terminable, is an exercise of business
judgment on the part of the employer. The
wisdom and soundness of such
characterization or decision is not subject
to discretionary review provided, of
course, that a violation of law or arbitrary
or malicious action is not shown.[36]
Astorga claims that the termination
of her employment was illegal and tainted
with bad faith. She asserts that the
reorganization was done in order to get rid
of her. But except for her barefaced
allegation, no convincing evidence was
offered to prove it. This Court finds it
extremely difficult to believe that SMART
would enter into a joint venture agreement
with NTT, form SNMI and abolish
CSMG/FSD simply for the sole purpose
of easing out a particular employee, such
as Astorga. Moreover, Astorga never
denied that SMART offered her a
supervisory position in the Customer Care
Department, but she refused the offer
because the position carried a lower salary
rank and rate. If indeed SMART simply
wanted to get rid of her, it would not have
offered her a position in any department in
the enterprise.
Astorga also states that the
justification advanced by SMART is not
true because there was no compelling
economic reason for redundancy. But
contrary to her claim, an employer is not sales force of SMART in
charge of selling SMARTs
precluded from adopting a new policy telecommunications
conducive to a more economical and services to the corporate
effective management even if it is not market. SMART, to ensure
it can respond quickly,
experiencing economic reverses. Neither
efficiently and flexibly to
does the law require that the employer its customers requirement,
should suffer financial losses before he abolished CSMG/FSD and
shortly thereafter assigned
can terminate the services of the employee
its functions to newly-
on the ground of redundancy. [37] created SNMI Multimedia
Incorporated, a joint
We agree with the CA that the venture company of
SMART and NTT of Japan,
organizational realignment introduced by for the reason that
SMART, which culminated in the CSMG/FSD does not have
abolition of CSMG/FSD and termination the necessary technical
expertise required for the
of Astorgas employment was an honest value added services. By
effort to make SMARTs sales and transferring the duties of
marketing departments more efficient and CSMG/FSD to SNMI,
SMART has created a more
competitive. As the CA had taken pains to
competent and specialized
elucidate: organization to perform the
work required for corporate
x x x a careful and accounts. It is also relieved
assiduous review of the SMART of all
records will yield no other administrative costs
conclusion than that the management, time and
reorganization undertaken money-needed in
by SMART is for no maintaining the
purpose other than its CSMG/FSD. The
declared objective as a determination to outsource
labor and cost savings the duties of the
device. Indeed, this Court CSMG/FSD to SNMI was,
finds no fault in SMARTs to Our mind, a sound
decision to outsource the business judgment based
corporate sales market to on relevant criteria and is
SNMI in order to attain therefore a legitimate
greater exercise of management
productivity. [Astorga] prerogative.
belonged to the Sales
Marketing Group under the
Fixed Services Division Indeed, out of our concern for
(CSMG/FSD), a distinct
those lesser circumstanced in life, this

