Calo vs.
Roldan Judge Roldan decided to consider the MR and granted the appointment
Facts:
This is a petition for writ of certiorari against Judge Arsenio Roldan on
the ground of exceeding his jurisdiction and acted with grave abuse of
discretion in appointing a receiver of certain lands and their fruits.
Regino Relova and Teodula Bartolome filed a complaint against
Tranquilino Calo and Doroteo San Jose for conniving with each other,
and through the use of force, stealth, threats, and intimidation, intend to
enter and work or harvest existing fruits may be found in the lands
allegedly owned and possessed by the plaintiffs.
The plaintiffs prayed for the issuance of the preliminary injunction
(WOPI) to be issued ex parte to immediately restrain, enjoin, and
prohibit the defendants and their agents from entering and interfering
with the harvest of the lands belonging to the plaintiffs.
The defendants opposed the WOPI on the ground that they are owners
of the lands and have been in actual possession thereof since 1925.
The CFI Judge denied the petition for the WOPI on the ground that the
defendants were in actual possession of said lands.
MR was filed but was not decided by the CFI.
Plaintiffs then filed an urgent petition ex-parte praying that the MR of
the order denying their petition for WOPI be granted and/or for the
appointment of the receiver of the properties on the ground that:
a. Plaintiffs have interest in properties in question and the fruits
were in danger of being lost unless a receiver is appointed
b. The appointment of a receiver was the most convenient and
feasible means of preserving, administering, and or disposing
of the properties in litigation which included their fruits
of a receiver.
Issue: WON it is proper for the plaintiffs to apply and be granted of
the preliminary attachment.
Held:
According to the complaint filed by the plaintiffs, their action is one of
ordinary injunction, for they alleged that they are the owners of the
lands, and were in actual possession thereof and that the defendants
with any legal right and through the use of force, stealth, threat, and
intimidation, intend to enter the lands in violation of the plaintiff’s
proprietary rights.
In the present case, the plaintiffs alleged that they are the owners and
were in actual possession of the lands described in the complaint and
their fruits, the action of injunction filed by them is the proper and
adequate remedy in law, for a judgment in favor of plaintiffs would
quiet their title to said lands.
The provisional remedies (PRs) denominated attachment,
preliminary injunction, receivership, and delivery of personal
property, provided in Rules 59, 60, 61, and 62 of the ROC, are
remedies to which parties litigant may resort for the preservation
or protection of their rights or interest, and for no other purpose,
during the pendency of the principal action.
If by the nature of such action does not require such protection or
preservation, said remedies cannot be applied for and granted. To
each kind of action, a proper provisional remedy is provided by
law. The Rules of Court clearly specify the case in which they may
be properly granted.
Attachment may be issued only in the case or actions specifically
stated in section 1, Rule 59, in order that the defendant (not the
plaintiff) 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, cannot be attached upon
motion of the same plaintiff. (It cannot be attached since the
petitioner claims it to be his. In order to be attached, Rule 59 (57)
requires that the defendant may not dispose of “his” property
attached).
The special remedy of preliminary prohibitory injunction (PPI) lies
when the plaintiff’s principal action is an ordinary action of injunction,
that is when the relief demanded in the complaint consists in
restraining the commission or continuance of the act complained of,
either perpetually or for a limited period, or other conditions required
by Section 3 of Rule 60 are present. The purpose of this PR 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.
If no PPI were issued, the defendant may, before final judgment, do or
continue the doing of the act which the plaintiff asks the court to
restrain, thus make ineffectual the final judgment granting the relief
sought by the plaintiff.
But, a WOPI should not be granted to take the property out of the
possession of one party to place it in the hands of another whose title
has not been clearly established.
A receiver may be appointed to take charge of personal or real
property which is the subject of an ordinary civil action, when it
appears that the party applying for the appointment of a receiver has an
interest in the property or fund which is subject of the action or
litigation.
According to law, the PR proper to plaintiff’s action of injunction is a
PPI, if plaintiff’s theory as set forth in the complaint, that he is the
owner and in actual possession of the premises is correct. But as the
lower court found at the hearing of the petition for preliminary
injunction that the defendants were in possession of the lands, the
lower court acted in accordance with law in denying the petition.
From the foregoing it appears evident that the respondent judge acted
in excess of his jurisdiction in appointing a receiver.
Appointment of a receiver is not proper or does not lie in an action
of injunction such as the one filed by the plaintiff. The petition for
appointment of a receiver filed by the plaintiffs is based on the ground
that it is the most convenient and feasible means of preserving,
administering and disposing of the properties in litigation; and
according to plaintiffs' theory or allegations in their complaint,
neither the lands nor the palay harvested therein, are in litigation.
The litigation or issue raised by plaintiffs in their complaint is not the
ownership or possession of the lands and their fruits. It is whether or
not defendants intend or were intending to enter or work or
harvest whatever existing fruits could then be found in the lands
described in the complaint, alleged to be the exclusive property and in
the actual possession of the plaintiffs.
It is a matter not only of law but of plain common sense that a plaintiff
will not and legally cannot ask for the appointment of receiver of
property which he alleges to belong to him and to be actually in his
possession. (Common sense, you cannot ask for the appointment of
receiver if you are actually in possession of the property).
 ALFREDO C. LIM, JR. v. SPOUSES TITO S. LAZARO AND
CARMEN T. LAZARO
G.R. No. 185734, 03 July 2013
Topic
Rule 57 – Preliminary Attachment (Nature of PA)
Doctrine
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
addition, attachment is also availed of in order to acquire
jurisdiction over the action by actual or constructive seizure of the
property in those instances where personal or substituted service of
summons on the defendant cannot be effected.
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.
Facts
Lim, Jr. filed a complaint for sum of money with prayer for the
issuance of a writ of preliminary attachment before the Regional
Trial Court (RTC), seeking to recover from respondents-spouses Tito
S. Lazaro and Carmen T. Lazaro (Sps. Lazaro) the sum of
₱2,160,000.00, which represented the amounts stated in several
dishonored checks issued by the latter to the former, as well as
interests, attorney’s fees, and costs. The RTC granted the writ of
preliminary attachment application and upon the posting of the
required ₱2,160,000.00 bond, issued the corresponding writ. Three
(3) parcels of land situated in Bulacan, covered by Transfer Certificates
of Title (TCTs) registered in the names of Sps. Lazaro, were levied
upon.
In their Answer with Counterclaim, Sps. Lazaro averred, among others,
that Lim, Jr. had no cause of action against them since: (a) Colim
Merchandise (Colim), and not Lim, Jr., was the payee of the fifteen
(15) Metrobank checks; and (b) the PNB and Real Bank checks were
not drawn by them, but by Virgilio Arcinas and Elizabeth Ramos,
respectively. While they admit their indebtedness to Colim, Sps.
Lazaro alleged that the same had already been substantially reduced on
account of previous payments which were apparently misapplied. In
this regard, they sought for an accounting and reconciliation of records
to determine the actual amount due. They likewise argued that no fraud
should be imputed against them as the aforesaid checks issued to
Colim were merely intended as a form of collateral. Hinged on the
same grounds, Sps. Lazaro equally opposed the issuance of a writ of
preliminary attachment.
Nonetheless, the parties entered into a Compromise
Agreement whereby Sps. Lazaro agreed to pay Lim, Jr. the
amount of ₱2,351,064.80 on an installment basis, following a
schedule of payments, under the following terms, among others: (a)
that should the financial condition of Sps. Lazaro improve, the monthly
installments shall be increased in order to hasten the full payment of
the entire obligation; and (b) that Sps. Lazaro’s failure to pay any
installment due or the dishonor of any of the postdated checks
delivered in payment thereof shall make the whole obligation
immediately due and demandable.
The aforesaid compromise agreement was approved by the RTC in
its October 31, 2006 Decision and January 5, 2007 Amended Decision.
Subsequently, Sps. Lazaro filed an Omnibus Motion, seeking to lift
the writ of preliminary attachment annotated on the subject TCTs,
which the RTC granted. It ruled that a writ of preliminary attachment
is a mere provisional or ancillary remedy, resorted to by a litigant to
protect and preserve certain rights and interests pending final
judgment. Considering that the case had already been considered
closed and terminated by the rendition of the January 5, 2007
Amended Decision on the basis of the compromise agreement, the
writ of preliminary attachment should be lifted and quashed.
Consequently, it ordered the Registry of Deeds of Bulacan to
cancel the writ’s annotation on the subject TCTs.
Lim, Jr. filed a motion for reconsideration which was denied by
the RTC.
The Court of Appeals (CA) found no grave abuse of discretion on
the RTC’s part. It observed that a writ of preliminary attachment may
only be issued at the commencement of the action or at any time before
entry of judgment. Thus, since the principal cause of action had
already been declared closed and terminated by the RTC, the
provisional or ancillary remedy of preliminary attachment would
have no leg to stand on, necessitating its discharge.
Lim, Jr. moved for reconsideration which was denied by the CA.
Issue
Whether the writ of preliminary attachment was properly lifted. No!
Supreme Court’s Ruling
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
addition, attachment is also availed of in order to acquire jurisdiction
over the action by actual or constructive seizure of the property in
those instances where personal or substituted service of summons on
the defendant cannot be effected.
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.
Applying these principles, the Supreme Court (SC) found that the
discharge of the writ of preliminary attachment against the
properties of Sps. Lazaro was improper.
Records indicate that while the parties have entered into a compromise
agreement which had already been approved by the RTC, the
obligations thereunder have yet to be fully complied with –
particularly, the payment of the total compromise amount of
₱2,351,064.80. Hence, given that the foregoing debt remains unpaid,
the attachment of Sps. Lazaro’s properties should have continued to
subsist.
In Chemphil Export & Import Corporation v. CA, the Court
pronounced that a writ of attachment is not extinguished by the
execution of a compromise agreement between the parties.

