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I. A.

The Different Provisional Remedies

Calo vs Roldan

Facts

Petitioner Cs filed for injunction against Respondent Rs to restraint the latter


from entering their property and exercising rights of ownership over a parcel of
land located in Pila, Laguna. The former gave a two thousand bond. The
defendants argued that they were owners in actual possession of the land. The
judge presiding the case appointed a receiver after the Petitioner Cs applied
and prayed for a receiver over the property.

Issue:

What are the different provisional remedies and their purpose?

Held:

The provisional remedies denominated attachment, preliminary injunction, receivership,


and delivery of personal property, provided in Rules 59, 60, 61, and 62 of the Rules of
Court, respectively, are remedies to which parties litigant may resort for the preservation
or protection of their rights or interest, and for no other purpose, during the pendency of
the principal action. If an action, by its nature, does not require such protection or
preservation, said remedies can not be applied for and granted. To each kind of action or
actions a proper provisional remedy is provided for by law.

(Preliminary Attachment) Attachment may be issued only in the case or actions


specifically stated in section 1, Rule 59, in order that the defendant may not dispose of his
property attached, and thus secure the satisfaction of any judgment that may be
recovered by plaintiff from defendant. For that reason a property subject of litigation
between the parties, or claimed by plaintiff as his, can not be attached upon motion of the
same plaintiff..

(Preliminary Injunction)The special remedy of preliminary prohibitory injunction lies when


the plaintiff's principal action is an ordinary action of injunction, that is, when the relief
demanded in the plaintiff's complaint consists in restraining the commission or
continuance of the act complained of, either perpetually or for a limited period, and the
other conditions required by section 3 of Rule 60 are present. The purpose of this
provisional remedy is to preserve the status quo of the things subject of the action or the
relation between the parties, in order to protect the rights of the plaintiff respecting the
subject of the action during the pendency of the suit. Because, otherwise or if no
preliminary prohibition injunction were issued, the defendant may, before final judgment,
do or continue the doing of the act which the plaintiff asks the court to restrain, and thus
make ineffectual the final judgment rendered afterwards granting the relief sought by the
plaintiff. But, as this court has repeatedly held, a writ of preliminary injunction should not
be granted to take the property out of the possession of one party to place it in the hands
of another whose title has not been clearly established..

(Receivership) A receiver may be appointed to take charge of personal or real property


which is the subject of an ordinary civil action, when it appears that the party applying for
the appointment of a receiver has an interest in the property or fund which is the subject of
the action or litigation, and that such property or fund is in danger of being lost, removed
or materially injured unless a receiver is appointed to guard and preserve it (section 1 [b],
Rule 61); or when it appears that the appointment of a receiver is the most convenient and
feasible means of preserving, administering or disposing of the property in litigation
(section 1 [e] of said Rule). The property or fund must, therefore be in litigation according
to the allegations of the complaint, and the object of appointing a receiver is to secure and
preserve the property or thing in controversy pending the litigation. Of course, if it is not in
litigation and is in actual possession of the plaintiff, the latter can not apply for and obtain
the appointment of a receiver thereof, for there would be no reason for such appointment.

(Replevin) Delivery of personal property as a provisional remedy consists in the delivery,


by order of the court, of a personal property by the defendant to the plaintiff, who shall give
a bond to assure the return thereof or the payment of damages to the defendant in the
plaintiff's action to recover possession of the same property fails, in order to protect the
plaintiff's right of possession of said property, or prevent the defendant from damaging,
destroying or disposing of the same during the pendency of the suit.

II. Attachment

A. Nature

Lim vs Lazaro

Facts: Petitioner L filed a complaint for sum of money (the sum of Php 2,160,000.00) with
prayer for issuance of writ of preliminary attachment against Respondent Spouses Z. The
Parties entered into a compromise agreement, wherein Respondent Spouses Z agreed to
pay Petitioner on an installment basis. Respondent Spouses moved for the lifting of the
writ of preliminary attachment based on the compromised agreement entered by the
parties.

Issue: May a writ of Preliminary Attachment be lifted due to a compromise agreement


entered by the parties?

