digest in rule 57

8/12/2019 Digest in rule 57

1/37

Facts:

Calo vs Roldan

According to the complaint fled in the said case No. 7951, the plaintis action is one o!

ordinar" in#$nction, !or the plaintis allege that the" are the o%ners o! the lands therein

descri&ed, and %ere in act$al possession thereo!, and that 'the de!endants %itho$t an" legal

right %hatever and in connivance %ith each other, thro$gh the $se o! !orce, stealth, threat

and intimidation, intend or are intending to enter and %or( or harvest %hatever e)isting

!r$its ma" &e !o$nd in the lands a&ove mentioned in violation o! plaintis proprietar" rights

thereto*' and pra"s 'that the de!endants, their agents, servants, representatives, and other

persons acting !or or in their &ehal!, &e restrained, en#oined and prohi&ited !rom entering in,

inter!ering %ith, or in an" %a" ta(ing an" participation in the harvest o! the lands a&ove

descri&ed &elonging to the plaintis.'

+ss$e:

he -$estion to &e determined in the present special civil action o! certiorari is, %hether or

not the respondent #$dge acted in e)cess o! his #$risdiction or %ith grave a&$se o! discretion

in iss$ing the order appointing a receiver in the case No. 7951 o! the Co$rt o! First +nstance

o! ag$na

R$ling:

he provisional remedies denominated attachment, preliminar" in#$nction, receivership, and

deliver" o! personal propert", provided in R$les 59, /0, /1 and / o! the R$les o! Co$rt,

respectivel", are remedies to %hich parties litigant ma" resort !or the preservation or

protection o! their rights or interests, and !or no other p$rpose, d$ring the pendenc" o! the

principal action. +! an action, &" its nat$re, does not re-$ire s$ch protection or preservation,

said remedies can not &e applied !or and granted. o each (ind o! action or actions a proper

provisional remed" is provided !or &" la%. he R$les o! Co$rt clearl" speci!" the cases in

%hich the" ma" &e properl" granted.

Attachment ma" &e iss$ed onl" in the cases or actions specifcall" stated in section 1, R$le

59, in order that the de!endant ma" not dispose o! his propert" attached, and th$s sec$re

the satis!action o! an" #$dgment that ma" &e recovered &" plainti !rom de!endant. For that

reason a propert" s$ect o! litigation &et%een the parties, or claimed &" plainti as his, can

not &e attached $pon motion o! the same plainti.


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he special remed" o! preliminar" prohi&itor" in#$nction, that is, %hen the relie! demanded

in the plaintis complaint consists in restraining the commission or contin$ance o! the act

complained o!, either perpet$all" or !or a limited period, and the other conditions re-$ired

&" section 2 o! R$le /0 are present. he p$rpose o! this provisions remed" is to preserve the

stat$s -$o o! the things s$ect o! the action d$ring the pendenc" o! the s$it. 3eca$se,

other%ise or i! no preliminar" prohi&itor" in#$nction %ere iss$ed, the de!endant ma", &e!ore

fnal #$dgment, do or contin$e the doing o! the act %hich the plainti as(s the co$rt to

restrain, and th$s ma(e ineect$al the fnal #$dgment rendered a!ter%ards granting the

relie! so$ght &" the plainti. 3$t, as this co$rt has repeatedl" held, a %rit o! preliminar"

in#$nction sho$ld not &e granted to ta(e the propert" o$t o! the possession o! one part" to

place it in the hands o! another %hose title has not &een clearl" esta&lished.

A receiver ma" &e appointed to ta(e charge o! personal or real propert" %hich is the s$ect

o! an ordinar" civil action, %hen it appears that the part" appl"ing !or the appointment o! a

receiver has an interest in the propert" or !$nd %hich is the s$ect o! the action or

litigation, and that s$ch propert" or !$nd is in danger o! &eing lost, removed or materiall"

in#$red $nless a receiver is appointed to g$ard or preserve it 4section 1&6, R$le /1* or %hen

it appears that the appointment o! a receiver is the most convenient and !easi&le means o!preserving, administering or disposing o! the propert" in litigation 4section 1e6 o! said R$le.

he propert" or !$nd m$st, there!ore, &e in litigation according to the allegations o! the

complaint, and the oect o! appointing a receiver is to sec$re and preserve the propert" or

thing in controvers" pending the litigation. 8! co$rse, i! it is not in litigation and is in the

act$al possession o! the plainti, the latter can not appl" !or and o&tain the appointment o!

a receiver thereo!, !or there %o$ld &e no reason !or s$ch appointment.

eliver" o! personal propert" as a provisional remed" consists in the deliver, &" order o! the

co$rt, o! a personal propert" &" the de!endant to the plainti, %ho shall give a &ond to

ass$re the ret$rn thereo! or the pa"ment o! damages to the de!endant i! the plaintis action

to recover possession o! the same propert" !ails, in order to protect the plaintis right o!

possession o! said propert", or prevent the de!endant !rom damaging, destro"ing ordisposing o! the same d$ring the pendenc" o! the s$it.

ndo$&tedl", according to la%, the provisional remed" proper to plaintis action o!

in#$nction is a preliminar" prohi&itor" in#$nction, i! plaintis theor", as set !orth in the

complaint, that he is the o%ner and in act$al possession o! the premises is correct. 3$t as

the lo%er co$rt !o$nd at the hearing o! the said petition !or preliminar" in#$nction that the

de!endants %ere in possession o! the lands, the lo%er co$rt acted in accordance %ith la% in

den"ing the petition, altho$gh in their motion !or reconsideration, %hich %as still pending at

the time the petition in the present case %as heard in this co$rt, plaintis insist that the" are

in act$al possession o! the lands and, there!ore, o! the !r$its thereo!.

From the !oregoing it appears evident that the respondent #$dge acted in e)cess o! his#$risdiction in appointing a receiver in case No. 7951 o! the Co$rt o! First +nstance o! ag$na.

Appointment o! a receiver is not proper or does not lie in an action o! in#$nction s$ch as the

one fled &" the plainti.

im vs ;po$ses a


3/37

Facts:

8n A$g$st , 005, im, =r. fled a complaint 5 !or s$m o! mone" %ith pra"er !or the

iss$ance o! a %rit o! preliminar" attachment &e!ore the RC, see(ing to recover !rom

respondents>spo$ses ito ;. a


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3or#a vs ?laton

Facts

8n A$g$st 1, 192/, petitioner &ro$ght a civil action in the Co$rt o! First +nstance o! Ri


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RCG in !avor or ?R8+

CAG

CA decision n$llifed: +

a. the 8rder dated =$l" 1/, 001 o! the Regional rial Co$rt 4RC, ?asig Cit", in Civil CaseNo. /E57, directing the attachmentgarnishment o! the properties o! respondent echnical

Bd$cation and ;(ills evelopment A$thorit" 4B;A amo$nting to hirt" Five Dillion ?esos

4?25,000,000.00* and

&. the RCs A$g$st , 001 8rder 5 den"ing respondent B;As motion to

discharge-$ash %rit o! attachment.

+ss$e:

%hether or not the %rit o! attachment against B;A and its !$nds, to cover ?R8+s claim

against B;A, is valid. he iss$e involves a p$re -$estion o! la% and re-$ires $s todetermine %hether the CA %as correct in r$ling that the RC gravel" a&$sed its discretion in

iss$ing a %rit o! attachment against B;A.

R$ling:

No%, the !act that a non>corporate government entit" per!orms a !$nction proprietar" in

nat$re does not necessaril" res$lt in its &eing s$a&le. +! said non>governmental !$nction is

$nderta(en as an incident to its governmental !$nction, there is no %aiver there&" o! the

sovereign imm$nit" !rom s$it e)tended to s$ch government entit".

B;As !$nds are p$&lic in character, hence e)empt !rom attachment or garnishment.

Bven ass$ming that B;A entered into a proprietar" contract %ith ?R8+ and there&" gave

its implied consent to &e s$ed, B;As !$nds are still p$&lic in nat$re and, th$s, cannot &e

the valid s$ect o! a %rit o! garnishment or attachment.

is&$rsements o! p$&lic !$nds m$st &e covered &" the corresponding appropriation as

re-$ired &" la%. he !$nctions and p$&lic services rendered &" the ;tate cannot &e allo%ed

to &e paral"


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%hich the action is &ro$ght, ;ection 1 4d o! R$le 57 a$thori


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he evidence sho%s that the de!endant>appellant %as president>treas$rer and general

manager o! the plainti>appellee corporation and e)ercised direct and almost e)cl$sive

s$pervision over its !$nction,

8lsen vs . he cond$ct o! the de!endant>appellant in connection %ith the !$nds o! thecorporation he represented %as more than an irreg$larit"* and %hile it is not s$Mcientl"

serio$s to constit$te a criminal !ra$d, it is $ndo$&tedl" a !ra$d o! a civil character, &eca$se

it is an a&$se o! confdence to the damage o! the corporation and its stoc(holders, and

constit$tes one o! the gro$nds en$merated in section , in connection %ith section 1, o!

the Code o! Civil ?roced$re !or the iss$ance o! a preliminar" attachment, 8lsen

Facts

his is an appeal ta(en &" the de!endant !rom a #$dgment o! the Co$rt o! First +nstance o!

Danila, sentencing him to pa" plainti corporation the s$m o! ?//,07./ %ith legal interest

As gro$nd o! his appeal, the de!endant assigns !o$r errors as committed &" the trial co$rt, to

%it: 41 he holding that the de!endant>appellant contracted !ra$d$lentl" the de&t %hich the

plainti>appellee see(s to recover in its complaint* 4 its !ail$re to set aside the %rit o!

preliminar" attachment iss$ed &" it e) parte

+ss$e:

he frst -$estion that arises is %hether or not an order den"ing a motion !or the ann$lment

o! a preliminar" attachment ma" &e revie%ed thro$gh an appeal.

R$ling:

he preliminar" attachment is an a$)iliar" remed" the granting o! %hich lies %ithin the

so$nd discretion o! the #$dge ta(ing cogni


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he !act that section 1 o! the Code o! Civil ?roced$re does not provide an" remed" against

the granting or denial o! a motion !or the ann$lment o! a %rit o! preliminar" attachment,

e)cept in case o! e)cess o! #$risdiction, does not con!er $pon said order a fnal and

irrevoca&le character, ta(ing it o$t !rom the general provisions as to appeal and revie%, !or a

special provision is necessar" !or that p$rpose.

he cond$ct o! the de!endant>appellant in connection %ith the !$nds o! the corporation herepresented %as more than an irreg$larit"* and %hile it is not s$Mcientl" serio$s to

constit$te a criminal !ra$d, it is $ndo$&tedl" a !ra$d o! a civil character, &eca$se it is an

a&$se o! confdence to the damage o! the corporation and its stoc(holders, and constit$tes

one o! the gro$nds en$merated in section , in connection %ith section 1, o! the Code

o! Civil ?roced$re !or the iss$ance o! a preliminar" attachment, and the order o! the Co$rt o!

