Está en la página 1de 17

CALO V.

ROLDAN
FACTS:
Regino Relova and Teodula Bartolome filed a complaint
against Tranquilino Calo and Doroteo San Jose for
conniving with each other, and through the use of
force, stealth, threats, and intimidation, intend to enter
and work or harvest existing fruits may be found in the
lands allegedly owned and possessed by the Relova.
Calo prayed for the issuance of the preliminary
injunction (PI) to be issued ex parte to immediately
restrain, enjoin, and prohibit the defendants and their
agents from entering and interfering with the harvest
of the lands belonging to the plaintiffs.
Relova opposed the PI on the ground that they are
owners of the lands and have been in actual
possession thereof since 1925.
The Judge Roldan denied the petition for the PI on the
ground that Calo were in actual possession of said
lands.
Motion for Reconsideration (MR) was filed but was not
decided by the CFI.
Calo then filed an urgent petition ex-parte praying that
the MR of the order denying their petition for PI be
granted and/or for the appointment of the receiver of
the properties on the ground that:
a) Calo have interest in properties in question and the
fruits were in danger of being lost unless a receiver
is appointed
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
Judge Roldan decided to consider the MR and granted
the appointment of a receiver.
ISSUE:

hearing of the 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.
It appears evident that the respondent judge acted in
excess of his jurisdiction in appointing a receiver.
The litigation or issue raised by Calo 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 cannot ask for
the appointment or receiver of property which he
alleges to belong to him and to be actually in his
possession.
G.R. No. L-63225

ELEAZAR V. ADLAWAN vs.HON. JUDGE


VALERIANO P. TOMOL
Facts:

Eleazar A. Adlawan, a private contractor, was


awarded by the NIA and BPH for the construction of
various infrastructure projects of the government.

Petitioner sought financial assistance and support


from private respondent Aboitiz and Company, Inc.
and for failure to pay the his obligations to Aboitiz
the latter filed a case1 for the collection of a sum of
money and damages including an exparte application for the issuance of a writ of
preliminary attachment against his property.

The Executive Judge without notice and


hearing issued an order directing the
issuance of a writ of preliminary attachment
against all the properties of Adlawan.

Thereafter, the case was raffled to the sala of


Judge Tomol. The writs of preliminary
attachment were issued addressed to the
Sheriffs directing them to attach the real and
personal properties of Adlawan. The
properties of Adlawan were attached on the
strength of writ of preliminary attachment
and given to the custody of Aboitiz.

Judge Tomol issued an order lifting and setting


aside the writ of preliminary attachment and
ordered the return of the property attached and
levied. Thus, petitioner was able to recover some
of his properties

In view of the foregoing, Aboitiz and Company, Inc.


filed an Urgent Ex-Parte Motion, praying for the
stay of the Order dissolving the writ of preliminary
attachment, thus maintaining the status quo.

Consequently, respondent Judge Tomol issued on


the same day an Orders 8granting the motion
prayed for by private respondent Aboitiz and
Company, Inc. Thus, the Order was stayed.

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

WON it is proper for the plaintiffs to apply and be


granted of the preliminary attachment.
HELD:
Calo 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 (PRs) denominated
attachment, preliminary injunction, receivership,
and delivery of personal property, provided in
Rules 59, 60, 61, and 62 of the ROC, 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 by the nature of such action does not require
such protection or preservation, said remedies
cannot be applied for and granted. To each kind
of action, a proper provisional remedy is
provided by law. The Rules of Court clearly
specify the case in which they may be properly
granted.
According to law, the Provisional Remedy proper to
Calos action of injunction is a petition for preliminary
injunction, if Calos 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

April 3, 1990

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

Respondent Judge Tomol issued an


Order terminating the case.

Hence, the present petition


for certiorari and mandamus impleading
respondent Judge Valeriano P. Tomol Judge Ceferino
E. Dulay and private respondent Aboitiz and
Company.

ISSUE: WON the Judge exercise grave abuse of


discretion in setting aside the writ of preliminary
attachment subsequently lifting it and terminating the
case.
Ruling:
We rule in favor of petitioner Adlawan.
There is no question that the order 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 was stayed for a
period of fifteen (15) days on motion of the
plaintiff(Adlawan) 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.
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
The reasons advanced by respondent Judge Tomol for
denying the enforcement of his order 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 in CFILapu-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 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, an
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 trendered 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.
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.