Held:

By its nature, preliminary attachment, under Rule 57 of the Rules of Court (Rule 57), is an
ancillary remedy applied for not for its own sake but to enable the attaching party to
realize upon the relief sought and expected to be granted in the main or principal action; it
is a measure auxiliary or incidental to the main action. As such, it is available during its
pendency which may be resorted to by a litigant to preserve and protect certain rights and
interests during the interim, awaiting the ultimate effects of a final judgment in the case.
In this relation, while the provisions of Rule 57 are silent on the length of time within which
an attachment lien shall continue to subsist after the rendition of a final judgment,
jurisprudence dictates that the said lien continues until the debt is paid, or the sale is had
under execution issued on the judgment or until the judgment is satisfied, or the
attachment discharged or vacated in the same manner provided by law.

Hence, given that the foregoing debt remains unpaid, the attachment of properties should
continue to subsist.

The parties to the compromise agreement should not be deprived of the protection
provided by an attachment lien especially in an instance where one reneges on his
obligations under the agreement, as in the case at bench, where Antonio Garcia failed to
hold up his own end of the deal, so to speak.

Ligon vs RTC

II A. 1. Stages of Attachment

Torres vs Satsatin 2009

Facts: Petitioner T, et al filed before the RTC a complaint for sum of money and damages
against Respondent, and filed five days after an ex-parte Motion for Issuance of a Writ of
Attachment. The Writ of Attachment was served upon the respondent on November
19,2002 while the summons together with the complaint was served on the 20th of
November.

Issue: What are stages of Attachment?

Held:

In Cuartero v. Court of Appeals,43 this Court held that the grant of the provisional remedy
of attachment 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 be first obtained. However, once the implementation of the writ commences,
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.44

II.A.2. Contemporaneous Service of Summons


Torres vs Satsatin 2009

Facts: Petitioner T, et al filed before the RTC a complaint for sum of money and damages
against Respondent, and filed five days after an ex-parte Motion for Issuance of a Writ of
Attachment. The Writ of Attachment was served upon the respondent on November
19,2002 while the summons together with the complaint was served on the 20th of
November.

Issues: When does the Court acquire jurisdiction over the respondent?

Held:

The acts done by the Court prior to the acquisition of jurisdiction over the person of
defendant x x x issuance of summons, order of attachment and writ of attachment x x
x these do not and cannot bind and affect the defendant until and unless
jurisdiction over his person is eventually obtained by the court, either by service on
him of summons or other coercive process or his voluntary submission to the court’s
authority.

It is indispensable not only for the acquisition of jurisdiction over the person of the
defendant, but also upon consideration of fairness, to apprise the defendant of the
complaint against him and the issuance of a writ of preliminary attachment and the
grounds therefor that prior or contemporaneously to the serving of the writ of attachment,
service of summons, together with a copy of the complaint, the application for attachment,
the applicant’s affidavit and bond, and the order must be served upon him.

II.B.2 Plaintiff

Borja v. Platon, 73 Phil. 659

Facts: Petitioner JB is the son of respondent FB and JT. JB filed against his father and
mother a civil action for annulment of sale of a large estate known as Hacienda Jalajala.
Respondent FB and JT filed several counterclaims against their son JB.

Issue: May a a preliminary attachment be issued to a defendant based on his


counterclaim?

Held:

A writ of preliminary attachment may be issued in favor of a defendant who sets up a


counterclaim. For the purpose of the protection afforded by such attachment, it is
immaterial whether the defendants simply presented a counterclaim or brought a separate
civil action against the plaintiff in the previous case and petitioner herein. To lay down a
subtle distinction would be to sanction that formalism and that technicality which are
discountenanced by the modern laws of procedure for the sake of speedy and substantial
justice.

II.C.1 What may be attached?

Professional Video, Inc. v. TESDA, G.R. No. 155504, June 26, 2009
Facts: Petitioner V entered into a contract of sale with a government instrumentality,
T. T failed to pay Petitioner V, which forced Petitioner V to file a complaint for sum
of money with Preliminary Attachment against T.

Issue: May government properties be attached?

Held:

Public funds cannot be the object of garnishment proceedings even if the consent
to be sued had been previously granted and the state liability adjudged.

Government funds and properties may not be seized under writs of execution or
garnishment to satisfy judgments, is based on obvious considerations of public
policy. Disbursements of public funds must be covered by the corresponding
appropriation as required by law. The functions and public services rendered by the
State cannot be allowed to be paralyzed or disrupted by the diversion of public
funds from their legitimate and specific objects, as appropriated by law.

II.C.3 Fraud Incurring the obligation


Metro, Inc. v. Lara’s Gifts, G.R. No. 171741, November 27, 2009

Facts: Petitioner M induce Respondent L to enter into a contract wherein


Respondent L would endorse to Petitioner M purchase orders received by L from
their buyers in the US in exchange for 15% commission. L filed against M for sum
of money with preliminary attachment alleging that M defrauded them in the
amount of $521,841.62. The amended complaint alleged that M undertook to sell
exclusively and only through L for Target Store Corporation but M transacted
directly with L’s foreign Buyers.