First +nstance o! Danila, den"ing the motion !or the ann$lment o! the in#$nction in -$estion,

is in accordance %ith la%.

Ng Iee vs an(iansee

Facts:

The facts are undisputed. Petitioner Alejandro Ng Wee, a valued client of Westmont Bank (now nited

!verseas Bank", made several mone# placements totaling P$%&,'',%.)$ with the *ank+s affiliate,

Westmont nvestment -orporation (Wincorp", a domestic entit# engaged in the *usiness of an investment

house with the authorit# and license to etend credit./

0inding that 1irata purportedl# used Power 2erge as a conduit and connived with Wincorp+s officers and

directors to fraudulentl# o*tain for his *enefit without an# intention of pa#ing the said placements,

petitioner instituted, on !cto*er %, $&&&, -ivil -ase No. &&3&&) for damages with the 4egional Trial-ourt (4T-" of 2anila.) !ne of the defendants impleaded in the complaint is herein respondent 2anuel

Tankiansee, 1ice3-hairman and 5irector of Wincorp.6

!cto*er $), $&&&, on the *asis of the allegations in the complaint and the !cto*er %$, $&&& Affidavit7 of

petitioner, the trial court ordered the issuance of a writ of preliminar# attachment against the properties

not eempt from eecution of all the defendants in the civil case su*ject, among others, to petitioner+s

filing of a P'&23*ond. The writ was, conse8uentl#, issued on Novem*er ), $&&&.%&

!n 9eptem*er /&, $&&:, respondent filed *efore the trial court another 2otion to 5ischarge

Attachment,$& re3pleading the grounds he raised in his first motion *ut raising the following additional

grounds; (%" that he was not present in Wincorp+s *oard meetings approving the 8uestiona*le

transactions


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4uling that the grounds raised were alread# passed upon *# it in the previous orders affirmed *# the -A

and this -ourt, and that the additional grounds were respondent+s affirmative defenses that properl#

pertained to the merits of the case, the trial court denied the motion in its >anuar# ), $&&' !rder.$/

4T-? denied

-A? lifted the writ

With the denial of its motion for reconsideration,$: respondent filed a certiorari petition *efore the -A

docketed as [email protected]. 9P No. &%/&. !n 9eptem*er %:, $&&', the appellate court rendered the assailed

5ecision$' reversing and setting aside the aforementioned orders of the trial court and lifting the

Novem*er ), $&&& Writ of Preliminar# Attachment$) to the etent that it concerned respondent+s

properties. Petitioner moved for the reconsideration of the said ruling, *ut the -A denied the same in its

>anuar# ), $&&) 4esolution.$6

Thus, petitioner filed the instant petition on the following grounds;

+ss$e:

Thus, petitioner filed the instant petition on the following grounds;

A.

T 9 49P-T0C 9B2TT5 TDAT TD -!4T !0 APPA9 9D!5 N!T DA1 @1N

5 -!49 T! TD PTT!N 0!4 -4T!4A4 05 BC 49P!N5NT, 9N- T 24C

4A95 44!49 N >5@2NT, WD-D, N54 P41AN@ >49P45N-, A4 N!T TDP4!P4 9B>-T9 !0 A W4T !0 -4T!4A4.

B.

2!4!14, T 9 49P-T0C 9B2TT5 TDAT TD -!4T !0 APPA9 -!22TT5

94!9 @A 44!4 N 49!1N@ 0A1!4ABC TD @4!N59 A@5 BC 49P!N5NT

N D9 PTT!N AN5 (9-" 0TN@ TD W4T !0 P42NA4C ATTA-D2NT, 9N- TD9

@4!N59 A4A5C 4AT T! TD 24T9 !0 -1 -A9 N!. &&3&&) WD-D, N54

P41AN@ >49P45N-, -ANN!T B 95 A9 BA99 (9-" 0!4 59-DA4@N@ A W4T !0P42NA4C ATTA-D2NT.

-.


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EW9, T 9 49P-T0C 9B2TT5 TDAT TD -!4T !0 APPA9 445 N

99TANN@ TD 44!49 N >5@2NT A@5 BC 49P!N5NT, N!T !NC B-A9

TD9 A4 B5 BC TD 14C 5!-2NT9 D 9B2TT5 A9 P4!!0 !0 9-D 44!49,

BT A9! B-A9 TD9 DA5 A44 BN 49!15 WTD 0NATC BC TD !W4

-!4T.$7

R$ling

n the case at *ench, the *asis of petitioner+s application for the issuance of the writ of preliminar#

attachment against the properties of respondent is 9ection %(d" of 4ule '6 of the 4ules of -ourt which

pertinentl# reads;

9ection %. @rounds upon which attachment ma# issue.3At the commencement of the action or at an# time

*efore entr# of judgment, a plaintiff or an# proper part# ma# have the propert# of the adverse part#

attached as securit# for the satisfaction of an# judgment that ma# *e recovered in the following cases;

(d" n an action against a part# who has *een guilt# of a fraud in contracting the de*t or incurring the

o*ligation upon which the action is *rought, or in the performance thereof.

0or a writ of attachment to issue under this rule, the applicant must sufficientl# show the factual

circumstances of the alleged fraud *ecause fraudulent intent cannot *e inferred from the de*tor+s mere

non3pa#ment of the de*t or failure to compl# with his o*ligation./& The applicant must then *e a*le to

demonstrate that the de*tor has intended to defraud the creditor./% n i*ert# nsurance -orporation v.

-ourt of Appeals,/$ we eplained as follows;

To sustain an attachment on this ground, it must *e shown that the de*tor in contracting the de*t or

incurring the o*ligation intended to defraud the creditor. The fraud must relate to the eecution of the

agreement and must have *een the reason which induced the other part# into giving consent which he

would not have otherwise given. To constitute a ground for attachment in 9ection % (d", 4ule '6 of the

4ules of -ourt, fraud should *e committed upon contracting the o*ligation sued upon.

A de*t is fraudulentl# contracted if at the time of contracting it the de*tor has a preconceived plan or

intention not to pa#, as it is in this case. 0raud is a state of mind and need not *e proved *# direct

evidence *ut ma# *e inferred from the circumstances attendant in each case.//


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n the instant case, petitioner+s !cto*er %$, $&&& Affidavit/: is *ereft of an# factual statement that

respondent committed a fraud. The affidavit narrated onl# the alleged fraudulent transaction *etween

Wincorp and 1irata andFor Power 2erge, which, *# the wa#, eplains wh# this -ourt, in @.4. No. %)$$7,

affirmed the writ of attachment issued against the latter. As to the participation of respondent in the said

transaction, the affidavit merel# states that respondent, an officer and director of Wincorp, connived with

the other defendants in the civil case to defraud petitioner of his mone# placements. No other factual

averment or circumstance details how respondent committed a fraud or how he connived with the other

defendants to commit a fraud in the transaction sued upon. n other words, petitioner has not shown an#

specific act or deed to support the allegation that respondent is guilt# of fraud.

n the instant case, petitioner+s !cto*er %$, $&&& Affidavit/: is *ereft of an# factual statement that

respondent committed a fraud. The affidavit narrated onl# the alleged fraudulent transaction *etween

Wincorp and 1irata andFor Power 2erge, which, *# the wa#, eplains wh# this -ourt, in @.4. No. %)$$7,

affirmed the writ of attachment issued against the latter. As to the participation of respondent in the said

transaction, the affidavit merel# states that respondent, an officer and director of Wincorp, connived with

the other defendants in the civil case to defraud petitioner of his mone# placements. No other factual

averment or circumstance details how respondent committed a fraud or how he connived with the other

defendants to commit a fraud in the transaction sued upon. n other words, petitioner has not shown an#

specific act or deed to support the allegation that respondent is guilt# of fraud.

The affidavit, *eing the foundation of the writ,/' must contain such particulars as to how the fraud

imputed to respondent was committed for the court to decide whether or not to issue the writ./) A*sent

an# statement of other factual circumstances to show that respondent, at the time of contracting the

o*ligation, had a preconceived plan or intention not to pa#, or without an# showing of how respondent

committed the alleged fraud, the general averment in the affidavit that respondent is an officer and

director of Wincorp who allegedl# connived with the other defendants to commit a fraud, is insufficient to

support the issuance of a writ of preliminar# attachment./6 n the application for the writ under the said

ground, compelling is the need to give a hint a*out what constituted the fraud and how it was

perpetrated/7 *ecause esta*lished is the rule that fraud is never presumed./ 1eril#, the mere fact that

respondent is an officer and director of the compan# does not necessaril# give rise to the inference that

he committed a fraud or that he connived with the other defendants to commit a fraud. While under

certain circumstances, courts ma# treat a corporation as a mere aggroupment of persons, to whom

lia*ilit# will directl# attach, this is onl# done when the wrongdoing has *een clearl# and convincingl#

esta*lished.:&

et it *e stressed that the provisional remed# of preliminar# attachment is harsh and rigorous for it

eposes the de*tor to humiliation and anno#ance.:% The rules governing its issuance are, therefore,

strictl# construed against the applicant,:$ such that if the re8uisites for its grant are not shown to *e all

present, the court shall refrain from issuing it, for, otherwise, the court which issues it acts in ecess of its

jurisdiction.:/ ikewise, the writ should not *e a*used to cause unnecessar# prejudice. f it is wrongfull#

issued on the *asis of false or insufficient allegations, it should at once *e corrected.::


12/37

BCB?+8N:

-onsidering, therefore, that, in this case, petitioner has not full# satisfied the legal o*ligation to show the

specific acts constitutive of the alleged fraud committed *# respondent, the trial court acted in ecess of

its jurisdiction when it issued the writ of preliminar# attachment against the properties of respondent.