12
Court has inclined towards the worker and
upheld his cause in most of his conflicts
with his employer.This favored treatment
is consonant with the social justice policy
of the Constitution. But while tilting the
scales of justice in favor of workers, the
fundamental law also guarantees the right
of the employer to reasonable returns for
his investment.[38] In this light, we must
acknowledge the prerogative of the
employer to adopt such measures as will
promote greater efficiency, reduce
overhead costs and enhance prospects of
economic gains, albeit always within the
framework of existing laws. Accordingly,
we sustain the reorganization and
redundancy program undertaken by
SMART.
However, as aptly found by the
CA, SMART failed to comply with the
mandated one (1) month notice prior to
termination. The record is clear that
Astorga received the notice of termination
only on March 16, 1998[39] or less than a
month prior to its effectivity on April 3,
1998. Likewise, the Department of Labor
and Employment was notified of the
redundancy program only on March 6,
1998.[40]
Article 283 of the Labor Code
clearly provides:
Art. 283. Closure of
establishment and
13
reduction of personnel. The
employer may also
terminate the employment
of any employee due to the
installation of labor saving
devices, redundancy,
retrenchment to prevent
losses or the closing or
cessation of operation of
the establishment or
undertaking unless the
closing is for the purpose
of circumventing the
provisions of this Title, by
serving a written notice on
the workers and the
Ministry of Labor and
Employment at least one
(1) month before the
intended date thereof x x x.
SMARTs assertion that Astorga
cannot complain of lack of notice because
the organizational realignment was made
known to all the employees as early as
February 1998 fails to persuade. Astorgas
actual knowledge of the reorganization
cannot replace the formal and written
notice required by the law. In the written
notice, the employees are informed of the
specific date of the termination, at least a
month prior to the effectivity of such
termination, to give them sufficient time
to find other suitable employment or to
make whatever arrangements are needed
to cushion the impact of termination. In
this case, notwithstanding Astorgas
knowledge of the reorganization, she
remained uncertain about the status of her
employment until SMART gave her
formal notice of termination. But such
notice was received by Astorga barely two [I]f the dismissal is
based on a just cause under
(2) weeks before the effective date of Article 282 but the
termination, a period very much shorter employer failed to comply
than that required by law. with the notice
requirement, the sanction
to be imposed upon him
Be that as it may, this procedural should be temperedbecause
infirmity would not render the termination the dismissal process was,
in effect, initiated by an act
of Astorgas employment illegal. The
imputable to the employee,
validity of termination can exist and (2) if the dismissal is
independently of the procedural infirmity based on an authorized
of the dismissal.[41] In DAP Corporation v. cause under Article 283 but
the employer failed to
CA,[42] we found the dismissal of the comply with the notice
employees therein valid and for authorized requirement, the sanction
cause even if the employer failed to should be stiffer because
the dismissal process was
comply with the notice requirement under initiated by the employers
Article 283 of the Labor Code. This Court exercise of his
upheld the dismissal, but held the management prerogative.
employer liable for non-compliance with
the procedural requirements.
We deem it proper to increase the amount
of the penalty on SMART to P50,000.00.
The CA, therefore, committed no
reversible error in sustaining Astorgas
As provided in Article 283 of the
dismissal and at the same time, awarding
Labor Code, Astorga is, likewise, entitled
indemnity for violation of Astorga's
to separation pay equivalent to at least one
statutory rights.
(1) month salary or to at least one (1)
months pay for every year of service,
However, we find the need to
whichever is higher. The records show
modify, by increasing, the indemnity
that Astorgas length of service is less than
awarded by the CA to Astorga, as a
a year. She is, therefore, also entitled to
sanction on SMART for non-compliance
separation pay equivalent to one (1)
with the one-month mandatory notice
month pay.
requirement, in light of our ruling in Jaka
Food Processing Corporation v. Pacot,
Finally, we note that Astorga
[43]
viz.:
claimed non-payment of wages

14
from February 15, 1998. This assertion of the Court of Appeals in CA-G.R. SP.
was never rebutted by SMART in the No. 53831 are SET
proceedings a quo. No proof of payment ASIDE. The Regional Trial Court of Mak
was presented by SMART to disprove the ati City, Branch 57 is DIRECTED to
allegation. It is settled that in labor cases, proceed with the trial of Civil Case
the burden of proving payment of No. 98-1936 and render its Decision with
monetary claims rests on the employer. reasonable dispatch.
[44]
SMART failed to discharge the onus
probandi. Accordingly, it must be held On the other hand, the petitions of
liable for Astorgas salary from February SMART and Astorga docketed as G.R.
15, 1998 until the effective date of her Nos. 151079 and 151372
termination, on April 3, 1998. are DENIED. The June 11, 2001 Decision
and the December 18, 2001 Resolution in
However, the award of backwages CA-G.R. SP. No. 57065,
to Astorga by the CA should be deleted for are AFFIRMED with MODIFICATION
lack of basis. Backwages is a relief given . Astorga is declared validly
to an illegally dismissed employee. Thus, dismissed. However, SMART is ordered
before backwages may be granted, there to pay Astorga P50,000.00 as indemnity
must be a finding of unjust or illegal for its non-compliance with procedural
dismissal from work.[45] The Labor Arbiter due process, her separation pay equivalent
ruled that Astorga was illegally to one (1) month pay, and her salary
dismissed. But on appeal, the NLRC from February 15, 1998 until the effective
reversed the Labor Arbiters ruling and date of her termination on April 3, 1998.
categorically declared Astorgas dismissal The award of backwages
valid. This ruling was affirmed by the CA is DELETED for lack of basis.
in its assailed Decision. Since Astorgas
dismissal is for an authorized cause, she is
not entitled to backwages. The CAs award
of backwages is totally inconsistent with
its finding of valid dismissal.