Issue: Is fraud alleged in the complaint enough to sustain the writ of preliminary
attachment?

Held:

To sustain an attachment on this ground, it must be shown that the debtor in contracting
the debt or incurring the obligation intended to defraud the creditor. The fraud must relate
to the execution of the agreement and must have been the reason which induced the
other party into giving consent which he would not have otherwise given. To constitute a
ground for attachment in Section 1(d), Rule 57 of the Rules of Court, fraud should be
committed upon contracting the obligation sued upon. A debt is fraudulently contracted if
at the time of contracting it the debtor has a preconceived plan or intention not to pay, as it
is in this case.15
The applicant for a writ of preliminary attachment must sufficiently show the factual
circumstances of the alleged fraud because fraudulent intent cannot be inferred from the
debtor’s mere non-payment of the debt or failure to comply with his obligation.16

II.C.4 Disposal in fraud of creditors


Aboitiz v. Cotabato, 105 SCRA 88

Facts: A writ of preliminary attachment was issued ex-parte in favor of Petitioner


A&Co for the collection of money against the Respondent C, a bus company .
Personal properties of Respondent C consisting of buses, machinery and equipment.
The complaint and affidavit of merit alleged that Respondent C has removed or
disposed of its properties or assets, or is about to do so, with intent to defraud its
creditors. Furthermore the removal and rescue of Respondent C of five attached
buses during the pendency of its motion to dissolve the attachment is an act of
removal of properties with intent to defraud creditor.

Issue:Is the removal and rescue of the buses an act in the purview of removal of
properties with intent to defraud creditors?
Held:

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.

4. C.5. Residing out of the Philippines

II.E. Affidavit and bond (§§3, 4)


2. Affidavit of:
a. Applicant
b. or of some other person who personally knows the facts
Philippine Bank of Communications v. Court of Appeals, G.R. No. 115678.
February 23, 2001

Facts:
PBC filed a motion for attachment based on Sec. 1 (b) and (d) Rule 57;
supported by an affidavit executed by an Assistant Manager of PBC. The
affidavit merely contains statement that the latter have understood the content
of the motion and its true and correct.

Issue:
Is the affidavit submitted by PBC enough to sustain an order of attachment?

Held:
No. A mere citation or reproduction of the rules , without more, cannot serve as
good ground for issuing a writ of preliminary attachment. An order of
attachment cannot be issued on a general averment, such as one
ceremoniously quoting from a pertinent rule.

The affidavit of the representative of PBc lacks the particularity that the court
may discern whether or not a writ of attachment should issue.

3. Contents of Affidavit ( THIS SHOULD BE UNDER BOND which is under II.


E. 4)

Republic v. Garcia, G.R. No. 167741, 12 July 2007


Fact:The State filed for forfeiture of unlawfully acquired properties, with an
ex-parte application for the issuance of a writ of Preliminary attachment
against Maj. G and his Family. The State argued argued that as a sovereign
political entity, it is exempt from filing the required attachment bond.

Issue: Is the contention of the Republic of the Philippines tenable?

Held:Yes. The rule provides that before a writ of attachment may issue a bond
must first be filed to answer for all cost which may be adjudge to the adverse
party and for the damages he may sustain by reason of the attachment. The
state is exempt from this on theory that the state is always solvent and is able
to meet its obligation.

The fling of an application for the issuance of a writ of Preliminary attachment


is a necessary incident in forfeiture cases. It is needed to protect the interest of
the government and to prevent the removal, concealment and disposition of
properties in the hands of unscrupulous public officers. Otherwise, even if the
government subsequently wins the case, it will be left holding an empty bag.

III. E.
Spouses Tiu vs Villar
A.M. No. P-11-2986 June 13,2012
Facts:The trial court granted an order of preliminary attachment against First
Global and Spouses T.Sheriff Villar of RTC Pasay City served copies of the
summons, complaint and the writ of preliminary attachment to Spouses T at
their office at Pasig City but were received by the General Manager and
Caretaker of First Global.Spouses T argued that there was no proper service
of summons upon them.

Issue: Was there a valid service of summons?