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.

In fine, the Court held that the writ of preliminary attachment subject
of this case should be restored and its annotation revived in the
subject TCTs, re-vesting unto Lim, Jr. his preferential lien over the
properties covered by the same as it were before the cancellation of the
said writ.
People v. Velasco
G.R. No. 127444 13 September 2000
There was a shooting in San Ildefonso, Bulacan. The shooting claimed
the life of Alex Vinculado and seriously injured his twin brother Levi.
Their uncle, Miguel Vinculado, Jr. was also shot. Three (3) criminal
Informations - one (1) for homicide and two (2) for frustrated homicide
were initially filed against Honorato Galvez, Mayor of San Ildefonso,
and Godofredo Diego, the alleged bodyguard of the mayor. However,
the charges were withdrawn and a new set was filed against the same
accused upgrading the crimes to murder and frustrated murder. Mayor
Galvez was charged, in addition, with violation of PD 1866 for
unauthorized carrying of firearm outside his residence.
The trial court found the accused Godofredo Diego guilty beyond
reasonable doubt of the crimes of murder and double frustrated murder.
However, it acquitted Mayor Honorato Galvez of the same charges due
to insufficiency of evidence. It also absolved him from the charge of
illegal carrying of firearm upon its finding that the act was not a
violation of law.
The acquittal of accused Honorato Galvez was challenged by the
Government before this Court in a Petition for Certiorari under Rule 65
of the Rules of Court. Allegedly, in holding in favor of Galvez, the
judge deliberately and wrongfully disregarded certain facts and
evidence on record which, if judiciously considered, would have led to
a finding of guilt of the accused beyond reasonable doubt. Petitioner
proposes that this patently gross judicial indiscretion and arbitrariness
should be rectified by a re-examination of the evidence by the Court
upon a determination that a review of the case will not transgress the
constitutional guarantee against double jeopardy. It is urged that this is
necessary because the judgment of acquittal should be nullified and
substituted with a verdict of guilt.
Petitioner invokes the constitutional doctrine in the United States that
the Double Jeopardy Clause permits a review of acquittals decreed by
US trial magistrates where, as in this case, no retrial is required should
judgment be overturned. Since Philippine concepts on double jeopardy
have been sourced from American constitutional principles, statutes
and jurisprudence, particularly the case of Kepner v. United States and
because similarly in this jurisdiction a retrial does not follow in the
event an acquittal on appeal is reversed, double jeopardy should also
be allowed to take the same directional course.
ISSUES
- Whether a review by the Supreme Court of a judgment of acquittal in
light of the constitutional interdict against double jeopardy is
permissible
HELD/RATIO
NO. It must be explained that under existing American law and
jurisprudence, appeals may be had not only from criminal convictions
but also, in some limited instances, from dismissals of criminal
charges, sometimes loosely termed "acquittals." But this is so as long
as the judgments of dismissals do not involve determination of
evidence. It must involve questions of law or matters unrelated to a
factual resolution of the case which consequently, on appeal, will not
involve a review of evidence.
United States v. Scott positively spelled out that if an acquittal was
based on an appreciation of the evidence adduced, no appeal
would lie. In the case at bar, the records show that respondent trial
judge based his finding of acquittal, no matter how erroneous it
might seem to petitioner, upon the evidence presented by both
parties. The judgment here was no less than a factual resolution of the
case.
The doctrine that an appeal of a judgment after the defendant had been
acquitted by the court in a bench trial is a new trial, is applicable in this
case.
Requisites for invoking double jeopardy:
(a) a valid complaint or information;
(b) before a competent court before which the same is filed;
(c) the defendant had pleaded to the charge; and,
(d) the defendant was acquitted, or convicted, or the case against him
dismissed or otherwise terminated without his express consent.
It bears repeating that where acquittal is concerned, the rules do not
distinguish whether it occurs at the level of the trial court or on appeal
from a judgment of conviction. This firmly establishes the finality-of- jurisdiction. Errors of judgment are not to be confused with errors in
acquittal rule in our jurisdiction. Therefore, as mandated by our laws the exercise of jurisdiction.
and jurisprudence, an acquittal is final and unappealable on the ground
of double jeopardy, whether it happens at the trial court level or before
the Court of Appeals.

In general, the rule is that a remand to a trial court of a judgment

of acquittal brought before the Supreme Court on certiorari cannot
be had unless there is a finding of mistrial. The doctrine that "double
jeopardy may not be invoked after trial" may apply only when the
Court finds that the “criminal trial was a sham” because the
prosecution representing the sovereign people in the criminal case was
denied due process. The "remand of the criminal case for further
hearing and/or trial before the lower courts amounts merely to a
continuation of the first jeopardy, and does not expose the accused to a
second jeopardy.

*Sir said: Acquittal must be valid – an error of jurisdiction is the only

valid ground for review. If appeal is based on error of judgment, it will
amount to double jeopardy.

SYNOPSIS
For insufficiency of evidence, private respondent Honorato Galvez was
acquitted in the cases for murder and frustrated of murder. Further, he
was absolved from the charge of illegal carrying of firearm. In this
petition for certiorari, however, the State would want his acquittal
reversed.