G.R. No. L-45720 December 29, 1937


VENTURA GUZMAN vs. ALFREDO CATOLICO
Facts: 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"
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.

Issue: whether or not the requisites prescribed by law


for the issuance of a writ of preliminary attachment
have been complied with.

Held: No. 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."
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.
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.

1980, which authorized the issuance of a writ of


attachment.
Issue:
WON Attachment was issued correctly
Held:

Spouces Salgado vs CA G.R. No. 55381

No, issuance of the writ of attachment was not

Facts:

proper.

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.

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.

The Bank further prayed for the issuance of a writ of


attachment.
As grounds therefor it alleged that:
1.

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;

2.

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;

3.

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."
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. Then 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."
After due hearing, the trial court issued an
order dated January 31, 1979 granting petitioners
motion and lifting the writ of attachment previously
issued.
The Bank went to the Court of Appeals on a
petition for certiorari to annul the order of the trial
court lifting the writ of attachment.
On motion of the Bank, the respondent Court
reconsidered its decision of November 29, 1979 and
issued the questioned resolution dated September 18,

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.
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.

U.S vs NAMIT
FACTS:
> This is a case of qualified homicide wherein while the
case is pending, an attachment was filed upon the
property of the accused to secure the satisfaction of
the civil liability incident to the commission of the
homicide. 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.
> Court authorized the attachment.
ISSUE:
Whether or not the attachment was proper?
RULING:
NO. 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
the affidavit was in several respects defective.
Disregarding these informalities, however, we are of
the opinion that the remedy of attachment there
provided is not available as an aid 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, declares that the


procedure in all civil actions shall be in accordance with
the provisions of 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 liability can be
made the subject of recovery in a criminal 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 it results that the attachment
effected under the order of the Court must be
considered to have been improvidently granted. The
same is hereby declared to be of no effect, but 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.

FACTS:

a petition to review the decision of CA (now


IAC) which affirmed the order for the issuance
of a writ of preliminary attachment & other
related orders of the trial.

Flores filed for annulment of sale, recovery of


ownership and possession of the house and lot
situated in Diliman, QC, as the administratrix
of the intestate estate of the late William
Gruenberg.

Alleged that:

LUIS F. GENERAL vs. JOSE R. DE VENECIA


Facts:

the house & lot (sold to defendant


Albert Gruenberg) 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
as
manager
&
administrator of the conjugal
partnership;

the sale was before the death of


William Gruenberg, when two
creditors had already filed suits
against him for collection of
unpaid obligations, and the latter
had unpaid obligation to Flores in
the amount of P13k, exclusive of
interest and collection charges,
patently and clearly can no longer
be paid or liquidated.

Complaint was filed by Ruedas against General to


recover the value of a promissory note worth
P4,000.00. It prayed additionally for preliminary
attachment of petitioners property, upon the
allegation that the General was about to dispose of his
assets to defraud creditors. Writ of attachment was
issued upon the filing of a suitable bond.
Petitioner General submitted 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). Motion to dismiss and reconsideration
was denied which prompted the institution of this
special civil action. Petitioner contend that his promise
is to pay the said amount within six months after peace
has been declared and government is established in
the Philippines. Since no competent official has
formally declared the advent of peace, the six month
period has not begun. Hence, he has no duty to make
payment to plaintiffs, independently of the moratorium
directive.

Ps filed their answer to the complaint.

Flores filed a 'Motion for Issuance of Writ of


Preliminary Attachment' against the properties
of Ps, that the latter are indebted to her in the
principal amount of P1k which she seeks to
recover.

Ps opposed the motion for the issuance of writ


of preliminary attachment alleging that this is
an action for annulment of sale and recovery of
the house and lot & not for recovery of sum of
money; that a writ of preliminary attachment
is not the proper remedy for the protection of
the rights of the estate.

Trial court -> a writ of preliminary attachment


against the properties of Ps & served by sheriff
(respondent)

Allegedly the order of respondent Judge was


not received by Ps' new counsel but upon being

Issue:
W/N attachment was valid.
Ruling:
No. 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.
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.
G. R. No. L-45948 September 10, 1985 (Strict
Compliance with the Rules)
MERCEDES GRUENBERG and ALBERT GRUENBERG
vs.
HONORABLE COURT OF APPEALS

informed by Ps of the writ of preliminary


attachment and notice of garnishment,
petitioners' new counsel promptly went to the
trial court & then and there he discovered that
Ps' opposition to the motion was not attached
to the record, because the same was forwarded
to Branch XVIII to which this case was originally
assigned.

