https://docs.google.

com/spreadsheets/d/153lpxxonoO82QoO88BVwi05euJI3dl4F8Uwl_MEllYA/
edit?usp=sharing - For your assigned case, refer to this spreadsheet!

PROVISIONAL REMEDIES

SYLLABUS FOR SY 2021-2022

Prof: Kristine Jane B. Pague

I. Introduction/preliminaries

Case 1 Zuneca Pharmaceutical vs. Natrapharm, Inc. G..R No. 197802, November
11, 2015

Principle A writ of preliminary injunction is generally based solely on initial and incomplete
evidence. The evidence submitted during the hearing on an application for a writ
of preliminary injunction is not conclusive or complete for only a sampling is
needed to give the trial court an idea of the justification for the preliminary
injunction pending the decision of the case on the merits. As such, the findings
of fact and opinion of a court when issuing the writ of preliminary injunction are
interlocutory in nature and made even before the trial on the merits is
commenced or terminated.

By contrast a permanent injunction, based on Section 9, Rule 58 of the Rules of

Court, forms part of the judgment on the merits and it can only be properly
ordered only on final judgment. A permanent injunction may thus be granted
after a trial or hearing on the merits of the case and a decree granting or
refusing an injunction should not be entered until after a hearing on the merits
where a verified answer containing denials is filed or where no answer is
required, or a rule to show cause is equivalent to an answer.

Facts
Respondent is an all-Filipino pharmaceutical company which manufactures and
sells a medicine bearing the generic name "CITICOLINE," which is indicated for
heart and stroke patients. The said medicine is marketed by respondent under
its registered trademark "ZYNAPSE," which respondent obtained from the
Intellectual Property Office (IPO).

Allegedly unknown to respondent, since 2003 or even as early as 2001,

petitioners have been selling a medicine imported from Lahore, Pakistan
bearing the generic name "CARBAMAZEPINE," an anti-convulsant indicated for
epilepsy, under the brand name "ZYNAPS," which trademark is however not
registered with the IPO. "ZYNAPS" is pronounced exactly like "ZYNAPSE."

On October 30, 2007, respondent sent petitioners a cease-and-desist demand

letter which the petitioners refused to heed. Petitioners claimed that they had
prior use of the name "ZYNAPS" since 2003, having been issued by the BFAD a
Certificate of Product Registration.
 Respondent filed a complaint against petitioners for trademark infringement for
violation of the Intellectual Property Code of the Philippines, with prayer for a
temporary restraining order (TRO) and/or writ of preliminary injunction. To justify
the TRO/writ of preliminary injunction, respondent cited Section 122 of R.A. No.
8293, under which the registration of "ZYNAPSE" gives it the exclusive right to
use the said name as well as to exclude others from using the same.
Certificates of registration are prima facie evidence of the registrant's ownership
of the mark and of the registrant's exclusive right to use the same. Respondent
also invoked the case of Conrad and Company, Inc. v. Court of Appeals where it
was ruled that an invasion of a registered mark entitles the holder of a certificate
of registration thereof to injunctive relief.

In their answer, petitioners argued that they enjoyed prior use in good faith of
the brand name "ZYNAPS," having submitted their application for CPR with the
BFAD on October 2, 2001, with the name "ZYNAPS" expressly indicated
thereon. The CPR was issued to them on April 15, 2003. Moreover, petitioners
averred that under Section 15919 of the IPC their right to use the said mark is
protected. RTC: denied respondent's application for a TRO, ruling that even if
respondent was able to first register its mark "ZYNAPSE" with the IPO in 2007,
it is nevertheless defeated by the prior actual use by petitioners of "ZYNAPS" in
2003.

RTC denied the application for a writ of preliminary injunction

The CA, in its April 18, 2011 Decision, granted the petition for certiorari,
permanently enjoining petitioners from the commercial use of "ZYNAPS."

On December 2, 2011, the RTC rendered a Decision on the merits of the case.
It found that the petitioners are liable to the respondent for damages. It also
enjoined the petitioners from using “Zynaps” and ordered all materials related to
it be disposed outside the channel of commerce or destroyed without
compensation.

Issue
Whether the CA may order a permanent injunction in deciding a petition for
certiorari against the denial of an application for a preliminary injunction issued
by the RTC - No.

Ruling
A writ of preliminary injunction is generally based solely on initial and incomplete
evidence. The evidence submitted during the hearing on an application for a writ
of preliminary injunction is not conclusive or complete for only a sampling is
needed to give the trial court an idea of the justification for the preliminary
injunction pending the decision of the case on the merits. As such, the findings
of fact and opinion of a court when issuing the writ of preliminary injunction are
interlocutory in nature and made even before the trial on the merits is
commenced or terminated.
 By contrast a permanent injunction, based on Section 9, Rule 58 of the Rules of
Court, forms part of the judgment on the merits and it can only be properly
ordered only on final judgment. A permanent injunction may thus be granted
after a trial or hearing on the merits of the case and a decree granting or
refusing an injunction should not be entered until after a hearing on the merits
where a verified answer containing denials is filed or where no answer is
required, or a rule to show cause is equivalent to an answer.

As such a preliminary injunction, like any preliminary writ and any interlocutory
order, cannot survive the main case of which it is an incident; because an
ancillary writ of preliminary injunction loses its force and effect after the decision
in the main petition.

Here, this Court is being asked to determine whether the CA erred by issuing a
permanent injunction in a case which questioned the propriety of the denial of
an ancillary writ. But with the RTC's December 2, 2011 Decision on the case for
"Injunction, Trademark Infringement, Damages and Destruction," the issues
raised in the instant petition have been rendered moot and academic. We note
that the case brought to the CA on a petition for certiorari merely involved the
RTC's denial of respondent's application for a writ of preliminary injunction, a
mere ancillary writ. Since a decision on the merits has already been rendered
and which includes in its disposition a permanent injunction, the proper remedy
is an appeal from the decision in the main case.

The petition is hereby DENIED for being moot and academic.

Case 2 Calo v. Roldan, 76 Phil. 445

Principle 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 interests,
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. The Rules of Court clearly
specify the cases in which they may be properly granted

Facts Private respondents filed an action for injunction alleging that they are the
owners of the subject lands and were in actual possession thereof. The trial
court denied the petition for a writ of preliminary injunction on the ground that
the petitioners were in actual possession of said lands. A MR was filed but had
not yet been decided by the judge as he was assigned to another court. Private
respondents filed a motion for reconsideration of the order denying their petition
for preliminary injunction be granted and/or for the appointment of a receiver of
the properties described in the complaint. Judge Roldan appointed a receiver of
 the land and fruits which were in the actual possession of petitioners.

Issue Whether or not the order appointing a receiver was proper.

Ruling NO. If an action by its nature does not require preservation or protection of the
interests of the parties, the provisional remedies denominated in the Rules of
Court cannot be applied for and granted. To each kind of action or actions a
proper provisional remedy is provided for by law. The Rules of Court clearly
specify the case in which they may be properly granted. Here, it is a matter not
only of law but of plain common sense that a plaintiff will not and legally cannot
ask for the appointment or receiver of property which he alleges to belong to
him and to be actually in his possession. For the owner and possessor of a
property is more interested than persons in preserving and administering it and
there would be no reason to appoint a receiver. The proper remedy to
respondents’ action of injunction is a preliminary prohibitory injunction if he is
the owner and in actual possession of the premises. Thus, it was grave abuse of
discretion for Judge Roldan to issue an order appointing a receiver.

I.A. Other provisional remedies:

1.) a deposit order

Case 1. LORENZO SHIPPING CORPORATION vs. FLORENCIO 0. VILLARIN and

FIRST CARGOMASTERS CORPORATION, CEBU ARRASTRE &
STEVEDORING SERVICES CORPORATION and GUERRERO G. DAJAO/
LORENZO SHIPPING CORPORATION, vs. FLORENCIO O. VILLARIN, G.R.
No. 175727/ G.R. No. 178713,

Principle

The provisional remedy of deposit is a "fair response to the exigencies

and equities of the situation", when the factual circumstances of the case
call for its application. Thus, when there is no juridical tie between the
obligee-plaintiff and the beneficiary of the services he has rendered; and
the obligor-defendant failed to set up a cross-claim to connect the two
parties with whom it had separate contracts, a deposit order would only
amount to a circumvention of the rules on preliminary attachment and an
unjust imposition on the alleged beneficiary who is not a party to the
contract sought to be enforced.

The define that a writ of preliminary attachment is a provisional remedy

issued upon order of the court where an action is pending to be levied
upon the property or properties of the defendant therein, the same to be
held thereafter by the Sheriff as security for the satisfaction of whatever
judgment might be secured in said action by the attaching creditor
against the defendant. It is governed by Rule 57 of the Revised Rules of
Court.
 The provisional remedy of attachment is available in order that the
defendant may not dispose of his property attached, and thus secure the
satisfaction of any judgment that may be secured by plaintiff from
defendant.

Facts
Lorenzo Shipping Corporation (LSC) is a domestic corporation which
operates interisland shipping vessels in the Philippines. On the other
hand, Cebu Arrastre and Stevedoring Services Corporation (CASSCOR)
provides arrastre and stevedoring services for LSC's ships calling at the
Port of Cebu under a Cargo Handling Contract dated March 8, 1997.

On February 20, 1997, Guerrero G. Dajao (Dajao), as President and

General Manager of CASSCOR, entered into a Memorandum of
Agreement (MOA) with Serafin Cabanlit (Cabanlit) and Florencio Villarin
(Villarin).

Under the MOA, Villarin and Cabanlit undertook to operate and manage
the arrastre and stevedoring operations of CASSCOR with respect to
LSC's vessels. CASSCOR was entitled to 5% of the proceeds of the
operation, while Dajao was entitled to a 2% royalty. 10% was allocated
for taxes, wages and other necessary expenses; and another 10% was
earmarked for the share of the Philippine Ports Authority. Villarin and
Cabanlit alleged that the rest of the proceeds, amounting to 73%, were
due to them.

Attachment Case

Alleging failure on the part of CASSCOR and Dajao to the shares of

Villarin, Cabanlit, and FCC (Villarin, et al.) they filed a Complaint for specific
performance and accounting against CASSCOR and Dajao. Impleading LSC
as a nominal defendant; to include a prayer for a writ of preliminary
attachment against CASSCOR and Dajao; and to include a prayer for
mandatory injunction against LSC. A writ of preliminary attachment was
thereafter issued by the RTC against CASSCOR and Dajao.

Around January, Villarin et al filed a motion for issuance of a writ of

preliminary attachement. Later on May LSC filed a motion for
clarification/reconsideration, arguing that it cannot be subjected t the
attachement writ.

The Court stated that all the defendants appear to be guilty of frud in the
performance of the obligation.
 The Deposit Case

The Court granted the Order to Deposit filed by Villarin et al. And on
September 6, 2005, moved for the issuance of a writ of execution.
However it was denied and the motion for reconsideration filed by LSC
was reconsider.

The CA rendered decision in favor of Villarin et al in both Deposit and

Attachment Cases. Hence this petition.

Issue
Whether or not the provisional remedy of deposit be availed in this case.

Ruling
The Court said No.

The provisional remedy of deposit is a "fair response to the exigencies

and equities of the situation", when the factual circumstances of the case
call for its application. Thus, when there is no juridical tie between the
obligee-plaintiff and the beneficiary of the services he has rendered; and
the obligor-defendant failed to set up a cross-claim to connect the two
parties with whom it had separate contracts, a deposit order would only
amount to a circumvention of the rules on preliminary attachment and an
unjust imposition on the alleged beneficiary who is not a party to the
contract sought to be enforced.

The define that a writ of preliminary attachment is a provisional remedy

issued upon order of the court where an action is pending to be levied
upon the property or properties of the defendant therein, the same to be
held thereafter by the Sheriff as security for the satisfaction of whatever
judgment might be secured in said action by the attaching creditor
against the defendant. It is governed by Rule 57 of the Revised Rules of
Court.

The provisional remedy of attachment is available in order that the

defendant may not dispose of his property attached, and thus secure the
satisfaction of any judgment that may be secured by plaintiff from
defendant.

The purpose and function of an attachment or garnishment is two-fold;

A. First, it seizes upon property of an alleged debtor in advance of

final judgment and holds it subject to appropriation thus preventing
the loss or dissipation of the property by fraud or otherwise;
 B. Second, it subjects .to the payment of a creditor's claim property
of the debtor in those cases where personal service cannot be
obtained upon the debtor.

The Court reiterated the long-standing doctrine that "[t]he provisional

remedy of preliminary attachment is harsh and rigorous for it exposes
the debtor to humiliation and annoyance. The rules governing its
issuance are, therefore, strictly construed against the applicant, 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 more than its jurisdiction.

The Court stated that the CA’s decision against LSC must be reversed.

The Court said LSC cannot be guilty of fraud within the contemplation of
Section 1(d), Rule 57 of the Rules of Court because it did not enter into
any agreement or contract with Villarin. In the absence of any
assignment of rights to LSC, the MOA can only bind the parties thereto.
Not being a party to the MOA, LSC cannot be subjected to an attachment
writ on the basis of Section 1(d).

The Court added that there is no fiduciary relation between LSC and
Villarin. LSC cannot be guilty of fraud within the contemplation of Section
1(d), Rule 57 of the Rules of Court because it did not enter into any
agreement or contract with Villarin. In the absence of any assignment of
rights to LSC, the MOA can only bind the parties thereto. Not being a
party to the MOA, LSC cannot be subjected to an attachment writ on the
basis of Section 1(d).

Deposit as a Provisional Remedy

While deposit may not be included in the provisional remedies stated in

Rules 57 to 61 of the Rules of Court, this does not mean, however, that
its concept as a provisional remedy is nonexistent. As correctly pointed
out by the appellate court, Rule 135 gives courts wide latitude in
employing means to carry their jurisdiction into effect. Thus, this Court
has upheld deposit orders issued by trial courts in cases involving actions
for partition, recovery of possession, and even annulment of contract .

A deposit order is an extraordinary provisional remedy whereby money

or other property is placed in custodia legis to ensure restitution to
whichever party is declared entitled thereto after court proceedings. It is
extraordinary because its basis is not found in Rules 57 to 61 of the Rules of
Court on Provisional Remedies but rather, under Sections 5(g) and 6 of Rule
135 of the same Rules53 pertaining to the inherent power of every court
"[t]o amend and control its process and orders so as to make them
conformable to law and justice;" as well as to issue "all auxiliary writs,
processes and other means necessary" to carry its jurisdiction into effect.
 Provisional deposit orders can be seen as falling under two general
categories:

a. the demandability of the money or other property to be deposited

is not, or cannot - because of the nature of the relief sought - be
contested by the party-depositor;

b. the party-depositor regularly receives money or other property

from a non-party during the pendency of the case, and the court
deems it proper to place such money or other property in custodia
legis pending final determination of the party truly entitled to the same.

The petitions on both cases are granted.

II. RULE 57: PRELIMINARY ATTACHMENT

Case 1. Northern Islands Company, Inc. vs. Sps Garcia G.R. No. 203240, March 18,
2015

Principle Being merely ancillary to a principal proceeding, the attachment must fail if the
suit itself cannot be maintained as the purpose of the writ can no longer be
justified.

Where the main action is appealed, the attachment which may have been
issued as an incident of that action, is also considered appealed and so also
removed from the jurisdiction of the court a quo. The attachment itself cannot be
the subject of a separate action independent of the principal action because the
attachment was only an incident of such action.

Facts On September 23, 2005, petitioner Northern Islands Co., Inc. filed a Complaint
with application for a writ of preliminary attachment, before the RTC against
Spouses Garcia, which was later amended. It alleged that: (a) petitioner caused
the delivery to respondents of various appliances in the aggregate amount of
P8,040,825.l 7; (b) the goods were transported, shipped, and delivered and
were accepted in good order and condition by respondents' representatives; (c)
the parties agreed that the goods delivered were payable within 120 days, and
that the unpaid amounts would earn interest at a rate of eighteen percent (18%)
per annum; (d) however, the value of the goods were not paid by respondents
despite repeated demands; and (e) respondents fraudulently asserted that
petitioner had no proof that they had indeed received the quantity of the subject
goods.

In connection with the application for a writ of preliminary attachment, petitioner

posted a bond, through Visayan Surety and Insurance Corporation, in the
amount of P8,040,825.17. On November 7, 2005, the RTC issued the writ
sought for.

Instead of filing an answer, respondents filed on November 11, 2001, an Urgent

Motion for Extension of Time to File Proper Pleading and Motion for Discovery,
asking the RTC to allow them to photocopy and personally examine the original
invoices, delivery cargo receipts, and bills of lading attached to the Amended
Complaint.

Thereafter, or on January 11, 2006, respondents filed a Motion to Discharge

Excess Attachment, alleging that the attachment previously ordered by the RTC
exceeded by P9,232,564.56 given that the estimated value of the attached
properties, including the garnished bank accounts, as assessed by their
appraiser, amounted to P17,273,409.73, while the attachment bond is only in
the amount of P8,040,825.17.

RTC: In an Order dated June 21, 2006, denied the Motion to Discharge Excess
Attachment, finding that the appraisal made by the appraiser was not reflective
of the true valuation of the properties, adding too that the bond posted by
petitioner stands as sufficient security for whatever damages respondents may
sustain by reason of the attachment.

On July 25, 2006, respondents filed a Motion for Partial Reconsideration of the
Order dated June 21, 2006, specifically assailing the denial of their Motion to
Discharge Excess Attachment. In this relation, they prayed that the RTC refer to
a commissioner, pursuant to Rule 32 of the Rules of Court, the factual
determination of the total aggregate amount of respondents' attached properties
so as to ascertain if the attachment was excessive. Also, they prayed that the
order for production and inspection be modified and that petitioner be ordered to
produce the original documents anew for their inspection and copying.

The foregoing motion was, however, denied by the RTC for lack of merit. Thus,
respondents elevated the matter to the CA via petition for certiorari and
mandamus.

In the interim, the RTC rendered a Decision dated September 21, 2011 in the
Main Case. Essentially, it dismissed petitioner's Amended Complaint due to the
absence of any evidence to prove that respondents had agreed to the pricing of
the subject goods.

The RTC's September 21, 2011 Decision was later appealed by petitioner
before the CA. Finding that the Notice of Appeal was seasonably filed, with the
payment of the appropriate docket fees, the RTC, on January 25, 2012, ordered
the elevation of the entire records of the Main Case to the CA. On the other
hand, records do not show that respondents filed any appeal.

CA: In a Decision dated January 19, 2012, partly granted the certiorari petition
of respondents, ordering the RTC to appoint a commissioner as provided under
Rule 32 of the Rules of Court as well as the subsequent discharge of any
excess attachment if so found therein, and, on the other hand, denying
 respondents' Motion for Discovery.