As mandated by the Constitution, statutes and cognate jurisprudence,

an acquittal is final and unappealable on the ground of double
jeopardy, whether it happens the at the trial court level or before the
Court of Appeals. Thus, the rule is that a judgment of acquittal brought
before the Supreme Court on certiorari cannot be had unless there is a
finding of mistrial as in the case of Galman v. Sandiganbayan. In the
instant case, the petition for certiorari seeks the nullity of the decision
of the respondent judge acquitting the accused. However, the
questioned decision showed that respondent judge considered and
passed upon the evidence received at the trial. Thus, this exempts the
act from the writ's limiting requirement of excess or lack of

Ligon vs RTC Branch 56 Makati City
G.R. No. 190028 February 26, 2014
LETICIA P. LIGON, Petitioner,
vs.
THE REGIONAL TRIAL COURT, BRANCH 56 AT MAKATI
CITY AND ITS PRESIDING JUDGE, JUDGE REYNALDO M.
LAIGO, SHERIFF IV LUCITO V. ALEJO, ATTY. SILVERIO
GARING, MR. LEONARDO J. TING, AND MR. BENITO G.
TECHICO, Respondents.
FACTS: Petitioner Ligon filed before the QC RTC a complaint for the
collection of a sum of money with prayer for the issuance of a writ of
preliminary attachment against the Sps. Baladjay, a certain Olivia
Marasigan (Marasigan), Polished Arrow Holdings, Inc. (Polished
Arrow), and its incorporators. The complaint alleges among others that
the spouses Baladjay enticed her to extend a short-term loan secured by
a PDC which bounced upon presentment, and that the subject property
was transferred to respondent Polished Arrow allegedly defendants’
dummy corporation to defraud creditors. The application for the writ
was granted so the subject property was levied upon by annotating the
writ on the dorsal portion of TCT No. 9273.
While the case was pending, a similar complaint for the sum of
money damages, and cancellation of title with prayer for issuance
of a writ of preliminary attachment was lodged before the RTC
Makati by the Sps Vicente against the same respondents. During
the proceedings therein, a writ of preliminary attachment also against
the subject property was issued and annotated on the dorsal portion of
TCT No. 9273.
While the case is still pending in QC, the Makati RTC rendered a
decision rescinding the transfer of the subject property to Polished
Arrow upon a finding that the same was made in fraud of creditors.
Consequently, the Makati City RTC directed the Register of Deeds of
Muntinlupa City to: (a) cancel TCT No. 9273 in the name of Polished
Arrow; and (b) restore TCT No. 8502 “in its previous condition” in
the name of Rosario Baladjay. In the subsequent execution
proceedings, the property was sold at a public auction to respondent
Ting.
The RTC Makati then ordered the RD under pain of contempt to
issue a new certificate in favor of Ting free from any liens and
encumbrances.
Meanwhile the QC RTC ruled in favor of Ligon who sought its
execution and discovered the earlier attachment annotation in her favor
has been deleted.
ISSUE: W/N the Makati RTC gravely abused its discretion when it
ordered the deletion of Ligon’s attachment lien
HELD: YES. Case law instructs that an attachment is a proceeding in
rem, and, hence, is against the particular property, enforceable against
the whole world. Accordingly, 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 the subject property had been effectively restored in view of the RTC’s
proceeding, in effect, means that the property attached is an indebted rescission of the property’s previous sale to Polished Arrow.48Thus,
thing and a virtual condemnation of it to pay the owner’s debt. The Sps. Ligon’s attachment lien against Sps. Baladjay as well as their
lien continues until the debt is paid, or sale is had under execution successors-in-interest should have been preserved, and the annotation
issued on the judgment, or until the judgment is satisfied, or the thereof carried over to any subsequent certificate of title,49 the most
attachment discharged or vacated in some manner provided by recent of which as it appears on record is TCT No. 31001 in the name
law. Thus, a prior registration40 of an attachment lien creates a of Techico, without prejudice to the latter’s right to protect his own
preference, such that when an attachment has been duly levied ownership interest over the subject property.
upon a property, a purchaser thereof subsequent to the attachment
takes the property subject to the said attachment.42 As provided
under PD 1529, said registration operates as a form of constructive
notice to all.
Notwithstanding the subsequent cancellation of TCT No. 9273 due
to the Makati City RTC’s December 9, 2004 Decision rescinding the
transfer of the subject property from Sps. Baladjay to Polished Arrow
upon a finding that the same was made in fraud of creditors, Ligon’s
attachment lien over the subject property continued to subsist
since the attachment she had earlier secured binds the property
itself, and, hence, continues until the judgment debt of Sps. Baladjay to
Ligon as adjudged in the Quezon City Case is satisfied, or the
attachment discharged or vacated in some manner provided by law.
The grave abuse of discretion of the Makati City RTC lies with its
directive to issue a new certificate of title in the name of Ting (i.e.,
TCT No. 19756),47 free from any liens and encumbrances. This
course of action clearly negates the efficacy of Ligon’s attachment
lien and, also, defies the legal characterization of attachment
proceedings. It bears noting that Ligon’s claim, secured by the
aforesaid attachment, is against Sps. Baladjay whose ownership over
TORRES V SATSATIN
GR 166759 | November 25, 2009 | J. Peralta
(A) belated service of summons on respondents cannot be deemed to
have cured the fatal defect in the enforcement of the writ. The trial
court cannot enforce such a coercive process on respondents without
first obtaining jurisdiction over their person. The preliminary writ of
attachment must be served after or simultaneous with the service of
summons on the defendant whether by personal service, substituted
service or by publication as warranted by the circumstances of the
case.
Facts: Stages of Attachment and Contemporaneous Service of
Summons
Siblings Torres (petitioners) each owned adjacent 20,000 square
meters track of land in Dasmariñas, Cavite. Nicanor Satsatin,
through petitioners’ mother Agripina Aledia, was able to convince
the siblings to sell their property and authorize him via SPA, to
negotiate for its sale. Nicanor offered to sell the properties to Solar
Resources, to which Solar allegedly agreed to buy the three parcels
of land plus the property of one Rustica Aledia for P35, 000,000.
Petitioners claimed that Solar has already paid the entire purchase
price, however Nicanor only remitted P9, 000,000 out of the P28,
000,000 sum they are entitled to and that Nicanor had acquired a house
and lot and a car (which he registered in the names of his children).
Despite the repeated verbal and written demands, Nicanor failed
to remit the balance prompting the petitioners to file a complaint
for sum of money against the family Satsatin.
Petitioners filed an Ex Parte Motion for the Issuance of a Writ of
Attachment, alleging among other things, that respondent was
about to depart the country and that they are willing to post a
bond fixed by court. After filing a Motion for Deputation of Sheriff,
which the RTC granted, it issued a Writ of Attachment (WOA) on
November 15. On November 19, after serving a copy of the WOA
upon the Satsatins, the sheriff levied their real and personal properties.
On November 21, the summons and copy of complaint was served
upon the respondents. Respondents filed their answer and a
Motion to Discharge Writ of Attachment, claiming, among others,
that: the bond was issued before the issuance of WOA, the WOA
was issued before the summons was received. Respondents posted
a counter-bond for the lifting of WOA, which was denied along
with MR. Aggrieved, they filed with CA a Petition for Certiorari,
Mandamus and Prohibition with Preliminary Injunction and TRO
under Rule 65. CA ruled in favor of respondents and denied
petitioners’ MR hence the petition for review on certiorari with the
SC.
Issue:
W/N CA erred in finding that RTC was guilty of GADALEJ in the
issuance and implementation of the WOA
Held:
No. A writ of preliminary attachment is defined as a provisional
remedy issued upon order of the court where an action is pending to be
levied upon the property or properties of the defendant therein, the
same to be held thereafter by the sheriff as security for the satisfaction
of whatever judgment that might be secured in the said action by the
attaching creditor against the defendant.
In the case at bar, the CA correctly found that there was grave abuse of
discretion amounting to lack of or in excess of jurisdiction on the part
of the trial court in approving the bond posted by petitioners despite
the fact that not all the requisites for its approval were complied
with. In accepting a surety bond, it is necessary that all the requisites
for its approval are met; otherwise, the bond should be rejected.
Moreover, in provisional remedies, particularly that of preliminary the respondents by service of the summons upon them, such belated
attachment, the distinction between the issuance and the service of summons on respondents cannot be deemed to have
implementation of the writ of attachment is of utmost importance to the cured the fatal defect in the enforcement of the writ. The trial
validity of the writ. The distinction is indispensably necessary to court cannot enforce such a coercive process on respondents
determine when jurisdiction over the person of the defendant without first obtaining jurisdiction over their person. The
should be acquired in order to validly implement the writ of preliminary writ of attachment must be served after or
attachment upon his person. simultaneous with the service of summons on the defendant
whether by personal service, substituted service or by publication
In Cuartero v. Court of Appeals, this Court held that the grant of the as warranted by the circumstances of the case. The subsequent
provisional remedy of attachment involves three stages: first, the service of summons does not confer a retroactive acquisition of
court issues the order granting the application; second, the writ of jurisdiction.
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.