Ps filed an MR and motion to recall the writ of


preliminary
attachment
and
notice
of
garnishment, on the ground that it is not true
that Ps did not oppose the motion of Flores,
and that there is no valid basis to grant the
motion

Respondent Judge denied the motions of Ps.

Respondent Judge required Ps to appear before


his court to explain why they should not be
punished for contempt for denying/disobeying
the lawful processes of the court ("show cause"
order).

This prompted the Ps to file a petition for


certiorari w/ writ of preliminary injunction in the
CA.

The petition was dismissed.

Hence, the instant petition

the property for the taking,


detention or conversion of
which the action is brought.
xxx xxx xxx

While the R filed the motion as administratrix


of the Gruenberg estate, the motion for a writ
of attachment & its supporting affidavit show
that the attachment was intended to secure
only her 13k claim against the estate.

Obviously, this cannot be done.

A writ of attachment is a remedy ancillary to


the principal proceeding.

Attachment - a juridical institution which has


for its purpose to secure the outcome of the
trial -> 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).

ISSUE: the proprietary of the writ of attachment and


garnishment against the Ps' properties issued by the
trial court and affirmed by the appellate court.

Purpose was to recover a piece of property


allegedly belonging to the intestate estate
of the deceased.

Hence, must be related to the protection of


the estate.

may not issue if only to protect the


personal
interests
of
the
private
respondent as a creditor of that estate.

HELD: IT WAS NOT PROPERLY ISSUED.

Flores 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:

Flores' remedy to recover the outstanding debt


of the deceased is to follow the procedure in
Rule 86 on claims against an estate. Section 8
of Rule 86 calls for the appointment of a
special administrator to defend the estate
against such claim.

Allowing Flores in the annulment case to attach


the Ps' properties for the benefit of her 13k
claim against the estate would give her an
undue advantage over other creditors against
the estate,

Moreover, 13k claim of Flores cannot be settled


in the case for annulment of the deed of sale,
wherein the writ of attachment is sought. What

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

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.

Following the principle of strict compliance with


all requisites, this Court 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).

Flores states that the "defendants are


indebted to plaintiff in the amount of
P13,000.00" exclusive of interests and
collection charges.

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 Ps'
failed to file an opposition thereto.
-

Ps filed a timely opposition to the motion


but in another branch where this case had
earlier been assigned. Despite this timely
opposition, the MR of the order for the
issuance of
a writ of
preliminary
attachment, was summarily denied for lack
of merit.

The absence of specific grounds highlights that


Ps are not indebted to Flores.
-

It was the late William Gruenberg who


incurred the alleged indebtedness & 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


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 Ps' interests in the Hollywood
Theatre, the Palace Theatre & the Illusion
Theatre. 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.

So the Court found the writ of preliminary


attachment to have been improvidently issued.

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 are DISSOLVED. The
other related orders issued in connection with
the writ of attachment are SET ASIDE.

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.

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).

Then, she avers that the "defendants are


guilty of fraud in contracting the debt or
incurring the obligation due plaintiff ".

Then order-> issuance of a writ of preliminary


attachment => merely recited the grounds
alleged in Flores motion w/o any specific
details as to the supposed fraud committed by
the Ps when they contracted the debt & the
alleged disposition/concealment by the Ps of
their properties.

The motion for issuance of a writ of preliminary


attachment & the affidavit of preliminary
attachment are misleading.
-

ROGELIO DY, SY JIAN AND DY CHING


ENG, Petitioners, v. THE HONORABLE JUDGE
MANUEL LOPEZ ENAGE AND HEIRS OF EMMANUEL
O. TOLENTINO, represented by MARIA DUGOS

VDA. DE TOLENTINO,Respondents.