It held that: (a) on the issue of attachment, trial by commissioners under Rule 32
of the Rules of Court was proper so that the parties may finally settle their
conflicting valuations; and (b) on the matter of discovery, petitioner could not be
compelled to produce the originals sought by respondents for inspection since
they were not in the former's possession.

Issue Whether the RTC had lost jurisdiction over the matter of the preliminary
attachment after petitioner appealed the decision in the Main Case, and
thereafter ordered the transmittal of the records to the CA.

Ruling YES. Section 9, Rule 41 of the Rules of Court provides that in appeals by
notice of appeal, the court loses jurisdiction over the case upon the
perfection of the appeals filed in due time and the expiration of the time to
appeal of the other parties.

In this case, petitioner had duly perfected its appeal of the RTC's September 21,
2011 Decision resolving the Main Case through the timely filing of its Notice of
Appeal dated October 27, 2011, together with the payment of the appropriate
docket fees. The RTC, in an Order dated January 25, 2012, had actually
confirmed this fact, and thereby ordered the elevation of the entire records to
the CA. Meanwhile, records do not show that respondents filed any appeal,
resulting in the lapse of its own period to appeal therefrom. Thus, based on
Section 9, Rule 41, it cannot be seriously doubted that the RTC had already lost
jurisdiction over the Main Case.

With the RTC's loss of jurisdiction over the Main Case necessarily comes its
loss of jurisdiction all over matters merely ancillary thereto. Thus, the propriety
of conducting a trial by commissioners in order to determine the excessiveness
of the subject preliminary attachment, being a mere ancillary matter to the Main
Case, is now mooted by its supervening appeal.

In Sps. Olib v. Judge Pastoral, the Court, in view of the nature of a preliminary
attachment, definitively ruled that the attachment itself cannot be the subject of
a separate action independent of the principal action because the attachment
was only an incident of such action, viz.:

Attachment is defined as a provisional remedy by which the property of

an adverse party is taken into legal custody, either at the
commencement of an action or at any time thereafter, as a security for
the satisfaction of any judgment that may be recovered by the plaintiff or
any proper party.

It is an auxiliary remedy and cannot have an independent existence

apart from the main suit or claim instituted by the plaintiff against the
defendant. Being merely ancillary to a principal proceeding, the
attachment must fail if the suit itself cannot be maintained as the
purpose of the writ can no longer be justified.
 The consequence is that where the main action is appealed, the
attachment which may have been issued as an incident of that
action, is also considered appealed and so also removed from the
jurisdiction of the court a quo. The attachment itself cannot be the
subject of a separate action independent of the principal action
because the attachment was only an incident of such action.

That being said, it is now unnecessary to discuss the other issues raised herein.
In fine, the petition is GRANTED and the assailed CA rulings are SET ASIDE.

Case 2. Davao Light v. CA, 204 SCRA 343

Principle A remedy which is purely statutory in respect of which the law requires a strict of
construction of the provisions granting it. No principle, whether statutory or
through jurisprudence, prohibits its issuance by any court before the acquisition
of jurisdiction over the person.

Preliminary Attachment is a provisional remedy in virtue of which a plaintiff or

other party may, at the commencement of the action or at any time thereafter,
have the property of the adverse party taken into custody of court as security for
satisfaction of judgment to be recovered.

Facts
Davao Light and
and damages PowerQueensland
against Inc, Co. filed a complaint
Hotel for recovery
and Teodorico of sum
Adarna. of money
The complaint
contained an ex parte application for a writ of preliminary attachment. Judge
Nartatez granted the writ and fixed the attachment bond at around P4Million.
The summons, copy of complaint, writ of attachment, copy of attachment bond
were served upon Queensland and Adarna. Pursuant to the writ, the Sheriff
seized the properties of the latter.
Queensland
jurisdiction toand Adarna
issue filed because
the same a motion attothe
discharge
time thethe attachment
order for lack
of attachment of
was
promulgated (May 3, 1989) and the attachment writ issued (May 11,1989), the
Trial Court had not yet acquired jurisdiction over cause and person of
defendants. Trial Court denied the motion to discharge. The Court of Appeals
annulled the Trial Court’s Order. Davao seeks to reverse the Court of Appeal’s
order.

Issue Whether or not preliminary attachment may issue ex parte against a defendant
before acquisition of jurisdiction of the latter’s person by service of summons or
his voluntary submission to the court’s authority.

Ruling No. The plaintiff may apply for and obtain a writ of preliminary attachment upon
fulfilment of the pertinent requisites laid down by law and that he may do so at
any time, either before or after service of summons on the defendant.

The Court declared that nothing in the Rules of Court makes notice and hearing
indispensable and mandatory requisites for the issuance of the writ of
attachment, the only pre requisite is that the court be satisfied, upon
consideration of the affidavit of the applicant or of some other person who
personally knows the facts that a sufficient cause of actions exists, that the case
is one of those mentioned in Section 1, Rule 57, that there is no other sufficient
security for the claim sought to be enforced by the action, and that the amount
 due to the applicant, or the value of the property the possession of which he is
entitled to recover, is as much as the sum for which the order of attachment is
granted above all legal counterclaims. If the court be so satisfied, the order of
attachment shall be granted, and the writ shall issue upon the applicant’s
posting of bond executed to the adverse party in an amount to be fixed by the
judge not exceeding the plaintiff’s claim, conditioned that the latter will pay all
the costs which may be adjudged to the adverse party and all damages which
he may sustain by reason of the attachment, if the court shall finally adjudge
that the applicant was not entitled thereto.

Two ways of discharging the attachment are through posting of a counterbond

and by showing of its improper or irregular issuance. With respect to other
provisional remedies; preliminary injunction rule 58; receivership rule 59;
replevin or delivery of personal property rule 60; the rule is the same they may
also be issued ex parte.

Case 3. Insular Bank of Asia and America v. CA, 190 SCRA 629

Principle A debtor's inability to pay, is not necessarily synonymous with fraudulent

intent not to honor an admitted obligation, that will justify the issuance of
a writ of attachment.—The purpose of attachment is to secure a contingent
lien on defendant's property until plaintiff can obtain a judgment and have such
property applied to its satisfaction or to make provision for unsecured debts in
such cases where the means of satisfaction thereof are liable to be removed
beyond the jurisdiction or improperly disposed of (by fraud or otherwise) or
concealed or placed beyond the reach of creditors.

It was held that a writ of preliminary attachment cannot be issued for moral and
exemplary damages and other unliquidated and contingent claims. The amount
of such damages is not for the party to determine . Its assessment is left to the
discretion of the court, according to the circumstances of each case. (page 20
book)

Petitioner claims that at the time the obligation was incurred by respondent
CCC, the latter already had the fraudulent intent not to pay the obligation or
indebtedness. This contention is not borne out by the records. Upon the other
hand, respondent CCC has not denied that it was undergoing financial
difficulties and had in fact called a creditor's meeting to make full disclosure of
its business condition and negotiate for payment of its outstanding obligations.
Petitioner also claims there was an incipient misrepresentation regarding
respondent's capacity to pay. The Court of Appeals found, on the other hand,
that there was no dissipation of assets, in fact, respondent's withdrawal of
money from Far East Bank and Trust Co. was intended to finance its
operations. Inability to pay, we rule, is not necessarily synonymous with
fraudulent intent not to honor an admitted obligation. (Insular Bank of Asia &
America, Inc. vs. Court of Appeals, 190 SCRA 629, G.R. No. 61011 October 18,
1990).
Facts
Petitioner Insular Bank of Asia and America (IBAA) made a money market
placement with respondent Commercial Credit Corporation (CCC) on 12
December 1980 in the amount of P1,877,053.03. In consideration of such
placement, Commercial Credit Corporation executed a Non Negotiable
Repurchase Agreement whereby it conveyed to IBAA securities issued by
International Corporate Bank (Interbank) with a face value of P2,000,000.00 and
with a maturity date of 22 April 1981.

The parties (IBAA and CCC) also executed a resale agreement which bound
IBAA to re-sell to CCC the Interbank securities for P2,000,000.00 on 22 April
1981. On due date, CCC caused to be issued to IBAA a Commercial Bank and
Trust Co. (CBTC) cashier's check for P2,000,000.00 which was, however,
dishonored upon presentment for being drawn against uncollected deposits.

On 18 May 1981, IBAA advised CCC of the dishonor and demanded cash
payment. In its reply, CCC admitted difficulty in replacing the dishonored check
and proposed payment on a staggered basis, attaching to the proposal a copy
of a Central Bank letter approving its (CCC's) request for additional standby
credit facility to meet its maturing money market placements.

Due to CCC's failure to meet its obligation despite demands, on 24 August

1981, IBAA filed an action for recovery of sum of money with a prayer for the
issuance of a writ of preliminary attachment before the CFI of Rizal, Pasig,
claiming that the action is commenced against defendant 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; this is an action against defendant
who has removed or disposed of his property, or is about to do so, with intent to
defraud his creditors.

On 20 October 1981, the CFI of Rizal issued an order granting the preliminary
attachment against real and personal properties of CCC. On 19 November
1981, CCC filed a petition for certiorari with the CA alleging grave abuse of
discretion amounting to lack of jurisdiction on the part of the RTC of Rizal in the
issuance of the attachment order.

The Court of Appeals, in its order has set aside the RTC’s decision. It held that,

"Petitioner (meaning, CCC) operates as an on-going concern. While it is apparent—that

it is in a financial crisis with the Central Bank's grant of an additional standby credit
facility of P20 million in favor of the latter, the attachment of its property will unduly
hinder any transaction where it can regain its financial solvency to meet its obligations. x
x x.

xxx xxx xxx

It is true that petitioner failed to pay the private respondent the sum of P2,000,000.00
due to its financial difficulty at the time of the maturity date for the payment of
P2,000,000.00 but We find no reason to uphold the order of attachment issued by the
respondent judge on October 20,1981 where there is no showing that the petitioner
 was performing acts to defraud its creditors or by disposing its assets to the
prejudice of its creditors or persons who may have a claim to its assets. On the
other hand, the withdrawal of petitioner's bank deposits in the Far East Bank and Trust
Company (which were then subject to the garnishment proceedings by the respondent
Deputy Sheriff) was intended to finance the operations of the petitioner as an on-going
concern, in payment of wages of its employees."

Not satisfied with the Court of Appeals decision, the present petition for review
was filed by petitioner bank.

Issue
Whether or not the questioned Court of Appeals decision setting aside the order
of the CFI of Rizal, Branch X, Pasig granting a writ of preliminary attachment
upon a complaint for collection of a sum of money which the respondent CCC
allegedly fraudulently contracted and now has difficulty paying, is in accordance
with law or a reversible error.

Ruling
HELD: It is in Accordance with Law.

The purpose of attachment is to secure a contingent lien on defendant's

property until plaintiff can obtain a judgment and have such property applied to
its satisfaction or to make provision for unsecured debts in such cases where
the means of satisfaction thereof are liable to be removed beyond the
jurisdiction or improperly disposed of (by fraud or otherwise) or concealed or
placed beyond the reach of creditors.

Petitioner claims that at the time the obligation was incurred by respondent
CCC, the latter already had the fraudulent intent not to pay the obligation or
indebtedness. This contention is not borne out by the records. Upon the other
hand, respondent CCC has not denied that it was undergoing financial
difficulties and had in fact called a creditor's meeting to make full disclosure of
its business condition and negotiate for payment of its outstanding obligations.
Petitioner also claims there was an incipient misrepresentation regarding
respondent's capacity to pay. The Court of Appeals found, on the other hand,
that there was no dissipation of assets, in fact, respondent's withdrawal of
money from Far East Bank and Trust Co. was intended to finance its operations.
Inability to pay, we rule, is not necessarily synonymous with fraudulent intent not
to honor an admitted obligation.

There is thus no reversible error in the questioned Court of Appeals decision

which we find to be in accordance with law.

WHEREFORE, the petition is DENIED. The Court of Appeals decision in CA-

G.R. No. SP-13376-SCA is AFFIRMED in toto.
Case 4. Spouses Yu v. Ngo Yet Te, G.R. No. 155868, February 6, 2007

Principle
Where there is wrongful attachment, the attachment defendant may recover
actual damages even without proof that the attachment plaintiff
acted in bad faith in obtaining the attachment. However, if it is alleged
and established that the attachment was not merely wrongful but also malicious,
the attachment defendant may recover moral damages and exemplary damages
as well. Either way, the wrongfulness of the attachment does not warrant the
automatic award of damages to the attachment defendant; the latter must first
discharge the burden of proving the nature and extent of the loss or injury
incurred by reason of the wrongful attachment

To merit an award of actual damages arising from a wrongful attachment, the

attachment defendant must prove, with the best evidence obtainable, the fact
of loss or injury suffered and the amount thereof. Such loss or injury
must be of the kind which is not only capable of proof but must actually be
proved with a reasonable degree of certainty. As to its amount, the same
must be measurable based on specific facts, and not on guesswork or
speculation. In particular, if the claim for actual damages covers unrealized
profits, the amount of unrealized profits must be established and supported by
independent evidence of the mean income of the business undertaking
interrupted by the illegal seizure.

As to moral and exemplary damages, to merit an award thereof, it must be

shown that the wrongful attachment was obtained by the attachment
plaintiff with malice or bad faith, such as by appending a false affidavit to
his application

As a rule, attorney’s fees cannot be awarded when moral and

exemplary damages are not granted, the exception however is when a
party incurred expenses to lift a wrongfully issued writ of attachment.

Facts Spouses Gregorio and Josefa Yu purchased from Ngo Yet Te bars of detergent
soap worth P594,240.00 and issued to the latter three postdated checks as
payment. However, upon presentment of the checks at maturity, said checks
were returned dishonored and stamped “ACCOUNT CLOSED”. Respondent
demanded payment from petitioners, but they did not heed her demands.
Respondent, through her daughter, filed with RTC for Collection of Sum of
Money and Damages with Prayer for Preliminary Attachment. She also attached
to her complaint an affidavit executed by Sy that petitioners were guilty of fraud
in entering into the purchase agreement for they never intended to pay the
contract price, and that, based on reliable information, they were about to move
or dispose of their properties to defraud their creditors.

The RTC ordered for the properties of petitioners to be levied and attached
consisting of one parcel of land and four units of motor vehicle. Petitioners filed
an Answer with counterclaim, Urgent Motion to Dissolve writ of Preliminary
Attachment, and Claim against Surety Bond. The RTC, then, discharged from
attachment the Toyota Ford Fierra, jeep, and delivery van on humanitarian
 grounds. The CA later on lifted the RTC Order of Attachment on the ground that
the complaint and affidavit only contain general averments and failed to states
particularly how fraud was committed by petitioners. The Motion for
Reconsideration was likewise denied. The SC also denied Te’s Petition for
Review on Certiorari for having been filed late and for failure to show that a
reversible error was committed by the CA.

The RTC, however, apparently not informed of SCs decision, ruled in favor of
herein respondents. On their appeal with CA, Spouses Yu questioned only that
portion of the July 20, 1994 Decision where the RTC declined to rule on their
counterclaim for damages. However, Spouses Yu did not dispute the specific
monetary awards granted to respondent Te; and therefore, the same have
become final and executory. The CA, while affirming RTCs decision in toto,
made a ruling on the counterclaim of Spouses Yu by declaring that the latter had
failed to adduce sufficient evidence of their entitlement to damages. Hence, this
petition.

Issues
ISSUE #1: WON the petitioner’s counterclaim was correctly
dismissed for failure to comply with the procedure laid down in
Section 20 of Rule 57? – NO.

ISSUE #2: WON the appellate court erred in refusing to award

actual, moral and exemplary damages after it was established by
final judgment that the writ of attachment was procured with no true
ground for its issuance. – NO.

Ruling
ISSUE #1: WON the petitioner’s counterclaim was correctly
dismissed for failure to comply with the procedure laid down in
Section 20 of Rule 57? – NO.

RESPONDENT: Regardless of the evidence presented by Spouses Yu, their

counterclaim was correctly dismissed for failure to comply with the procedure
laid down in Section 20 of Rule 57. As Visayan Surety was not notified of the
counterclaim, no judgment thereon could be validly rendered.

COURT: Such argument is not only flawed, it is also specious. Spouses Yu filed
a Claim Against Surety Bond on the same day they filed their Answer and Urgent
Motion to Dissolve Writ of Preliminary Attachment. The records reveal that
Spouses Yu filed with the RTC a Motion to Give Notice to Surety. The RTC
granted the Motion. Accordingly, Visayan Surety was notified of the pre-trial
conference to apprise it of a pending claim against its attachment bond. Visayan
Surety received the notice as shown by a registry return receipt attached to the
records.

Moreover, even if it were true that Visayan Surety was left in the proceedings a
quo, such omission is not fatal to the cause of Spouses Yu. If the surety was
not given notice when the claim for damages against the principal in
the replevin bond was heard, then as a matter of procedural due
process the surety is entitled to be heard when the judgment for
damages against the principal is sought to be enforced against the
surety's replevin bond." This remedy is applicable for the procedures
governing claims for damages on an attachment bond and on a
replevin bond are the same.

ISSUE #2: WON the appellate court erred in refusing to award

actual, moral and exemplary damages after it was established by
final judgment that the writ of attachment was procured with no true
ground for its issuance.– NO.

The SC ruled that the counterclaim disputed therein was not for
moral damages and therefore, there was no need to prove malice. In
Lazatin v. Twaño, the Court laid down the rule that where there is wrongful
attachment, the attachment defendant may recover actual damages even without
proof that the attachment plaintiff acted in bad faith in obtaining the
attachment. However, if it is alleged and established that the attachment was not
merely wrongful but also malicious, the attachment defendant may recover
moral damages and exemplary damages as well. Either way, the wrongfulness of
the attachment does not warrant the automatic award of damages to the
attachment defendant; the latter must first discharge the burden of proving the
nature and extent of the loss or injury incurred by reason of the wrongful
attachment.

The Court also held that petitioners are not relieved of the burden of proving the
basis of their counterclaim for damages. To merit an award of actual damages
arising from a wrongful attachment, the attachment defendant must prove, with
the best evidence obtainable, the fact of loss or injury suffered and the amount
thereof. Such loss or injury must be of the kind which is not only capable of
proof but must actually be proved with a reasonable degree of certainty. As to its
amount, the same must be measurable based on specific facts, and not on
guesswork or speculation. In particular, if the claim for actual damages covers
unrealized profits, the amount of unrealized profits must be established and
supported by independent evidence of the mean income of the business
undertaking interrupted by the illegal seizure.