We are not unmindful of the rule enunciated in @.B. nc., etc. v. 9anche=, et al.,:' that

GtHhe merits of the main action are not tria*le in a motion to discharge an attachment otherwise an

applicant for the dissolution could force a trial of the merits of the case on his motion.:)

Dowever, the principle finds no application here *ecause petitioner has not #et fulfilled the re8uirementsset *# the 4ules of -ourt for the issuance of the writ against the properties of respondent.:6 The evil

sought to *e prevented *# the said ruling will not arise, *ecause the propriet# or impropriet# of the

issuance of the writ in this case can *e determined *# simpl# reading the complaint and the affidavit in

support of the application.

FCH C8N;RC+8N JR8?, +NC., and FRANC+; C. H, petitioners,

;

CA

Facts:

=$ne 9, 1992, private respondent e" Constr$ction and evelopment Corporation fled a

Complaint !or collection o! a s$m o! mone" %ith application !or preliminar" attachment

against petitioner FCH Constr$ction Jro$p, +nc. and Francis C. H$ %ith the Da(ati Regional

rial Co$rt %hich %as doc(eted as Civil Case No. 92>11.

8n =$l" /, 1992, !ollo%ing an e)>parte hearing, the lo%er co$rt iss$ed an 8rder !or the

iss$ance o! a %rit o! preliminar" attachment, conditioned $pon the fling o! a ?7,000,000.00

attachment &ond.

?etitioners moved !or the li!ting o! the %rit o! preliminar" attachment on the !ollo%ing

gro$nds: 41 the attachment %as heard, iss$ed and implemented even &e!ore service o!

s$mmons $pon them* 4 !ail$re o! the attaching oMcer to serve a cop" o! the aMdavit o!

merit $pon them* and 42 that there %as no !ra$d in inc$rring the o&ligation. As an

alternative pra"er in their Dotion, petitioners pra"ed that the attachment &e limited to their


13/37

receiva&les %ith the epartment o! ?$&lic Ior(s and @igh%a"s. his alternative pra"er %as

later %ithdra%n &" petitioners in a Dani!estation and Dotion.

8n Da" 5, 199, the lo%er co$rt iss$ed another 8rder den"ing petitioners Dotion to i!t

Attachment.1 +t, ho%ever, red$ced and confned the attachment to receiva&les d$epetitioners !rom the andang ;ora Common%ealth Fl"over pro#ect.

;$&se-$entl", petitioners fled a Dotion !or Reconsideration as %ell as an 8mni&$s Dotion

!or eave to fle Amended Ans%er andor to delete Francis C. H$ as part">de!endant.2

Iith the denial o! &oth Dotions &" the lo%er co$rt on ;eptem&er , 199, petitioners fled a

?etition !or Certiorari &e!ore the Co$rt o! Appeals on ;eptem&er 1/, 199.5 he ?etition %as,

ho%ever, denied on =$l" 21, 1995*/ so %as petitioners Dotion !or Reconsideration.7

;o:

RC G denied G did not li!t the %rit o! A

CAG denied G

@ence, the instant ?etition.

+ss$e:

I8N the %rit o! preliminar" attachment %as irreg$larl" iss$ed inasm$ch as there %as no

evidence o! !ra$d in inc$rring the o&ligations s$ed $pon.

R$ling:

+t is evident that the -$estioned %rit o! attachment %as anchored $pon ;ection 14d, R$le 57

o! the Revised R$les o! Co$rt, to %it K

;ec. 1.Jro$nds $pon %hich attachment ma" iss$e. K A plainti or an" proper part" ma", at

the commencement o! the action or at an" time therea!ter, have the propert" o! the adverse

part" attached as sec$rit" !or the satis!action o! an" #$dgment that ma" &e recovered in the

!ollo%ing cases:

) ) ) ) ) ) ) ) )


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4d+n an action against a part" %ho has &een g$ilt" o! a !ra$d in contracting the de&t or

inc$rring the o&ligation $pon %hich the action is &ro$ght, or in concealing or disposing o! the

propert" !or the ta(ing, detention or conversion o! %hich the action is &ro$ght*

) ) ) ) ) ) ) ) )

A c$rsor" reading o! the a&ove>cited testimon", ho%ever, readil" sho%s that said

reass$rance !rom the ?I@ oMcials came, not at the inception o! the o&ligation or contract,

&$t d$ring its per!ormance. 8n the other hand, the !ra$d o! %hich petitioners are acc$sed o!

and %hich %as the &asis !or the iss$ance o! the -$estioned attachment, is !ra$d alleged to

have &een committed $pon contracting the o&ligation s$ed $pon. h$s, petitioners

arg$ment that 'the ind$cement %as the mo$th>%atering temptation o! a ?I@ promise o! a

'ne% pro#ect a!ter the andang ;ora Fl"over pro#ect %ill &e fnished' is clearl" o>tangent ass$ch ind$cement, i! an", came not at the inception o! the o&ligation.

Finall", considering that the %rit o! preliminar" attachment has &een iss$ed on acco$nt o!

allegations o! !ra$d in contracting the o&ligation $pon %hich the action is &ro$ght

petitioners eorts to have the %rit o! preliminar" attachment dissolved on the gro$nd that it

%as improperl" or irreg$larl" iss$ed is in vain. +ndeed, in i&ert" +ns$rance Corporation,

s$pra, %hich cited Dindanao ;avings and oan Assoc. vs. Co$rt o! Appeals 417 ;CRA E0,

%e r$led K

. . ., %hen the preliminar" attachment is iss$ed $pon a gro$nd %hich is at the same time the

applicants ca$se o! action: e.g., . . . an action against a part" %ho has &een g$ilt" o! !ra$d

in contracting the de&tor inc$rring the o&ligation $pon %hich the action is &ro$ght, the

de!endant is not allo%ed to fle a motion to dissolve the attachment $nder ;ection 12 o! R$le

57 &" oering to sho% the !alsit" o! the !act$al averments in the plaintis application and

aMdavits on %hich the %rit %as &ased and conse-$entl" that the %rit &ased therein had

&een improperl" or irreg$larl" iss$ed K the reason &eing that the hearing on s$ch motion !or

dissol$tion o! the %rit %o$ld &e tantamo$nt to a trial on the merits. +n other %ords, the

merits o! the action %o$ld &e ventilated at a mere hearing o! a motion* instead o! the

reg$lar trial. here!ore, %hen the %rit o! attachment is o! this nat$re, the onl" %a" it can &e

dissolved is &" a co$nter&ond.

Ie no% come to the iss$e o! %hether or not petitioner Francis H$ sho$ld remain as part">

de!endant. ?etitioners arg$e that since the transactions %ere corporation to corporation

onl", petitioner Francis H$ sho$ld &e dropped as part">de!endant considering the horn&oo(

la% that corporate personalit" is a shield against personal lia&ilit" o! its oMcers. Ie agree

that petitioner Francis H$ cannot &e made lia&le in his individ$al capacit" i! he indeed

entered into and signed the contract in his oMcial capacit" as ?resident, in the a&sence o!

stip$lation to that eect, d$e to the personalit" o! the corporation &eing separate and


15/37

distinct !rom the persons composing it.1 @o%ever, %hile %e agree that petitioner Francis H$

cannot &e held solidaril" lia&le %ith petitioner corporation merel" &eca$se he is the

?resident thereo! and %as involved in the transactions %ith private corporation, %e also note

that there e)ists instances %hen corporate oMcers ma" &e held personall" lia&le !or

corporate acts. ;$ch e)ceptions %ere o$tlined in ramat Dercantile, +nc. vs. Co$rt o!

Appeals,12 as !ollo%s K

?ersonal lia&ilit" o! a corporate director, tr$stee or oMcer along 4altho$gh not necessaril"

%ith the corporation ma" so validl" attach, as a r$le, onl" %hen K

1.@e assents 4a to a patentl" $nla%!$l act o! the corporation, or 4& !or &ad !aith or gross

negligence in directing its aairs, or 4c !or conOict o! interest, res$lting in damages to the

corporation, its stoc(holders or other persons*

.@e consents to the iss$ance o! %atered do%n stoc(s or %ho, having (no%ledge thereo!,

does not !orth%ith fle %ith the corporate secretar" his %ritten oection thereto*

2.@e agrees to hold himsel! personall" and solidaril" lia&le %ith the corporation* or

.@e is made, &" a specifc provision o! la%, to personall" ans%er !or his corporate action.

he attendance o! these circ$mstances, ho%ever, cannot &e determined at this stage and

sho$ld properl" &e threshed o$t d$ring the trial on the merits. ;tated dierentl", %hether or

not petitioner Francis H$ sho$ld &e held personall" and solidaril" lia&le %ith petitioner

corporation is a matter that sho$ld &e le!t to the trial co$rts discretion, dependent as it is on

evidence d$ring trial.

Detro +nc vs araPs gi!ts

Facts:

araPs Ji!ts and ecors +nc. 4J and Detro, +nc. are corporations engaged in the &$siness

o! man$!act$ring, prod$cing, selling and e)porting handicra!ts. $is illa!$erte, =r. and ara


16/37

Daria R. illa!$erte are the president and vice>president o! J respectivel". Frederic( =$an

and imail la&eled as the '001 Agreement.'

+n Da" 002, respondents fled %ith the Regional rial Co$rt, 3ranch 197, as ?iLas Cit" 4trial

co$rt a complaint against petitioners !or s$m o! mone" and damages %ith a pra"er !or the

iss$ance o! a %rit o! preliminar" attachment. ;$&se-$entl", respondents fled an amended

complaint5 and alleged that, as o! =$l" 00, petitioners de!ra$ded them in the amo$nt o!

51,E1./. Respondents also pra"ed !or ?1,000,000 as moral damages, ?1,000,000 as

e)emplar" damages and 10Q o! the #$dgment a%ard as attorne"Ps !ees. Respondents alsopra"ed !or the iss$ance o! a %rit o! preliminar" attachment.

RC: IA iss$ed

?etitioners: fled a motion to discharge the %rit o! attachment

8n / =$ne 002, petitioners. ?etitioners arg$ed that the %rit o! attachment sho$ld &e

discharged on the !ollo%ing gro$nds: 41 that the 001 agreement %as not a valid contract

&eca$se it did not sho% that there %as a meeting o! the minds &et%een the parties* 4

ass$ming that the 001 agreement %as a valid contract, the same %as inadmissi&le&eca$se respondents !ailed to a$thenticate it in accordance %ith the R$les on Blectronic

Bvidence* 42 that respondents !ailed to s$&stantiate their allegations o! !ra$d %ith specifc

acts or deeds sho%ing ho% petitioners de!ra$ded them* and 4 that respondents !ailed to

esta&lish that the $npaid commissions %ere alread" d$e and demanda&le.