Held: As a rule, Personal service of summons is preferred as against


substituted service. Substituted service can only be resorted to by the process
server only if personal service cannot be made promptly. The proof of
substituted service of summons must indicate a. the impossibility of service of
summons within reasonable time; b.specify the efforts exerted to locate the
defendant; c. state that the summons was served upon sufficient age and
discretion who is residing in the address, or who is in charge of the office or
regular place of business of the defendant. It is required that the pertinent facts
proving these circumstances be stated in the proof of service or in the officer’s
return.

The General Manager Bauco was competent and of sufficient age to receive
the summons on behalf of Sps T, as the former presented herself as General
Manager and Caretaker.

Facts: Spouses T argued that the Sheriff improperly implemented the writ
since it was executed outside his territorial jurisdiction.

Issue: Was there valid execution of the writ?


Held: Under Administrative Circular No. 12 that Sheriff or deputy sheriff who
execute a court writ outside his territorial jurisdiction must first notify in writing,
and seek the assistance of, the sheriff of the place where the execution shall
take place.

Documentary evidence discloses that Sheriff Villar of Pasay coordinated with


the Sheriff of Pasig City. Sheriff Villar formally coordinated with the Sheriff of
Pasig City, the Clerk of Court provided a certified true copy of Sheriff Villar’s
request for coordination.

Facts:Spouse T moved for the dismissal based on improper venue which the
court granted. Sheriff Villar did not immediately release the attached property
despite the RTC’s order of release but filed a Sheriff’s Report asking for a
clarification as whether or not he should wait for the trial court ‘s order to ttain
finality before returning the attached properties.

Issue: Is the Sheriff administratively liable for failure to effect the immediate
release of the attached properties despite the RTC’s order of release.

Held: Sec. 19 of Rule 57 provides that:


Section 19. Disposition of attached property where judgment is for party
against whom attachment was issued. — If judgment be rendered against the
attaching party, all the proceeds of sales and money collected or received by
the sheriff, under the order of attachment, and all property attached remaining
in any such officer's hands, shall be delivered to the party against whom
attachment was issued, and the order of attachment discharged.

The Sheriff should have followed the order of the court to return the attached
properties but the Sheriff did not show deliberate defiance against the order of
the court but rather consulted the judge before taking action on a matter which
he is not an expert.

II.J.1 J. Discharge of attachment


1. Upon counterbond (§12)
United Pulp and Paper Co., Inc. v. Acropolis, G.R. No. 171750, 25 January
2012
Facts:Acropolis a surety bound itself with Unibox to be solidarily liable to
answer for any judgment which UPPC may recover from Unibox. UPPC and
Unibox entered in to a compromise agreement approved by the court but
Unibox failed its obligation under the agreement. UPPC moved that surety be
liable to pay the Amount of the Counter-bond. Acropolis argued that the
compromise agreement is a novation extinguishing its liability under the
counter-bond.

Question:Is the argument of Acropolis tenable?

Answer:
No. The liability of the sureties was fixed and conditioned on the finality of the
judgment rendered regardless of whether the decision was based on consent
of the parties or on merits. A judgment entered on stipulation is nonetheless a
judgment of the court because consented by the parties.
In order for novation to extinguish its obligation, the surety must be able to
show that there is an incompatibility between the compromise agreement and
the terms of the counterbond.

II. K. Third party claim (§14)


Rural Bank of Sta. Barbara v. Manila Mission of Church of Jesus Christ, G.R.
No.130223, August 19, 2009

Facts: R Bank filed a complaint of sum money with prayer for issuance of writ
of preliminary attachment against Sps. S on April 15 1993.An order of
attachment was issued against the properties of the latter on Ma7 1993. The
Sheriff attached a parcel of land which the Sps.S sold to Manila Mission on
MAy 18 1992 but its title was only issued in the name of Respondent (MIssion
Manila) on April 28, 1994. Respondent executed an Affidavit claiming title and
ownership over the subject property, and requested the Ex-Officio Provincial
and City Sheriff to release the said property from attachment. The Sheriff,
however, advised respondent to file a motion directly with the RTC.
Question: Is the Motion to Release Property from Attachment a proper
remedy?
Answer:The filing by respondent of the Motion to Release Property from
Attachment was made on the advice of the Sheriff upon whom respondent
served its Affidavit of Title and Ownership. Respondent should not be faulted
for merely heeding the Sheriffs advice. The filing of the Motion in question can
be deemed as a mere continuation of the third-party claim of respondent, in the
form of its Affidavit of Title and Ownership, served upon the Sheriff, in accord
with the first paragraph of Section 14, Rule 57 of the Rules of Court.