The SC also affirmed CAs finding that spouses Yu failed to prove their
counterclaim of actual damages by relying mainly on submission of used and
unused ticket stubs and ticket sales for five (5) days. Thus, Spouses Yu cannot
complain that they were unreasonably deprived of the use of the passenger bus
by reason of the subsequent wrongful attachment issued in Civil Case No. 4061-
V-93. Nor can they also attribute to the wrongful attachment their failure to earn
income or profit from the operation of the passenger bus. The submitted basis is
too speculative and conjectural. No reports regarding the average actual profits
and other evidence of profitability necessary to prove the amount of actual
 damages were presented.

As to moral and exemplary damages, to merit an award thereof, it must be

shown that the wrongful attachment was obtained by the attachment plaintiff
with malice or bad faith, such as by appending a false affidavit to his application.
The SC did not grant moral and exemplary damages. Based on the foregoing
testimony, it is not difficult to understand why Te concluded that Spouses Yu
never intended to pay their obligation for they had available funds in their bank
but chose to transfer said funds instead of cover the checks they issued.

Petitioners were, however, awarded temperate or moderate damages of

P50,000 for pecuniary loss when their properties were wrongfully seized.

Case 5. Security Pacific Assurance Corporation v. Tria- Infante, 468 SSCRA 526

Principle
Counter-bonds are replacements of the property formerly attached, and just as
the latter, may be levied upon after final judgment.

NOTE: The mere posting of the counter-bond does not automatically discharge
the writ of attachment. It is only after the hearing and after judge has ordered
the Civil Procedure 137 discharge of attachment that the same is properly
discharged.

Facts
On 26 August 1988, Reynaldo Anzures instituted a complaint against Villaluz for
violation of Batas Pambansa Blg. 22. The criminal information was brought before
the Regional Trial Court, City of Manila, and raffled off to Branch 9, then presided
over by Judge Edilberto G. Sandoval, docketed as Criminal Case No. 89-69257.

An Ex-Parte Motion for Preliminary Attachment dated 06 March 1989 was filed by
Reynaldo Anzures praying that pending the hearing on the merits of the case, a Writ
of Preliminary Attachment be issued ordering the sheriff to attach the properties of
Villaluz in accordance with the Rules.

On 03 July 1989, the trial court issued an Order for the issuance of a writ of
preliminary attachment "upon complainant’s posting of a bond which is hereby fixed
at ₱2,123,400.00 and the Court’s approval of the same under the condition
prescribed by Sec. 4 of Rule 57 of the Rules of Court…."

An attachment bond was thereafter posted by Reynaldo Anzures and approved by

the court. Thereafter, the sheriff attached certain properties of Villaluz, which were
duly annotated on the corresponding certificates of title.

On 25 May 1990, the trial court rendered a Decision on the case acquitting Villaluz
of the crime charged, but held her civilly liable. As to the civil aspect of the case
 however, accused is ordered to pay complainant Reynaldo Anzures the sum
P2,123,400.00 PESOS with legal rate of interest from December 18, 1987 until fully
paid, the sum of P50,000.00 as attorney’s fees and the cost of suit.

Villaluz interposed an appeal with the Court of Appeals, and on 30 April 1992, the
latter rendered its Decision affirming the Decision of the Regional Trial Court of
Manila.

The case was elevated to the Supreme Court (G.R. No. 106214), and during its
pendency, Villaluz posted a counter-bond in the amount of ₱2,500,000.00 issued by
petitioner Security Pacific Assurance Corporation. Villaluz, on the same date of the
counter-bond, filed an Urgent Motion to Discharge Attachment.

On 05 September 1997, we promulgated our decision in G.R. No. 106214, affirming

in toto the decision of the Court of Appeals.

In view of the finality of this Court’s decision in G.R. No. 106214, the private
complainant moved for execution of judgment before the trial court.

On 07 May 1999, the trial court, now presided over by respondent Judge, issued a
Writ of Execution. Reynaldo Anzures, through the private prosecutor, filed a Motion
to Proceed with Garnishment, which was opposed by petitioner contending that it
should not be held liable on the counter-attachment bond.

The trial court, in its Order dated 31 March 2000, granted the Motion to Proceed
with Garnishment. The sheriff issued a Follow-Up of Garnishment addressed to the
President/General Manager of petitioner.

Issue
WHETHER OR NOT THE COURT OF Appeals committed reversible error in
affirming the 31 march 2000 order of public respondent judge which allowed
execution on the counter-bond issued by the petitioner.

Ruling NO. Under the Rules, there are two (2) ways to secure the discharge of an
attachment. First, the party whose property has been attached or a person
appearing on his behalf may post a security. Second, said party may show that the
order of attachment was improperly or irregularly issued. The first applies in the
instant case. Section 12, Rule 57, provides:

SEC. 12. Discharge of attachment upon giving counter-bond. – After a writ of

attachment has been enforced, the party whose property has been attached, or the
person appearing on his behalf, may move for the discharge of the attachment
wholly or in part on the security given. The court shall, after due notice and hearing,
order the discharge of the attachment if the movant makes a cash deposit, or files a
counter-bond executed to the attaching party with the clerk of the court where the
application is made, in an amount equal to that fixed by the court in the order of
attachment, exclusive of costs. But if the attachment is sought to be discharged with
respect to a particular property, the counter-bond shall be equal to the value of that
property as determined by the court. In either case, the cash deposit or the counter-
bond shall secure the payment of any judgment that the attaching party may recover
in the action. A notice of the deposit shall forthwith be served on the attaching party.
Upon the discharge of an attachment in accordance with the provisions of this
section, the property attached, or the proceeds of any sale thereof, shall be
delivered to the party making the deposit or giving the counter-bond, or to the
person appearing on his behalf, the deposit or counter-bond aforesaid standing in
place of the property so released. Should such counter-bond for any reason be
found to be or become insufficient, and the party furnishing the same fail to file an
additional counter-bond, the attaching party may apply for a new order of
attachment.

It should be noted that in G.R. No. 106214, per our Resolution dated 15 January
1997, we permitted Villaluz to file a counter-attachment bond. On 17 February 1997,
we required the private respondents to comment on the sufficiency of the counter-
bond posted by Villaluz.

During the pendency of this petition, a counter-attachment bond was filed by

petitioner Villaluz before this Court to discharge the attachment earlier issued by the
trial court. Said bond amounting to P2.5 million was furnished by Security Pacific
Assurance, Corp. which agreed to bind itself "jointly and severally" with petitioner for
"any judgment" that may be recovered by private respondent against the former.

We are not unmindful of our ruling in the case of Belisle Investment and Finance
Co., Inc. v. State Investment House, Inc.,47 where we held:

. . . [T]he Court of Appeals correctly ruled that the mere posting of a counterbond
does not automatically discharge the writ of attachment. It is only after hearing and
after the judge has ordered the discharge of the attachment if a cash deposit is
made or a counterbond is executed to the attaching creditor is filed, that the writ of
attachment is properly discharged under Section 12, Rule 57 of the Rules of Court.

The ruling in Belisle, at first glance, would suggest an error in the assailed ruling of
the Court of Appeals because there was no specific resolution discharging the
attachment and approving the counter-bond. As above-explained, however,
consideration of our decision in G.R. No. 106214 in its entirety will readily show that
this Court has virtually discharged the attachment after all the parties therein have
been heard on the matter.

WHEREFORE, in view of all the foregoing, the Decision and Resolution of the Court
of Appeals dated 16 June 2000 and 22 August 2000, respectively, are both
AFFIRMED. Costs against petitioner.

SO ORDERED.
Case 6. WATERCRAFT VENTURE CORPORATION, represented by its
VicePresident, ROSARIO E. RANOA,vs ALFRED RAYMOND WOLFE, GR.
No. 181721, September 9, 2015

Principle The applicant must sufficiently show the factual circumstances of the alleged
fraud because it cannot be inferred from the debtor’s mere non-payment or
failure to comply with his obligation.

Preliminary attachment should be resorted to only when necessary and as a last

remedy because it exposes the debtor to humiliation and annoyance.11 It must
be granted only on concrete and specific grounds and not merely on general
averments quoting the words of the rules.12 Since attachment is harsh,
extraordinary, and summary in nature,13 the rules on the application of a writ of
attachment must be strictly construed in favor of the defendant. (page 14 book)

Facts Sometime in June 1997, Watercraft hired respondent Alfred Raymond Wolfe
(Wolfe), a British national and resident of Subic Bay Freeport Zone, Zambales,
as its Shipyard Manager.
During his employment, Wolfe stored the sailboat, Knotty Gull, within
Watercraft's boat storage facilities, but never paid for the storage fees.
On March 7, 2002, Watercraft terminated the employment of Wolfe.
Sometime in June 2002, Wolfe pulled out his sailboat from Watercraft's storage
facilities after signing a Boat Pull-Out Clearance dated June 29, 2002 where he
allegedly acknowledged the outstanding obligation of Sixteen Thousand Three
Hundred and Twenty-Four and 82/100 US
Dollars (US$16,324.82) representing unpaid boat storage fees for the period of
June 1997 to June 2002. Despite repeated demands, he failed to pay the said
amount.
Thus, on July 7, 2005, Watercraft filed against Wolfe a Complaint for Collection
of Sum of Money with Damages with an Application for the Issuance of a Writ of
Preliminary Attachment.
In his Answer, Wolfe... denied owing Watercraft the amount of US$16,324.82
representing storage fees for the sailboat. He explained that the sailboat was
purchased in February 1998 as part of an... agreement between him and
Watercraft1 s then General Manager, Barry Bailey, and its President, Ricky
Sandoval, for it to be repaired and used as training or fill-in project for the staff,
and to be sold later on. He added that pursuant to a central Listing Agreement
for the sale... of the sailboat, he was appointed as agent, placed in possession
thereof and entitled to a ten percent (10%) sales commission. He insisted that
nowhere in the agreement was there a stipulation that berthing and storage fees
will be charged during the entire time that the... sailboat was in Watercraft's
dockyard.
Fie pointed out that the complaint was an offshoot of an illegal dismissal case
he... filed against Watercraft which had been decided in his favor by the Labor
Arbiter.
Meanwhile, finding Watercraft's ex-parte application for writ of preliminary
attachment sufficient in form and in substance pursuant to Section 1 of Rule 57
of the Rules of Court, the RTC granted the same in the Order dated July 15,
2005
Pursuant to the Order dated July 15, 2005, the Writ of Attachment dated August
3, 2005 and the Notice of Attachment dated August 5, 2005 were issued, and
Wolfe's two vehicles, a gray Mercedes Benz with plate number XGJ 819 and a
maroon Toyota Corolla with plate number TFW 110,... were levied upon.
On August 12, 2005, Wolfe's accounts at the Bank of the Philippine Islands
were also garnished.
On November 8, 2005, Wolfe filed a Motion to Discharge the Writ of Attachment,
arguing that Watercraft failed to show the existence of fraud and that the mere
failure to pay or perform an obligation does not amount to fraud. Me also
claimed that he is not a flight risk for the... following reasons: (1) contrary to the
claim that his Special Working Visa expired in April 2005, his Special Subic
Working Visa and Alien Certificate of Registration are valid until April 25, 2007
and May 11, 2006, respectively; (2) he and his family have been residing in the
Philippines since 1997; (3) he is an existing stockholder and officer of Wolfe
Marine Corporation which is registered with the Securities and Exchange
Commission, and a consultant of "Sudeco/Ayala" projects in Subic, a member of
the Multipartite Committee for the new port... development in Subic, and the
Subic Chamber of Commerce; and (4) he intends to finish prosecuting his
pending labor case against Watercraft.
In an Order dated March 20, 2006, the RTC denied Wolfe's Motion to Discharge
Writ of Attachment and Motion for Preliminary Hearing for lack of merit.
Wolfe filed a petition for certiorari before the CA.
The CA granted Wolfe's petition in a Decision dated September 2007
The CA ruled that the act of issuing the writ of preliminary attachment ex-parte
constitutes grave abuse of discretion on the part of the RTC
In the instant case, the Affidavit of Merit executed by Rosario E. Rañoa,
Watercraft's Vice-President, failed to show fraudulent intent on the part of Wolfe
to defraud the company. It merely enumerated the circumstances tending to
show the alleged possibility of Wolfe's flight... from the country. And upon
Wolfe's filing of the Motion to Discharge the Writ, what the respondent Judge
should have done was to determine, through a hearing, whether the allegations
of fraud were true.
As correctly noted by Wolfe, although Sec. 1 of Rule 57 allows a party to invoke
fraud as a ground for the issuance of a writ of attachment, the Rules require that
in all averments of fraud, the circumstances constituting fraud must be stated
with particularity, pursuant to Rule
8, Section 5.
 Wolfe's mere failure to pay the boat... storage fees does not necessarily amount
to fraud, absent any showing that such failure was due to [insidious]
machinations and intent on his part to defraud Watercraft of the amount due it.
As to the allegation that Wolfe is a flight risk, thereby warranting the issuance of
the writ, the same lacks merit.
circumstances... should have convinced the trial court that Wolfe would not want
to... leave the country at will just because a suit for the collection of the alleged
unpaid boat storage fees has been filed against him by Watercraft.
Neither should the fact that Wolfe's Special Working Visa expired in April 2005
lead automatically to the conclusion that he would leave the country. It is worth
noting that all visas issued by the government to foreigners staying in the
Philippines have expiration periods.
These visas, however, may be renewed, subject to the requirements of the law.
In Wolfe's case, he indeed renewed his visa

Issue (1)WON the issuance of the writ of preliminary attachment ex-parte despite the
applicant’s affidavit of merit being squarely refuted by the defendant is valid

(2)WON the affidavit of merit filed by Watercraft sufficiently alleged the

existence of fraud

Ruling (1) No.

A writ of preliminary attachment should be resorted to only where necessary
and as a last remedy because it exposes the debtor to humiliation and
annoyance. It must be granted only on concrete and specific grounds and not
merely on general averments quoting the words of the rules.
Since attachment is harsh, extraordinary, and summary in nature, the rules on
the application of a writ of attachment must be strictly construed in favor of the
defendant. If the party against whom the writ is prayed for squarely controverts
the allegation of fraud, it is incumbent on the applicant to prove his allegation.

(2) No.
The sufficient or insufficiency of an affidavit depends upon the amount of credit
given it by the judge, and its acceptance or rejection upon his sound discretion.
Wolfe’s mere failure to pay the boat storage feeds does not necessarily amount
to fraud, absent any showing that such failure was due to insidious
machinations and intent on his part to defraud Watercraft of the amount due it.
Fraudulent intent is not a physical entity but a condition of the mind beyond the
reach of the senses,usually kept secret, very unlikely to be confessed, and
therefore can only be proved by unguarded expressions, conduct, and
circumstances. Thus, the applicant must sufficiently show the factual
circumstances of the alleged fraud because it cannot be inferred from the
debtor’s mere non-payment. An affidavit which does not contain concrete and
specific grounds is inadequate to sustain
the issuance of such writ. Mere general averments render the writ defective and
 the court that ordered its issuance acted with grave abuse of discretion
amounting to excess of jurisdiction

Case 7. DM Wenceslao and Associates, Inc. v Readycon Trading and Construction

Corp., G.R. No. 154106, June 29, 2004

Principle The mere existence of malice and bad faith would not per se warrant the award
of actual or compensatory damages. To grant such damages, sufficient proof
thereon is required.

Petitioner is not entitled to an award of actual or compensatory damages since

both the trial and the appellate courts held that the complaint had merit.
READYCON is entitled to a writ of preliminary attachment as a provisional
remedy by which the property of WENCESLAO is taken into custody of the law
as a security for the satisfaction of any judgment which the plaintiff may recover.

Facts WENCESLAO had a contract with the Public Estates Authority (PEA) for the
improvement of the main expressway in the R-1 Toll Project along the Coastal
Road in Parañaque City. To fulfill its obligations to the PEA, WENCESLAO
entered into a contract with READYCON for the purchase asphalt materials
valued at ₱1,178,308.75. Under the contract, WENCESLAO was bound to pay
respondent a twenty percent (20%) downpayment, or ₱235,661.75, upon
delivery of the materials contracted for. The balance of the contract price,
amounting to ₱942,647, was to be paid within fifteen (15) days thereof. It was
further stipulated by the parties that respondent was to furnish, deliver, lay, roll
the asphalt, and if necessary, make the needed corrections on a prepared base
at the jobsite.

Fifteen (15) days after READYCON performed the said work, it demanded that
WENCESLAO pay the balance of the contract price. WENCESLAO, however,
ignored said demand. The demand letter sent by READYCON’S counsel was
also ignored by WENCESLAO.

In view of this development, READYCON filed a complaint for collection of a

sum of money and damages, with prayer for writ of preliminary attachment
against D.M. Wenceslao and/or Dominador Dayrit. READYCON demanded
payment of ₱1,014,110.45 from petitioners herein with ₱914,870.75 as the
balance of contract price, as well as payment of ₱99,239.70, representing
another unpaid account.

As READYCON timely posted the required bond of ₱1,150,000, its application

for the writ of preliminary attachment was granted.
 The RTC Sheriff attached certain assets of WENCESLAO, particularly, the
following heavy equipments: One (1) asphalt paver, one (1) bulldozer, one (1)
dozer and one (1) grader.

WENCESLAO then moved for the release of the attached equipments and
posted its counter-bond. The trial court granted the motion and directed the RTC
Sheriff to return the attached equipments.

Contention of Parties:

Petitioners cited Lazatin v. Twano and Castro, 112 Phil. 733 (1961), reiterated in
MC Engineering v. Court of Appeals, 380 SCRA 116 (2002) wherein the Court held
that actual or compensatory damages may be recovered for wrongful, though not
malicious, attachment. Lazatin also held that attorney’s fees may be recovered
under Article 2208 of the Civil Code. Petitioners contend that Lazatin applies in the
instant case because the wrongful attachment of WENCESLAO’s equipment
resulted in a paralysis of its operations, causing it to sustain a loss of ₱100,000 per
day in terms of accomplishment of work. Since the attachment lasted 19 days it
suffered a total loss of ₱1.9 million. Aside from that, it had to spend ₱50,000 on the
pullout of the equipment and another ₱100,000 to repair and restore them to their
former working condition.

Respondent counters that inasmuch as a preliminary attachment is an available

ancillary remedy under the rules, a penalty cannot be meted out for the enforcement
of a right, such as in this case when it sought such relief. It stresses that the writ
was legally issued by the RTC, upon a finding that READYCON sought the relief
without malice or bad faith. Furthermore, WENCESLAO failed to show concrete and
credible proof of the damages it suffered. The issuance of a writ and its enforcement
entail a rigorous process where the court found that it was not attended by malice or
bad faith. It cites Mindanao Savings and Loan Association v. Court of Appeals, 172
SCRA 480 (1989), to the effect where a counter-bond is filed, the right to question
the irregularity and propriety of the writ of attachment must be deemed waived since
the ground for the issuance of the writ forms the core of the complaint.