WHEREFORE, the petition of SMART

docketed as G.R. No. 148132
is GRANTED. The February 28, 2000
Decision and the May 7, 2001 Resolution

15
 TERLYNGRACE G.R. No.
165895
RIVERA,
Pe Present:
titi
on YNARES-
er, SANTIAGO,
J.,
Chairperson,
CARPIO,*
CORONA,**
- versus - NACHURA,
and
PERALTA, JJ.

Promulgated:
FLORENCIO L. June 5, 2009
VARGAS,
Re
sp
on
de
nt.

x------------------------------------------------------
------------------------------x

16
 DECISION to petitioners husband, Jan T. Rivera, who
NACHURA, J.: died sometime in late 2002, as caretaker
of respondents construction aggregates
business in Batangas. According to
Vargas, petitioner failed to return the said
equipment after her husbands death
What is the effect of a writ of despite his repeated demands, thus forcing
replevin that has been improperly served? him to resort to court action.[6] The
complaint was accompanied by a prayer
This is the sole issue to be resolved for the issuance of a writ of replevin and
in this petition for review the necessary bond amounting
on certiorari seeking to set aside the to P2,400,000.00.
Decision[1] of the Court of Appeals (CA)
dated November 18, 2003 in CA-G.R. SP Summons[7] dated February 24,
No. 78529, as well as its October 20, 2004 2003 was served upon petitioner through
Resolution,[2] denying the petition her personal secretary on April 28, 2003 at
for certiorari filed by petitioner her residence in Paraaque City.
Terlyngrace Rivera (Rivera). Interestingly, however, the writ of
replevin[8] was served upon and signed by
The facts follow. a certain Joseph Rejumo, the security
guard on duty in petitioners crushing plant
On February 24, 2003, respondent in Sariaya, Quezon on April 29, 2003,
[9]
Florencio Vargas (Vargas) filed a contrary to the sheriffs return[10] stating
complaint[3] against petitioner and several that the writ was served upon Rivera.
John Does before Branch 02 of the
Regional Trial Court (RTC) On May 8, 2003, Rivera filed her
in Tuguegarao City, Cagayan, for the answer, manifestation, and motion for the
recovery of a 150 T/H rock crushing plant acceptance of petitioners redelivery bond.
[11]
located in Sariaya, Quezon. In his In her answer, petitioner countered that
complaint and affidavit,[4] Vargas claims the rock-crushing plant was ceded in favor
ownership of the said equipment, having of her husband as his share following the
purchased and imported the same directly dissolution of the partnership formed
from Hyun Dae Trading Co., between Jan Rivera and respondents wife,
in Seoul, South Korea, in December 1993. Iluminada Vargas (Iluminada), on May 28,
[5]
The equipment was allegedly entrusted 1998, while the partnerships second rock-