RC: li!ted the IA

Respondents fled a petition !or certiorari &e!ore the Co$rt o! Appeals. Respondents alleged

that the trial co$rt gravel" a&$sed its discretion %hen it ordered the discharge o! the %rit o!

attachment %itho$t re-$iring petitioners to post a co$nter>&ond.

CA: ann$lled RCPs 8rder

I@BRBF8RB, fnding merit in the petition, Ie JRAN the same. he assailed 8rders are

here&" ANNB and ;B A;+B. @o%ever, the iss$ed Irit o! ?reliminar" Attachment ma"

&e ordered discharged $pon the fling &" the private respondents o! the proper co$nter>&ond

p$rs$ant to ;ection 1, R$le 57 o! the R$les o! Civil ?roced$re.


17/37

;8 8RBRB.10

?etitioners fled a motion !or reconsideration. +n its Darch 00/ Resol$tion, the Co$rt o!

Appeals denied the motion.

@ence, this petition.

+ss$e:

?etitioners raise the -$estion o! %hether the %rit o! attachment iss$ed &" the trial co$rt %as

improperl" iss$ed s$ch that it ma" &e discharged %itho$t the fling o! a co$nter>&ond.

R$ling:

he petition has no merit.

+n this case, the &asis o! respondentsP application !or the iss$ance o! a %rit o! preliminar"

attachment is ;ection 14d, R$le 57 o! the R$les o! Co$rt %hich provides:

;BC. 1. Jro$nds $pon %hich attachment ma" iss$e. K At the commencement o! the action

or at an" time &e!ore entr" o! #$dgment, a plainti or an" proper part" ma" have the

propert" o! the adverse part" attached as sec$rit" !or the satis!action o! an" #$dgment that

ma"&e recovered in the !ollo%ing cases: ) ) )

4d +n an action against a part" %ho has &een g$ilt" o! !ra$d in contracting the de&t or

inc$rring the o&ligation $pon %hich the action is &ro$ght, or in the per!ormance thereo!* ) )

)

he applicant !or a %rit o! preliminar" attachment m$st s$Mcientl" sho% the !act$al

circ$mstances o! the alleged !ra$d &eca$se !ra$d$lent intent cannot &e in!erred !rom the

de&torPs mere non>pa"ment o! the de&t or !ail$re to compl" %ith his o&ligation.1/

Doreover, the reliance o! the Co$rt o! Appeals in the cases o! Ch$idian v. ;andigan&a"an,1E

FCH Constr$ction Jro$p, +nc. v. Co$rt o! Appeals,19 and i&ert" +ns$rance Corporation v.

Co$rt o! Appeals0 is proper. he r$le that '%hen the %rit o! attachment is iss$ed $pon a

gro$nd %hich is at the same time the applicantPs ca$se o! action, the onl" other %a" the %rit

can &e li!ted or dissolved is &" a co$nter>&ond'1 is applica&le in this case. +t is clear that in


18/37

respondentsP amended complaint o! !ra$d is not onl" alleged as a gro$nd !or the iss$ance o!

the %rit o! preliminar" attachment, &$t it is also the core o! respondentsP complaint. he !ear

o! the Co$rt o! Appeals that petitioners co$ld !orce a trial on the merits o! the case on the

strength o! a mere motion to dissolve the attachment has a &asis.

I@BRBF8RB, %e BNH the petition. Ie AFF+RD the 9 ;eptem&er 00 ecision and

Darch 00/ Resol$tion o! the Co$rt o! Appeals in CA>J.R. ;? No. 7975.

;8 8RBRB.

Rep$&lic vs im

he Facts:

8n 8cto&er , 1991, in Civil Case No. 0020, the Rep$&lic, represented &" the ?residential Commission

on Jood Jovernment 4?CJJ, fled &e!ore the ;andigan&a"an, ;econd ivision, an Amended

Complaint !or reconve"ance, reversion, acco$nting, restit$tion, and damages. +n it, the Rep$&lic

averred that Al!onso im, ;r. 4no% deceased and Al!onso im, =r., acting &" themselves andor in

$nla%!$l coll$sion %ith Ferdinand B. Darcos and +melda R. Darcos, and ta(ing $nd$e advantage o! their

relationship, inO$ence, and connection %ith the latter, em&ar(ed $pon devices and stratagems to

$n#$stl" enrich themselves at the e)pense o! the Rep$&lic and the Filipino people.

he +ss$es

he t%o interrelated iss$es petitioner Rep$&lic tenders &oils do%n to: %hether the ;andigan&a"an, in

the light o! the denial o! respondentsP dem$rrer to evidence, acted %ith grave a&$se o! discretion

amo$nting to lac( or e)cess o! #$risdiction in not considering that the evidence alread" on record

s$pport the iss$ance o! a %rit or preliminar" attachment.

he Co$rtPs R$ling

An assid$o$s revie% o! the antecedent !acts and !act$al fndings and concl$sions o! the

;andigan&a"an relative to the denial o! dem$rrer to evidence and the %rit o! preliminar" in#$nction

compels this Co$rt to grant the instant petition.

Nat$re o! ?reliminar" Attachment

Attachment is an ancillar" remed" applied !or not !or its o%n sa(e &$t to ena&le the attaching part" to

reali


19/37

a$)iliar" or incidental to the main action. As s$ch, it is availa&le d$ring the pendenc" o! the action

%hich ma" &e resorted to &" a litigant to preserve and protect certain rights and interests therein

pending rendition, and !or p$rposes o! the $ltimate eects, o! a fnal #$dgment in the case. As a

corollar" proposition, an order granting an application !or a %rit o! preliminar" attachment cannot,

o%ing to the incidental or a$)iliar" nat$re o! s$ch order, &e the s$ect o! an appeal independentl" o!

the main action.0

he instant case is one o! those mentioned in ;ec. 1, R$le 57 o! the R$les, specifcall" the sectionPs

paragraph 'd,' %herein a %rit o! preliminar" attachment ma" &e iss$ed. +t provides:

;BC+8N 1. Jro$nds $pon %hich attachment ma" iss$e.SSA plainti or an" proper part" ma", at the

commencement o! the action or at an" time therea!ter, have the propert" o! the adverse part"

attached as sec$rit" !or the satis!action o! an" #$dgment that ma" &e recovered in the !ollo%ing cases:

) ) ) )

4d +n an action against a part" %ho has &een g$ilt" o! !ra$d in contracting the de&t or inc$rring the

o&ligation $pon %hich the action is &ro$ght, or in concealing or disposing o! the propert" !or the

ta(ing, detention or conversion o! %hich the action is &ro$ght*

For a %rit o! attachment to iss$e $nder the a&ove>-$oted r$le, the applicant m$st s$Mcientl" sho% the

!act$al circ$mstances o! the alleged !ra$d.

Fra$d ma" &e defned as the vol$ntar" e)ec$tion o! a %rong!$l act, or a %ill!$l omission, (no%ing and

intending the eects %hich nat$rall" and necessaril" arise !rom s$ch act or omission.1 +n its general

sense, !ra$d is deemed to comprise an"thing calc$lated to deceive, incl$ding all acts and omissions

and concealment involving a &reach o! legal or e-$ita&le d$t", tr$st, or confdence #$stl" reposed,

res$lting in damage to another, or &" %hich an $nd$e and $nconscientio$s advantage is ta(en o!

another. Fra$d is also descri&ed as em&racing all m$lti!ario$s means %hich h$man ingen$it" can

device, and %hich are resorted to &" one individ$al to sec$re an advantage over another &" !alse

s$ggestions or &" s$ppression o! tr$th and incl$des all s$rprise, tric(, c$nning, dissem&ling, and an"

$n!air %a" &" %hich another is cheated.2 Fra$d$lent, on the other hand, connotes intentionall"

%rong!$l, dishonest, or $n!air.

+ndeed, the imsP availment and en#o"ment o! logging concessions grossl" in e)cess o! constit$tional

limits amo$nt to a vol$ntar" e)ec$tion o! a %rong!$l act, i! not a serio$s &reach o! legal d$t". 3" their

acts, the ims verita&l" de!ra$ded and cheated the Filipino peopleSSthe $ltimate &enefciaries o! the

co$ntr"Ps nat$ral reso$rces.

enial o! em$rrer to Bvidence +ndicative


20/37

o! the Commission o! Fra$d$lent Acts

;andigan&a"an id Not Consider

Bvidence in en"ing Attachment

Jiven the !oregoing prono$ncement !rom the ;andigan&a"an, the Co$rt is completel" at a loss to

$nderstand the gra!t co$rtPs denial o! the Rep$&licPs plea !or the ancillar" remed" o! preliminar"

attachment. he %rong!$l actSSthe !ra$d perpet$ated &" im ;r. andor his corporations on the

Rep$&licSSis %ritten over or easil" ded$ci&le !rom the adverted Daceda decision and B)hi&it 'B.' Ihile

!ra$d cannot &e pres$med, it need not &e proved &" direct evidence and it can %ell &e in!erred !rom

attendant circ$mstances.2E Iithal, %e cannot &$t agree %ith the Rep$&licPs contention that the

;andigan&a"anPs denial o! its motion !or a %rit o! preliminar" attachment constit$tes grave and patent

a&$se o! discretion amo$nting to lac( or e)cess o! #$risdiction.

A scr$tin" o! the a&ove>-$oted =$l" 17, 002 Resol$tion readil" sho%s that the ;andigan&a"an indeed

considered the evidence presented and oered &" the Rep$&lic, specifcall" B)hi&its '3' and 'B' %hich

convincingl" sho% the fnding that respondentsP acts %ere tainted %ith !ra$d in the ac-$isition o! the

logging concessions d$e to their close association %ith the Darcoses.

+t is incongr$o$s, there!ore, !or the ;andigan&a"an to den" the %rit o! preliminar" attachment %hen

the pieces o! evidence on record %hich it $sed and &ased its fndings and concl$sions in den"ing the

dem$rrer to evidence %ere the same ones %hich demonstrate the propriet" o! the %rit o! preliminar"

attachment. Clearl", the Rep$&lic has complied %ith and satisfed the legal o&ligation to sho% the

specifc acts constit$tive o! the alleged !ra$d committed &" respondents. he denial o! the pra"ed %rit,

th$s, evidentl" constit$tes grave a&$se o! discretion on the part o! ;andigan&a"an. A!ter all,'attachment is a mere provisional remed" to ens$re the sa!et" and preservation o! the thing attached

$ntil the plainti can, &" appropriate proceedings, o&tain a #$dgment and have s$ch propert" applied

to its satis!action.'29 +ndeed, the properties o! respondents so$ght to &e s$ected to the ancillar" %rit

o! preliminar" attachment are not onl" in danger o! &eing lost &$t sho$ld &e placed $nder c$stodia

legis to ans%er !or an" lia&ilities that ma" &e ad#$dged against them in the instant case.