Issue Is respondent READYCON liable to petitioner WENCESLAO for damages

caused by the issuance and enforcement of the writ of preliminary attachment?

Ruling No, READYCON is not liable to WENCESLAO for damages.

It is to be stressed that the posting of a counter-bond is not tantamount to a

waiver of the right to damages arising from a wrongful attachment. In Calderon
v. Intermediate Appellate Court, the Court ruled that:

Whether the attachment was discharged by either of the two (2) ways indicated
in the law, i.e., by filing a counterbond or by showing that the order of
attachment was improperly or irregularly issued, the liability of the surety on the
attachment bond subsists because the final reckoning is when "the Court shall
finally adjudge that the attaching creditor was not entitled" to the issuance of the
attachment writ in the first place. The attachment debtor cannot be deemed to
have waived any defect in the issuance of the attachment writ by simply availing
himself of one way of discharging the attachment writ, instead of the other.
Moreover, the filing of a counterbond is a speedier way of discharging the
attachment writ maliciously sought out by the attaching party creditor instead of
the other way, which in most instances like in the present case, would require
presentation of evidence in a full blown trial on the merits and cannot easily be
settled in a pending incident of the case.

Moreover, we laid no hard and fast rule that bad faith or malice must be proved
to recover any form of damages. In Philippine Commercial & Industrial Bank, we
found bad faith and malice to be present, thereby warranting the award of moral
and exemplary damages. But we denied the award of actual damages for want
of evidence to show said damages. For the mere existence of malice and bad
faith would not per se warrant the award of actual or compensatory damages.
To grant such damages, sufficient proof thereon is required.

Petitioners cite Lazatin and MC Engineering insofar as proof of bad faith and
malice as prerequisite to the claim of actual damages is dispensed with.
Otherwise stated, in the present case, proof of malice and bad faith are
unnecessary because, just like in Lazatin and MC Engineering, what is involved
here is the issue of actual and compensatory damages. Nonetheless, we find
that petitioner is not entitled to an award of actual or compensatory damages.
Unlike Lazatin and MC Engineering, wherein the respective complaints were
dismissed for being unmeritorious, the writs of attachment were found to be
wrongfully issued, in the present case, both the trial and the appellate courts
held that the complaint had merit. Stated differently, the two courts found
READYCON entitled to a writ of preliminary attachment as a provisional remedy
by which the property of the defendant is taken into custody of the law as a
security for the satisfaction of any judgment which the plaintiff may recover.

Rule 57, Section 4 of the 1997 Rules of Civil Procedure states that:

SEC. 4. Condition of applicant’s bond. - The party applying for the order must
thereafter give a bond executed to the adverse party in the amount fixed by the
court in its order granting the issuance of the writ, conditioned that the latter will
pay all the costs which may be adjudged to the adverse party and all damages
which he may sustain by reason of the attachment, if the court shall finally
adjudge that the applicant was not entitled thereto (italics for emphasis).

In this case, both the RTC and the Court of Appeals found no reason to rule that
 READYCON was not entitled to issuance of the writ. Neither do we find now that
the writ is improper or illegal. If WENCESLAO suffered damages as a result,
it is merely because it did not heed the demand letter of the respondent in
the first place. WENCESLAO could have averted such damage if it
immediately filed a counter-bond or a deposit in order to lift the writ at
once. It did not, and must bear its own loss, if any, on that account.

Case 8. Insular Savings Bank vs. CA 460 SCRA 122

Principle Remedial law; Provisional Remedies; Preliminary Attachment; Discharge of

attachment upon giving counter-bond; The amount of the counter-attachment
bond is, under the terms of the Sec. 12, Rule 57 of the Rules of Court, to be
measured against the value of the attached property, as determined by the
judge to secure the payment of any judgment that the attaching creditor may
recover in the action. Albeit not explicitly stated in the same section and without
necessarily diminishing the sound discretion of the issuing judge on matters of
bond approval, there can be no serious objection, in turn, to the proposition that
the attached property - and logically the counter-bond necessary to discharge
the lien on such property - should as much as possible correspond in value to,
or approximately match the attaching creditor's principal claim.

Facts On December 11, 1991, Far East Bank and Trust Company (respondent Bank)
instituted arbitration case against Insular Savings Bank (petitioner) before the
Arbitration Committee of the Philippine Clearing House Corporation (PCHC).
The dispute between the parties involved three unfunded checks with a total
value of P25,200,000.00. The checks were drawn against respondent Bank and
were presented by petitioner for clearing. The respondent bank returned the
checks beyond the reglementary period, but after petitioner’s account with
PCHC was credited with the disputed amount, wherein the petitioner refused to
refund the money to respondent Bank. While the dispute was pending
arbitration, on January 17, 1992, respondent Bank instituted civil case and
prayed for the issuance of a writ of preliminary attachment. Regional Trial Court
(RTC) of Makati issued an Order granting the application for preliminary
attachment upon posting by respondent Bank of an attachment bond in the
amount of P6,000,000.00.

On January 27, 1992, RTC of Makati issued a writ of preliminary attachment for
the amount of P25,200,000.00. During the hearing on February 11, 1992 before
the Arbitration Committee of the PCHC, petitioner and respondent Bank agreed
to temporarily divide between them the disputed amount of P25,200,000.00
while the dispute has not yet been resolved. As a result, the sum of
P12,600,000.00 is in the possession of respondent Bank. On March 9, 1994,
petitioner filed a motion to discharge attachment by counter-bond in the amount
of P12,600,000.00. On June 13, 1994, respondent Judge issued the first
assailed order denying the motion. On June 27, 1994, petitioner filed a motion
for reconsideration which was denied in the second assailed order dated July
20, 1994. The Court of Appeals (CA), in the herein assailed decision dated
October 9, 1995, nonetheless denied due course to and dismissed the petition
 with its motion for reconsideration having been similarly denied.

Issue Whether the CA erred in not ruling that the trial court committed grave abuse of
discretion in denying petitioner's motion to discharge attachment by counter-
bond in the amount of P12,600,000.00.

Ruling Yes, the CA and trial court committed grave abuse of discretion in denying the
petitioner’s motion to discharge attachment by counter-bond in the amount of
P12,600,000.00.

Section 12, Rule 57 (Preliminary Attachment) of the Rules of Court. Discharge

of attachment upon giving counter-bond. - At any time after an order of
attachment has been granted, the party whose property has been attached, . . .
may upon reasonable notice to the applicant, apply to the judge who granted the
order or to the judge of the court which the action is pending, for an order
discharging the attachment wholly or in part on the security given. The judge
shall, after hearing, order the discharge of the attachment if a cash deposit is
made, or a counter-bond executed to the attaching creditor is filed, on behalf of
the adverse party, with the clerk or judge of the court where the application is
made in an amount equal to the value of the property attached as
determined by the judge, to secure the payment of any judgment that the
attaching creditor may recover in the action. x x x . Should such counter-
bond for any reason be found to be, or become insufficient, and the party
furnishing the same fail to file an additional counter-bond, the attaching party
may apply for a new order of attachment.

As may be noted, the amount of the counter-attachment bond is, under the
terms of the aforequoted Section 12, to be measured against the value of the
attached property, as determined by the judge to secure the payment of any
judgment that the attaching creditor may recover in the action. Albeit not
explicitly stated in the same section and without necessarily diminishing the
sound discretion of the issuing judge on matters of bond approval, there can be
no serious objection, in turn, to the proposition that the attached property - and
logically the counter-bond necessary to discharge the lien on such property -
should as much as possible correspond in value to, or approximately match the
attaching creditor's principal claim. Else, excessive attachment, which ought to
be avoided at all times, shall ensue.

In the case given, before the Arbitration Committee of the PCHC, petitioner and
respondent, agreed to equally divide between themselves, although on a
temporary basis, the disputed amount of P25,200,000.00, subject to the
outcome of the arbitration proceedings. Thus, the release by petitioner of the
amount of P12,600,000.00 to respondent. Petitioner filed a motion to discharge
attachment by counter-bond in the amount of P12,600,000.00 which, to
petitioner, is the extent that respondent may actually be prejudiced in the event
its basic complaint for recovery of money against petitioner prospers. Therefore,
respondent's principal claim against petitioner immediately prior to the filing of
the motion to discharge attachment has effectively been pruned down to
P12,600,000.00.
 The trial court, in requiring petitioner to post a counter-bond in the amount of
P27,237,700.00, obviously glossed over one certain fundamental. The Supreme
Court ruled that it was simply unjust for the trial court to base the amount of the
counter-bond on a figure beyond the P25,200,000.00 threshold, as later
reduced to P12,600,200.00.

The trial court, therefore, committed grave abuse of discretion when it denied
petitioner's motion to discharge attachment by counter-bond in the amount of
P12,600,000.00, an amount more than double the attachment bond required of,
and given by, respondent. As a necessary consequence, the Court of Appeals
committed reversible error when it dismissed petitioner's recourse thereto.

Case 9. Engracio U. Ang, Jr. vs. Spouses Benjamin M. Bitanga and Marilyn Andal
Bitanga, et al. G.R. No. 223046, November 28, 2019

Principle - a judgement or final order dismissing a charge of indirect contempt on the

merits like an acquittal in a criminal case necessarily becomes final and
executory upon its promulgation.

- Section 11, Rule 71 of the Rules of Court- Review of judgment or final order;
bond for stay. - The judgment or final order of a court in a case of indirect
contempt may be appealed to the proper court as in criminal cases. But
execution of the judgment or final order shall not be suspended until a bond is filed
by the person adjudged in contempt, in an amount fixed by the court from which the
appeal is taken, conditioned that if the appeal be decided against him he will abide
by and perform the judgment or final order.

- Res judicata is a legal principle that regards a final judgment on the merits of a
case as conclusive between the parties to such case and their privies. 60 The
principle, in our jurisdiction, may be applied in two (2) ways.

The first way, which is known as the "bar by former judgment rule," considers the
final judgment in a previous case as an absolute bar to a subsequent case between
the same parties.61 For this variant of res judicata to apply, however, it is essential
that the subsequent case was prosecuted between the same parties and on the
same claim, demand or cause of action as the previously decided case.

The second way or the "conclusiveness of judgment rule," on the other hand,
considers the final judgment in a previous case not as an absolute bar to a
subsequent case between the same parties, but merely as having a preclusive
effect on the latter case insofar as the matters already settled in that final judgment
are concerned.63 This variant of res judicata applies when there is an identity of
parties, but not of claim, demand or cause of action, between the subsequent case
and the previously decided case.

- the certiorari case is not an appeal or a continuation of the indirect contempt case.
It is an elementary tenet in remedial law that the remedy of certiorari under Rule 65
of the Rules of Court is an original and independent action whose purpose and
scope of review are completely different from an appeal's.
Facts Pyramid construction company is a domestic construction company, Macrogen
Realty engages the services of Pyramid company for the construction of a mall
in Sucat, Paranaque. However, Macrogen failed to settle its outstanding
obligation. Pyramid initiated arbitration proceedings before the Construction
Industry Arbitration Commission ( CIAC)in order to compel Macrogen to settle its
obligation, the parties entered into a compromise agreement which effectively
abated the progress of the arbritation proceeding.

The fulfillment of by Macrogen of its obligation under the compromise

agreement was secured by a guaranty of the respondent Benjamin Bitanga, the
president of the Macrogen, he “absolutely, unconditionally and irrevocably”
guaranteed the full and complete payment by Macrogen of its obligation under
the compromise agreement. However, Macrogen failed to comply with the
compromise agreement.

Because of the failure of Macrogen to comply with the compromise agreement,

Pyramid filed with the CIAC a motion for the issuance of the writ of execution
against Macrogen. The CIAC granted the motion, however the sheriff filed a
return on the writ of execution stating that he was unable to locate any property
of macrogen except the laters bank account Pyramid send a letter of demand to
Bitanga but it was also went unheeded. Thus Pyramid filed before the RTC
complaint for specific performance, Notice of garnishment and execution sale.
Pyramid claimed that the notice of garnishment was served to the corporate
secretary of Manila gofl & country club (MGCCI)

Bitanga was adjudged by the supreme court as liable for the debt of Macrogen
as a guarantor and Pyramid won as the highest bidder in the public sale of
shares of stocks in MGGCI which was subject of the notice of garnishment,
Pyramid requested MGCCI for the transfer of the stocks in its name, however it
was turned down by MGCCI because the said stocks was already sold and
transferred to Wilfred Siy.

Pyramid the filed an indirect contempt case against MGCCI, Bitanga and Siy,
The RTC initially found them to be guiltiy of indirect contempt however it was
later on found by the RTC that they were incapable of violating the notice of
garnishment because such notice was not delivered to MGCCI or Siy but to a
completely different entirely, the Manila Polo Club.

Pyramid assigned all its rights and interest as judgment creditor to Engracio U.
Ang, petitioner

Issue Whether or not the dismissal in the indirect contempt case final and
unappealable

Ruling
Yes.

The order of the RTC dismissing / absolving MGCCI and SIY the case for
indirect contempt became final and executory immediately upon its
promulgation. This is due to the norm, observed in our jurisdiction, that regards
as unappealable any judgment or final order that dismisses on the merits a
charge of indirect contempt. Sec 11, Rule 71 provides that the appeal in
contempt proceedings may be taken as in criminal case. Hence, as in criminal
proceedings, an appeal would not lie from the order of dismissal of, or an
exoneration from, a charge of contempt of court.

Verily, since no appeal could lie against it, a judgment or final order dismissing a
charge of indirect contempt on the merits-like an acquittal in a criminal case-
necessarily becomes final and executory upon its promulgation. Such, therefore,
is the status of the July 19, 2012 Order of the RTC-QC when petitioner filed his
complaint in Civil Case No. 13-682.

The finality of the July 19, 2012 Order of the RTC-QC in the indirect contempt
case meant that the said order, as well as the matters settled therein, became
conclusive upon the petitioner and the other parties of that case. This as much
is clear by the principle of res judicata.

Res judicata is a legal principle that regards a final judgment on the merits of a
case as conclusive between the parties to such case and their privies.60 The
principle, in our jurisdiction, may be applied in two (2) ways.

The first way, which is known as the "bar by former judgment rule," considers
the final judgment in a previous case as an absolute bar to a subsequent case
between the same parties.61 For this variant of res judicata to apply, however, it
is essential that the subsequent case was prosecuted between the same parties
and on the same claim, demand or cause of action as the previously decided
case.

The second way or the "conclusiveness of judgment rule," on the other hand,
considers the final judgment in a previous case not as an absolute bar to a
subsequent case between the same parties, but merely as having a preclusive
effect on the latter case insofar as the matters already settled in that final
judgment are concerned.63 This variant of res judicata applies when there is an
identity of parties, but not of claim, demand or cause of action, between the
subsequent case and the previously decided case.

In this case, we find that the second variant of res judicata, or the
conclusiveness of judgment rule, may be applied to Civil Case No. 13-682
insofar as the matters already settled in the indirect contempt case are
concerned.

Among the matters settled in the July 19, 2012 Order of the RTC-QC in the
indirect contempt case is the fact that the September 28, 2001 notice of
garnishment was not addressed and validly delivered to MGCCI.

The finding that the September 28, 2001 notice of garnishment had not been
addressed and delivered to MGCCI effectively means that Pyramid, petitioner's
predecessor-in-interest, was not able to secure any attachment on Bitanga's
MGCCI stocks. Our rule of procedure are clear that in order to place a share of
 stock of a certain corporation under levy on attachment, the notice indicating the
attachment of such stock, as well as a copy of the writ of attachment, must have
been first delivered to the appropriate officer of that very corporation:

RULE 57

Preliminary Attachment

Section 7. Attachment of real and personal property; recording thereof. - Real

and personal property shall be attached by the sheriff executing the writ in the
following manner:

xxxx

(c) Stocks or shares, or an interest in stocks or shares, of any corporation or

company, by leaving with the president or managing agent thereof, a copy of the
writ, and a notice stating that the stock or interest of the party against whom the
attachment is issued is attached in pursuance of such writ[.] (Emphasis
supplied)

Hence, for the above reasons, we sustain the dismissal of petitioner's complaint
albeit on the ground that its cause of action has already been negated by res
judicata.

It is true that at the time petitioner filed his complaint in Civil Case No. 13-682, a
certiorari case assailing the July 19, 2012 Order of the RTC-QC in the indirect
contempt case was already filed and had been pending before the CA. We find,
however, that the filing and pendency of such certiorari case do little, if anything
at all, to alter the conclusion we have reached.

The finality of the order in the indirect contempt case, it should be stressed, was
unaffected by the filing and pendency of the certiorari case before the CA. The
certiorari case is not an appeal or a continuation of the indirect contempt case. It
is an elementary tenet in remedial law that the remedy of certiorari under Rule
65 of the Rules of Court is an original and independent action whose purpose
and scope of review are completely different from an appeal's

Since the certiorari case is not deemed a continuation of the indirect contempt
case, it cannot be said that the filing of the former could have forestalled the
order in the latter case from attaining final and executory status.74 This is true
even though a potential outcome of the certiorari case could be the nullification
of the July 19, 2012 Order in the indirect contempt case for being rendered by
the RTC-QC either with grave abuse of discretion or lack of jurisdiction.

Case 10. REPUBLIC OF THE PHILIPPINES VS MEGA PACIFIC eSOLUTIONS, INC.,

WILLY U. YU, BONNIE S. YU, ENRIQUE T. TANSIPEK, ROSITA Y.
TANSIPEK, PEDRO 0. TAN, JOHNSON W. FONG, BERNARD I. FONG, and
 *LAURIANO A. BARRIOS, G.R. No. 184666 June 27, 2016

Principle 1. A writ of preliminary attachment is a provisional remedy issued upon the

order of the court where an action is pending. Through the writ, the
property or properties of the defendant may be levied upon and held
thereafter by the sheriff as security for the satisfaction of whatever
judgment might be secured by the attaching creditor against the
defendant. The provisional remedy of attachment is available in order
that the defendant may not dispose of the property attached, and thus
prevent the satisfaction of any judgment that may be secured by the
plaintiff from the former.

2. The purpose and function of an attachment or garnishment is twofold.

First, it seizes upon property of an alleged debtor in advance of final
judgment and holds it subject to appropriation, thereby preventing the
loss or dissipation of the property through fraud or other means.
Second, it subjects the property of the debtor to the payment of a
creditor’s claim, in those cases in which personal service upon the
debtor cannot be obtained. This remedy is meant to secure a contingent
lien on the defendant’s property until the plaintiff can, by appropriate
proceedings, obtain a judgment and have the property applied to its
satisfaction, or to make some provision for unsecured debts in cases in
which the means of satisfaction thereof are liable to be removed beyond
the jurisdiction, or improperly disposed of or concealed, or otherwise
placed beyond the reach of creditors.