At the time the trial court issued the writ of attachment on November
15, 2002, it can validly to do so since the motion for its issuance can be
filed “at the commencement of the action or at any time before
entry of judgment.” However, at the time the writ was implemented,
the trial court has not acquired jurisdiction over the persons of the
respondent since no summons was yet served upon them. The proper
officer should have previously or simultaneously with the
implementation of the writ of attachment, served a copy of the
summons upon the respondents in order for the trial court to have
acquired jurisdiction upon them and for the writ to have binding effect.
Consequently, even if the writ of attachment was validly issued, it was
improperly or irregularly enforced and, therefore, cannot bind and
affect the respondents.

Moreover, again assuming arguendo that the writ of attachment was

validly issued, although the trial court later acquired jurisdiction over
G.R. No. L-48080 August 31, 1942
JOSE DE BORJA, petitioner,
vs.
SERVILLANO PLATON and FRANCISCO DE
BORJA, respondents.
Petitioner seeks the setting aside of an order of preliminary attachment
issued on November 6, 1940, and reiterated on January 13, 1941, by
the respondent Judge of the Court of First Instance against petitioner's
properties.
On August 12, 1936, petitioner brought a civil action in the Court
of First Instance of Rizal against Hermogena Romero, Francisco
de Borja, JosefaTangco and Crisanto de Borja to annul a second
sale by Francisco de Borja to Hermogena Romero, of a large estate
known as the Hacienda Jalajala, and to recover damages in the amount
of P25,000. On August 29, 1936, Francisco de Borja and his wife
JosefaTangco filed an answer with three counterclaims, and on
September 29, 1936, they presented two more counterclaims. Trial
began September 30, 1936. Under date of August 4, 1937, defendants
Francisco de Borja, JosefaTangco and Crisanto de Borja submitted
their amended answer, consisting of a general denial, special defenses,
and five counterclaims and cross-complaints. In these causes for
counter-claim and cross-complaint, it was alleged that plaintiff,
being a son of defendants Francisco de Borja and JosefaTangco,
had been entrusted with the administration of the extensive
interests of his parents, but had been unfaithful to his trust. Said
defendants, therefore, prayed, inter alia, that the spouses Borja and
Tangco be declared owners of the Hacienda Jalajala in question; that
plaintiff be required to render an accounting of the products of said
hacienda that he had received and to pay said spouses at least P100,000
illegally retained by him; that plaintiff be ordered to account for the
proceed of rice and bran and to pay at least P700,000 unlawfully
retained by him; that plaintiff be made to deliver P20,000 which he had
collected from a debtor of said spouses; that plaintiff be likewise
ordered to pay another sum of P9,034 collected by him from the same
debtor; and that plaintiff be required to turn over to defendants
Francisco de Borja and JosefaTangco the amount of P40,000 collected
by him as indemnity of an insurance policy on property belonging to
said spouses.
On July 27, 1940, Francisco de Borja and his wife filed their
petition for preliminary attachment to cover their third, fourth,
and fifth, grounds for cross-complaint, involving a total of P69,035.
In said motion, the defendants Borja and wife stated that they did not
include the first and second causes for cross-complaint because the
visible property of plaintiff that could then be attached was only worth
about P2,000. On August 21, 1940, plaintiff presented an amended
answer setting up a counterclaim against defendants Borja and wife in
the sum of P99,175.46.
The order for preliminary attachment is questioned upon several
grounds, among which are: (1) that no writ of attachment can be issued
in favor of a defendant who presents a counterclaim; (2) and the
defendants' affidavit was fatally defective.
On the first point, we believe a writ of preliminary attachment may be
issued in favor of a defendant who sets up a counterclaim. For the
purpose of the protection afforded by such attachment, it is immaterial
whether the defendants Borja and wife simply presented a
counterclaim or brought a separate civil action against Jose de Borja,
plaintiff in the previous case and petitioner herein. To lay down a
subtle distinction would be to sanction that formalism and that
technicality which are discountenanced by the modern laws of
procedure for the sake of speedy and substantial justice. In the present
case we see no reason why the order of the trial court should be
disturbed, this question being a matter within its discretion and we find
no grave abuse of that discretion.
As to be the second objection of petitioner, his counsel strenuously
advances the theory that the affidavit attached to the petition for a writ
of preliminary attachment was fatally defective because it failed to
allege that "the amount due to the plaintiff is as much as the sum
for which the order is granted above all legal counterclaims" as
required in section 426, Code of Civil Procedure and section 3, Rule
59, Rules of Court. Petitioner contends that his counterclaim against
that of Francisco de Borja and wife being P99,175.46 whereas the
latter's counterclaim totalled only P69,035, the omission of the
allegation referred to is a serious defect. The trial court found,
however, that the counterclaim of Francisco de Borja and wife
exceed those of the petitioner Jose de Borja. It should be borne in
mind that the aggregate counterclaims of Francisco de Borja and
wife amounted to P869,000, which exceeds petitioner's
counterclaim by P769,000 in round figures. Moreover, as the trial
court had before it the evidence adduce by both sides, the petition for a
writ of preliminary attachment having been filed four years after the
trial had begun, we presume that the lower court, having in mind such
evidence, ordered the attachment accordingly.

The order appealed from is hereby affirmed, with costs against the
petitioner. So ordered.

SYLLABUS
1. ATTACHMENT; ISSUANCE IN FAVOR OF A
DEFENDANT WHO SETS UP A COUNTERCLAIM; DISCRETION
OF TRIAL COURT. — 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. 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.
2. ID.; ID.; ID.; ALLEGATION AS TO AMOUNT DUE. — The
trial court having found that the counterclaims of defendants exceeded
the claims of plaintiff, it was not necessary to allege in the affidavit
attached to the petition for a writ of preliminary attachment that the
amount due to counter-claimants was as much as the sum for which the
order was granted.