Fo$ndation ;pecialist +nc vs CA

Facts:

8n separate dates, petitioner Fo$ndation ;pecialists, +nc. 4F;+ and respondent 3etonval

Read" Concrete, +nc. 43etonval e)ec$ted three contracts1 !or the deliver" o! read" mi)ed

concrete &" 3etonval to F;+. he &asic stip$lations %ere: 4a !or F;+ to s$ppl" the cement to

&e made into read" mi)ed concrete* 4& !or F;+ to pa" 3etonval %ithin seven da"s a!ter


21/37

presentation o! the invoices pl$s 20Q interest p.a. in case o! overd$e pa"ments and 4c a

credit limit o! ?/00,000 !or F;+.

3etonval delivered the read" mi)ed concrete p$rs$ant to the contracts &$t F;+ !ailed to pa"

its o$tstanding &alances starting =an$ar" 199. As an accommodation to F;+, 3etonvale)tended the seven da" credit period to 5 da"s.

3etonval therea!ter fled an action !or s$m o! mone" and damages in the Regional rial Co$rt

4RC.7 +t also applied !or the iss$ance o! a %rit o! preliminar" attachment alleging that F;+

emplo"ed !ra$d %hen it contracted %ith 3etonval and that it %as disposing o! its assets in

!ra$d o! its creditors.

he RC iss$ed a %rit o! preliminar" attachment and approved the ?500,000 &ond o!

respondent ;tronghold +ns$rance Co., +nc. 4;tronghold. F;+ fled a co$nter&ond o! ?500,000

there&" discharging the %rit o! preliminar" attachment, e)cept %ith respect to F;+Pse)cavator, cra%ler crane and +s$$p tr$c(, %hich remained in c$stodia legis.E An

additional co$nter&ond o! ?250,000li!ted the garnishment o! F;+Ps receiva&les !rom the

epartment o! ?$&lic Ior(s and @igh%a"s.

8n =an$ar" 9, 1999, the RC r$led !or 3etonval.9 @o%ever, it a%arded ?00,000

compensator" damages to F;+ on the gro$nd that the attachment o! its properties %as

improper.10

RC G in !avor o! 3entoval &$t held, that attachment %as improper

CA G in !avor o! 3entoval &$t held, that attachment %as improper

+ss$es:

+n this petition !or revie% on certiorari, F;+ pra"s !or the !ollo%ing:

R$ling:

he petition has no merit.

here %as +mproper

Attachment o! F;+Ps

?roperties


22/37

3etonvalPs application !or the iss$ance o! the %rit o! preliminar" attachment %as

&ased on ;ection 14d and 4e, R$le 57 o! the R$les o! Co$rt.2 @o%ever, the CA

aMrmed the RCPs !act$al fndings that there %as improper attachment o! F;+Ps

properties. +n de&$n(ing F;+Ps claim !or act$al damages, respondents insist that the

attachment %as proper and that 3etonval %as a&le to s$Mcientl" prove the e)istence

o! the gro$nds !or attachment. @o%ever, these are !act$al matters that have &een

d$l" passed $pon &" the RC and the CA and %hich are inappropriate in a petition !or

revie%.

Doreover, %e agree %ith the RC and the CA that F;+Ps properties %ere improperl" attached.

3etonval %as not a&le to s$Mcientl" sho% the !act$al circ$mstances o! the alleged !ra$d

&eca$se !ra$d$lent intent cannot &e in!erred !rom F;+Ps mere nonpa"ment o! the de&t or

!ail$re to compl" %ith its o&ligation. +n Ng Iee v. an(iansee,22 %e held that the applicant

m$st &e a&le to demonstrate that the de&tor intended to de!ra$d the creditor. F$rthermore:

he !ra$d m$st relate to the e)ec$tion o! the agreement and m$st have &een the reason

%hich ind$ced the other part" into giving consent %hich he %o$ld not have other%ise given.

o constit$te a gro$nd !or attachment in ;ection 1 4d, R$le 57 o! the R$les o! Co$rt, !ra$d

sho$ld &e committed $pon contracting the o&ligation s$ed $pon. A de&t is !ra$d$lentl"

contracted i! at the time o! contracting it the de&tor has a preconceived plan or intention not

to pa", as it is in this case. Fra$d is a state o! mind and need not &e proved &" direct

evidence &$t ma" &e in!erred !rom the circ$mstances attendant in each case.2

+n other %ords, mere !ail$re to pa" its de&t is, o! and &" itsel!, not eno$gh to #$sti!"

an attachment o! the de&torPs properties. A !ra$d$lent intention not to pa" 4or not tocompl" %ith the o&ligation m$st &e present.

4a decrease the rate o! imposa&le interest on the ?1,11,02.2 a%ard to 3etonval, !rom

1Q to /Q p.a. !rom date o! #$dicial demand or fling o! the complaint $ntil the !$ll amo$nt is

paid*

4& ded$ct !rom the a%ard to 3etonval6 the cost or val$e o! $n$sed cement &ased on its6

invoice stating 1,207.5 &ags comp$ted at the prevailing price*

4c a%ard act$al and compensator" damages at ?2,,771.9*


23/37

4d hold 3etonval and ;tronghold #ointl" and severall" lia&le to pa" s$ch act$al and

compensator" damages*

4e hold 3etonval lia&le !or %hatever ;tronghold ma" &e held lia&le $nder the attachment

&ond and

4! aMrm in toto the rest o! the order.1/

A&oiti< vs Cota&ato

A %rit o! preliminar" attachment %as iss$ed in Civil Case No. 729 &" the Co$rt o! First

+nstance o! avao on the strength o! an aMdavit o! merit attached to the verifed complaint

!or the collection o! a s$m o! mone" fled &" petitioner A&oiti< T Co., +nc. alleging that

respondent &$s compan" 'has removed or disposed o! its properties or assets, or is a&o$t to

do so, %ith intent to de!ra$d its creditors.' he lo%er co$rt denied respondent compan"s

'rgent Dotion to issolve or U$ash Irit o! Attachments. '8n certiorari, alleging grave

a&$se o! discretion on the part o! respondent =$dge, the Co$rt o! Appeals iss$ed a

restraining order, restraining the trial co$rt !rom en!orcing the %rit o! attachment and !rom

proceeding %ith the hearing o! said Civil Case. +n its decision, the Co$rt o! Appeals declared

'n$ll and void' the orders iss$ed &" the trial co$rt, ordered the release o! the attached

properties and made the restraining order iss$ed, permanent.

+ss$e:

Joing !orth%ith to this -$estion o! %hether insolvenc", %hich petitioners in eect claims to

have &een proven &" the evidence, partic$larl" &" compan"s &an( acco$nt %hich has &een

red$ced to nil, ma" &e a gro$nd !or the iss$ance o! a %rit o! attachment

R$ling:

8n certiorari, the ;$preme Co$rt r$led that the Co$rt o! Appeals has not committed an"

reversi&le error, m$ch less grave a&$se o! discretion in this case, e)cept that the restraining

order sho$ld not have incl$ded restraining the trial co$rt !rom hearing the case.

+t is an $ndisp$ted !act that, as averred &" petitioner itsel!, the several &$ses attached are

nearl" #$n(s. @o%ever, $pon permission &" the sheri, fve o! them %ere repaired* &$t the"%ere s$&stit$ted %ith fve &$ses %hich %ere also in the same condition as the fve repaired

ones &e!ore the repair. his cannot &e the removal intended as gro$nd !or the iss$ance o! a

%rit o! attachment $nder ;ection 14e, R$le 57, o! the R$les o! Co$rt. he repair o! the fve

&$ses %as evidentl" motivated &" a desire to serve the interest o! the riding p$&lic, clearl"

not to de!ra$d its creditors, as there is no sho%ing that the" %ere not p$t on the r$n a!ter

their repairs, as %as the o&vio$s p$rpose o! their s$&stit$tion to &e placed in r$nning

condition.


24/37

;HA3;

1. RBDB+A AI* A??BA;* F+N+NJ; 8F FAC 8F @B C8R 8F A??BA;* JBNBRAH

C8N;+BRB C8NC;+B AN F+NA. K Ihere the -$estions raised are mainl", i! not

solel", !act$al, revolving on %hether respondent has in !act removed its properties, or is

a&o$t to do so, in !ra$d o! its creditors, the fndings o! the Co$rt o! Appeals on said iss$es o!

!acts are generall" considered concl$sive and fnal and sho$ld no longer &e dist$r&ed.

. +.* ?R8+;+8NA RBDB+B;* AAC@DBN* +N;8BNCH N8 A JR8N F8R

+;;ANCB @BRB8F. K 8n the strength o! the e)plicit r$ling o! this Co$rt in Da) Chamorro T

Co. vs. ?hilippine Read" Di) Concrete Compan", +nc. and @on. Dan$el ?. 3arcelona, the

respondent Co$rt o! Appeals correctl" too( its position in the negative on the -$estion o!

%hether insolvenc" is a gro$nd !or the iss$ance o! a %rit o! attachment.

2. +.* ;?BC+A C++ AC+8N* CBR+8RAR+* N8 JRAB A3;B 8F +;CRB+8N +N @B

ANNDBN 8F IR+ 8F AAC@DBN +N CA;B A 3AR. K Ihere it is indeed e)tremel" hard

to remove the &$ses, machiner" and other e-$ipment %hich respondent compan" has to

o%n and (eep to &e a&le to engage and contin$e in the operation o! its transportation

&$siness and the sale or other !orm o! disposition o! an" o! this (ind o! propert" is notdiMc$lt o! detection or discover", and strangel", petitioner has add$ced no proo! o! an" sale

or trans!er o! an" o! them %hich sho$ld have &een easil" o&taina&le &$t petitioner insists

that its evidence is intended to prove his assertion that respondent compan" has disposed

or is a&o$t to dispose, o! its properties in !ra$d o! its creditors, the respondent Co$rt o!