17
crushing plant in Cagayan was ceded in
favor of Iluminada.[12] She further averred
that from the time that the partnership was
dissolved sometime in 2000 until Jan
Riveras death in late 2002, it was
petitioners husband who exercised
ownership over the said equipment
without any disturbance from respondent.
[13]
On May 12, 2003, the RTC issued an
Order[14] disapproving petitioners
redelivery bond application for failure to
comply with the requirements under
Sections 5 and 6 of Rule 60 of the Rules
of Court.[15] Without directly saying so, the
RTC faulted petitioner for her failure to
file the application for redelivery bond
within five (5) days from the date of
seizure as provided in the Rules of Court.
Petitioner moved for reconsideration,
[16]
but the same was also denied.[17]
Aggrieved, petitioner elevated the matter
to the CA through a petition
for certiorari under Rule 65. This, too,
was denied for lack of merit.[18] Petitioner
moved for reconsideration,[19] but it was
also denied.[20]
Undaunted, petitioner now comes
to us via this Rule 45 petition.
Petitioner argues that the RTC
committed grave abuse of discretion in
18
denying her counterbond on the ground
that it was filed out of time. She contends
that the mandatory five-day period did not
even begin to run in this case due to the
improper service of the writ of replevin,
contrary to Section 4 of Rule 60.[21]
We find the petition meritorious.
Replevin is one of the most ancient
actions known to law, taking its name
from the object of its process.[22] It
originated in common law as a remedy
against the wrongful exercise of the right
of distress for rent[23] and, according to
some authorities, could only be
maintained in such a case.[24] But by the
weight of authority, the remedy is not and
never was restricted to cases of wrongful
distress in the absence of any statutes
relating to the subject, but is a proper
remedy for any unlawful taking.
[25]
Replevied, used in its technical sense,
means delivered to the owner,[26] while the
words to replevy means to recover
possession by an action of replevin.[27]
Broadly understood in this
jurisdiction, replevin is both a form of
principal remedy and of provisional
relief. It may refer either to the action
itself, i.e., to regain the possession of
personal chattels being wrongfully
detained from the plaintiff by another, or
to the provisional remedy that would
allow the plaintiff to retain the thing
during the pendency of the action and to
hold it pendente lite.[28] The action is
primarily possessory in nature and
generally determines nothing more than
the right of possession.[29]
The law presumes that every possessor is
a possessor in good faith.[30] He is entitled
to be respected and protected in his
possession[31] as if he were the true owner
thereof until a competent court rules
otherwise.[32] Before a final judgment,
property cannot be seized unless by virtue
of some provision of law.[33] The Rules of
Court, under Rule 60, authorizes such
seizure in cases of replevin. However, a
person seeking a remedy in an action for
replevin must follow the course laid down
in the statute, since the remedy is penal in
nature.[34] When no attempt is made to
comply with the provisions of the law
relating to seizure in this kind of action,
the writ or order allowing the seizure is
erroneous and may be set aside on
motion[35] by the adverse party. Be it
noted, however, that a motion to quash the
writ of replevin goes to the technical
regularity of procedure, and not to the
merits of the case[36] in the principal
action.
The process regarding the
execution of the writ of replevin in
Section 4 of Rule 60 is unambiguous: the
19
sheriff, upon receipt of the writ of replevin
and prior to the taking of the property,
must serve a copy thereof to the adverse
party (petitioner, in this case) together
with the application, the affidavit of merit,
and the replevin bond.[37] The reasons are
simple, i.e., to provide proper notice to the