Professional Video Inc. vs. TESDA, G.R. No. 155504, June 26,
2009, Sovereignty, State Immunity from Suit, International Law
OCTOBER 21, 2017
FACTS:
In 1999, TESDA, an instrumentality of the government established
under R.A. No. 7796 (the TESDA Act of 1994) and attached to the
DOLE to develop and establish a national system of skills
standardization, testing, and certification in the country.
To fulfill this mandate, it sought to issue security-printed certification
and/or identification polyvinyl (PVC) cards to trainees who have
passed the certification process.
Professional Video Inc. (PROVI) signed and executed the
“Contract Agreement Project PVC ID Card issuance” for the
provision of goods and services in the printing and encoding of the
PVC cards. PROVI was to provide TESDA with the system and
equipment compliant with the specifications defined in the
proposal. In return, TESDA would pay PROVI a specified sum of
money after TESDA’s acceptance of the contracted goods and
services. PPOVI alleged that TESDA has still an outstanding
balance and still remains unpaid.
TESDA claims that it entered the Contract Agreement and Addendum
in the performance of its governmental function to develop and
establish a national system of skills standardization, testing, and
certification; in the performance of this governmental function,
TESDA is immune from suit.
ISSUE:
Can TESDA be sued without its consent?
RULING:
TESDA, as an agency of the State, cannot be sued without its
consent. The rule that a state may not be sued without its consent is
embodied in Section 3, Article XVI of the 1987 Constitution and has
been an established principle that antedates this Constitution. It is as
well a universally recognized principle of international law that
exempts a state and its organs from the jurisdiction of another state.
The principle is based on the very essence of sovereignty, and on
the practical ground that there can be no legal right as against the
authority that makes the law on which the right depends. It also
rests on reasons of public policy. That public service would be
hindered, and the public endangered, if the sovereign authority could
be subjected to law suits at the instance of every citizen and,
consequently, controlled in the uses and dispositions of the means
required for the proper administration of the government.
The proscribed suit that the state immunity principle covers takes on
various forms, namely: a suit against the Republic by name; a suit
against an unincorporated government agency; a suit against a
government agency covered by a charter with respect to the agencys
performance of governmental functions; and a suit that on its face is
against a government officer, but where the ultimate liability will fall
on the government. In the present case, the writ of attachment was
issued against a government agency covered by its own charter.
As discussed above, TESDA performs governmental functions, and
the issuance of certifications is a task within its function of
developing and establishing a system of skills standardization,
testing, and certification in the country. From the perspective of this
function, the core reason for the existence of state immunity
applies i.e., the public policy reason that the performance of
governmental function cannot be hindered or delayed by suits, nor can
these suits control the use and disposition of the means for the
performance of governmental functions.
Doctrines:
TESDAs funds are public in character, hence exempt from
attachment or garnishment.
Even assuming that TESDA entered into a proprietary contract with
PROVI and thereby gave its implied consent to be sued, TESDAs
funds are still public in nature and, thus, cannot be the valid
subject of a writ of garnishment or attachment. Under Section 33 of
the TESDA Act, the TESDA budget for the implementation of the Act
shall be included in the annual General Appropriation Act; hence,
TESDA funds, being sourced from the Treasury, are moneys belonging
to the government, or any of its departments, in the hands of public
officials.[37] We specifically spoke of the limits in dealing with this
fund in Republic v. Villasor[38] when we said:
This fundamental postulate underlying the 1935 Constitution is now
made explicit in the revised charter. It is therein expressly provided,
The State may not be sued without its consent. A corollary, both
dictated by logic and sound sense, from such a basic concept, is that
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. Thus in the recent case of Commissioner of Public
Highways vs. San Diego, such a well-settled doctrine was restated in
the opinion of Justice Teehankee:
The universal rule that where the State gives its consent to be sued by
private parties either by general or special law, it may limit claimant's
action 'only up to the completion of proceedings anterior to the stage of
execution' and that the power of the Courts ends when the judgment is
rendered, since government funds and properties may not be seized
under writs of execution or garnishment to satisfy such 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. [Emphasis supplied.]
As pointed out by TESDA in its Memorandum,[40] the garnished
funds constitute TESDAs lifeblood in government parlance, its
MOOE[41] whose withholding via a writ of attachment, even on a
temporary basis, would paralyze TESDAs functions and services. As
well, these funds also include TESDAs Personal Services funds from
which salaries of TESDA personnel are sourced. Again and for
obvious reasons, the release of these funds cannot be delayed.
PROVI has not shown that it is entitled to the writ of attachment.
Even without the benefit of any immunity from suit, the attachment of
TESDA funds should not have been granted, as PROVI failed to prove
that TESDA fraudulently misapplied or converted funds allocated
under the Certificate as to Availability of Funds. Section 1, Rule 57 of
the Rules of Court sets forth the grounds for issuance of a writ of
preliminary attachment, as follows:
SECTION 1. Grounds upon which attachment may issue. A plaintiff or
any proper party may, at the commencement of the action or at any
time thereafter, have the property of the adverse party attached as
security for the satisfaction of any judgment that may be recovered in
the following cases:
(a) In an action for recovery of a specified amount of money or
damages, other than moral and exemplary, on a cause of action arising
from law, contract, quasi-contract, delict or quasi-delict against a party
who is about to depart from the Philippines with intent to defraud his
creditors;
(b) In an action for money or property embezzled or fraudulently
misapplied or converted to his use by a public officer, or an officer
of a corporation, or an attorney, factor, broker, agent or clerk, in
the course of his employment as such, or by any other person in a
fiduciary capacity, or for a willful violation of duty;
(c) In an action to recover the possession of property unjustly or
fraudulently taken, detained or converted, when the property or any
part thereof, has been concealed, removed or disposed of to prevent its
being found or taken by the applicant or an authorized person;