Appeals has not committed an" reversi&le error, m$ch less grave a&$se o! discretion, in

declaring 'n$ll and void the order%rit o! attachment dated Novem&er 2, 1971 and the

orders o! ecem&er ,1971, as %ell as that o! ecem&er 11, 1971 ordering the release o!

the attached properties and in ma(ing the restraining order originall" iss$ed permanent,

e)cept that the restraining order iss$ed &" it sho$ld not have incl$ded restraining the trial

co$rt !rom hearing the case, altogether.

I++AD AA+N D+A+@B and @B @8N. FB+ . 3AR3BR;, in his capacit" as ?residing =$dge,

RC o! Danila, 3ranch +++, petitioners>appellants, vs. B+ANB D. B BNCUB;A+NJ and

@BRB B BNCUB;A+NJ, respondents>appellees.

Facts:

Dean%hile ho%ever, and more specifcall" on Fe&r$ar" E, 19E2, respondent Blaine fled a

criminal complaint !or esta!a against petitioner Iilliam Alain, %ith the oMce o! the Cit" Fiscal

o! Danila, alleging in her s$pporting aMdavit that on the !ace o! the ver" acco$nt s$&mitted

&" him as Administrator, he had misappropriated considera&le amo$nts, %hich sho$ld have

&een t$rned over to her as her share in the net rentals o! the common properties. %o da"s

a!ter fling the complaint, respondent Oe% &ac( to ?aris, the Cit" o! her residence. i(e%ise,

a !e% da"s a!ter the fling o! the criminal complaint, an e)tensive ne%s item a&o$t it

appeared prominentl" in the 3$lletin oda", Darch , 19E2 iss$e, stating s$&stantiall" that

Alain Diailhe, a cons$l o! the ?hilippines in the Rep$&lic o! France, had &een charged %ith

Bsta!a o! several million pesos &" his o%n sister %ith the oMce o! the Cit" Fiscal o! Danila.


25/37

8n April 1, 19E2, petitioner Alain fled a verifed complaint against respondent Blaine, !or

amages in the amo$nt o! ?,000,000.00 and attorne"s !ees o! ?50,000.00 allegedl"

s$stained &" him &" reason o! the fling &" respondent 4then de!endant o! a criminal

complaint !or esta!a, solel" !or the p$rpose o! em&arrassing petitioner 4then plainti and

&esmirching his honor and rep$tation as a private person and as an @onorar" Cons$l o! the

Rep$&lic o! the ?hilippines in the Cit" o! 3ordea$), France. ?etitioner !$rther charged

respondent %ith having ca$sed the p$&lication in the Darch , 19E2 iss$e o! the 3$lletin

oda", o! a li&elo$s ne%s item. +n his verifed complaint, petitioner pra"ed !or the iss$ance o!

a %rit o! preliminar" attachment o! the properties o! respondent consisting o! 1/ $ndivided

interests in certain real properties in the Cit" o! Danila on the gro$nd that 'respondent>

de!endant is a non>resident o! the ?hilippines', p$rs$ant to paragraph 4!, ;ection 1, R$le /7,

in relation to ;ection 17, R$le 1 o! the Revised R$les o! Co$rt.

+ss$e:

he most important iss$e raised &" petitioner is > %hether or not the +ntermediate

Appellate Co$rt erred in constr$ing ;ection 1 par. 4! R$le 57 o! the R$les o! Co$rt to

&e applica&le onl" in case the claim o! the plainti is !or li-$idated damages 4and

there!ore not %here he see(s to recover $nli-$idated damages arising !rom a crime

or tort.

R$ling:

+n its no% assailed decision, the +AC stated K

'Ie fnd, there!ore, and so hold that respondent co$rt had e)ceeded its #$risdiction in

iss$ing the %rit o! attachment on a claim &ased on an action !or damages arising !rom delict

and -$asi delict, the amo$nt o! %hich is $ncertain and had not &een red$ced to #$dgment

#$st &eca$se the de!endant is not a resident o! the ?hilippines. 3eca$se o! the $ncertaint" o!

the amo$nt o! plaintis claim it can not &e said that said claim is over and a&ove all legal

co$nterclaims that de!endant ma" have against plainti, one o! the indispensa&le

re-$irements !or the iss$ance o! a %rit o! attachment %hich sho$ld &e stated in the aMdavit

o! applicant as re-$ired in ;ec. 2 o! R$le 57 or alleged in the verifed complaint o! plainti.

he attachment iss$ed in the case %as there!ore n$ll and void.

Ie agree.

;ection 1 o! R$le 57 o! the R$les o! Co$rt provides K

;BC. 1. Jro$nds $pon %hich attachment ma" iss$e. K A plainti or an" proper part" ma",

at the commencement o! the action or at an" time therea!ter, have the propert" o! the

adverse part" attached as sec$rit" !or the satis!action o! an" #$dgment that ma" &e

recovered in the !ollo%ing cases:

4a +n an action !or the recover" o! mone" or damages on a ca$se o! action arising !rom

contract, e)press or implied, against a part" %ho is a&o$t to depart !rom the ?hilippines %ith

intent to de!ra$d his creditors*

4& +n an action !or mone" or propert" em&e


26/37

agent, or cler(, in the co$rse o! his emplo"ment as s$ch, or &" an" other person in a

fd$ciar" capacit", or !or a %ill!$l violation o! d$t"*

4c +n an action to recover the possession o! personal propert" $n#$stl" detained, %hen the

propert", or an" part thereo!, has &een concealed, removed, or disposed o! to prevent its

&eing !o$nd or ta(en &" the applicant or an oMcer*

4d +n an action against a part" %ho has &een g$ilt" o! a !ra$d in contracting the de&t or

inc$rring the o&ligation $pon %hich the action is &ro$ght, or in concealing or disposing o! the

propert" !or the ta(ing, detention or conversion o! %hich the action is &ro$ght*

4e +n an action against a part" %ho has removed or disposed o! his propert", or is a&o$t to

do so, %ith intent to de!ra$d his creditors*

4! +n an action against a part" %ho resides o$t o! the ?hilippines, or on %hom s$mmons

ma" &e served &" p$&lication. 4emphasis s$pplied

Ihile it is tr$e that !rom the a!ore-$oted provision attachment ma" iss$e 'in an action

against a part" %ho resides o$t o! the ?hilippines,' irrespective o! the nat$re o! the action ors$it, and %hile it is also tr$e that in the case o! C$ n#ieng et al v. Al&ert, 5E ?hil. 95, it %as

held that 'each o! the si) gro$nds treated ante is independent o! the others,' still it is

imperative that the amo$nt so$ght &e li-$idated.

+n vie% o! the !oregoing, the ecision appealed !rom is here&" AFF+RDB.

;8 8RBRB.

oledo vs 3$rgos

Facts:

, petitioner applied !or the iss$ance o! a %rit o! preliminar" attachment %ith the Co$rt &elo%,

and %hich %as re-$ested &" the !ormers co$nsel !or it to &e considered in the morning o! /

=$ne 19E/ '%ith or %itho$t the attendance o! co$nsel and %itho$t oral arg$ments' 4p. E,

Rollo. +n said application, it %as alleged that respondent Castro, among others, 'has

removed and has deposed 4sic or is a&o$t to depose 4sic o! her propert" %ith intent to

de!ra$d the herein plainti 4p. , Rollo. o s$pport s$ch allegation, an aMdavit o! one

R$dol!o +not 4p. 9, Rollo %as attached to the application to prove that respondent Castro

and her spo$se insistentl" oered to sell to him t%o 4 motor vehicles.

+ss$es:

he sole iss$e in this case concerns the propriet" o! the respondent #$dges denial o!

petitioners application !or a %rit o! attachment. +n &randing the denial as improper,

petitioner acc$ses respondent #$dge o! having made it '%ith $nd$e haste and %itho$t

proper notice o! hearing' and %ith disregard o! the '4strong evidence in s$pport o!

the application'. 4?etition, p. E, Rollo.

R$ling:


27/37

Ie disagree %ith the petitioners acc$sations. Contrar" to his claims, the respondent #$dge

acted %ell %ithin his po%ers and in the highest regard !or #$stice. Respondent #$dge acted

correctl" in den"ing petitioners 'Application !or +ss$ance o! a Irit o! ?reliminar"

attachment'. here %as no need !or him to, as against petitioners claim, set a hearing on

the said application. his is &eca$se the iss$ance o! a %rit o! preliminar" attachment ma" &e

made &" the Co$rt e) parte. As Ie held in the case o! Filinvest Credit Corporation vs.

Relova, 117 ;CRA 0, and reiterated in 3elisle +nvestment and Finance Co., +nc. vs. ;tate

+nvestment @o$se, +nc., 151 ;CRA /20:

'Nothing in the R$les o! Co$rt ma(es notice and hearing indispensa&le and mandator"

re-$isites !or the iss$ance o! a %rit o! attachment. he statement in the case 3l$e Jreen

Iaters, +nc. vs. @on. ;$ndiam and an cited &" private respondent, to the eect that the

order o! attachment iss$ed %itho$t notice to therein petitioner 3l$e Jreen Iaters, +nc. and

%itho$t giving it a chance to prove that it %as not !ra$d$lentl" disposing o! its properties is

irreg$lar, gives the %rong implication. As clarifed in the separate opinion o! Dr. =$stice

Cla$dio eehan(ee in the same cited case, a %rit o! attachment ma" &e iss$ed e) parte.'

And even i! said notice is indeed necessar", petitioner can onl" &lame himsel! !or !ailing to

attend the sched$led hearing o! / =$ne 19E/. his is &eca$se it %as he, thro$gh his co$nsel,

%ho re-$ested that the application &e set !or consideration and approval &" the Co$rt on the

said date. +t %as, there!ore, his d$t" to &e present in Co$rt on that date. cdphil

+nasm$ch as a %rit o! preliminar" attachment ma" &e iss$ed %itho$t hearing, the #$dge

&e!ore %hom the application is made has !$ll discretion in considering the s$pporting

evidence proered &" the applicant. And in dealing %ith the aMdavit o! Dr. +not, the

respondent #$dge %as empo%ered to decide %hether or not s$ch sho$ld &e given credit. As

Ie en$nciated in the earl" case o! a Jrande vs. ;amson 45E ?hil. 57E* 'the s$Mcienc" or

ins$Mcienc" o! an aMdavit depends $pon the amo$nt o! credit given to it &" the #$dge, and

its acceptance or re#ection $pon his so$nd discretion.'