Facts:
Petitioners filed before the court a quo against
respondents predecessor-in-interest an action for
collection of sum of money, annulment of supposed
contract of agency, and damages. Pleadings were filed
and trial was conducted but before the defendant
therein had completed the formal presentation of his
evidence in support of his counterclaim, he died. After
the proper substitution of parties, Respondents,
through counsel, filed a "Jurisdictional Motion for
Dismissal of Plaintiffs Complaint" asking that
notwithstanding the dismissal of the complaint prayed
for, the court proceed with the trial and final
disposition of the counterclaims. The motion was based
on the ground that inasmuch as plaintiffs case was a
claim for money, under Section 21 of Rule 3 of the
Rules of Court, it should be dismissed as an action and
filed as claim in the special proceedings for the
settlement of the estate of the deceased defendant.
Petitioners opposed the motion contending that the
second cause of action was for damages and that their
defense to the counterclaims of the defendant was in
their complaint. Respondent judge denied the motion
to dismiss and proceed with the trial.
Thereafter, petitioners withdrew their opposition to the
Jurisdictional Motion and manifested that they no
longer will present rebuttal evidence, reserving the
same to be adduced instead in the proper probate
court. Respondents filed their Counter-Manifestation
and Opposition to petitioners motion and reiterated
their prayer to have the complaint against them
dismissed to declare the case, as far as their
counterclaim is concerned, submitted for decision. Both
motions were denied.
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. Vicente Jayme for the
respondents, after their proper substitution as heirs 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 counterclaims. The motion was based
on the ground that inasmuch as the plaintiffs case was
a claim for money, under Section 21 of Rule 3, it should
be dismissed as an action and filed as a claim in the
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 their complaint
and citing the case of Javier v. Araneta, L-4369, August
31, 1953, in support of their opposition. On January 5,
1972, respondent judge denied the motion to dismiss.
Issue:
-------- respondent judge violate the Rule of court in
refusing to dismiss petitioners complaint contend
constitutes a money claim?

of the estate of respondents deceased predecessor


and ordered it to proceed with the trial of respondents
their evidence in defense thereto, after which another
decision should be rendered as the facts and the law
may warrant.
The principal ground of the petition is the alleged
violation by respondent court of Section 21 of Rule 3 of
the Rules of Court in refusing to dismiss petitioners
complaint, which they contend constitutes a money
claim, notwithstanding the death of the defendant,
private respondents predecessor in interest, before
final judgment could be rendered. While respondents
do not seem to seriously deny the basis of petitioners
gripe, they maintain that inasmuch as petitioners had
apparently abided with the earlier adverse ruling of the
court by taking part in the trial which, in fact, is almost
through except for the presentation of the "rebuttal"
evidence of petitioners, the latter are in estoppel to
question the action of the court. Moreover, it is
respondents position that since they have alleged
counterclaims in their answer and have actually
completed proving the same, it would be against the
rules to dismiss the subject complaint.
It results, therefore, that as of the 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.

ROMAN MABANAG vs JOSEPH M. GALLEMORE


Facts:
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 Mabanag to
Gallemore for two parcels of land whose sale was
afterward annulled. Gallemore 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 Mabanag, 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.
Issue:
Whether or Not the court has jurisdiction to try and
hear the case?

Ruling:
The Supreme Court ruled that respondent court
deviated from the course laid down by the provisions of
the Rules when it refused to dismissed petitioners
complaint insofar as their first cause of action was
concerned. It enjoined the same to dismiss the subject
case before it without prejudice to its being filed as
money claim in special proceedings for the settlement

Ruling:
Yes, 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.
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.
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, vs. COURT OF APPEALS
FACTS:

On August 20, 1990, petitioner Ricardo Cuartero


filed a complaint before the Regional Trial Court of
Quezon City against the private respondents,
Evangelista spouses, for a sum of money plus
damages with a prayer for the issuance of a writ of
preliminary attachment.

On 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.

Thereafter, on the following day, a copy of the writ


of preliminary attachment, the order granting the
writ, and the summons and the complaint were all
simultaneously served upon the private
respondents at their residence. The 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.

Subsequently, the spouses Evangelista filed motion


to set aside the order granting the writ and to
discharge the writ of preliminary attachment for
having been irregularly and improperly issued.

The lower court denied the motion for lack of merit.

The respondents, Sps Evangelista filed a special


action for certiorari with the Court of Appeals
questioning the order of writ of preliminary
attachment with restraining order or writ of
preliminary injunction.

CAs finding is grounded that the trial court did not


acquire any jurisdiction over the person of the
defendants, that the trial court have no jurisdiction
to proceed in the main case as the ancillary
remedy of attachment.

CA relied in the case of Sievert vs. CA that valid


service of summons and a copy of the complaint
vest jurisdiction in the court over the defendant.