(d) In an action against a party who has been guilty of fraud in

contracting the debt or incurring the obligation upon which the
action is brought, or in concealing or disposing of the property for
the taking, detention or conversion of which the action is brought;
 G.R. No. L-23237 November 14, 1925
WALTER E. OLSEN & CO., plaintiff-appellee, vs.
WALTER E. OLSEN, defendant-appellant.
SYLLABUS
1.PRELIMINARY ATTACHMENT; DENIAL OF ANNULMENT
OF; APPEAL. — An order denying a motion or the annulment of a
preliminary attachment may be renewed is an appeal taken from the
final judgment rendered in the principal case.
2.CORPORATIONS; CIVIL FRAUD; ABUSE OF CONFIDENCE
OF OFFICERS. — He who has almost an exclusive control over the
function of the corporation and its funds on account of his triple
capacity as president, treasurer and general manager must be very
scrupulous in the application of the funds of said corporation to his
own use. The act of taking money of the corporation for his
personal use without being duly authorized therefor constitutes
such an irregularity that, while it does not amount to a criminal fraud,
is undoubtedly a fraud of a civil character, because it is an abuse of
confidence to the damage of the corporation and its stockholders and
constitutes one of the grounds enumerated in section 424, in
connection with 412, of the Code of Civil Procedure for the issuance of
a preliminary attachment.
FACTS:
Defendant-appellant was president-treasurer and general manager
of the plaintiff-appellee corporation and exercised direct and
almost exclusive supervision over its function, funds and books of
account until about the month of August, 1921. During that time he
has been taking money of the corporation without being duly
authorized to do so either by the board of directors or by the by-laws,
the money taken by him having amounted to the considerable sum of
P66,207.62. Of this sum, P19,000 was invested in the purchase of the
house and lot now under attachment in this case, and P50,000 in the
purchase of 500 shares of stock of Prising at the price of P100 per
share for himself and Marker. A few days afterwards he began to sell
the ordinary shares of the corporation for P430 each. The defendant-
appellant attempted to justify his conduct, alleging that the withdrawal
of the funds of the corporation for his personal use was made in his
current account with said corporation, in whose treasury he deposited
his own money and the certificates of title of his shares, as well as of
his estate, and that at the first meeting of the stockholders, which took
place on February 1, 1919, a statement of his account with a debit
balance was submitted and approved.
ISSUES:
Whether or not an order denying a motion for the annulment of a
preliminary attachment may be reviewed through an appeal.
Whether or not the trial court committed error in denying the motion
for the annulment of the preliminary attachment levied upon the
property of the defendant-appellant.
HELD:
An order denying a motion for the annulment of a preliminary
attachment may be reviewed in an appeal taken from a final judgment
rendered in the principal case, in which said order was entered as an
auxiliary remedy.
The preliminary attachment is an auxiliary remedy the granting of
which lies within the sound discretion of the judge taking
cognizance of the principal case upon whose existence it depends. The
order of the judge denying a motion for the annulment of a writ of
preliminary attachment, being of an incidental or interlocutory and
auxiliary character, cannot be the subject of an appeal
independently from the principal case, because our procedural law
now in force authorizes an appeal only from a final judgment which
gives an end to the litigation.
The conduct of the defendant-appellant in connection with the funds of
the corporation he represented was more than an irregularity; and
while it is not sufficiently serious to constitute a criminal fraud, it is
undoubtedly a fraud of a civil character, because it is an abuse of
confidence to the damage of the corporation and its stockholders,
and constitutes one of the grounds enumerated in section 424, in
connection with section 412, of the Code of Civil Procedure for the
issuance of a preliminary attachment, and the order of the Court
of First Instance of Manila, denying the motion for the annulment
of the injunction in question, is in accordance with law.
NG WEE V. TANKIANSEE (REMEDIAL)
For a writ of attachment to issue under this rule, the applicant 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. The applicant must then be able to demonstrate that the
debtor has intended to defraud the creditor.
In the instant case, petitioner's affidavit is bereft of any factual
statement that respondent committed fraud. As to the participation of
the respondent in the transaction, the affidavit merely states that
respondent, an officer and director of Wincorp, connived with the
other defendants in the civil case to defraud petitioner of his
money placements. In other words, petitioner has not shown any
specific act or deed to support the allegation that respondent is guilty
of fraud.
Considering therefore, that in this case, petitioner has not fully
satisfied the legal obligation to show the specific acts constitutive of
the alleged fraud committed by respondent, the trial court acted in
excess of its jurisdiction when it issued the writ of preliminary
attachment against the properties of respondent.
We are not unmindful of the rule enunciated in GB Inc. v. Sanchez,
that the merits of the main action are not triable 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.
G.R. No. 171124 February 13, 2008
Wee v. Tankiansee
THIRD DIVISION
[G.R. No. 171124. February 13, 2008.]
ALEJANDRO NG WEE, petitioner, vs. MANUEL TANKIANSEE,
respondent.
DECISION
NACHURA, J p:
Before the Court is a petition for review on certiorari under Rule 45 of
the Rules of Court assailing the September 14, 2005 Decision 1 of the
Court of Appeals (CA) in CA-G.R. SP No. 90130 and its January 6,
2006 Resolution 2 denying the motion for reconsideration thereof.
caSEAH
The facts are undisputed. Petitioner Alejandro Ng Wee, a valued
client of Westmont Bank (now United Overseas Bank), made
several money placements totaling P210,595,991.62 with the bank's
affiliate, Westmont Investment Corporation (Wincorp), a domestic
entity engaged in the business of an investment house with the
authority and license to extend credit. 3
Sometime in February 2000, petitioner received disturbing news
on Wincorp's financial condition prompting him to inquire about
and investigate the company's operations and transactions with its
borrowers. He then discovered that the company extended a loan
equal to his total money placement to a corporation [Power Merge]
with a subscribed capital of only P37.5M. This credit facility
originated from another loan of about P1.5B extended by Wincorp to
another corporation [Hottick Holdings]. When the latter defaulted in
its obligation, Wincorp instituted a case against it and its surety.
Settlement was, however, reached in which Hottick's president, Luis
Juan L. Virata (Virata), assumed the obligation of the surety. 4
Under the scheme agreed upon by Wincorp and Hottick's president,
petitioner's money placements were transferred without his
knowledge and consent to the loan account of Power Merge
through an agreement that virtually freed the latter of any
liability. Allegedly, through the false representations of Wincorp and
its officers and directors, petitioner was enticed to roll over his
placements so that Wincorp could loan the same to Virata/Power
Merge. 5 SDTIHA
Finding that Virata purportedly used Power Merge as a conduit
and connived with Wincorp's officers and directors to fraudulently
obtain for his benefit without any intention of paying the said
placements, petitioner instituted, on October 19, 2000, Civil Case
No. 00-99006 for damages with the Regional Trial Court (RTC) of
Manila. 6 One of the defendants impleaded in the complaint is
herein respondent Manuel Tankiansee, Vice-Chairman and
Director of Wincorp. 7
On October 26, 2000, on the basis of the allegations in the complaint
and the October 12, 2000 Affidavit 8 of petitioner, the trial court
ordered the issuance of a writ of preliminary attachment against
the properties not exempt from execution of all the defendants in
the civil case subject, among others, to petitioner's filing of a P50M-
bond. 9 The writ was, consequently, issued on November 6, 2000. 10
Arguing that the writ was improperly issued and that the bond
furnished was grossly insufficient, respondent, on December 22, 2000,
moved for the discharge of the attachment. 11 The other defendants
likewise filed similar motions. 12 On October 23, 2001, the RTC, in
an Omnibus Order, 13 denied all the motions for the discharge of
the attachment. The defendants, including respondent herein, filed
their respective motions for reconsideration 14 but the trial court
denied the same on October 14, 2002. 15 ESTcIA
Incidentally, while respondent opted not to question anymore the said
orders, his co-defendants, Virata and UEM-MARA Philippines
Corporation (UEM-MARA), assailed the same via certiorari under
Rule 65 before the CA [docketed as CA-G.R. SP No. 74610]. The
appellate court, however, denied the certiorari petition on August 21,
2003, 16 and the motion for reconsideration thereof on March 16,
2004. 17 In a petition for review on certiorari before this Court, in G.R.
No. 162928, we denied the petition and affirmed the CA rulings on
May 19, 2004 for Virata's and UEM-MARA's failure to sufficiently
show that the appellate court committed any reversible error. 18 We
subsequently denied the petition with finality on August 23, 2004. 19
On September 30, 2004, respondent filed before the trial court
another Motion to Discharge Attachment, 20 re-pleading the
grounds he raised in his first motion but raising the following
additional grounds: (1) that he was not present in Wincorp's board
meetings approving the questionable transactions; 21 and (2) that
he could not have connived with Wincorp and the other defendants
because he and Pearlbank Securities, Inc., in which he is a major
stockholder, filed cases against the company as they were also
victimized by its fraudulent schemes. 22
Ruling that the grounds raised were already passed upon by it in the
previous orders affirmed by the CA and this Court, and that the
additional grounds were respondent's affirmative defenses that
properly pertained to the merits of the case, the trial court denied the
motion in its January 6, 2005 Order. 23
With the denial of its motion for reconsideration, 24 respondent
filed a certiorari petition before the CA docketed as CA-G.R. SP
No. 90130. On September 14, 2005, the appellate court rendered
the assailed Decision 25 reversing and setting aside the
aforementioned orders of the trial court and lifting the November
6, 2000 Writ of Preliminary Attachment 26 to the extent that it
concerned respondent's properties. Petitioner moved for the
reconsideration of the said ruling, but the CA denied the same in its
January 6, 2006 Resolution. 27