;ofa orres vs ;atsatin

Facts:

;ometime in 1997, Nicanor ;atsatin 4Nicanor as(ed petitionersP mother, Agripina Aledia, i!

she %anted to sell their lands. A!ter cons$ltation %ith her da$ghters, da$ghter>in>la%, and

grandchildren, Agripina agreed to sell the properties. ?etitioners, th$s, a$thori

s-$are>meter propert" o%ned &" a certain R$stica Aledia, !or ?25,000,000.00. ?etitioners

alleged that Nicanor %as s$pposed to remit to them the total amo$nt o! ?E,000,000.00 or

?9,222,222.00 each to ;ofa, Fr$ctosa, and the heirs o! Dario.


28/37

Conse-$entl", on 8cto&er 5, 00, petitioners fled &e!ore the regional trial co$rt 4RC a

Complaint7 !or s$m o! mone" and damages, against Nicanor, Brmilinda ;atsatin, Ni((i

Normel ;atsatin, and Ni((i Norlin ;atsatin. he case %as doc(eted as Civil Case No. /9>0,

and raVed to RC, 3ranch 90, asmariLas, Cavite.

8n 8cto&er 20, 00, petitioners fled an B)>?arte Dotion !or the +ss$ance o! a Irit o!

Attachment,E alleging among other things: that respondents are a&o$t to depart the

?hilippines

8n 8cto&er 20, 00, the trial co$rt iss$ed an 8rder9 directing the petitioners to post a

&ond in the amo$nt o! ?7,000,000.00 &e!ore the co$rt iss$es the %rit o! attachment, the

dispositive portion o! %hich reads as !ollo%s:

+n the 8rder1 dated Novem&er 15, 00, the RC granted the a&ove motion and dep$ti


29/37

alternative, respondents oered to post a co$nter>&ond !or the li!ting o! the %rit o!

attachment.19

8n ecem&er 15, 002, respondents fled an rgent Dotion to i!t;et Aside 8rder ated

Darch 116, 002,2 %hich the RC denied in an 8rder o! even date, the dispositiveportion o! %hich reads:

Aggrieved, respondents fled &e!ore the CA a ?etition !or Certiorari, Dandam$s and

?rohi&ition %ith ?reliminar" +n#$nction and emporar" Restraining 8rder7 $nder R$le /5 o!

the R$les o! Co$rt, doc(eted as CA>J.R. ;? No. E2595, anchored on the !ollo%ing gro$nds:

+ss$es:

@B @8N8RA3B C8R 8F A??BA; BRRB +N 8RBR+NJ @B +F+NJ 8F @B IR+ 8F

AAC@DBN ?R;AN 8 ;BC+8N 12, RB 57 8F @B RB+;B RB; 8F C++

?R8CBRB.

++.

@B @8N8RA3B C8R 8F A??BA; BRRB +N @8+NJ @A ?3+C RB;?8NBN

C8DD+B JRAB A3;B 8F +;CRB+8N AD8N+NJ 8 ACW 8F 8R +N BCB;; 8F

=R+;+C+8N +N JRAN+NJ @B IR+ 8F AAC@DBN B;?+B @B 38N 3B+NJ

+N;FF+C+BN AN @A+NJ 3BBN +D?R8?BRH +;;B.

R$ling:

Doreover, in provisional remedies, partic$larl" that o! preliminar" attachment, the

distinction &et%een the iss$ance and the implementation o! the %rit o! attachment is o!

$tmost importance to the validit" o! the %rit. he distinction is indispensa&l" necessar" to

determine %hen #$risdiction over the person o! the de!endant sho$ld &e ac-$ired in order to

validl" implement the %rit o! attachment $pon his person.

his Co$rt has long p$t to rest the iss$e o! %hen #$risdiction over the person o! the

de!endant sho$ld &e ac-$ired in cases %here a part" resorts to provisional remedies. A part"

to a s$it ma", at an" time a!ter fling the complaint, avail o! the provisional remedies $nder

the R$les o! Co$rt. ;pecifcall", R$le 57 on preliminar" attachment spea(s o! the grant o! the

remed" 'at the commencement o! the action or at an" time &e!ore entr" o! #$dgment.'0

his phrase re!ers to the date o! the fling o! the complaint, %hich is the moment that mar(s


30/37


31/37

At the time the trial co$rt iss$ed the %rit o! attachment on Novem&er 15, 00, it can validl"

to do so since the motion !or its iss$ance can &e fled 'at the commencement o! the action

or at an" time &e!ore entr" o! #$dgment.' @o%ever, at the time the %rit %as implemented,

the trial co$rt has not ac-$ired #$risdiction over the persons o! the respondent since no

s$mmons %as "et served $pon them. he proper oMcer sho$ld have previo$sl" or

sim$ltaneo$sl" %ith the implementation o! the %rit o! attachment, served a cop" o! the

s$mmons $pon the respondents in order !or the trial co$rt to have ac-$ired #$risdiction $pon

them and !or the %rit to have &inding eect. Conse-$entl", even i! the %rit o! attachment

%as validl" iss$ed, it %as improperl" or irreg$larl" en!orced and, there!ore, cannot &ind and

aect the respondents.

Doreover, altho$gh there is tr$th in the petitionersP contention that an attachment

ma" not &e dissolved &" a sho%ing o! its irreg$lar or improper iss$ance i! it is $pon a

gro$nd %hich is at the same time the applicantPs ca$se o! action in the main case,

since an anomalo$s sit$ation %o$ld res$lt i! the iss$es o! the main case %o$ld &e

ventilated and resolved in a mere hearing o! a motion. @o%ever, the same is not

applica&le in the case &ar. +t is clear !rom the respondentsP pleadings that the

gro$nds on %hich the" &ase the li!ting o! the %rit o! attachment are the irreg$larities

in its iss$ance and in the service o! the %rit* not petitionersP ca$se o! action.1avvphi1

F$rther, petitionersP contention that respondents are &arred &" estoppel, laches, and

prescription !rom -$estioning the orders o! the RC iss$ing the %rit o! attachment and that

the iss$e has &ecome moot and academic &" the rene%al o! the attachment &ond covering

a!ter its e)piration, is devoid o! merit. As correctl" held &" the CA:

here are t%o %a"s o! discharging the attachment. First, to fle a co$nter>&ond in accordance

%ith ;ection 1 o! R$le 57. ;econd,6 t6o -$ash the attachment on the gro$nd that it %as

irreg$larl" or improvidentl" iss$ed, as provided !or in ;ection 12 o! the same r$le. Ihether

the attachment %as discharged &" either o! the t%o %a"s indicated in the la%, the

attachment de&tor cannot &e deemed to have %aived an" de!ect in the iss$ance o! the

attachment %rit &" simpl" availing himsel! o! one %a" o! discharging the attachment %rit,

instead o! the other. he fling o! a co$nter>&ond is merel" a speedier %a" o! discharging the

attachment %rit instead o! the other %a".5

Doreover, again ass$ming arg$endo that the %rit o! attachment %as validl" iss$ed, altho$ghthe trial co$rt later ac-$ired #$risdiction over the respondents &" service o! the s$mmons

$pon them, s$ch &elated service o! s$mmons on respondents cannot &e deemed to have

c$red the !atal de!ect in the en!orcement o! the %rit. he trial co$rt cannot en!orce s$ch a

coercive process on respondents %itho$t frst o&taining #$risdiction over their person. he

preliminar" %rit o! attachment m$st &e served a!ter or sim$ltaneo$s %ith the service o!

s$mmons on the de!endant %hether &" personal service, s$&stit$ted service or &"

p$&lication as %arranted &" the circ$mstances o! the case. he s$&se-$ent service o!


32/37

s$mmons does not con!er a retroactive ac-$isition o! #$risdiction over her person &eca$se

the la% does not allo% !or retroactivit" o! a &elated service./

?hilippine 3an( o! Comm$nication vs CA

Facts:

8n April E, 1991, ?hilippine 3an( o! Comm$nications 4?3C fled a complainant against

3ernardino illan$eva, Filipinas e)tile Dills and ;ochi illan$eva &e!ore the Regional rial

Co$rt o! Danila. ?3C so$ght the pa"ment o! ?,,9/.20 representing the proceeds or

val$e o! vario$s te)tile goods, the p$rchase o! %hich %as covered &" irrevoca&le letters o!

credit and tr$st receipts e)ec$ted &" Filipinas e)tile Dills as o&ligor* %hich, in t$rn, %ere

covered &" s$ret" agreements e)ec$ted &" 3ernardino illan$eva. +n their Ans%er,

de!endants co$ntered that the" had alread" made pa"ments on the amo$nt demanded and

that the interest and other charges imposed &" petitioner %ere onero$s.

pon motion o! the ?3C, the trial co$rt iss$ed a %rit o! preliminar" attachment, conditioned

$pon the fling o! an attachment &ond.

Follo%ing the denial o! the motion !or certiorari &e!ore the Co$rt o! Appeals assailing the said

order. he Co$rt o! Appeals granted &oth petitions %hich r$led that the lo%er co$rt %as

g$ilt" o! grave a&$se o! discretion in not cond$cting a hearing on the application !or a %rit o!

preliminar" attachment, and that the gro$nds cited &" complainant in its motion did not

provide s$Mcient &asis !or the iss$ance o! a %rit o! preliminar" attachment !or &eing mere

general averments.

@ence, this petition. +c@C;

+ss$e:

I8N respondent Co$rt o! Appeals erred in K

'1. @olding that there %as no s$Mcient &asis !or the iss$ance o! the %rit o! preliminar"

attachment in spite o! the allegations o! !ra$d, em&e


33/37

that a %rit o! attachment can and sho$ld a$tomaticall" iss$e. ?etitioner cannot merel" cite

;ection 14& and 4d, R$le 57, o! the Revised R$les o! Co$rt, as mere reprod$ction o! the

r$les, %itho$t more, cannot serve as good gro$nd !or iss$ing a %rit o! attachment.

Again, it lac(s partic$lars $pon %hich the co$rt can discern %hether or not a %rit o!

attachment sho$ld iss$e.

?etitioner cannot insist that its allegation that private respondents !ailed to remit the

proceeds o! the sale o! the entr$sted goods nor to ret$rn the same is s$Mcient !or

attachment to iss$e. Ie note that petitioner anchors its application $pon ;ection 14d, R$le

57. his partic$lar provision %as ade-$atel" e)plained in i&ert" +ns$rance Corporation v.