3. Fraud is a generic term that is used in various senses and assumes so

many different degrees and forms that courts are compelled to content
themselves with comparatively few general rules for its discovery and
defeat.

4. Pursuant to Article 1339 of the Civil Code, silence or concealment does

not, by itself, constitute fraud, unless there is a special duty to disclose
certain facts, or unless the communication should be made according to
good faith and the usages of commerce.

Facts The present case involves the attempt of petitioner Republic of the Philippines
to cause the attachment of the properties owned by respondent MPEI, as well
as by its incorporators and stockholders (individual respondents in this case), in
order to secure petitioner’s interest and to ensure recovery of the payments it
made to respondents for the invalidated automation contract.

RELEVANT FACTS on the 2004 Decision:

Republic Act No. 8436 authorized the COMELEC to use an automated election
system for the May 1998 elections. However, the automated system failed to
materialize and votes were canvassed manually during the 1998 and the 2001
elections.
For the 2004 elections, the COMELEC again attempted to implement the
automated election system. For this purpose, it invited bidders to apply for the
procurement of supplies, equipment, and services. Respondent MPEI, as lead
company, purportedly formed a joint venture — known as the Mega Pacific
Consortium (MPC) — together with We Solv, SK C & C, ePLDT, Election.com
and Oracle. Subsequently, MPEI, on behalf of MPC, submitted its bid proposal
to COMELEC.

The COMELEC evaluated various bid offers and subsequently found MPC and
another company eligible to participate in the next phase of the bidding process.
The two companies were referred to the Department of Science and Technology
(DOST) for technical evaluation. After due assessment, the Bids and Awards
Committee (BAC) recommended that the project be awarded to MPC. The
COMELEC favorably acted on the recommendation and issued Resolution No.
6074, which awarded the automation project to MPC.

Despite the award to MPC, the COMELEC and MPEI executed on 2 June 2003
the Automated Counting and Canvassing Project Contract (automation contract)
for the aggregate amount of P1,248,949,088. MPEI agreed to supply and deliver
1,991 units of ACMs and such other equipment and materials necessary for the
computerized electoral system in the 2004 elections. Pursuant to the automation
contract, MPEI delivered 1,991 ACMs to the COMELEC. The latter, for its part,
made partial payments to MPEI in the aggregate amount of P1.05 billion.

In Our 2004 Decision, We identified a red flag of rigged bidding in the form of
overly narrow specifications. As already discussed, the accuracy requirement of
99.9995 percent was set up by COMELEC bidding rules. This Court
recognized that this rating was “too high and was a sure indication of
fraud in the bidding, designed to eliminate fair competition.” Indeed, “the
essence of public bidding is violated by the practice of requiring very high
standards or unrealistic specifications that cannot be met . . . only to water them
down after the bid has been awarded.”

THE PRESENT CASE

Upon the finality of the declaration of nullity of the automation contract,

respondent MPEI filed a Complaint for Damages before the RTC Makati,
arguing that, notwithstanding the nullification of the automation contract, the
COMELEC was still bound to pay the amount of P200,165,681.89.

Petitioner filed its Answer with Counterclaim24 and argued that respondent
MPEI could no longer recover the unpaid balance from the void automation
contract, since the payments made were illegal disbursements of public funds. It
contended that a null and void contract vests no rights and creates no
obligations, and thus produces no legal effect at all. By way of a counterclaim,
petitioner demanded from respondents the return of the payments made
pursuant to the automation contract.

To recoup its losses petitioner seeks to attach not only the properties of
the respondent but also those of the private respondents.

Pursuant to Section 1(d) of Rule 57 of the Rules of Court, petitioner prayed for
the issuance of a writ of preliminary attachment against the properties of MPEI
and individual respondents. The application was grounded upon the fraudulent
misrepresentation of respondents as to their eligibility to participate in the
bidding for the COMELEC automation project and the failure of the ACMs to
comply with mandatory technical requirements.

RTC RULING: Subsequently, the trial court denied the prayer for the issuance
of a writ of preliminary attachment, ruling that there was an absence of factual
allegations as to how the fraud was actually committed

CA RULING: The CA explained in its Amended Decision that respondents could

not be considered to have fostered a fraudulent intent to dishonor their
obligation, since they had delivered 1,991 units of ACMs. It directed petitioner to
present proof of respondents’ intent to defraud COMELEC during the execution
of the automation contract .

Rule 45 Petition before the SC

Consequently, petitioner filed the instant Rule 45 Petition, arguing that the CA
erred in ordering the remand of the case to the trial court for the reception of
evidence to determine the presence of fraud. Petitioner contends that this
Court’s 2004 Decision was sufficient proof of the fraud committed by
respondents in the execution of the voided automation contract.46 Respondents
allegedly committed fraud by securing the automation contract, although MPEI
was not qualified to bid in the first place. Their claim that the members of MPC
bound themselves to the automation contract was an indication of bad faith as
the contract was executed by MPEI alone.48 Neither could they deny that the
software submitted during the bidding process was not the same one that would
be used on election day.49 They could not dissociate themselves from telltale
signs such as purportedly supplying software that later turned out to be
nonexistent.

The private respondents contend that such attachment is improper as they

were not parties to the proceeding in which the contract was declared
void.

In their respective Comments, respondents Willy Yu, Bonnie Yu, Enrique

Tansipek, and Rosita Tansipek counter that this Court never ruled that individual
respondents were guilty of any fraud or bad faith in connection with the
automation contract, and that it was incumbent upon petitioner to present
evidence on the allegations of fraud to justify the issuance of the writ. They
likewise argue that the 2004 Decision cannot be invoked against them, since
petitioner and MPEI were corespondents in the 2004 case and not adverse
parties therein. Respondents further contend that the allegations of fraud are
belied by their actual delivery of 1,991 units of ACMs to the COMELEC, which
they claim is proof that they never had any intention to evade performance.
 Echoing the other respondents’ arguments on the lack of particularity in the
allegations of fraud, respondents MPEI, Johnson Wong, Bernard Fong, Pedro
Tan, and Lauriano Barrios likewise argue that they were not parties to the 2004
case.

Issue May the properties of the private respondents be subject to attachment?

Ruling YES.

A writ of preliminary attachment should issue in favor of petitioner over the

properties of respondents MPEI, Willy Yu (Willy) and the remaining individual
respondents, namely: Bonnie S. Yu (Bonnie), Enrique T. Tansipek (Enrique),
Rosita Y. Tansipek (Rosita), Pedro O. Tan (Pedro), Johnson W. Fong
(Johnson), Bernard I. Fong (Bernard), and Lauriano Barrios (Lauriano). The
bases for the writ are the following:

First. Fraud on the part of respondent MPEI was sufficiently established by

the factual findings of this Court in its 2004 Decision and subsequent
pronouncements.

Second. A writ of preliminary attachment may issue over the properties of

the individual respondents using the doctrine of piercing the corporate
veil.

FIRST, Fraud on the part of respondent MPEI was sufficiently

established by the factual findings of this Court in its 2004 Decision
and subsequent pronouncements.

On the First Ground, Petitioner argues that the findings of this Court in the 2004
Decision serve as sufficient basis to prove that, at the time of the execution of
the automation contract, there was fraud on the part of respondents that justified
the issuance of a writ of attachment. Respondents, however, argue the contrary.
They claim that fraud had not been sufficiently established by petitioner.

We rule in favor of petitioner. Fraud on the part of respondents MPEI and Willy,
as well as of the other individual respondents — Bonnie, Enrique, Rosita, Pedro,
Johnson, Bernard, and Lauriano — has been established.

A writ of preliminary attachment is a provisional remedy issued upon the order

of the court where an action is pending. Through the writ, the property or
properties of the defendant may be levied upon and held thereafter by the
sheriff as security for the satisfaction of whatever judgment might be secured by
the attaching creditor against the defendant.61 The provisional remedy of
attachment is available in order that the defendant may not dispose of the
property attached, and thus prevent the satisfaction of any judgment that may
be secured by the plaintiff from the former.62

The purpose and function of an attachment or garnishment is twofold. First, it

seizes upon property of an alleged debtor in advance of final judgment and
holds it subject to appropriation, thereby preventing the loss or dissipation of the
property through fraud or other means. Second, it subjects the property of the
debtor to the payment of a creditor’s claim, in those cases in which personal
service upon the debtor cannot be obtained.63 This remedy is meant to secure
a contingent lien on the defendant’s property until the plaintiff can, by
appropriate proceedings, obtain a judgment and have the property applied to its
satisfaction, or to make some provision for unsecured debts in cases in which
the means of satisfaction thereof are liable to be removed beyond the
jurisdiction, or improperly disposed of or concealed, or otherwise placed beyond
the reach of creditors.64

Petitioner relied upon Section 1(d), Rule 57 of the Rules of Court as basis for its
application for a writ of preliminary attachment. This provision states:

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:

xxxx

(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. (Emphasis supplied)

For a writ of preliminary attachment to issue under the above quoted rule, the
applicant must sufficiently show the factual circumstances of the alleged fraud.
In Metro, Inc. v. Lara’s Gift and Decors, Inc., We explained:

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. x x x.

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 nonpayment of the debt or failure to comply with his obligation. (Emphasis
supplied)

An amendment to the Rules of Court added the phrase “in the performance
thereof” to include within the scope of the grounds for issuance of a writ of
preliminary attachment those instances relating to fraud in the performance of
the obligation.

Fraud is a generic term that is used in various senses and assumes so many
different degrees and forms that courts are compelled to content themselves
with comparatively few general rules for its discovery and defeat. For the same
reason, the facts and circumstances peculiar to each case are allowed to bear
heavily on the conscience and judgment of the court or jury in determining the
presence or absence of fraud. In fact, the fertility of man’s invention in devising
new schemes of fraud is so great that courts have always declined to define it,
thus, reserving for themselves the liberty to deal with it in whatever form it may
present itself.68

Fraud may be characterized as the voluntary execution of a wrongful act or a

wilful omission, while knowing and intending the effects that naturally and
necessarily arise from that act or omission. In its general sense, fraud is
deemed to comprise anything calculated to deceive — including all acts and
omission and concealment involving a breach of legal or equitable duty, trust, or
confidence justly reposed — resulting in damage to or in undue advantage over
another. Fraud is also described as embracing all multifarious means that
human ingenuity can device, and is resorted to for the purpose of securing an
advantage over another by false suggestions or by suppression of truth; and it
includes all surprise, trick, cunning, dissembling, and any other unfair way by
which another is cheated.

While fraud cannot be presumed, it need not be proved by direct evidence and
can well be inferred from attendant circumstances. Fraud by its nature is not a
thing susceptible of ocular observation or readily demonstrable physically; it
must of necessity be proved in many cases by inferences fm circumstances
shown to have been involved in the transaction in question.

In the case at bar, petitioner has sufficiently discharged the burden of

demonstrating the commission of fraud by respondent MPEI in the execution of
the automation contract in the two ways.

SECOND A writ of preliminary attachment may issue over the

properties of the individual respondents using the doctrine of
piercing the corporate veil.

Veil-piercing in fraud cases requires that the legal fiction of separate juridical
personality is used for fraudulent or wrongful ends.

For reasons discussed below, We see red flags of fraudulent schemes in public
procurement, all of which were established in the 2004 Decision, the totality of
which strongly indicate that MPEI was a sham corporation formed merely for the
purpose of perpetrating a fraudulent scheme.

The red flags are as follows: (1) overly narrow specifications; (2) unjustified
recommendations and unjustified winning bidders; (3) failure to meet the terms
of the contract; and (4) shell or fictitious company

1. We identified a red flag of rigged bidding in the form of overly narrow

specifications. As already discussed, the accuracy requirement of 99.9995
percent was set up by COMELEC bidding rules.
 This Court recognized that this rating was “too high and was a sure
indication of fraud in the bidding, designed to eliminate fair competition.”
Indeed, “the essence of public bidding is violated by the practice of requiring
very high standards or unrealistic specifications that cannot be met. . . only to
water them down after the bid has been award(ed).

2. The red flags of questionable recommendation and unjustified awards are

raised in this case. As earlier discussed, the project was awarded to MPC,
which proved to be a nonentity.

It was MPEI that actually participated in the bidding process, but it was not
qualified to be a bidder in the first place. Moreover, its ACMs failed the accuracy
requirement set by COMELEC. Yet, MPC – the nonentity – obtained a favorable
recommendation from the BAC, and the automation contract was awarded to
the former.

3. Failure to meet contract terms. As mentioned earlier, this Court already found
the ACMs to be below the standards set by the COMELEC.

4. Shell companies have no significant assets, staff or operational capacity.

They pose a serious red flag as a bidder on public contracts, because they often
hide the interests of project or government officials, concealing a conflict of
interest and opportunities for money laundering. Also, by definition, they have
no experience.

MPEI qualifies as a shell or fictitious company. It was nonexistent at the time of

the invitation to bid; to be precise, it was incorporated only 11 days before the
bidding. It was a newly formed corporation and, as such, had no track record to
speak of. The totality of the red flags found in this case leads Us to the
inevitable conclusion that MPEI was nothing but a sham corporation formed for
the purpose of defrauding petitioner.

We have consistently held that when the notion of legal entity is used to defeat
public convenience, justify wrong, protect fraud, or defend crime, the law will
regard the corporation as an association of persons.

Thus, considering that We find it justified to pierce the corporate veil in the case
before Us, MPEI must, perforce, be treated as a mere association of persons
whose assets are unshielded by corporate fiction.

(Note: This is a really long case and it involves discussions in Corpo. which is also
related to ProvRem so inclusion of which is inevitable).

Case 11. SECURITY BANK CORPORATION, vs. GREAT WALL COMMERCIAL

PRESS COMPANY, INC., ALFREDO BURIEL ATIENZA, FREDINO CHENG
ATIENZA and SPS. FREDERICK CHENG ATIENZA and MONICA CU
ATIENZA, G.R. No. 219345, January 30, 2017
Principle
Previously, Section 1(d), Rule 57 of the 1964 Rules of Court provided that a writ
of preliminary attachment may be issued "[i]n 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 xxx" Thus, the fraud that justified the issuance of a
writ of preliminary attachment then was only fraud committed in contracting an
obligation (dolo casuante). When the 1997 Rules of Civil Procedure was issued
by the Court, Section 1(d) of Rule 57 conspicuously included the phrase "in the
performance thereof." Hence, the fraud committed in the performance of the
obligation (dolo incidente) was included as a ground for the issuance of a writ of
preliminary attachment.

Facts On May 15, 2013, Security Bank filed a Complaint for Sum of Money (with
Application for Issuance of a Writ of Preliminary Attachment) against
respondents Great Wall and its sureties before the RTC. The complaint sought
to recover from respondents their unpaid obligations under a credit facility
covered by several trust receipts and surety agreements, as well as interests,
attorney's fees and costs. On May 31, 2013, after due hearing, the RTC granted
the application for a writ of preliminary attachment of Security Bank, which then
posted a bond in the amount of P10,000,000.00.

On June 3, 2013, respondents filed their Motion to Lift Writ of Preliminary

Attachment Ad Cautelam, claiming that the writ was issued with grave abuse of
discretion based on the following grounds: (1) Security Bank's allegations in its
application did not show a prima facie basis therefor; (2) the application and the
accompanying affidavits failed to allege at least one circumstance which would
show fraudulent intent on their part; and (3) the general imputation of fraud was
contradicted by their efforts to secure an approval for a loan restructure.

In its Order, dated July 4, 2013, the RTC denied respondents' motion to lift.
Respondents filed a motion for reconsideration, but it was denied by the RTC in
its Order, dated August 12, 2013.

Dissatisfied, respondents filed a petition for certiorari before the CA seeking to

reverse and set aside the RTC orders denying their motion to lift the writ of
preliminary attachment issued.

In its assailed decision, dated December 12, 2014, the CA lifted the writ of
preliminary attachment. The appellate court explained that the allegations of
Security Bank were insufficient to warrant the provisional remedy of preliminary
attachment. It pointed out that fraudulent intent could not be inferred from a
debtor's inability to pay or comply with its obligations. It also stressed that
respondents' act of offering a repayment proposal negated the allegation of
fraud. The CA held that fraud must be present at the time of contracting the
obligation, not thereafter, and that the rules on the issuance of a writ of
attachment must be construed strictly against the applicant
Security Bank moved for reconsideration but its motion was denied by the CA in
its assailed resolution, dated June 26, 2015.
Issue
WHETHER OR NOT THE COURT OF APPEALS ERRED IN NULLIFYING
THE WRIT OF PRELIMINARY ATTACHMENT ISSUED BY THE TRIAL
COURT.

Security Bank argues that there are sufficient factual and legal bases to justify
the issuance of the writ of preliminary attachment. It claims that it was misled by
respondents, who employed fraud in contracting their obligation, as they made
the bank believe that they had the capacity to pay; that respondents also
committed fraud in the performance of their obligation when they failed to turn
over the goods subject of the trust receipt agreements, or remit the proceeds
thereof despite demands; and that these were not mere allegations in the
complaint but facts that were testified to by its witness and supported by written
documents.

Ruling YES. The Court finds merit in the petition.

Preliminary Attachment

A writ of preliminary attachment is a provisional remedy issued upon the order

of the court where an action is pending. Through the writ, the property or
properties of the defendant may be levied upon and held thereafter by the
sheriff as security for the satisfaction of whatever judgment might be secured by
the attaching creditor against the defendant. The provisional remedy of
attachment is available in order that the defendant may not dispose of the
property attached, and thus prevent the satisfaction of any judgment that may
be secured by the plaintiff from the former.17

In this case, Security Bank relied on Section 1 (d), Rule 57 of the Rules of Court
as basis of its application for a writ of preliminary attachment. It 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
(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;
xxx

For a writ of preliminary attachment to issue under the above-quoted rule, the
applicant must sufficiently show the factual circumstances of the alleged fraud. It
is settled that fraudulent intent cannot be inferred from the debtor's mere non-
payment of the debt or failure to comply with his obligation.

While fraud cannot be presumed, it need not be proved by direct evidence and
can well be inferred from attendant circumstances. Fraud by its nature is not a
thing susceptible of ocular observation or readily demonstrable physically; it
must of necessity be proved in many cases by inferences from circumstances
shown to have been involved in the transaction in question.

To support its allegation of fraud, Security Bank attached the Affidavit of

German Pulgar, the Manager of the Remedial Management Division of the said
bank. He detailed how respondents represented to Security Bank that they
would pay the loans upon their maturity date. Pulgar added that respondents
signed the Credit Agreement which contained the Warranty of Solvency and
several Trust Receipt Agreements in favor of Security Bank. The several
demand letters sent by Security Bank to respondents, which were unheeded,
were likewise attached to the complaint. These pieces of evidence were
presented by Security Bank during the hearing of the application for the
issuance of a writ of preliminary attachment in the RTC.