Thus, petitioner filed the instant petition on the following grounds:
A.
IT IS RESPECTFULLY SUBMITTED THAT THE COURT OF
APPEALS SHOULD NOT HAVE GIVEN DUE COURSE TO THE
PETITION FOR CERTIORARI FILED BY RESPONDENT, SINCE
IT MERELY RAISED ERRORS IN JUDGMENT, WHICH, UNDER
PREVAILING JURISPRUDENCE, ARE NOT THE PROPER
SUBJECTS OF A WRIT OF CERTIORARI.
B.
MOREOVER, IT IS RESPECTFULLY SUBMITTED THAT THE
COURT OF APPEALS COMMITTED SERIOUS LEGAL ERROR
IN RESOLVING FAVORABLY THE GROUNDS ALLEGED BY
RESPONDENT IN HIS PETITION AND (SIC) LIFTING THE
WRIT OF PRELIMINARY ATTACHMENT, SINCE THESE
GROUNDS ALREADY RELATE TO THE MERITS OF CIVIL
CASE NO. 00-99006 WHICH, UNDER PREVAILING
JURISPRUDENCE, CANNOT BE USED AS BASIS (SIC) FOR
DISCHARGING A WRIT OF PRELIMINARY ATTACHMENT.
aIAHcE
C.
LIKEWISE, IT IS RESPECTFULLY SUBMITTED THAT THE
COURT OF APPEALS ERRED IN SUSTAINING THE ERRORS IN
JUDGMENT ALLEGED BY RESPONDENT, NOT ONLY
BECAUSE THESE ARE BELIED BY THE VERY DOCUMENTS
HE SUBMITTED AS PROOF OF SUCH ERRORS, BUT ALSO
BECAUSE THESE HAD EARLIER BEEN RESOLVED WITH
FINALITY BY THE LOWER COURT. 28
For his part, respondent counters, among others, that the general and
sweeping allegation of fraud against respondent in petitioner's affidavit
— respondent as an officer and director of Wincorp allegedly connived
with the other defendants to defraud petitioner—is not sufficient basis
for the trial court to order the attachment of respondent's properties.
Nowhere in the said affidavit does petitioner mention the name of
respondent and any specific act committed by the latter to defraud
the former. A writ of attachment can only be granted on concrete and
specific grounds and not on general averments quoting perfunctorily
the words of the Rules. Connivance cannot also be based on mere
association but must be particularly alleged and established as a fact.
Respondent further contends that the trial court, in resolving the
Motion to Discharge Attachment, need not actually delve into the
merits of the case. All that the court has to examine are the allegations
in the complaint and the supporting affidavit. Petitioner cannot also
rely on the decisions of the appellate court in CA-G.R. SP No. 74610
and this Court in G.R. No. 162928 to support his claim because
respondent is not a party to the said cases. 29 cSDIHT
We agree with respondent's contentions and deny the petition.
In the case at bench, the basis of petitioner's application for the
issuance of the writ of preliminary attachment against the properties of
respondent is Section 1 (d) of Rule 57 of the Rules of Court which
pertinently reads:
Section 1. Grounds upon which attachment may issue. — At the
commencement of the action or at any time before entry of judgment, a
plaintiff or any proper party may have the property of the adverse party
attached as security for the satisfaction of any judgment that may be
recovered in the following cases:
xxx xxx xxx
(d) In an action against a party who has been guilty of a fraud
in contracting the debt or incurring the obligation upon which the
action is brought, or in the performance thereof.
For a writ of attachment to issue under this rule, the applicant 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. 30
The applicant must then be able to demonstrate that the debtor has
intended to defraud the creditor. 31 In Liberty Insurance Corporation v.
Court of Appeals, 32 we explained as follows: DAcSIC
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. Fraud is a state of mind and
need not be proved by direct evidence but may be inferred from the
circumstances attendant in each case. 33
In the instant case, petitioner's October 12, 2000 Affidavit 34 is bereft
of any factual statement that respondent committed a fraud. The
affidavit narrated only the alleged fraudulent transaction between
Wincorp and Virata and/or Power Merge, which, by the way, explains
why this Court, in G.R. No. 162928, affirmed the writ of attachment
issued against the latter. As to the participation of respondent in the
said transaction, the affidavit merely states that respondent, an officer
and director of Wincorp, connived with the other defendants in the
civil case to defraud petitioner of his money 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. In other words,
petitioner has not shown any specific act or deed to support the
allegation that respondent is guilty of fraud. DcSACE
The affidavit, being the foundation of the writ, 35 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. 36 Absent any
statement of other factual circumstances to show that respondent, at the
time of contracting the obligation, had a preconceived plan or intention
not to pay, or without any showing of how respondent committed the
alleged fraud, the general averment in the affidavit that respondent is
an officer and director of Wincorp who allegedly connived with the
other defendants to commit a fraud, is insufficient to support the
issuance of a writ of preliminary attachment. 37 In the application
for the writ under the said ground, compelling is the need to give a hint
about what constituted the fraud and how it was perpetrated 38 because
established is the rule that fraud is never presumed. 39 Verily, the
mere fact that respondent is an officer and director of the company
does not necessarily 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 may treat a
corporation as a mere aggroupment of persons, to whom liability will
directly attach, this is only done when the wrongdoing has been clearly
and convincingly established. 40
Let it be stressed that the provisional remedy of preliminary
attachment is harsh and rigorous for it exposes the debtor to
humiliation and annoyance. 41 The rules governing its issuance are,
therefore, strictly construed against the applicant, 42 such that if the
requisites for its grant are not shown to be all present, the court shall
refrain from issuing it, for, otherwise, the court which issues it acts in
excess of its jurisdiction. 43 Likewise, the writ should not be abused
to cause unnecessary prejudice. If it is wrongfully issued on the
basis of false or insufficient allegations, it should at once be
corrected. 44
Considering, therefore, that, in this case, petitioner has not fully
satisfied the legal obligation to show the specific acts constitutive of
the alleged fraud committed by respondent, the trial court acted in
excess of its jurisdiction when it issued the writ of preliminary
attachment against the properties of respondent.
We are not unmindful of the rule enunciated in G.B. Inc., etc. v.
Sanchez, et al., 45 that — cHCIEA
[t]he merits of the main action are not triable 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. 46
However, the principle finds no application here because petitioner has
not yet fulfilled the requirements set by the Rules of Court for the
issuance of the writ against the properties of respondent. 47 The evil
sought to be prevented by the said ruling will not arise, because the
propriety or impropriety of the issuance of the writ in this case can be
determined by simply reading the complaint and the affidavit in
support of the application.
Furthermore, our ruling in G.R. No. 162928, to the effect that the writ
of attachment is properly issued insofar as it concerns the properties of
Virata and UEM-MARA, does not affect respondent herein, for, as
correctly ruled by the CA, respondent is "never a party thereto." 48
Also, he is not in the same situation as Virata and UEM-MARA since,
as aforesaid, while petitioner's affidavit detailed the alleged fraudulent
scheme perpetrated by Virata and/or Power Merge, only a general
allegation of fraud was made against respondent.

We state, in closing, that our ruling herein deals only with the writ of
preliminary attachment issued against the properties of respondent — it
does not concern the other parties in the civil case, nor affect the trial
court's resolution on the merits of the aforesaid civil case.