adverse party that his property is being
seized in accordance with the courts order
upon application by the other party, and
ultimately to allow the adverse party to
take the proper remedy consequent
thereto.
Service of the writ upon the
adverse party is mandatory in line with the
constitutional guaranty on procedural due
process and as safeguard against
unreasonable searches and seizures.[38] If
the writ was not served upon the adverse
party but was instead merely handed to a
person who is neither an agent of the
adverse party nor a person authorized to
receive court processes on his behalf, the
service thereof is erroneous and is,
therefore, invalid, running afoul of the
statutory and constitutional requirements.
The service is likewise invalid if the writ
of replevin was served without the
required documents. Under these
circumstances, no right to seize and to
detain the property shall pass, the act of
the sheriff being both unlawful and
unconstitutional.
In the case at bar, petitioner avers that the
writ of replevin was served upon the
security guard where the rock-crushing
plant to be seized was located.[39] The
signature of the receiving party indicates
that the writ was received on April 29,
2003 by a certain Joseph Rejumo, the
guard on duty in a plant in Sariaya,
Quezon, where the property to be seized
was located, and witnessed by Claudio
Palatino, respondents caretaker.[40] The
sheriffs return,[41] however, peremptorily
states that both the writ of replevin and the
summons were served upon Rivera. On
May 8, 2003, or nine (9) days after the
writ was served on the security guard,
petitioner filed an answer to the complaint
accompanied by a prayer for the approval
of her redelivery bond. The RTC,
however, denied the redelivery bond for
having been filed beyond the five-day
mandatory period prescribed in Sections 5
and 6 of Rule 60.[42] But since the writ was
invalidly served, petitioner is correct in
contending that there is no reckoning
point from which the mandatory five-day
period shall commence to run.
The trial court is reminded that not
only should the writ or order of replevin
comply with all the requirements as to
matters of form or contents prescribed by
the Rules of Court.[43] The writ must also
satisfy proper service in order to be valid
and effective: i.e. it should be directed to
20
the officer who is authorized to serve it;
and it should be served upon the person
who not only has the possession or
custody of the property involved but who
is also a party or agent of a party to the
action. Consequently, a trial court is
deemed to have acted without or in excess
of its jurisdiction with respect to the
ancillary action of replevin if it seizes and
detains a personalty on the basis of a writ
that was improperly served, such as what
happened in this case.
At the outset, petitioners proper
remedy should have been to file a motion
to quash the writ of replevin or a motion
to vacate the order of seizure.
Nevertheless, petitioners filing of an
application for a redelivery bond, while
not necessary, did not thereby waive her
right to question the improper service. It
now becomes imperative for the trial court
to restore the parties to their former
positions by returning the seized property
to petitioner and by discharging the
replevin bond filed by respondent. The
trial, with respect to the main action, shall
continue. Respondent may, however, file a
new application for replevin should he
choose to do so.
WHEREFORE, the petition
is GRANTED. The Decision of the Court
of Appeals, as well as its Resolution, in
CA-G.R. SP No. 78529 is hereby SET
ASIDE. The Regional Trial Court is
hereby ordered to restore the parties to
TWIN ACE G.R. No. 160191
their former positions, discharge
respondents replevin bond, and proceed HOLDINGS Present:
CORPORATIO
with the trial of the main action with N, PANGANIBAN, C.J.
Chairperson,
dispatch. Petitioner, YNARES-SANTIAGO,*
AUSTRIA-
MARTINEZ, **