Co$rt o! Appeals, E as !ollo%s K

o s$stain an attachment on this gro$nd, it m$st &e sho%n that the de&tor in contracting the

de&t or inc$rring the o&ligation intended to de!ra$d the creditor. he !ra$d m$st relate to the

e)ec$tion o! the agreement and m$st have &een the reason %hich ind$ced the other part"

into giving consent %hich he %o$ld not have other%ise given. o constit$te a gro$nd !or

attachment in ;ection 1 4d, R$le 57 o! the R$les o! Co$rt, !ra$d sho$ld &e committed $pon

contacting the o&ligation s$ed $pon. A de&t is !ra$d$lentl" contracted i! at the time o!contracting it the de&tor has a preconceived plan or intention not to pa", as it is in this case.

Fra$d is a state o! mind and need not &e proved &" direct evidence &$t ma" &e in!erred !rom

the circ$mstances attendant in each case 4Rep$&lic v. JonJ.R. ;? No. 27/ that the lo%er

co$rt sho$ld have cond$cted a hearing and re-$ired private petitioner to s$&stantiate its

allegations o! !ra$d, em&e


34/37

Dills co$ld not have done these as it had ceased its operations starting in =$ne o! 19E d$e

to %or(ers stri(e. hese are matters %hich sho$ld have &een addressed in a preliminar"

hearing to g$ide the lo%er co$rt to a #$dicio$s e)ercise o! its discretion regarding the

attachment pra"ed !or. 8n this score, respondent Co$rt o! Appeals %as correct in setting

aside the iss$ed %rit o! preliminar" attachment.

ime and again, %e have held that the r$les on the iss$ance o! a %rit o! attachment m$st &econstr$ed strictl" against the applicants. his stringenc" is re-$ired &eca$se the remed" o!

attachment is harsh, e)traordinar" and s$mmar" in nat$re. +! all the re-$isites !or the

granting o! the %rit are not present, then the co$rt %hich iss$es it acts in e)cess o! its

#$risdiction. 1

Rep$&lic vs Jarcia

Facts:

Civil Case No. 0192 %as a petition !or !or!eit$re o! $nla%!$ll" ac-$ired properties, %ith a

verifed $rgent e)>parte application !or the iss$ance o! a %rit o! preliminar" attachment, fled

&" the Rep$&lic o! the ?hilippines against Da#. Jen. Carlos F. Jarcia, his %i!e2 and children

in the ;andigan&a"an on 8cto&er 7, 00. +n pra"ing !or the iss$ance o! a %rit o!

preliminar" attachment, the Rep$&lic maintained that, as a sovereign political entit", it %as

e)empt !rom fling the re-$ired attachment &ond.

8n 8cto&er 9, 00, the ;andigan&a"an iss$ed a resol$tion ordering the iss$ance o! a %rit

o! preliminar" attachment against the properties o! the Jarcias $pon the fling &" the

Rep$&lic o! a ?1 million attachment &ond.5 8n Novem&er , 00, the Rep$&lic posted the

re-$ired attachment

+ss$es:

id the ;andigan&a"an commit grave a&$se o! discretion %hen it re#ected the Rep$&licPs

claim o! e)emption !rom the fling o! an attachment &ondX

R$ling:

Hes.

+n other %ords, the iss$ance o! a %rit o! preliminar" attachment is conditioned on the flingo! a &ond $nless the applicant is the ;tate. Ihere the ;tate is the applicant, the fling o! the

attachment &ond is e)c$sed.9

he attachment &ond is contingent on and ans%era&le !or all costs %hich ma" &e ad#$dged

to the adverse part" and all damages %hich he ma" s$stain &" reason o! the attachment

sho$ld the co$rt fnall" r$le that the applicant is not entitled to the %rit o! attachment. h$s,


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it is a sec$rit" !or the pa"ment o! the costs and damages to %hich the adverse part" ma" &e

entitled in case there is a s$&se-$ent fnding that the applicant is not entitled to the %rit.

he Rep$&lic o! the ?hilippines need not give this sec$rit" as it is pres$med to &e al%a"s

solvent and a&le to meet its o&ligations.

he ;andigan&a"an th$s erred %hen it disregarded the !oregoing pres$mption and instead

r$led that the Rep$&lic sho$ld fle an attachment &ond. he error %as not simpl" an error o!

#$dgment &$t grave a&$se o! discretion.

here is grave a&$se o! discretion %hen an act is done contrar" to the Constit$tion, the la%

or #$rispr$dence.10 @ere, the ;andigan&a"anPs =an$ar" 1, 005 resol$tion %as clearl"

contrar" to olentino.

Iorse, the ;andigan&a"an transgressed the Constit$tion and arrogated $pon itsel! a po%er

that it did not &" la% possess. All co$rts m$st ta(e their &earings !rom the decisions and

r$lings o! this Co$rt. olentino has not &een s$perseded or reversed. h$s, it is e)isting

#$rispr$dence and contin$es to !orm an important part o! o$r legal s"stem.11 ;$rprisingl",

the ;andigan&a"an declared that olentino 'need4ed to &e care!$ll" ree)amined in the light

o! the changes that the r$le on attachment ha4d $ndergone thro$gh the "ears.'1

According to the co$rt a -$o:

olentino6 %as decided &" the ;$preme Co$rt emplo"ing the old Code o! Civil ?roced$re

4Act No. 190 %hich %as enacted &" the ?hilippine Commission on A$g$st 7, 1901 or more

than a cent$r" ago.

hat %as then, this is no%. he provisions o! the old Code o! Civil ?roced$re governing

attachment have &een s$&stantiall" modifed in the s$&se-$ent R$les o! Co$rt. +n !act, R$le

57 o! the present 1997 R$les o! Civil ?roced$re is an e)panded modifcation o! the provisions

o! the old Code o! Civil ?roced$re governing attachment. nli(e the old Code o! Civil

?roced$re, the present 1997 R$les o! Civil ?roced$re is noticea&l" e)plicit in its re-$irement

that the part" appl"ing !or an order o! attachment sho$ld fle a &ond.

8n this, Article +++, ;ection 42 o! the Constit$tion provides:

42 Cases or matters heard &" a division shall &e decided or resolved %ith the conc$rrence o!

ma#orit" o! the Dem&ers %ho act$all" too( part in the deli&erations on the iss$es in the case

and voted thereon, and in no case %itho$t the conc$rrence o! at least three o! s$ch

Dem&ers. Ihen the re-$ired n$m&er is not o&tained, the case shall &e decided en &anc*


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?rovided, that no doctrine or principle o! la% laid do%n &" the co$rt in a decision rendered

en &anc or in division ma" &e modifed or reversed e)cept &" the co$rt sitting en &anc.

4emphasis s$pplied

he Constit$tion mandates that onl" this Co$rt sitting en &anc ma" modi!" or reverse adoctrine or principle o! la% laid do%n &" the Co$rt in a decision rendered en &anc or in

division. An" co$rt, the ;andigan&a"an incl$ded, %hich renders a decision in violation o! this

constit$tional precept e)ceeds its #$risdiction.

here!ore, the ;andigan&a"an co$ld not have validl" 'ree)amined,' m$ch less reversed,

olentino. 3" doing something it co$ld not validl" do, the ;andigan&a"an acted $ltra vires

and committed grave a&$se o! discretion.

he !act %as, the revisions o! the R$les o! Co$rt on attachment, partic$larl" those pertaining

to the fling o! an attachment &ond, did not -$ash olentino.

Ihere the Rep$&lic o! the ?hilippines as a part" to an action as(s !or a %rit o! attachment

against the properties o! a de!endant, it need not !$rnish a &ond. his is so &eca$se the

;tate is pres$med to &e solvent.1/

Ihen plainti is the Rep$&lic o! the ?hilippines, it need not fle a &ond %hen it applies

!or a preliminar" attachment. his is on the premise that the ;tate is solvent.17

And then again, %e note the signifcant !act that ;ections 2 and , R$le 57 o! the 19/ R$leso! Co$rt %ere s$&stantiall" incorporated as ;ections 2 and , R$le 57 o! the present 41997

R$les o! Co$rt.1E here is th$s no reason %h" the Rep$&lic sho$ld &e made to fle an

attachment &ond.1avvphi1

+n !act, in ;po$ses 3adillo v. @on. a"ag,19 a !airl" recent case, this Co$rt declared that,

%hen the ;tate litigates, it is not re-$ired to p$t $p a &ond !or damages or even an appeal

&ond &eca$se it is pres$med to &e solvent. +n other %ords, the ;tate is not re-$ired to fle a

&ond &eca$se it is capa&le o! pa"ing its o&ligations.0

he prono$ncement in ;po$ses 3adillo applies in this case even i! ;po$ses 3adillo involvedthe fling o! a s$persedeas &ond. he prono$ncement that the ;tate 'is not re-$ired to p$t

$p a &ond !or damages or even an appeal &ond' is general eno$gh to encompass

attachment &onds. Doreover, the p$rpose o! an attachment &ond 4to ans%er !or all costs

and damages %hich the adverse part" ma" s$stain &" reason o! the attachment i! the co$rt

fnall" r$les that the applicant is not entitled to the %rit and a s$persedeas &ond 4to ans%er

!or damages to the %inning part" in case the appeal is !o$nd !rivolo$s is essentiall" the

same.1a%phil.


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+n fling !or!eit$re cases against erring p$&lic oMcials and emplo"ees, the 8Mce o! the

8m&$dsman per!orms the ;tatePs sovereign !$nctions o! en!orcing la%s, g$arding and

protecting the integrit" o! the p$&lic service and addressing the pro&lem o! corr$ption in the

&$rea$crac".

he fling o! an application !or the iss$ance o! a %rit o! preliminar" attachment is a

necessar" incident in !or!eit$re cases. +t is needed to protect the interest o! the government

and to prevent the removal, concealment and disposition o! properties in the hands o!

$nscr$p$lo$s p$&lic oMcers. 8ther%ise, even i! the government s$&se-$entl" %ins the case,

it %ill &e le!t holding an empt" &ag.

Accordingl", the petition is here&" JRANB. he =an$ar" 1, 005 and Darch , 005

resol$tions o! the ;andigan&a"an are RBBR;B and ;B A;+B. he Rep$&lic o! the

?hilippines is declared e)empt !rom the pa"ment or fling o! an attachment &ond !or the

iss$ance o! a %rit o! preliminar" attachment iss$ed in Civil Case No. 0192. he;andigan&a"an is here&" ordered to release the ?1,000,000 &ond posted &" the Rep$&lic o!

the ?hilippines to the 8Mce o! the 8m&$dsman

digest in rule 57

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