After a judicious study of the records, the Court finds that Security Bank was
able to substantiate its factual allegation of fraud, particularly, the violation of the
trust receipt agreements, to warrant the issuance of the writ of preliminary
attachment.

Fraud in the performance of the obligation must be considered

The CA stated in the assailed decision that under Section 1(d) of Rule 57, fraud
must only be present at the time of contracting the obligation, and not thereafter.
Hence, the CA did not consider the allegation of fraud - that respondents offered
a repayment proposal but questionably failed to attend the meeting with Security
Bank regarding the said proposal - because these acts were done after
contracting the obligation. In this regard, the CA erred.

Previously, Section 1(d), Rule 57 of the 1964 Rules of Court provided that a writ
of preliminary attachment may be issued "[i]n 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 xxx" Thus, the fraud that justified the issuance of a
writ of preliminary attachment then was only fraud committed in contracting an
obligation (dolo casuante).28 When the 1997 Rules of Civil Procedure was
issued by the Court, Section 1(d) of Rule 57 conspicuously included the phrase
"in the performance thereof." Hence, the fraud committed in the performance of
the obligation (dolo incidente) was included as a ground for the issuance of a
writ of preliminary attachment.

These circumstances of the fraud committed by respondents in the performance

of their obligation undoubtedly support the issuance of a writ of preliminary
attachment in favor of Security Bank.

Final Note

While the Court finds that Security Bank has substantiated its allegation of fraud
against respondents to warrant the issuance of writ or preliminary attachment,
 this finding should not in any manner affect the merits of the principal case. The
writ of preliminary attachment is only a provisional remedy, which is not a cause
of action in itself but is merely adjunct to a main suit.

WHEREFORE, the December 12, 2014 Decision and the June 26, 2015
Resolution of the Court of Appeals in CA-G.R. SP No. 131714 are REVERSED
and SET ASIDE. The issuance of the writ of preliminary attachment by the
Regional Trial Court, Branch 59, Makati City, in Civil Case No. 13-570, pursuant
to its May 31, 2013 Order, is upheld.

SO ORDERED.

Case 12. LORENZO SHIPPING CORPORATION, vs. FLORENCIO 0. VILLARIN and

FIRST CARGOMASTERS CORPORATION, CEBU ARRASTRE &
STEVEDORING SERVICES CORPORATION and GUERRERO G. DAJAO,
G.R. No. 175727, March 6, 2019 / LORENZO SHIPPING CORPORATION, vs.
FLORENCIO O. VILLARIN, G.R. No. 178713, March 6, 2019

Principle A writ of preliminary attachment is a provisional remedy issued by a court where

an action is pending. In simple terms, a writ of preliminary attachment allows the
levy of a property which shall then be held by the sheriff. This property will stand
as security for the satisfaction of the judgment that the court may render in favor
of the attaching party

Facts
Respondent MIS Maritime Corporation (MIS) contracted Tsuneishi to dry dock and
repair its vessel M/T MIS-1 through an Agreement dated March 22, 2006. 5 On
March 23, 2006, the vessel dry docked in Tsuneishi's shipyard. Tsuneishi rendered
the required services. However, about a month later and while the vessel was still
dry docked, Tsuneishi conducted an engine test on M/T MIS-1. The vessel's engine
emitted smoke. The parties eventually discovered that this was caused by a burnt
crank journal. The crankpin also showed hairline cracks due to defective lubrication
or deterioration, Tsuneishi insists that the damage was not its fault while MIS insists
on the contrary. Nevertheless, as an act of good will, Tsuneishi paid for the vessel's
new engine crankshaft, crankpin, and main bearings. 6

Tsuneishi billed MIS the amount of US$318,571.50 for payment of its repair and dry
docking services. MIS refused to pay this amount. Instead, it demanded that
Tsuneishi pay US$471,462.60 as payment for the income that the vessel lost in the
six months that it was not operational and dry docked at Tsuneishi's shipyard. It also
asked that its claim be set off against the amount billed by Tsuneishi. MIS further
insisted that after the set off, Tsuneishi still had the obligation to pay it the amount of
US$152,891.10.7 Tsuneishi rejected MIS' demands. It delivered the vessel to MIS in
September 2006.8 On November 6, 2006, MIS signed an Agreement for Final
Price.9 However, despite repeated demands, MIS refused to pay Tsuneishi the
amount billed under their contract.
 Tsuneishi claims that MIS also caused M/T White Cattleya, a vessel owned by
Cattleya Shipping Panama S.A. (Cattleya Shipping), to stop its payment for the
services Tsuneishi rendered for the repair and dry docking of the vessel. 10

MIS argued that it lost revenues because of the engine damage in its vessel. This
damage occurred while the vessel was dry docked and being serviced at
Tsuneishi's yard. MIS insisted that since this arose out of Tsuneishi's negligence, it
should pay for MIS' lost income. Tsuneishi offered to pay 50% of the amount
demanded but MIS refused any partial payment.11

On April 10, 2008, Tsuneishi filed a complaint 12 against MIS before the RTC. This
complaint stated that it is invoking the admiralty jurisdiction of the RTC to enforce a
maritime lien under Section 21 of the Ship Mortgage Decree of 1978 13 (Ship
Mortgage Decree). It also alleged as a cause of action MIS' unjustified refusal to
pay the amount it owes Tsuneishi under their contract. The complaint included a
prayer for the issuance of arrest order/writ of preliminary attachment. To support this
prayer, the complaint alleged that Section 21 of the Ship Mortgage Decree as well
as Rule 57 of the Rules of Court on attachment authorize the issuance of an order
of arrest of vessel and/or writ of preliminary attachment. 14

In particular, Tsuneishi argued that Section 21 of the Ship Mortgage Decree

provides for a maritime lien in favor of any person who furnishes repair or provides
use of a dry dock for a vessel. Section 21 states that this may be enforced through
an action in rem. Further, Tsuneishi and MIS' contract granted Tsuneishi the right to
take possession, control and custody of the vessel in case of default of payment.
Paragraph 9 of this contract further states that Tsuneishi may dispose of the vessel
and apply the proceeds to the unpaid repair bill

RTC: issued writ of preliminary attachment

CA: reversed the decision of the RTC due to the absence of fraud

Issue
WON a maritime lien under section 21 of the ship mortgage decree may be
enforced through a writ of preliminary attachment under rule 57 of the Rules of
court.

Ruling
No, A writ of preliminary attachment allows the levy of a property which shall
then be held by the sheriff. This property will stand as security for the
satisfaction of the judgment that the court may render in favor of the attaching
party.—A writ of preliminary attachment is a provisional remedy issued by a
court where an action is pending. In simple terms, a writ of preliminary
attachment allows the levy of a property which shall then be held by the sheriff.
This property will stand as security for the satisfaction of the judgment that the
court may render in favor of the attaching party. In Republic v. Mega Pacific
eSolutions (Republic), 794 SCRA 414 (2016), we explained that the purpose of
a writ of preliminary attachment is twofold: First, it seizes upon property of an
 alleged debtor in advance of final judgment and holds it subject to appropriation,
thereby preventing the loss or dissipation of the property through fraud or other
means. Second, it subjects the property of the debtor to the payment of a
creditor’s claim, in those cases in which personal service upon the debtor
cannot be obtained. This remedy is meant to secure a contingent lien on the
defendant’s property until the plaintiff can, by appropriate proceedings, obtain a
judgment and have the property applied to its satisfaction, or to make some
provision for unsecured debts in cases in which the means of satisfaction
thereof are liable to be removed beyond the jurisdiction, or improperly disposed
of or concealed, or otherwise placed beyond the reach of creditors.

A writ of preliminary attachment is issued precisely to create a lien. When a

party moves for its issuance, the party is effectively asking the court to attach a
property and hold it liable for any judgment that the court may render in his or
her favor. This is similar to what a lien does. It functions as a security for the
payment of an obligation. In Quasha Asperilla Ancheta Valmonte Peña &
Marcos v. Juan, 118 SCRA 505 (1982), we held:

An attachment proceeding is for the purpose of creating a lien on the

property to serve as security for the payment of the creditors’ claim.
Hence, where a lien already exists, as in this case a maritime lien, the
same is already equivalent to an attachment. x x x

To be clear, we repeat that when a lien already exists, this is already equivalent
to an attachment. This is where Tsuneishi’s argument fails. Clearly, because it
claims a maritime lien in accordance with the Ship Mortgage Decree, all
Tsuneishi had to do is to file a proper action in court for its enforcement. The
issuance of a writ of preliminary attachment on the pretext that it is the only
means to enforce a maritime lien is superfluous. The reason that the Ship
Mortgage Decree does not provide for a detailed procedure for the enforcement
of a maritime lien is because it is not necessary. Section 21 already provides for
the simple procedure — file an action in rem before the court.

We emphasize that when fraud is invoked as a ground for the issuance of a writ
of preliminary attachment under Rule 57 of the Rules of Court, there must be
evidence clearly showing the factual circumstances of the alleged fraud. Fraud
cannot be presumed from a party’s mere failure to comply with his or her
obligation.

Case 13. TSUNEISHI HEAVY INDUSTRIES (CEBU), INC., vs. MIS MARITIME
CORPORATION, G.R. No. 193572, APRIL 4, 2018

Principle
A writ of preliminary attachment allows the levy of a property which shall then be
held by the sheriff. This property will stand as security for the satisfaction of the
judgment that the court may render in favor of the attaching party.—A writ of
preliminary attachment is a provisional remedy issued by a court where an
 action is pending. In simple terms, a writ of preliminary attachment allows the
levy of a property which shall then be held by the sheriff. This property will stand
as security for the satisfaction of the judgment that the court may render in favor
of the attaching party. In Republic v. Mega Pacific eSolutions (Republic), 794
SCRA 414 (2016), we explained that the purpose of a writ of preliminary
attachment is twofold: First, it seizes upon property of an alleged debtor in
advance of final judgment and holds it subject to appropriation, thereby
preventing the loss or dissipation of the property through fraud or other means.
Second, it subjects the property of the debtor to the payment of a creditor’s
claim, in those cases in which personal service upon the debtor cannot be
obtained. This remedy is meant to secure a contingent lien on the defendant’s
property until the plaintiff can, by appropriate proceedings, obtain a judgment
and have the property applied to its satisfaction, or to make some provision for
unsecured debts in cases in which the means of satisfaction thereof are liable to
be removed beyond the jurisdiction, or improperly disposed of or concealed, or
otherwise placed beyond the reach of creditors.

Facts
Respondent MIS Maritime Corporation (MIS) contracted Tsuneishi to dry dock and
repair its vessel M/T MIS-1 through an Agreement dated March 22, 2006. 5 On
March 23, 2006, the vessel dry docked in Tsuneishi's shipyard. Tsuneishi rendered
the required services. However, about a month later and while the vessel was still
dry docked, Tsuneishi conducted an engine test on M/T MIS-1. The vessel's engine
emitted smoke. The parties eventually discovered that this was caused by a burnt
crank journal. The crankpin also showed hairline cracks due to defective lubrication
or deterioration, Tsuneishi insists that the damage was not its fault while MIS insists
on the contrary. Nevertheless, as an act of good will, Tsuneishi paid for the vessel's
new engine crankshaft, crankpin, and main bearings. 6

Tsuneishi billed MIS the amount of US$318,571.50 for payment of its repair and dry
docking services. MIS refused to pay this amount. Instead, it demanded that
Tsuneishi pay US$471,462.60 as payment for the income that the vessel lost in the
six months that it was not operational and dry docked at Tsuneishi's shipyard. It also
asked that its claim be set off against the amount billed by Tsuneishi. MIS further
insisted that after the set off, Tsuneishi still had the obligation to pay it the amount of
US$152,891.10.7 Tsuneishi rejected MIS' demands. It delivered the vessel to MIS in
September 2006.8 On November 6, 2006, MIS signed an Agreement for Final
Price.9 However, despite repeated demands, MIS refused to pay Tsuneishi the
amount billed under their contract.

Tsuneishi claims that MIS also caused M/T White Cattleya, a vessel owned by
Cattleya Shipping Panama S.A. (Cattleya Shipping), to stop its payment for the
services Tsuneishi rendered for the repair and dry docking of the vessel. 10

MIS argued that it lost revenues because of the engine damage in its vessel. This
damage occurred while the vessel was dry docked and being serviced at
Tsuneishi's yard. MIS insisted that since this arose out of Tsuneishi's negligence, it
should pay for MIS' lost income. Tsuneishi offered to pay 50% of the amount
 demanded but MIS refused any partial payment.11

On April 10, 2008, Tsuneishi filed a complaint 12 against MIS before the RTC. This
complaint stated that it is invoking the admiralty jurisdiction of the RTC to enforce a
maritime lien under Section 21 of the Ship Mortgage Decree of 1978 13 (Ship
Mortgage Decree). It also alleged as a cause of action MIS' unjustified refusal to
pay the amount it owes Tsuneishi under their contract. The complaint included a
prayer for the issuance of arrest order/writ of preliminary attachment. To support this
prayer, the complaint alleged that Section 21 of the Ship Mortgage Decree as well
as Rule 57 of the Rules of Court on attachment authorize the issuance of an order
of arrest of vessel and/or writ of preliminary attachment. 14

In particular, Tsuneishi argued that Section 21 of the Ship Mortgage Decree

provides for a maritime lien in favor of any person who furnishes repair or provides
use of a dry dock for a vessel. Section 21 states that this may be enforced through
an action in rem. Further, Tsuneishi and MIS' contract granted Tsuneishi the right to
take possession, control and custody of the vessel in case of default of payment.
Paragraph 9 of this contract further states that Tsuneishi may dispose of the vessel
and apply the proceeds to the unpaid repair bill

RTC: issued writ of preliminary attachment

CA: reversed the decision of the RTC due to the absence of fraud

Issue
Issue: WON a maritime lien under section 21 of the ship mortgage decree may
be enforced through a writ of preliminary attachment under rule 57 of the Rules
of court

Ruling
No, A writ of preliminary attachment allows the levy of a property which shall
then be held by the sheriff. This property will stand as security for the
satisfaction of the judgment that the court may render in favor of the attaching
party.—A writ of preliminary attachment is a provisional remedy issued by a
court where an action is pending. In simple terms, a writ of preliminary
attachment allows the levy of a property which shall then be held by the sheriff.
This property will stand as security for the satisfaction of the judgment that the
court may render in favor of the attaching party. In Republic v. Mega Pacific
eSolutions (Republic), 794 SCRA 414 (2016), we explained that the purpose of
a writ of preliminary attachment is twofold: First, it seizes upon property of an
alleged debtor in advance of final judgment and holds it subject to appropriation,
thereby preventing the loss or dissipation of the property through fraud or other
means. Second, it subjects the property of the debtor to the payment of a
creditor’s claim, in those cases in which personal service upon the debtor
cannot be obtained. This remedy is meant to secure a contingent lien on the
defendant’s property until the plaintiff can, by appropriate proceedings, obtain a
 judgment and have the property applied to its satisfaction, or to make some
provision for unsecured debts in cases in which the means of satisfaction
thereof are liable to be removed beyond the jurisdiction, or improperly disposed
of or concealed, or otherwise placed beyond the reach of creditors.

A writ of preliminary attachment is issued precisely to create a lien. When a

party moves for its issuance, the party is effectively asking the court to attach a
property and hold it liable for any judgment that the court may render in his or
her favor. This is similar to what a lien does. It functions as a security for the
payment of an obligation. In Quasha Asperilla Ancheta Valmonte Peña &
Marcos v. Juan, 118 SCRA 505 (1982), we held: An attachment proceeding is
for the purpose of creating a lien on the property to serve as security for the
payment of the creditors’ claim. Hence, where a lien already exists, as in this
case a maritime lien, the same is already equivalent to an attachment. x x x To
be clear, we repeat that when a lien already exists, this is already equivalent to
an attachment. This is where Tsuneishi’s argument fails. Clearly, because it
claims a maritime lien in accordance with the Ship Mortgage Decree, all
Tsuneishi had to do is to file a proper action in court for its enforcement. The
issuance of a writ of preliminary attachment on the pretext that it is the only
means to enforce a maritime lien is superfluous. The reason that the Ship
Mortgage Decree does not provide for a detailed procedure for the enforcement
of a maritime lien is because it is not necessary. Section 21 already provides for
the simple procedure — file an action in rem before the court.

We emphasize that when fraud is invoked as a ground for the issuance of a writ
of preliminary attachment under Rule 57 of the Rules of Court, there must be
evidence clearly showing the factual circumstances of the alleged fraud. Fraud
cannot be presumed from a party’s mere failure to comply with his or her
obligation.

Case 14. Philippine Commercial International Bank (PCIB) vs. Alejandro

533 SCRA 738

Principle Remedial Law; Attachments; Purposes of Preliminary Attachment.—

The purposes of preliminary attachment are: (1) to seize the property of the
debtor in advance of final judgment and to hold it for purposes of satisfying said
judgment, as in the grounds stated in paragraphs (a) to (e) of Section 1, Rule 57
of the Rules of Court; or (2) 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, as in
paragraph (f) of the same provision.

Remedial Law; Attachments; Summons; Jurisdictions; In order to acquire

jurisdiction in actions in personam where defendant resides out of and is not
found in the Philippines, it becomes a matter of course for the court to convert
the action into a proceeding in rem or quasi in rem by attaching the defendant’s
 property; The service of summons in this case (which may be by publication
coupled with the sending by registered mail of the copy of the summons and the
court order to the last known address of the defendant) is no longer for the
purpose of acquiring jurisdiction but for compliance with the requirements of due
process.

Remedial Law; Attachments; Summons; Jurisdictions; Where the defendant is a

resident who is temporarily out of the Philippines, attachment of his/her property
in an action in personam, is not always necessary in order for the court to
acquire jurisdiction to hear the case.—Section 16, Rule 14 of the Rules of Court
reads: Sec. 16. Residents temporarily out of the Philippines.—When an action is
commenced against a defendant who ordinarily resides within the Philippines,
but who is temporarily out of it, service may, by leave of court, be also effected
out of the Philippines, as under the preceding section. The preceding section
referred to in the above provision is Section 15 which provides for extraterritorial
service—(a) personal service out of the Philippines, (b) publication coupled with
the sending by registered mail of the copy of the summons and the court order
to the last known address of the defendant; or (c) in any other manner which the
court may deem sufficient.

Remedial Law; Attachments; Summons; Jurisdictions; Substituted service of

summons is the normal mode of service of summons that will confer jurisdiction
on the court over the person of residents temporarily out of the Philippines; The
court may acquire jurisdiction over an action in personam by mere substituted
service without need of attaching the property of the defendant.

Remedial Law; Attachments; Damages; It is a well-settled rule that one who has
been injured by a wrongful attachment can recover damages for the actual loss
resulting therefrom.