CALLEJO, SR.,
and
- versus - CHICO-
NAZARIO, JJ.

Promulgated:

RUFINA AND June 8, 2006

COMPANY,
Respondent.
x- - - - - - - - - - - - - - - - - - - - - - - - - - - -
- - - - - - - - - - - - - - - - - - - - - - -x

D E C I S I O N

CHICO-NAZARIO, J.:

From the records, it appears that on 3

December 1991, Twin Ace Holdings
Corporation (Twin Ace) filed a
Complaint for recovery of possession of
[1]

personal property, permanent injunction

and damages with prayer for the issuance
of a writ of replevin, temporary
restraining order and a writ of preliminary
injunction against Rufina and Company
(Rufina).
As alleged in the complaint, Twin Ace is a
private domestic corporation engaged in
the manufacture of rhum, wines and liquor

21
under the name and the said writ, Deputy
style Tanduay Distillers. It has registered Sheriff Amado P. Sevilla was able to seize
its mark of ownership of its bottles with a total of 26,241 empty bottles marked
the Bureau of Patent, Trademarks and TANDUAY DISTILLERY, INC., at the [3]

Technology Transfer under Republic Act address of Rufina.

No. 623. In the conduct of its business, it
sells its products to the public excluding In its Answer with counter-application for
the bottles. It makes substantial a Writ of Preliminary
investments in brand new bottles which it Injunction, Rufina claimed that the
buys from glass factories and which they marked bottles it used as containers for its
use for about five times in order to recover products were purchased from junk
the cost of acquisition. Twin Ace thus dealers; hence, it became the owner
retrieves its used empty bottles, washes thereof.
and uses them over and over again as
containers for its products. After hearing, the trial court rendered its
On the other hand, Rufina is engaged in decision dated 20 May 1995 the
the production, extraction, fermentation dispositive portion of which states:
and manufacture of patis and other food
seasonings and is engaged in the buying WHEREFORE,
PREMISES
and selling of all kinds of foods, CONSIDERED, judgment
merchandise and products for domestic is hereby rendered in favor
use or for export to other countries. In of the defendant as follows:
producing patis and other food
a) dismissing the complaint
seasonings, Rufina uses as containers for lack of merit;
bottles owned by Twin Ace without any
b) dissolving the order
authority or permission from the latter. In
of replevin;
the process, Rufina is unduly benefited
from the use of the bottles. c) ordering the plaintiff to
return 26,241 bottles to the
defendant in the place
Upon the posting of Twin Ace of the where the bottles were
required bond, the Regional Trial Court seized at the expense of the
(RTC) of Manila, Branch 26, issued an plaintiff within 48 hours
from receipt hereof;
Order dated 5 February 1992 granting the
application for the issuance of a writ d) ordering the plaintiff to
of replevin. Upon the implementation of
[2] pay the defendant the sum
of P100,000.00 as actual

22
 damages sustained by the respects, the assailed
latter to be taken from decision is AFFIRMED.
the replevin bond;
Costs against plaintiff-
e) ordering the plaintiff to appellant. [6]

pay the defendant the sum

of P1,000,000.00 as
damages for besmirched A motion for reconsideration dated 19
reputation;
October 2002 filed by Twin Ace was
[7]

f) ordering the plaintiff to denied in a resolution of the Court of

pay the sum of P100,00.00 Appeals dated 29 September 2003.
as nominal damages;
Hence, this Petition for Review.
[8]

g) ordering the plaintiff to

pay the defendant the sum For resolution are the following issues:
of P50,000.00 as attorneys
fee; and I.
THE HONORABLE
h) ordering the plaintiff to COURT OF APPEALS
pay the cost of the suit.
[4]

ERRED IN HOLDING
THAT RESPONDENT
RUFINA IS NOT
Twin Ace appealed to the Court of COVERED WITHIN THE
Appeals. On 27 September 2002, the EXEMPTION PROVIDED
BY SECTION 6 OF R.A.
appellate court rendered its
623, AS AMENDED BY
decision modifying the decision of
[5]
the R.A. 5700.
trial court as follows:
II.
WHEREFORE, in view of THE HONORABLE
all the foregoing, the COURT OF APPEALS
appealed decision ERRED IN AWARDING
dated May 20, 1995 of NOMINAL DAMAGES
Branch 26, Regional Trial AGAINST PETITIONER
Court, Manila, in Civil TWIN ACE
Case No. 92-59862 is CONSIDERING THAT IT
MODIFIED, in that the WAS THE ONE WHOSE
award of damages, except RIGHTS HAVE BEEN
nominal damages, and VIOLATED OR
attorneys fees is INVADED BY
DELETED for lack of legal RESPONDENT RUFINA.
and factual basis. The
award of nominal damages III.
is reduced THE HONORABLE
to P50,000.00. In all other COURT OF APPEALS