ISSUE: WON the granting of writ of preliminary


attachment, and the issuance of the writ proper.
RULING:
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-parte against 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 exparte 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.
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.
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 vs. HON.
MIDPANTAO L. ADIL
Facts: On September 10, 1976, respondents Rosita
Bedro and Benita Yu filed the afore-mentioned civil
action with the Court of First Instance of Iloilo against
herein petitioners Ricardo T. Salas and Maria Salas, the
Philippine Commercial & Industrial Bank, in its capacity
as Administrator of the Testate Estate of the deceased
Charles Newton Hodges, and Avelina A. Magno, in her
capacity as Administratrix of the Testate Estate of the
deceased Linnie Jane Hodge to annul the deed of sale
of Lot No. 5 executed by administrators of the Hodges
Estate in favor of the Spouses Ricardo T. Salas and
Maria Salas and for damages. 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 due to the
stoppage in the construction of their commercial
buildings on Lot No. 3.
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.

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.
Respondent Judge issued ex-parte a Writ of Attachment
"against the properties of the defendants

Issue: WON respondent Judge gravely abused his


discretion in issuing the said Writ of Attachment

Held: 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.
Considering that petitioners have not availed of this
remedy, the instant petition is premature.

or refused to turn over the amounts so collected to


JARDINE.
Likewise contained in said complaint is
petitioner's application for a writ of preliminary
attachment against private respondents. 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.
Defendants filed a motion to set aside the writ
of preliminary 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.
JARDINE opposed the motion arguing that the
mental reservation of defendants at the time of the
execution of the deeds of assignment constituted
fraud;
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.
On August 29, 1980, the Court of Appeals
annulled the assailed writ of attachment for having
been issued improperly and irregularly

Issue:
We deem it necessary, however, for the guidance of respondent Court and of the parties, to stress
non-compliance
with
the
formal
herein the nature of attachment as an extraordinary provisional remedy.WON
requirements
invalidate
the
writ
of
attachment.
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
Held: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
be null
The shall
general
ruleand
is void
that . the affidavit is the
And in Garcia v. Reyes, 3 considering the allegation that the debtors
foundation
were
of removing
the writ, and
or disposing
if none be
of filed or one be
some of their properties with intent to defraud their creditors,
filed
'this
which
Courtwholly
said that
fails "(a)ll
to setinout
all some
due facts required
process would seem to require that both parties further ventilate
by lawtheir
to be
respective
stated therein,
contentions
there isinno
a jurisdiction and
hearing that could indeed reveal the truth. Fairness would be the
served
proceedings
thereby, the
aredemand
null and
of void.
reasonThus, while not
satisfied."
unmindful of the fact that the property seized under
Considering the gravity of the allegation that herein petitioners
the have
writ and
removed
brought
or into
disposed
court is
of what
theirthe court finally
properties or are about to do so with intent to defraud their creditors,
exercises
andjurisdiction
further considering
over, the that
court
the
cannot subscribe
affidavit in support of the pre attachment merely states such ground
to thein general
proposition
terms,
that
without
the specific
steps pointed out by
allegations of lances to show the reason why plaintiffs believestatutes
that defendants
to obtainare
such
disposing
writ are of
inconsequential,
their
and in
properties in fraud of creditors, it was incumbent upon respondent
no sense
Judge
jurisdictional.
to give notice to petitioners
and to allow wherein evidence is them to present their position at a to be received. Moreover, it
Since damages,
the attachment
is moral
a harsh and rigorous
appears from the records that private respondents are claiming unliquidated
including
remedy
which
exposes
the
debtor
to humiliation and
damages, from petitioners. The authorities agree that the writ of attachment is not available 'm a suit
annoyance,
the
rule
authorizing
its
issuance must be
for damages where the amount claimed is contingent or unliquidated.
strictly construed in favor of defendant. It is the duty of
the court before issuing the writ to ensure that all the
Jardine Manila Finance vs CA G.R. No. 55272
requisites of the law have been complied with.
Otherwise, a judge acquires no jurisdiction to issue the
Facts:
writ.
Petitioner Jardine-Manila Finance, Inc. (JARDINE)
filed a complaint in the then Court of First Instance
(CFI) of Rizal, 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.

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.