Remedial Law; Attachments; Damages; While as a general rule, the liability on

the attachment bond is limited to actual (or in some cases, temperate or
nominal) damages, exemplary damages may be recovered where the
attachment was established to be maliciously sued out.

Facts Petitioner (PCIB) filed against respondent (JOSEPH ANTHONY M.

ALEJANDRO) a complaint for sum of money with prayer for the issuance of a
writ of preliminary attachment. Said complaint alleged that respondent
Alejandro, a resident of Hong Kong,executed in favor of petitioner PCIB a
promissory note obligating himself to pay P249,828,588.90 plus interest.

In praying for the issuance of a writ of preliminary attachment under Section 1

paragraphs (e) and (f) of Rule 57 of the Rules of Court, petitioner PCIB alleged
that (1) respondent fraudulently withdrew his unassigned deposits
notwithstanding his verbal promise to PCIB Assistant Vice President
Corazon B. Nepomuceno not to withdraw the same prior to their assignment as
security for the loan; and (2) that respondent is not a resident of the
Philippines.

The trial court granted the application and issued the writ ex parte. The
 bank deposits of respondent Alejandro with RCBC were garnished.
Respondent Alejandro filed a motion to quash the writ contending that
the withdrawal of his unassigned deposits was not fraudulent as it was approved
by petitioner bank. He also alleged that petitioner PCIB knew that he
maintains a permanent residence at Quezon City, and an office address in
Makati City at the Law Firm Romulo Mabanta Buenaventura Sayoc & De los
Angeles, where he is a partner. Respondent Alejandro added that he is the
managing partner of the Hong Kong branch of said Law Firm; that his stay in
Hong Kong is only temporary. The trial court issued an order quashing the writ
and holding that the withdrawal of respondent’s unassigned deposits was
not intended to defraud petitioner bank.

It concluded that petitioner bank misrepresented and suppressed the

facts regarding respondent’s residence considering that it has personal
and official knowledge that for purposes of service of summons,
respondent’s residence and office addresses are located in the Philippines.

Meanwhile, respondent Alejandro filed a claim for damages in the amount of

P25M on the attachment bond. The trial court awarded damages to
respondent Alejandro in the amount of P25 Million without specifying
the basis thereof.

Petitioner PCIB elevated the case to the CA which affirmed the findings of the
trial court. It held that in claiming that respondent was not a resident of the
Philippines, petitioner cannot be said to have been in good faith considering that
its knowledge of respondent’s Philippine residence and office address goes into
the very issue of the trial court’s jurisdiction which would have been defective
had respondent not voluntarily appeared before it.

Petitioner bank also contends that even if respondent Alejandro is considered a

resident of the Philippines, attachment is still proper under Section 1, paragraph
(f), Rule 57 of the Rules of Court since the respondent is a resident who is
temporarily out of the Philippines upon whom service of summons may be
effected by publication.

Further, petitioner bank holds that although it erroneously invoked the ground
that respondent does not reside in the Philippines, it should not be made to pay
damages because it is in fact entitled to a writ of attachment had it invoked the
proper ground under Rule 57.

Issue Whether petitioner bank is liable for damages for the improper issuance of the
writ of attachment against respondent. Yes, liable!

Ruling Yes, PCIB is liable for damages.

The circumstances under which a writ of preliminary attachment may be issued

are set forth in Section 1, Rule 57 of the Rules of Court, to wit:

SEC. 1. Grounds upon which attachment may issue. —

xxx

(f) In an action against a party who resides out of the Philippines, or on whom
summons may be served by publication. (Kat: SC underlined that)

The purposes of preliminary attachment are: (1) to seize the property of the
debtor in advance of final judgment and to hold it for purposes of satisfying said
judgment, as in the grounds stated in paragraphs (a) to (e) of Section 1, Rule 57
of the Rules of Court; or (2) 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, as in
paragraph (f) of the same provision.

Where the defendant is a resident who is temporarily out of the Philippines,

attachment of his/her property in an action in personam, is not always
necessary in order for the court to acquire jurisdiction to hear the case.

Section 16, Rule 14 of the Rules of Court reads:

Sec. 16. Residents temporarily out of the Philippines. – When an action is

commenced against a defendant who ordinarily resides within the Philippines,
but who is temporarily out of it, service may, by leave of court, be also effected
out of the Philippines, as under the preceding section.

The preceding section referred to in the above provision is Section 15 which

provides for extraterritorial service – (a) personal service out of the Philippines,
(b) publication coupled with the sending by registered mail of the copy of the
summons and the court order to the last known address of the defendant; or (c)
in any other manner which the court may deem sufficient.

In Montalban v. Maximo, however, the Court held that substituted service of

summons (under the present Section 7, Rule 14 of the Rules of Court) is the
normal mode of service of summons that will confer jurisdiction on the court
over the person of residents temporarily out of the Philippines. Meaning, service
of summons may be effected by (a) leaving copies of the summons at the
defendant’s residence with some person of suitable discretion residing therein,
or (b) by leaving copies at the defendant’s office or regular place of business
with some competent person in charge thereof. Hence, the court may acquire
jurisdiction over an action in personam by mere substituted service without need
of attaching the property of the defendant.

In the instant case, it must be stressed that the writ was issued by the trial court
mainly on the representation of petitioner that respondent is not a resident of the
Philippines. Obviously, the trial court’s issuance of the writ was for the sole
purpose of acquiring jurisdiction to hear and decide the case. Had the
allegations in the complaint disclosed that respondent has a residence in
Quezon City and an office in Makati City, the trial court, if only for the purpose of
acquiring jurisdiction, could have served summons by substituted service on the
said addresses, instead of attaching the property of the defendant. The rules on
the application of a writ of attachment must be strictly construed in favor of the
 defendant. For attachment is harsh, extraordinary, and summary in nature; it is
a rigorous remedy which exposes the debtor to humiliation and annoyance. It
should be resorted to only when necessary and as a last remedy.

It is clear from the foregoing that even on the allegation that respondent is a
resident temporarily out of the Philippines, petitioner is still not entitled to a writ
of attachment because the trial court could acquire jurisdiction over the case by
substituted service instead of attaching the property of the defendant. The
misrepresentation of petitioner that respondent does not reside in the
Philippines and its omission of his local addresses was thus a deliberate move
to ensure that the application for the writ will be granted.

WHEREFORE, the petition is PARTIALLY GRANTED. The Decision of the CA

is AFFIRMED with MODIFICATIONS. As modified, petitioner PCIB is ordered to
pay respondent Joseph Anthony M. Alejandro the following amounts:
₱50,000.00 as nominal damages, ₱200,000.00 as attorney’s fees; and
₱500,000.00 as moral damages, and ₱500,000.00 as exemplary damages, to
be satisfied against the attachment bond issued by Prudential Guarantee &
Assurance Inc.,45 under JCL (4) No. 01081, Bond No. HO-46764-97.

No pronouncement as to costs.

Case 15. China Banking Corporation vs. Asian Construction and Development
Corporation 550 SCRA 585

Principle
an attached property may be sold after levy on attachment and
before entry of judgment whenever it shall be made to appear to the
court in which the action is pending, upon hearing with notice to both
parties, that the attached property is perishable or that the
interests of all the parties to the action will be subserved by
the sale of the attached property.

an attached property is perishable "if it is shown that, by keeping the

article, it will necessarily become, or is likely to become, worthless to
the creditor, and by consequence to the debtor, then it is embraced
by the statute. It matters not, in our opinion, what the subject matter
is. It may be cotton bales, live stock, hardware provisions or dry
goods."

Facts
China Bank granted respondent Asian Construction and Development
Corporation (ACDC) an Omnibus Credit Line in the amount of
P90,000,000.00.3

On April 12, 1999, alleging that ACDC failed to comply with its
obligations under the Omnibus Credit Line, China Bank filed a
Complaint4 for recovery of sum of money and damages with prayer
for the issuance of writ of preliminary attachment before the Regional
Trial Court

On April 22, 1999, the RTC issued an Order 6 granting China Bank's
prayer for writ of preliminary attachment.

Consequently, as shown in the Sheriff's Report 7 dated June 14, 1999,

the writ of preliminary attachment was implemented levying personal
properties of ACDC, i.e., vans, dump trucks, cement mixers, cargo
trucks, utility vehicles, machinery, equipment and office machines
and fixtures.

On June 15, 2000, China Bank filed a Motion to Take Custody of

Attached Properties with Motion for Grant of Authority to Sell to the
Branch Sheriff10 with the RTC, praying that it be allowed to take
custody of ACDC's properties for the purpose of selling them in an
auction.11

On June 20, 2000, ACDC filed its Opposition 12 to the June 15, 2000
Motion arguing that there can be no sale of the latter's attached
properties in the absence of a final and executory judgment against
ACDC.

China Bank partially appealed. Records of the case were elevated to

the CA.14

According to the CA, selling the attached properties prior to final

judgment of the appealed case is premature and contrary to the
intent and purpose of preliminary attachment for the following
reasons:

first, the records reveal that the attached properties subject of the
motion are not perishable in nature; and

second, while the sale of the attached properties may serve the
interest of China Bank, it will not be so for ACDC.

LAW: Section 11, Rule 57 of the Rules of Court provides:

Sec. 11. When attached property may be sold after levy on

attachment and before entry of judgment. –
 Whenever it shall be made to appear to the court in which the action
is pending, upon hearing with notice to both parties, that the property
attached is perishable, or that the interests of all the parties to
the action will be subserved by the sale thereof, the court may order
such property to be sold at public auction in such manner as it may
direct, and the proceeds of such sale to be deposited in court to abide
the judgment in the action.

PRINCIPLE: Thus, an attached property may be sold after levy on

attachment and before entry of judgment whenever it shall be made
to appear to the court in which the action is pending, upon hearing
with notice to both parties, that the attached property is
perishable or that the interests of all the parties to the action
will be subserved by the sale of the attached property.

CHINA BANK: China Bank invokes the definition of "perishable

property" laid down by the Supreme Court of California as goods
which decay and lose their value if not speedily put to their intended
use; but where the time contemplated is necessarily long, the term
may embrace property liable merely to material depreciation in value
from other causes than such decay.

As stated in the Sheriff's Report26 and Notices of Levy on Properties, 27

all of ACDC's properties which were levied are personal properties
consisting of used vehicles, i.e., vans, dump trucks, cement mixers,
cargo trucks, utility vehicles, machinery, equipment and office
machines and fixtures. China Bank insists that the attached
properties, all placed inside ACDC's stockyard located at Silang,
Cavite and the branch office in Mayamot, Antipolo City, are totally
exposed to natural elements and adverse weather conditions. 28 Thus,
China Bank argues, that should the attached properties be allowed to
depreciate, perish or rot while the main case is pending, the attached
properties will continue losing their worth thereby rendering the rules
on preliminary attachment nugatory.

Issue A.) whether the vehicles, office machines and fixtures are "perishable
property" under Section 11, Rules 57 of the Rules of Court

B.) whether the bond posted by China Bank was sufficient

Ruling A.) In Mossler Acceptance Co. v. Denmark, Mossler offered

testimony to the effect that automobile tires tend to dry-rot in
storage, batteries to deteriorate, crankcases to become damaged,
paint and upholstery to fade, that generally automobiles tend to
depreciate while in storage.31 Rejecting these arguments, the
Supreme Court of Louisiana held that while there might be a
depreciation in the value of a car during storage, depending largely on
existing economic conditions, there would be no material deterioration
of the car itself or any of its appurtenances if the car was properly
cared for, and therefore it could not be said that automobiles were of
a perishable nature within the intendment of the statute, which could
only be invoked when the property attached and seized was of a
perishable nature.32

In McCreery v. Berney National Bank, the Supreme Court of Alabama

rejected the argument that the sale of the attached property was void
because the term "perishable" property, as used in the statute, meant
only such property as contained in itself the elements of speedy
decay, such as fruits, fish, fresh meats, etc.35

The Supreme Court of Alabama held that whatever may be the

character of the property, if the court is satisfied that, either by
reason of its perishable nature, or because of the expense of keeping
it until the termination of the litigation, it will prove, or be likely to
prove, fruitless to the creditor, and that the purpose of its original
seizure will probably be frustrated, the sale of the attached property
is justified.

McCreery applied the doctrine in Millard's Admrs. v. Hall36 where the

Supreme Court of Alabama held that an attached property is
perishable "if it is shown that, by keeping the article, it will
necessarily become, or is likely to become, worthless to the creditor,
and by consequence to the debtor, then it is embraced by the statute.
It matters not, in our opinion, what the subject matter is. It may be
cotton bales, live stock, hardware provisions or dry goods."

The determination on whether the attached vehicles are properly

cared for, and the burden to show that, by keeping the attached office
furniture, office equipment and supplies, it will necessarily become, or
is likely to become, worthless to China Bank, and by consequence to
ACDC, are factual issues requiring reception of evidence which the
Court cannot do in a petition for certiorari. Factual issues are beyond
the scope of certiorari because they do not involve any jurisdictional
issue.43

B.) Section 4, Rule 57 of the Rules of Court provides:

Section 4. Condition of applicant's bond. - The party applying for the

order must thereafter give a bond executed to the adverse party in
the amount fixed by the court in its order granting the issuance of the
writ, conditioned that the latter will pay all the costs which may be
adjudged to the adverse party and all the damages which he may
sustain by reason of the attachment, if the court shall finally adjudge
 that the applicant was not entitled thereto.

It is clear from the foregoing provision that the bond posted by China
Bank answers only for the payment of all damages which ACDC may
sustain if the court shall finally adjudge that China Bank was not
entitled to attachment. The liability attaches if "the plaintiff is not
entitled to the attachment because the requirements entitling him to
the writ are wanting," or "if the plaintiff has no right to the
attachment because the facts stated in his affidavit, or some of them
are untrue."52 Clearly, ACDC can only claim from the bond for all the
damages which it may sustain by reason of the attachment and not
because of the sale of the attached properties prior to final judgment.

Sale of attached property before final judgment is an equitable

remedy provided for the convenience of the parties and preservation
of the property.53 To repeat, the Court finds that the issue of whether
the sale of attached properties is for the convenience of the parties
and that the interests of all the parties will be subserved by the said
sale is a question of fact. Again, the foregoing issue can only be
resolved upon examination of the evidence presented by both parties
which the Court cannot do in a Petition for Certiorari under Rule 65 of
the Rules of Court.

Case 16 Luzon Development Bank – Tomas Clemente Jr. v. Erlinda Krishnan

G.R. No. 203530, April 13, 2015

Principle “While it is true that the word deposit cannot only be confined or
construed to refer to cash, a broader interpretation thereof is not
justified in the present case for the reason that a party seeking a stay of
the attachment under Section 5 is required to make a deposit in an
amount equal to the bond fixed by the court in the order of attachment
or to the value of the property to be attached. The proximate relation of
the word "deposit" and "amount" is unmistakable in Section 5 of Rule 57.
Plainly, in construing said words, it can be safely concluded that Section
5 requires the deposit of money as the word "amount" commonly refers
to or is regularly associated with a sum of money.”

Facts
The petitioners in this case are the respondents in the complaint for Collection
of Sum of Money and Damages filed by respondent Erlinda Khrishna on
February 7, 2001. Erlinda claimed that she was a client of the bank, wherein she
maintained several accounts including time deposits. On several occasions she
presented her time deposit certificates amounting to P28,597,472.70 for
payment because they have become due, petitioners refused to honor them for
the reason that they were fraudulent. As a result, she applied for a Writ for
Preliminary Attachment which was approved by the RTC on February 27, 2001.

By virtue of the writ, petitioner bank's accounts in BPI Family Bank, Calamba,
Laguna in the amount of P28,597,472.70 and its account amounting to
P49,000,000.00 in the Central Bank were garnished.

On March 9, 2001, petitioners filed an urgent ex-parte Motion to Recall Quash

and/or Lift Attachment or Garnishment (in excess of amounts in the writ).
Respondent Erlinda opposed the motion.

On August 15, 2001, petitioners filed an Omnibus Motion seeking the

substitution of their garnished account with government securities and the
immediate resolution of their motion to discharge attachment and setting the
motion for hearing, which respondent Erlinda opposed.

On May 22, 2002, the RTC resolved the pending incidents and required the
petitioners to justify their motion to discharge the attachment.

On September 8, 2003, the RTC issued an order lifting the attachment to which
respondent Erlinda filed a motion for reconsideration. Respondent Erlinda also
filed a Motion for Inhibition. On December 18, 2003, the RTC denied the motion
for reconsideration but granted the motion for inhibition. The said Order was
questioned by respondent Erlinda by way of Petition for Certiorari before the 7th
Division which was granted on November 15, 2006.

Petitioners' subsequent motion for reconsideration was denied. Thereafter, their

petition and motion for reconsideration before the Supreme Court were likewise
denied.

On May 09, 2008, respondent judge issued an Order directing respondent

Erlinda to file a new attachment bond in the amount of P35,000,000.00 and
petitioners to file a counterbond within ten days from notice of the filing and
approval of the bond of respondent Erlinda. Petitioners moved for the
reconsideration of the said Order which respondent judge denied and granted a
period of fifteen days for respondent Erlinda to file an attachment bond.

Respondent Erlinda filed her attachment bond on June 25, 2009 in the amount
of P35,000,000.00 through Visayan Surety and Insurance Corporation which
was approved by respondent on July 7, 2009.

Meanwhile, on July 3, 2009, petitioners filed an Omnibus Motion praying that a

hearing be held to determine the sufficiency of the attachment bond and they be
allowed to deposit Certificates of Title of real property, and the issuance of the
writ of attachment be held in abeyance.

On July 20, 2009, petitioners filed a motion for extension of time to comply
and/or file the appropriate pleading and to hold in abeyance the reinstatement of
the writ of attachment.
 On January 28, 2010, petitioners filed a motion to admit bank property in lieu of
counterbond which was opposed by respondent Erlinda.

On September 24, 2010 the motion was denied and the subsequent motion for
reconsideration was denied on May 26, 2011.

On June 27, 2011, the judge issued an Order reinstating the Writ of Attachment
dated March 1, 2001 for failure of petitioners to file the required counterbond.
The judge also issued an amended Reinstated Writ of Attachment directing
respondent Sheriff Oscar L. Rojas to attach the real estate or personal
properties of petitioners in the amount of P28,597,472.70. On June 30, 2011,
the sheriff served the Notice of Garnishment and the Amended Reinstated Writ
of Attachment.

On July 4, 2011, petitioners filed an urgent motion to recall, suspend or hold in

abeyance and re-examination of the amended reinstated writ of preliminary
attachment of June 27, 2011 which was opposed by respondent Erlinda.

On July 19, 2011, respondent Sheriff issued a Sheriff's Partial Report.

Thereafter, petitioners filed this petition for certiorari.