Alternatively, we may also consider the Motion to Release Property from


Attachment, filed by respondent before the RTC, as a Motion for Intervention in
Civil Case No. D-10583, pursuant to the second paragraph of Section 14, Rule
56, in relation to Rule 19 of the Rules of Court. Respondent, to vindicate its
claim to the subject property, may intervene in the same case, i.e., Civil Case
No. D-10583, instituted by petitioner against the spouses Soliven, in which the
said property was attached. Respondent has the personality to intervene, as
it is so situated as to be adversely affected by a distribution or other disposition
of property in the custody of the court or of an officer thereof.[5] The RTC, in
acting upon and granting the Motion to Release Property from Attachment in
its Order dated 9 October 1995, is deemed to have allowed respondent to
intervene in Civil Case No. D-10583.

Facts: A property already sold to respondent was attached in a case of sum of


money filed by the Petitioner against Sps S. The said property’s title has not
yet been transferred to the respondent.

Question: Who has better right over the property, the Petitioner or the
Respondent.

Answer: The settled rule is that levy on attachment, duly registered, takes
preference over a prior unregistered sale. This result is a necessary
consequence of the fact that the property involved was duly covered by
the Torrens system which works under the fundamental principle that
registration is the operative act which gives validity to the transfer or creates a
lien upon the land.

The preference created by the levy on attachment is not diminished even by


the subsequent registration of the prior sale. This is so because an
attachment is a proceeding in rem. It is against the particular property,
enforceable against the whole world. The attaching creditor acquires a
specific lien on the attached property which nothing can subsequently destroy
except the very dissolution of the attachment or levy itself. Such a proceeding,
in effect, means that the property attached is an indebted thing and a virtual
condemnation of it to pay the owners debt. The lien continues until the debt is
paid, or sale is had under execution issued on the judgment, or until the
judgment is satisfied, or the attachment discharged or vacated in some
manner provided by law.
Thus, in the registry, the attachment in favor of respondents appeared in the
nature of a real lien when petitioner had his purchase recorded. The effect of
the notation of said lien was to subject and subordinate the right of petitioner,
as purchaser, to the lien. Petitioner acquired ownership of the land only from
the date of the recording of his title in the register, and the right of ownership
which he inscribed was not absolute but a limited right, subject to a prior
registered lien of respondents, a right which is preferred and superior to that of
petitioner.

Question: Would your answer change if the Petiitoner has prior knowledge of
the sale before the attachment of the Property?

Answer:

II. N. Claim for damages (§20)

Stronghold Insurance Company, Inc. v. Cuenca, G.R. No. 173297, 6 March


2013

Facts:
Properties of a Corporation was attached in a case that was later dismissed,
for lack of jurisdiction of the court since the jurisdiction lies with the SEC being
an intra-corporate matter. The stockholder respondents claim for damages for
wrongful attachment of the property against the Petitioner

Question: May stockholders of a Corporation claim damages for wrongful


attachment of the property of the corporation.

Answer: No. The personality of a corporation is distinct and separate from the
personalities of its stockholders. Hence, its stockholders are not themselves
the real parties in interest to claim and recover compensation for the damages
arising from the wrongful attachment of its assets. Only the corporation is the
real party in interest for that purpose.
II. N.
Equitable Banking Corporation v. Special Steel Products, Inc., G.R. No.
175350,13 June 2012

Facts: The Affidavit of Merit executed by Pardo, SSPI President, supporting


the application for attachment of properties of is bereft of specific and definite
allegations of fraud against Equitable that would justify the attachment of its
properties.

Question: Is the Petitioner entitled to damages for wrongful attachment of its


properties?

Answer:
For such wrongful preliminary attachment, plaintiffs may be held liable for
damages. However, Petitioner is entitled only to such damages as its evidence
would allow, for the wrongfulness of an attachment does not automatically
warrant the award of damages. The debtor still has the burden of proving the
nature and extent of the injury that it suffered by reason of the wrongful
attachment.

The Court has gone over the records and found that Equitable has duly proved
its claim for, and is entitled to recover, actual damages. In order to lift the
wrongful attachment of Equitables properties, the bank was compelled to pay
the total amount of P30,204.26 in premiums for a counter-bond.However,
Equitable failed to prove that it sustained damage to its goodwill and business
credit in consequence of the alleged wrongful attachment. There was no proof
of Equitables contention that respondents actions caused it public
embarrassment and a bank run.

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