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; but despite the fact that IMPACT had
collected the amounts due on said receivables, it failed

LA GRANJA, INC. vs SAMSON


FACTS:
> Petitioner La Granja, Inc., filed a complaint in the
Court of First Instance against Chua Bian, Chua Yu Lee

and Chua Ki, for the recovery of the sum of money with
interest thereon at the rate of 12 per cent per annum.
> The plaintiff also prayed for the issuance of an order
of attachment against the aforementioned defendants'
property.
> La Granja, Inc., wherein it was alleged 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 but petitioner refused to
comply the respondent judge dismissed said petition
for an order of attachment.
ISSUE:
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?
RULING:
NO.
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.
ROMAN MABANAG, plaintiff-appellant, vs.
JOSEPH M. GALLEMORE, defendant-appellee.

Facts:
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 Mabanag to
Gallemore for two parcels of land whose sale was
afterward annulled. Gallemore 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 Mabanag, 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.
Issue:
Whether or Not the court has jurisdiction to try and
hear the case?
Ruling:
Yes, 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.
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.
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.
EL BANCO ESPAOL-FILIPINO vs. VICENTE
PALANCA
Facts:
Engracio Palanca entered a contract of loan with El
Banco Espanol-Filipino. Contract of mortgage was also

executed covering various parcels of land located in


the city of Manila which serves as a security for the
loan. After execution of the instrument by the
mortgagor, he returned to China which appears to have
been his native country, and he there died without
again returning to the Philippines. For failure to pay the
amount loaned, petitioner El Banco instituted an action
to foreclose the mortgage property.
As the defendant was a nonresident at the time of the
institution of the present action 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,
the city of Amoy, in the Empire of China.
As defendant not having appeared, judgment was
taken against him by default. A decision was rendered
in favor of the plaintiff. The court ordered that the
defendant should 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 was never made; and the court ordered the
sale of the property. The property was bought in by the
bank in a much lesser price.
About seven years after the confirmation of this sale, 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 and the judgment rendered, 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.
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.
Issue:
W/N the court acquired the jurisdiction to proceed with
the foreclosure of the mortgage.
Ruling:
YES. Palanca is a non-resident and having refused to
appear in court voluntarily, the court never acquired
jurisdiction over him. This is, however, not essential
since the foreclosed of mortgage is an action quasi in
rem and what is essential is the courts jurisdiction
over the res.
Jurisdiction over the property is based on the following:
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 the proper stage of the


proceedings takes the property into custody if
necessary, and it exposed it to sale for the purpose of
satisfying the mortgage debt.
And since jurisdiction is exclusively over the property,
the relief granted by the court must be limited only to
that which can be enforced against the property itself.
Therefore, whatever maybe the effect in other respects
of the failure of the clerk of court to mail the proper
papers to the defendant in Amoy, China, such
irregularity could impair or defeat the jurisdiction of the
court.
Adlawan vs. Judge Torres, Aboitiz

Facts: Petitioner Adlawan was indebted to Respondent


company Aboitiz for construction projects the former
was awarded with. However, due to inability to pay,
Aboitiz filed for collection of sum of money against
petitioner in the CFI of Cebu. It also moved for
preliminary attachment on some of Adlawans
properties after filing a bond. Aboitiz filed a notice of
dismissal for the above mention case. When Adlawan
moved for the enforcement of the dismissal, it was
denied by the court on account of the filing by
respondent Aboitiz an action or delivery of personal
property before the CFI of Lapu-Lapu and petitioner
Adlawans filing for damages in the same court for the
seizure of his property by virtue of the preliminary
attachment. Respondent Aboitiz alleged that the
voluntary dismissal of the previous case was without
prejudice to the institution of another action based on
the same subject matter and that the issuance of the
writ was justified because the petitioners were
intending to defraud Aboitiz by mortgaging 11 parcels
of land to PCIB thereby making PCIB a preferred
creditor to the prejudice of Aboitiz.

Issue:
Was the writ of attachment legal or valid?

Held:
Negative. The affidavit submitted by Aboitiz in support
of its prayer for the writ of attachment does NOT meet
the requirements of Rule 57 of the Rules of Court
regarding allegations on impending fraudulent
removal, concealment and disposition of defendants
property. To justify a preliminary attachment, the
removal or disposal must have been made withintent
to defraud defendants creditors.The factual basis must
be alleged in the affidavit in support of the prayer for
the writ of attachment if not so specifically alleged in
the verified complaint. (See full text for the copy of the
affidavit)The Supreme Court has found that there is no
factual allegation which may constitute as a valid basis
for the contention that the mortgage was in fraud of
Aboitiz. 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.By mortgaging a piece of property, a debtor
merely subjects it to a lien but ownership thereof is not
parted with.The Inability to pay ones creditors is no
necessarily synonymous with fraudulent intent not to
honor an obligation.