WHEREFORE, premises considered, the petition is DENIED. The

September 14, 2005 Decision and the January 6, 2006 Resolution of
the Court of Appeals in CA-G.R. SP No. 90130 are AFFIRMED.
aTADcH
SO ORDERED.
Liberty Insurance Corporation v. CA G.R. No. 104405 May 13,
1993
SYLLABUS
1. REMEDIAL LAW; PROVISIONAL REMEDIES;
ATTACHMENT; REMEDY AGAINST A PARTY GUILTY IN
CONTRACTING DEBT OR INCURRING AN OBLIGATION. — In
an action against a party who has been guilty of fraud in contracting
the debt or incurring the obligation upon which the action is brought,
Section 1 (d) of Rule 57 authorizes the plaintiff or any proper party to
have the property of the adverse party attached as security for the
satisfaction of any judgment that may be recovered therein. 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.
2. ID.; ID.; ID.; ID.; CASE AT BAR. — 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. Fraud
is a state of mind and need not be proved by direct evidence but may
be inferred from the circumstances attendant in each case (Republic v.
Gonzales, 13 SCRA 633 [1965]). Here, it has been established that all
the collaterals given by the respondent Arkin as security for the bond
were either fraudulent or heavily encumbered. Records show that
Transfer Certificate of Title No. 300011 supposedly issued by the
Register of Deeds of Rizal covering a parcel of land with an area of
25,750 square meters located at Muntinlupa, Las Piñas, M.M. and
registered in the name of Carmen Madlangbayan, used as one of the
collaterals, turned out to be fake and spurious as the genuine TCT No.
300011 of the Office of the Register of Deeds of Rizal covers a parcel
of land located in Angono, Rizal with an area of 514 square meters
registered in the name of persons other than respondents Imperial,
Arkin, and Madlangbayan. Likewise, the supposed lien-free motor
vehicle offered as collateral turned out to be heavily mortgaged and
was even disposed of without informing petitioner. Furthermore, it has
also been proven that subsequent to the issuance of the May 30, 1988
surety bond, respondent Arkin started disposing of his other properties.
Prior to the filing of the complaint, respondent not only had sold the
motor vehicle given as collateral but that his two other condominium
units, were also alienated in favor of a company of which respondent
Arkin is the president. All these circumstances unerringly point to the
devious scheme of respondent Arkin to defraud petitioner.
3. ID.; ID.; ID.; MOTION TO DISSOLVE ATTACHMENT,
NOT ALLOWED WHERE MAIN ACTION IS BASED ON FRAUD.
— When the preliminary attachment is issued upon a ground which is
at the same time the applicant's cause of action: e.g., . . . an action
against a party who has been guilty of fraud in contracting the debt or
incurring the obligation upon which the action is brought, the
defendant is not allowed to file a motion to dissolve the attachment
under Section 13 of Rule 57 by offering to show the falsity of the
factual averments in the plaintiff's application and affidavits on which
the writ was based and consequently that the writ based therein had
been improperly or irregularly issued — the reason being that the
hearing on such motion for dissolution of the writ would be
tantamount to a trial on the merits. In other words, the merits of the
action would be ventilated at a mere hearing of a motion, instead of the
regular trial. Therefore, when the writ of attachment is of this
nature, the only way it can be dissolved is by a counterbond.
(Mindanao Savings and Loan Assoc. vs. Court of Appeals, 172 SCRA
480 [1989])
DOCTRINES:
 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. Fraud is a state of mind and need not be proved by direct
evidence but may be inferred from the circumstances attendant in each
case.
 When the preliminary attachment is issued upon a ground which is at
the same time the applicant's cause of action, the only way it can be
dissolved is by a counterbond because the hearing on a motion for
dissolution would be tantamount to a trial on the merits.
FACTS:
Jose H. Imperial Organizations, Pty. Thru Atty. Jose H. Imperial
entered into an agreement with Coca-Cola Bottlers Philippines to
promote two concerts featuring "Earth, Wind and Fire" with
Coca-Cola sponsoring the concerts and the former promoting the
same.
To ensure compliance to the terms, Imperial Organizations put up
a performance bond, upon application with Liberty Insurance, in
the amount of P3M. This guarantees the return to Coca-cola of
“whatever portion of the cash sponsorship and cash advances to be
made by Coca-cola to finance the holding of the concerts…”
In turn, Liberty Insurance required Imperial Organizations, Jose
Imperial, Atilla Arkin and Carmen Madlangbayan to execute an
indemnity agreement in its favour to indemnify it for any and all
damages which it may incur by reason of the bund.
While the concerts took place, Imperial org and private
respondents failed to comply with their obligations, as a result of
which petitioner Liberty Insurance paid to Coca-cola the P3M bond.
Petitioner Liberty made demands upon the private respondents
based on the indemnity bond but to no avail.
Petitioner filed with RTC a complaint for damages with
application for the issuance of a writ of preliminary attachment
against respondents.
RTC:
RTC (presided by Judge De Leon) issued Order allowing issuance of
writ, stating:
There could have been fraud committed by defendants Arkin and
Madlangbayan in promising to give as security or collateral to their
indemnity agreement, which caused Liberty to release the security
bond when as it turns out, the TCT of a parcel of land supposedly
issued by Reg. of Deeds was fake and the Mercedes Benz was
already encumbered.
Fraud existed when the obligation was contracted in line with Sec. 1,
par (d), Rule 57.
Arkin filed a motion to Quash/recall Writ of Attachment but this was
denied (this time Judge Flojo).
Arkin filed MR (after more than 1 year). Judge Flojo reversed the
prior Order of denial of the Motion to Quash and thus directed the
lifting of the writ of preliminary attachment because:
A close examination of the evidence shows that the delivery of the
“fake collaterals” were made 2 days after the issuance of the surety
bond. Thus it was not prior or simultaneous with the execution of the
Surety bond.
On the claim that Arkin removed or disposed of his property with
intent to defraud his creditors, plaintiff did not prove the intent of
Arkin to defraud creditors.
Aggrieved, Petitioner filed Petition for Certiorari with the CA.
CA dismissed petition on the ground that petitioner did not file MR.
Hence this present petition. RELEVANT PROVISION: Rule 57, Sec.
1. Grounds upon which attachment may issue. — (d): In an action
against a party who has been guilty of a fraud of contracting the debt or
incurring the obligation upon which the action is brought, or in
concealing or disposing of the property for the taking, detention or
conversion of which the action is brought;
ISSUE:
Whether or not the writ of preliminary attachment in question was
properly or regularly issued – NO.
HELD:
The ground used as basis for the application for preliminary attachment
was Rule 57 Section 1(d) “In an action against a party who has
been guilty of a fraud of contracting the debt or incurring the
obligation upon which the action is brought, or in concealing or
disposing of the property for the taking, detention or conversion of
which the action is brought;” 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. Fraud should be committed upon
contracting the obligation sued upon.
As applied in the case at bar, It has been established that all the
collaterals given by the respondent Arkin as security for the bond
were either fraudulent or heavily encumbered.
It has also been proven that subsequent to the issuance of the surety
bond, Arkin started disposing of his other properties: a) the motor
vehicle given as collateral, b) his two other condominium units were
also alienated in favor of a company of which respondent Arkin is the
president.
other words, the merits of the action would be ventilated at a mere
hearing of a motion, instead of the regular trial. Therefore, when the
writ of attachment is of this nature, the only way it can be
dissolved is by a counterbond.
Side issue: Petitioner's failure to file a motion for reconsideration in the
trial court before commencing certiorari proceedings in the Court of
Appeals is not fatal considering the existence of special circumstances
that warrant immediate and more direct action
Disposition: Petition is GRANTED.

All these circumstances unerringly point to the devious scheme of

respondent Arkin to defraud petitioner. It is clear that fraud was
present when private respondent, among others, entered into an
indemnity agreement with petitioner. The actuations of respondent
Arkin indubitably lead to the conclusion that he never entertained the
idea of fulfilling his obligations under the agreement and was bent on
defrauding petitioner from the very beginning.

The Court ruled what “has been attended by irregularity is the assailed
order of respondent judge lifting the writ of attachment based on
grounds which are contradicted by the evidence on record.”

However, despite the irregular issuance of the attachment, Arkin is not

allowed to file a motion to dissolve the attachment on the ground that
the writ has been improperly or irregularly issued. As held in
Mindanao Savings and Loan v. CA, when the preliminary
attachment is issued upon a ground which is at the same time the
applicant's cause of action: e.g., . . . an action against a party who
has been guilty of fraud in contracting the debt or incurring the
obligation upon which the action is brought, the defendant is not
allowed to file a motion to dissolve the attachment under Section 13
of Rule 57 by offering to show the falsity of the factual averments in
the plaintiff's application and affidavits on which the writ was based
and consequently that the writ based therein had been improperly, or
irregularly, issued the reason being that the hearing on such motion for
dissolution of the writ would be tantamount to a trial on the merits. In