23
 ERRED IN NOT
FINDING THAT
PETITIONER AS
OWNER OF THE
SUBJECT BOTTLES IS
ENTITLED TO
COMPENSATION FOR
ITS UNAUTHORIZED
USE BY RESPONDENT
RUFINA. [9]
Pertinent provision of Republic Act No.
623, as amended by Republic Act No.
[10]
5700, is quoted hereunder for clarity:
[11]
Sec. 2. It shall be unlawful
for any person, without the
written consent of the
manufacturer, bottler, or
seller, who has successfully
registered the marks of
ownership in accordance
with the provisions of the
next preceding section, to
fill such bottles, boxes,
kegs, barrels, steel
cylinders, tanks, flasks,
accumulators, or other
similar containers so
marked or stamped, for the
purpose of sale, or to sell,
dispose of, buy or traffic in,
or wantonly destroy the
same, whether filled or not
to use the same for
drinking vessels or glasses
or drain pipes, foundation
pipes, for any other
purpose than that registered
by the manufacturer, bottler
or seller. Any violation of
this section shall be
punished by a fine of not
more than one thousand
pesos or imprisonment of
24
not more than one year or
both.
Sec. 3. The use by any
person other than the
registered manufacturer,
bottler or seller, without
written permission of the
latter of any such bottle,
cask, barrel, keg, box, steel
cylinders, tanks, flasks,
accumulators, or other
similar containers, or the
possession thereof without
written permission of the
manufacturer, by any junk
dealer or dealer in casks,
barrels, kegs, boxes, steel
cylinders, tanks, flasks,
accumulators, or other
similar containers, the
same being duly marked or
stamped and registered as
herein provided, shall give
rise to a prima
facie presumption that such
use or possession is
unlawful.[12]
Sec. 4. The criminal action
provided in this Act shall in
no way affect any civil
action to which the
registered manufacturer,
bottler, or seller, may be
entitled by law or contract.
Sec. 5. No action shall be
brought under this Act
against any person to
whom the registered
manufacturer, bottler, or
seller, has transferred by
way of sale, any of the
containers herein referred
to, but the sale of the
 beverage contained in the
said containers shall not
include the sale of the
containers unless
specifically so provided.
Sec. 6. The provisions of
this Act shall not be
interpreted as prohibiting
the use of bottles as
containers
for sisi, bagoong, patis, and
similar native products. [13]
In sum, Twin Ace asserts that the
provision under the law affords protection
only to small scale
producers/manufacturers who do not have
the capacity to buy new bottles for use in
their products and cannot extend
to Rufina which
had unequivocably admitted in
Answer and affirmed in the decision of
[14]
the trial court that it is engaged, on a large
scale basis, in the production and
manufacture of food seasonings.
For its part, Rufina counters that the law
did not really distinguish between large
scale manufacturers and small time
producers.
The petition is not meritorious.
The earlier case of Twin Ace
Holdings Corporation v. Court of
Appeals, applies
[15]
to the present
petition. In said case, Twin Ace filed a
Complaint
for Replevin againstLorenzana Food
Corporation to recover three hundred
eighty thousand bottles allegedly owned
by Twin Ace but detained and used
by Lorenzana Food Corporation as
containers for its native products without
its express permission, in violation of the
law. In that case, this Court acknowledged
that the exemption under the law is
unqualified as the law did not make a
distinction that it only applies to small
scale industries but not to large scale
manufacturers. Thus, even if the court in
said case held that the exemption is
primarily meant to give protection to
small scale industries, it did not qualify
that the protection therein was intended
and limited only to such. The Court held:
its
Petitioner itself
alleges that respondent
LORENZANA uses the
subject 350 ml., 375 ml.
and 750 ml. bottles as
containers for processed
foods and other related
products such
as patis,toyo, bagoong,
vinegar and other food
seasonings. Hence, Sec. 6
squarely applies in private
respondents
favor. Obviously, the
contention of TWIN ACE
that the exemption refers
only to criminal liability
but not to civil liability is
without merit. It is
inconceivable that an act
specifically allowed by
law, in other words legal,
25
can be the subject of
injunctive relief and
damages.Besides, the
interpretation offered by
petitioner defeats the very
purpose for which the
exemption was provided.
Republic Act No.
623, An Act to Regulate the
Use of Duly Stamped or
Marked Bottles, Boxes,
Casks, Kegs, Barrels and
Other Similar Containers,
as amended by RA No.
5700, was meant to protect
the intellectual property
rights of the registrants of
the containers and prevent
unfair trade practices and
fraud on the
public. However, the
exemption granted in Sec.
6 thereof was deemed
extremely necessary to
provide assistance and
incentive to the backyard,
cottage and small-scale
manufacturers of
indigenous native products
such
as patis, sisi and toyo who
do not have the capital to
buy brand new bottles as
containers nor afford to