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.
Facts:
Petitioner Consolidated Bank and Trust Corporation
(SOLIDBANK) loaned private respondent NICOS
Industrial Corporation (NICOS) sums of money.
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 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. T-210581 (T-32.505 M) and Transfer Certificate of
Title No. T-10580 (T-32.504 M) (Annexes "B", "B-1", "B2" and "B-3" of petition).
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, 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).
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.
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.
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.
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.
The Malolos Court issued an order denying the omnibus
motion.
The Intermediate Appellate Court rendered its assailed
decision "finding no merit in this appeal and affirming
in toto the appealed ruling that "the properties in
issue ... were not in custodia legis at the time of the
extrajudicial foreclosure."
Issue:
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?
Ruling:
Yes, Based on the foregoing evidence on record, the
conclusion is clear that the disputed real properties
were under custodia 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
consequences.

conclusion

has

two

necessary

Firstly, it follows that the writ of possession issued by


the Malolos court in favor of respondent GOLDEN STAR
is null 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).
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.

CLAUDE NEON LIGHTS, FEDERAL INC., U. S. A., vs.


PHILIPPINE ADVERTISING CORPORATION and
FRANCISCO SANTAMARIA, Judge of First Instance
of Manila,

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 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.

Claude Neon filed a petition for certiorari and


prays for annulment of the writ of attachment
as well as the appointment of receiver.

ISSUE: WON the issuance of writ of preliminary


attachment and the appointment of a receiver valid.

RULING:
FACTS:

On April 5, 1932, the respondent Philippine


Advertising Corporation filed suit against the
petitioner in the Court of Manila, claiming
damages for alleged breach of the agency
contract existing between the said respondent
and the petitioner. At the same time, said
respondent filed an application for writ of
attachment stating that Claude Neon Lights is
a foreign corporation having its principal place
of business in the City of Washington, District
of Columbia. It is not alleged in said application
that Claude 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 Claude Neon 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 filed in the court, supported
by affidavits of the attorney in fact in which it is
recited, that Claude Neon is not indebted to the
Phil Advertising in any sum whatever nor has it
in any way breached any contracts and 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.

No. Claude Neon Lights 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 issued. It was actively engaged in doing business
in the Philippine Islands and had considerable property,
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 Claude Neon, 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.
The question arises whether Claude Neon , a foreign
corporation, shall, be deemed as "not residing in the
Philippine Islands" in the sense in which that
expression would apply to a natural person.
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.
Our laws and jurisprudence indicate a purpose to
assimilate foreign corporations, duly licensed to do
business here, to the status of domestic corporations.
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.
A particularly monstrous result has followed as a
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".
Yes. 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.
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.
Facts: 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."

Held: NO. 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 nonpayment 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.
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.
PNB V. PABALAN

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".

FACTS:
Judge Javier Pabalan rendered a Decision against
Philippine

Virginia

Tobacco

Administration

(PVTA).

Consequently, a writ of execution and a notice of


garnishment on the funds of Philippine Virginia Tobacco
Administration (PVTA) deposited with the Philippine
National Bank in La Union was issued. PNB, however,

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."

filed a petition for certiorari and prohibition against


Judge Pabalan, invoking the doctrine of non-suability of
a state, it being alleged that such funds are public in
character.

A motion for reconsideration was filed by the defendant


bus company but the lower court denied it.
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.

Issue: 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.

ISSUE:
WON

the

funds

of

PVTA

deposited

with

the

PNB exempt from garnishment


HELD:
No. 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. If the funds

appertained to one of the regular departments or

garnishment. The government has entered with them

offices

such

into a commercial business hence it has abandoned its

provision would be a bar to garnishment. But funds of

sovereign capacity and has stepped down to the level

public corporations which can sue and be sued are

of a corporation. Therefore, it is subject to rules

not exempt from garnishment. As PVTA is likewise a

governing ordinary corporations and in effect can be

public corporation possessed of the same attributes, its

sued. Therefore, the petition of PNB La Union is denied.

in

the

government,

then,

certainly,

funds that are deposited with PNB are not exempt from