pass the added cost to the
majority of poor Filipinos
who use the products as
their daily condiments or
viands. If the contention of
petitioner is accepted, i.e.,
to construe the exemption
as to apply to criminal
liability only but not to
civil liability, the very
purpose for which the
26
exemption was granted will
be defeated. None of the
small-scale manufacturers
of the indigenous native
products protected would
possibly wish to use the
registered bottles if they
are vulnerable to civil
suits. The effect is a
virtual elimination of the
clear and unqualified
exemption embodied in
Sec. 6. It is worthy to note
that House Bill No. 20585
was completely rejected
because it sought to
expressly and directly
eliminate that which
petitioner indirectly
proposes to do with this
petition. (Emphasis
[16]
supplied.)
It is worth noting
that Lorenzana Food Corporation which
prevailed in the case filed by Twin Ace
against it is certainly not a small scale
industry. Just like Rufina,Lorenzana Food
Corporation also manufactures and
exports processed foods and other related
products, e.g., patis, toyo, bagoong,
vinegar and other food seasonings.
It is a basic rule in statutory
construction that when the law is clear and
free from any doubt or ambiguity, there is
no room for construction or
interpretation. As has been our consistent
ruling, where the law speaks in clear and
categorical language, there is no occasion
for interpretation; there is only room for
application. [17]
Notably, attempts to amend the
protection afforded by Section 6 of
Republic Act No. 623, by giving
protection only to small scale
manufacturers or those with
capitalization of five hundred thousand
pesos or less (P500,000.00), through then
House Bill No. 20585, and subsequently
[18]
through House Bill No. 30400, proved [19]
unsuccessful as the amendment proposed
in both Bills was never passed.
In view of these considerations, we
find and so hold that the exemption
contained in Section 6 of Rep. Act No.
623 applies to all manufacturers
of sisi, bagoong, patis and similar native
products without distinction
qualification as to whether they are small,
medium or large scale.
On the issue of nominal damages,
Article 2222 of the Civil Code states [20]
that the court may award nominal
damages in every obligation arising from
any source enumerated in Article 1157,
or in every other case where any
[21]
property right has been invaded.
Nominal damages are given in order
[22]
that a right of the plaintiff, which has been
violated or invaded by the defendant, may
be vindicated or recognized, and not for
the purpose of indemnifying the plaintiff
for any loss suffered by him. In another
[23]
case, this Court held that when plaintiff
[24]
suffers some species of injury not enough
to warrant an award of actual damages,
the court may award nominal
damages. Considering the foregoing, we
find that the award of nominal damages
to Rufina in the amount of fifty thousand
a pesos (P50,000.00) is reasonable,
warranted and justified.
As to the third issue, Rule 60,
Section 2(a), of the Revised Rules of
Court mandates that a party praying for
the recovery of possession of personal
property must show by his own affidavit
or that of some other person who
personally knows the facts that he is the
owner of the property claimed,
particularly describing it, or is entitled to
or the possession thereof. It must be borne
[25]
in mind that replevin is
a possessory action the gist of which
focuses on the right of possession that, in
turn, is dependent on a legal basis that, not
infrequently, looks to the ownership of the
object sought to be replevied. Wrongful
[26]
detention by the defendant of the
properties sought in an action
for replevin must be satisfactorily
established. If only a mechanistic
averment thereof is offered, the writ
should not be issued. In this case, Twin
[27]
Ace has not shown that it is entitled to the
possession of the bottles in question and
consequently there is thus no basis for the
27
demand by it of due compensation. As SO ORDERED.
stated by the court in the earlier case
of Twin Ace Holdings Corporation v.
Court of Appeals :
[28]

Petitioner cannot
seek refuge in Sec. 5 of RA
No. 623 to support its
claim of continuing
ownership over the subject
bottles. In United States v.
Manuel [7 Phil. 221
(1906)] we held that since
the purchaser at his
discretion could either
retain or return the bottles,
the transaction must be
regarded as a sale of the
bottles when the purchaser
actually exercised that
discretion and decided not
to return them to the
vendor. We also take
judicial notice of the
standard practice today that
the cost of the container is
included in the selling price
of the product such that the
buyer of liquor or any such
product from any store is
not required to return the
bottle nor is the liquor
placed in a plastic
container that possession of
the bottle is retained by the
store.

WHEREFORE, premises considered, the

instant petition is DENIED for lack of
merit and the decision dated 27 September
2002 and resolution dated 29 September
2003, in CA-G.R. CV No. 52852, both of
the Court of Appeals are Affirmed.

28