On March 27, 2012 the CA dismissed the certiorari petition and affirmed the
Orders of the RTC reinstating the Writ of Attachment for failure of petitioners to
file the required counter-bond. The CA ruled that the RTC judge committed no
grave abuse of discretion in denying petitioners' motion to admit bank property
in lieu of counter-bond.

Issue Whether or Not, Bank Property may be deposited in lieu of cash or a counter-
bond.

Ruling The Court ruled in the negative.

The Court cited Section 2 of Rule 57 of the Rules of Court stating that:

"[a]n order of attachment may be issued either ex parte or upon motion with
notice and hearing by the court in which the action is pending, or by the Court of
Appeals or the Supreme Court, and must require the sheriff of the court to
attach so much of the property in the Philippines of the party against whom it is
issued, not exempt from execution, as may be sufficient to satisfy the applicant's
demand, unless such party makes deposit or gives a bond as hereinafter
provided in an amount equal to that fixed in the order, which may be the
amount sufficient to satisfy the applicant's demand or the value of the property
to be attached as stated by the applicant, exclusive of costs."

The Court further cited Section 5 of the same Rule, stating that: "[t]he sheriff
enforcing the writ shall without delay and with all reasonable diligence attach, to
await judgment and execution in the action, only so much of the property in the
 Philippines of the party against whom the writ is issued, not exempt from
execution, as may be sufficient to satisfy the applicant's demand, unless the
former makes a deposit with the court from which the writ is issued, or
gives a counter-bond executed to the applicant, in an amount equal to the
bond fixed by the court in the order of attachment or to the value of the
property to be attached, exclusive of costs.".

Furthermore, the Court held in Security Pacific Assurance Corporation v. Tria-

Infante, that one of the ways secure the discharge of an attachment is for the
party whose property has been attached or a person appearing on his behalf, to
post a counterbond or make the requisite cash deposit in an amount equal to
that fixed by the court in the order of attachment.

As such: the trial court aptly ruled that while it is true that the word deposit
cannot only be confined or construed to refer to cash, a broader interpretation
thereof is not justified in the present case for the reason that a party seeking a
stay of the attachment under Section 5 is required to make a deposit in an
amount equal to the bond fixed by the court in the order of attachment or to the
value of the property to be attached. The proximate relation of the word
"deposit" and "amount" is unmistakable in Section 5 of Rule 57. Plainly, in
construing said words, it can be safely concluded that Section 5 requires the
deposit of money as the word "amount" commonly refers to or is regularly
associated with a sum of money.

Case 17. Fort BonifacioDevt Corporation vs. Yllas Lending Corporation 567 SCRA
454

Principle

Facts

Issue

Ruling

Case . POTC, PHILCOMSAT vs. SANDIGANBAYAN

G.R. No. 174462 February 10, 2016

Principle Sequestration is. a conservatory writ,which purpose is to preserve properties in

custodia legis, lest the dissipation and concealment of the "ill-gotten" wealth the
former President Marcos and his allies may resort to, pending the final
disposition of the properties. It is to prevent the disappearance or dissipation
 pending adjudgment of whether the acquisition thereof by the apparent owner
was attended by some vitiating anomaly or attended by some illegal means.
Thus by no means is it permanent in character. Upon the final disposition of the
sequestered properties, the sequestration is rendered functus officio.

Facts Pursuant to Executive Order Nos. 1 and 2, on 14 March 1986, then PCGG
Commissioner Ramon A. Diaz issued a letter directing Officer-In-Charge Carlos
M. Ferrales to:

a. Sequester and immediately take over POTC and PHILCOMSAT among

others, and

b. To freeze all 'withdrawals, transfers and/or remittances under any type of

deposit accounts, trust accounts or placements.

On 22 July 1987, the Office of the Solicitor General (OSG), on behalf of the
Republic of the Philippines, filed a Complaint for Reconveyance, Reversion,
Accounting and Restitution, and Damages, docketed as Civil Case No. 0009,
against Jose L. Africa, Manuel H. Nieto, Jr., Ferdinand E. Marcos, Imelda R.
Marcos, Ferdinand R. Marcos, Jr., Roberto S. Benedicto, Juan Ponce Enrile,
and Potenciano Ilusorio (collectively hereinafter referred to as "defendants").

As alleged in the Complaint, through clever schemes, the wealth that should go
to the coffers of the government, which should be deemed acquired for the
benefit of the Republic, went to the defendants in their own individual accounts-
some, however, through conduits or corporations. The property supposedly
acquired illegally was specifically set out in a list appended to the Complaint as
Annex A.

Pursuant to its power to sequester and to avoid further dissipation of the

sequestered properties, the PCGG appointed a comptroller, who controlled the
disbursement of funds of POTC and PHILCOMSAT. At the same time, in a
Memorandum by the PCGG to the Bangko Sentral ng Pilipinas (BSP), the
PCGG informed the BSP that in all cash withdrawals, transfer of funds, money
market placements and disbursements of POTC and PHILCOMSAT, the
approval of the PCGG appointed comptroller is required. The Memorandum was
to be disseminated to all commercial banks and other non-bank financial
institutions performing quasi-banking functions.

On 28 June 1996, Atty. Potenciano Ilusorio (Ilusorio), one of the defendants in

the Civil Case No. 0009, entered into a Compromise Agreement with the
Republic. Out of 5,400 or 40% of the shares of stock of POTC in the names of
Mid-Pasig Land Development Corporation (MLDC) and Independent Realty
Corporation (IRC), the government recovered 4, 727 shares or 34.9% of the
shares of stock. Ilusorio, on the other hand, retained 673 shares or 5% of the
shares of stock. The Compromise Agreement was approved by the
Sandiganbayan in an Order dated 8 June 1998.

Aggrieved, the PCGG, MLDC, and IRC filed separate petitions before this Court
to nullify the Order of the Sandiganbayan approving the Compromise
 Agreement, which this Court, on 15 June 2005, declared valid in Republic of the
Phils. v. Sandiganbayan, G.R. No. 141796 and 141804.

By virtue of the aforesaid Decision in Republic of the Phils. v. Sandiganbayan,

POTC and PHILCOMSAT filed an Omnibus Motion dated 28 February 2005,
which sought to nullify and/or discharge the continued sequestration of POTC
and PHILCOMSAT and to declare null and void the PCGG Memorandum to the
BSP dated 24 October 2000.

On 20 October 2005, the Sandiganbayan denied POTC and PHILCOMSAT' s

Omnibus Motion in the assailed Resolution. The Motion for Reconsideration was
likewise denied in a Resolution dated 2 August 2006.

Issue Whether or not the continued sequestration is necessary.

Ruling NO. Sequestration is the means to place or cause to be placed under the
PCGG's possession or control properties, building or office, including business
enterprises and entities, for the purpose of preventing the destruction,
concealment or dissipation of, and otherwise conserving and preserving the
same until it can be determined through appropriate judicial proceedings,
whether the property was in truth "ill-gotten. "

However, the power of the PCGG to sequester is merely provisional. None other
than Executive Order No. 1, Section 3(c) expressly provides for the provisional
nature of sequestration, to wit:

c) To provisionally take over in the public interest or to prevent its

disposal or dissipation, business enterprises and properties taken over
by the government of the Marcos Administration or by entities or persons
close to former President Marcos, until the transactions leading to such
acquisition by the latter can be disposed of by the appropriate
authorities.

In the notable case of Bataan Shipyard & Engineering Co., Inc. (BASECO) v.
PCGG, the Court clearly pronounced that sequestration is provisional, that such
sequestration shall last "until the transactions leading to such acquisition xxx
can be disposed of by the appropriate authorities."

Sequestration is akin to the provisional remedy of preliminary attachment, or

receivership. Similarly, in attachment, the property of the defendant is seized as
a security for the satisfaction of any judgment that may be obtained, and not
disposed of, or dissipated, or lost intentionally or otherwise, pending litigation. In
a receivership, the property is placed in the possession and control of a receiver
appointed by the court, who shall conserve the property pending final
determination of ownership or right of possession of the parties. In
sequestration, the same principle holds true. The sequestered properties are
placed under the control of the PCGG, subject to the final determination of
whether the property was in truth ill-gotten. We reiterate the disquisition of this
Court in BASECO:
 By the clear terms of the law, the power of the PCGG to sequester
property claimed to be "ill-gotten" means to place or cause to be placed
under its possession or control said property, or any building or office
wherein any such property and any records pertaining thereto may be
found, including "business enterprises and entities," - for the purpose of
preventing the destruction, concealment or dissipation of, and otherwise
conserving and preserving, the same - until it can be determined,
through appropriate judicial proceedings, whether the property was in
truth "ill- gotten," i.e., acquired through or as a result of improper or
illegal use of or the conversion of funds belonging to the Government or
any of its branches, instrumentalities, enterprises, banks or financial
institutions, or by taking undue advantage of official position, authority
relationship, connection or influence, resulting in unjust enrichment of the
ostensible owner and grave damage and prejudice to the State. xxx

Sequestration is a conservatory writ, which purpose is to preserve properties in

custodia legis, lest the dissipation and concealment of the "ill-gotten" wealth the
former President Marcos and his allies may resort to, pending the final
disposition of the properties. It is to prevent the disappearance or dissipation
pending adjudgment of whether the acquisition thereof by the apparent owner
was attended by some vitiating anomaly or attended by some illegal means.
Thus by no means is it permanent in character. Upon the final disposition of the
sequestered properties, the sequestration is rendered functus officio.

As sequestration is a provisional remedy, a transitional state of affairs, in order

to prevent the disappearance or dissipation of the property pending the final
disposition of the property, the ultimate purpose of sequestration is to bring an
intended permanent effect while the PCGG investigates in pursuit of a judicial
proceeding - to dispose of the sequestered properties. Tersely put, the ultimate
purpose of sequestration is to recover the sequestered properties in favor of the
government in case they turn out to be ill-gotten. This function to dispose of the
property is reserved to the Sandiganbayan. Until the Sandiganbayan determines
whether the property was in truth and in fact "ill- gotten", the sequestration shall
subsist. In case of a finding that the sequestered properties are ill-gotten, the
property shall be returned to the lawful owner, to the people, through the
government; otherwise, the sequestered property shall be returned to the
previous owner.

Clearly, the purpose of sequestration is to take control until the property is finally
disposed of by the proper authorities.

In the case at bar, the 34.9% ownership of the sequestered property has been
finally adjudged; the ultimate purpose of sequestration was already
accomplished when the ownership thereof was adjudged to the government by
this Court in Republic of the Phils. v. Sandiganbayan. Moreover, the said shares
in the ownership of the sequestered properties have reverted to the
Government. The government now owns 4,727 shares or 34.9% of the
sequestered corporations.

As the sequestered property has already been disposed, the ultimate purpose of
 sequestration has already been attained; the evil sought to be prevented is no
longer present. Evidently, the sequestered property which was already returned
to the government cannot anymore be dissipated or concealed. Otherwise
stated, the sequestered properties need no longer be subject of reversion
proceedings because they have already reverted back to the government. Thus,
as the sequestration is rendered functus officio, it is merely ministerial upon the
Sandiganbayan to lift the same.

Sequestration as statutorily and constitutionally recognized is not permanent. It

must be lifted when the law and proven facts warrant, or when the purpose has
been accomplished.

WHEREFORE, the Petition is GRANTED. The assailed Resolution issued by

the Sandiganbayan dated 20 October 2005 and 2 August 2006 are
REVERSED. The writ of sequestration issued against petitioner POTC and
PHILCOMSAT is hereby declared LIFTED six (6) months after the ratification of
the 1987 Constitution on 2 February 1987.

Case 18. CORPORATION, and FAR EASTERN SURETY & INSURANCE CO., INC.,
G.R. No. 212025, July 1, 2015

Principle By its nature, preliminary attachment, under Rule 57 of the Rules of Court,
“is an ancillary remedy applied for not for its own sake but to enable the
attaching party to realize upon relief sought and expected to be granted in
the main or principal action; it is a measure auxiliary or incidental to the
main action.

Section 20, Rule 57 specifically requires that the application for damages
against the wrongful attachment, whether filed before the trial court or
appellate court, must be with due notice to the attaching party and his
surety or sureties.

Under no circumstance, whatsoever, can the garnished funds or attached

properties, under the custody of the sheriff or the clerk of court, be
released to the attaching party before the promulgation of judgment.

Under Section 20, Rule 57, in relation to Section 4 therein, the surety bond
shall answer for all the costs which may be adjudged to the adverse party
and all damages which he may sustain by reason of the attachment.

Under Section 17, Rule 57, in relation to Section 12 therein, the cash
deposit or the counter-bond shall secure the payment of any judgment
that the attaching party may recover in the action.

Facts Petitioner, Excellent Quality Apparel, Inc. represented by Max Ying (V-Pres for
productions) and Alfiero Orden (treasurer) entered into a 5-month construction
contract with Multi-Rich Builders (Multi Rich), a single proprietorship,
represented by Wilson Chua (president and general manager, with an
Arbitration clause in case of dispute. The construction of the factory building
was completed on November 27, 1996. Win Multi-Rich Builders, Inc. (Win Multi-
Rich) was incorporated with the SEC. on January 26, 2004, Win Multi-Rich filed
a complaint for sum of money against petitioner and Ying before the RTC and
prayed for the issuance of a writ of attachment, claiming that Ying was about to
abscond and that petitioner had an impending closure. Win Multi-Rich secured
the necessary bond in the amount of P8,634,448.20 from respondent Visayan
Surety Corporation (Visayan Surety). The RTC issued a writ of preliminary
attachment in favor of Win Multi-Rich.

Petitioner issued Equitable PCI Bank check payable to the clerk of court for the
amount of P8,634,448.20 to prevent enforcement of the writ of preliminary
attachment on its equipment and machinery on February 16, 2004. Three days
later, petitioner filed an Omnibus Motion seeking to discharge the attachment.
Petitioner also questioned the jurisdiction of the RTC due to presence of
Arbitration Clause in the contract. That pursuant to EO No. 1008, the case
should have been referred first to the CIAC. The RTC however denied the
motion ruling that the issue of the case could be resolved after a full-blown trial.
The RTC issued another order directing the deposit of the garnished funds of
petitioner to the cashier of the Clerk of Court. Win Multi-Rich filed a motion on
April 29, 2004 to release petitioner’s cash deposit to it and was granted by the
RTC on May 3, 2004. Win Multi-Rich posted surety bond issued by respondent
Far Eastern Surety and Insurance Co., Inc. (FESICO) for 9,000,000.00 to
secure the withdrawal of the cash deposited by petitioner. Thus, Win Multi-Rich
was able to receive the funds of petitioner even before the trial began.

Petitioners filed a motion for certiorari under Rule 65 of the Rules of Civil
Procedure before the CA seeking to annul and set aside the April 12, 2004
orders of the RTC. The CA granted its motion and ruled accordingly the writ of
preliminary injunction permanent. Petitioner filed a motion for reconsideration
arguing that the CA decision failed to state an order to return the garnished
amount of P8,634,448.20 which was taken from its bank account and given to
Win Multi-Rich. The CA denied the motion.
Petitioner filed a petitioner for review on certiorari under Rule 45. The Court
promulgated a decision in favor of petitioner and ruled that the RTC should not
have taken cognizance of the collection suit because the presence of the
arbitration clause vested jurisdiction on the CIAC over all construction disputed
between petitioner and Multi-Rich. Win Multi-Rich could not retain the garnished
amount, as the RTC did not have jurisdiction to issue the questioned writ of
attachment and to order the release of the funds. Multi-Rich filed a motion for
reconsideration but it was denied. The court’s decision became final and
executory.

Petitioner moved for execution thereof, praying for the return of its cash deposit
and in the event of refusal of Win Multi-Rich t comply, to hold Visayan Surety
and FESICO liable under their respective bonds.

The RTC issued the order granting the surety respondents’ motion for
reconsideration and lifting its order on October 19, 2009 order insofar as it
 granted the motion for execution against Visayan Surety and FESICO. The RTC
absolved the surety respondents because petitioner did not file a motion for
judgment on the attachment bond before the finality of judgment, thus violating
the surety respondents’ right to due process. That execution against the surety
respondents would go beyond the terms of the judgment sought to be executed
considering that the Court decision pertained to Win Multi-Rich only.

Upon appeal to the CA, the court found petitioner’s appeal without merit under
Section 20, Rule 57 ruling that petitioner failed to timely claim damages against
the surety before the decision of the court became final and executory. That the
court judgment could not bind persons who were not parties to the action as the
records showed that Visayan Surety and FESICO were neither impleaded nor
informed of the proceedings.

Issue whether or not the respondents surety, Visayan Surety and FESICO are liable
for damages for the wrongful issuance and enforcement of the writ of
preliminary injunction pursuant to Rule 57 of the Rules of Court.

Ruling Visayan Surety not liable.

FESICO is solidary liable.

The party applying for the order of attachment must thereafter give a bond
executed to the adverse party in the amount fixed by the court in its order
granting the issuance of the writ. The purpose of an attachment bond is to
answer for all costs and damages which the adverse party may sustain by
reason of the attachment if the court finally rules that the applicant is not entitled
to the writ.

In this case, the attachment bond was issued by Visayan Surety in order for Win
Multi-Rich to secure the issuance of the writ of attachment. Hence, any
application for damages arising from the improper, irregular or excessive
attachment shall be governed by Section 20, Rule 57.

In a catena of cases, the Court has cited the requisites under Section 20, Rule
57 in order to claim damages against the bond, as follows:

1. The application for damages must be filed in the same case where the bond
was issued;
2. Such application for damages must be filed before the entry of judgment; and
3. After hearing with notice to the surety.

VISAYAN SURETY IS NOT LIABLE

In the present petition, the Court holds that petitioner sufficiently incorporated an
application for damages against the wrongful attachment in its answer with
compulsory counterclaim filed before the RTC.

Section 20, Rule 57 specifically requires that the application for damages
against the wrongful attachment, whether filed before the trial court or appellate
court, must be with due notice to the attaching party and his surety or sureties.
Such damages may be awarded only after proper hearing and shall be included
in the judgment on the main case.

In the present case, the petitioner's answer with compulsory counterclaim, which
contained the application for damages, was not served on Visayan Surety. Also,
a perusal of the records revealed that Visayan Surety did not furnish any copies
of the pleadings, motions, processes, and judgments concerned with the
application for damages against the surety bond. Visayan Surety was only
notified of the application when the motion for execution was filed by petitioner
on June 29, 2009, after the judgment in G.R. No. 175048 had become final and
executory on June 2, 2009.

Clearly, petitioner failed to comply with the requisites under Section 20, Rule 57
because Visayan Surety was not given due notice on the application for
damages before the finality of judgment. The subsequent motion for execution,
which sought to implicate Visayan Surety, cannot alter the immutable judgment
anymore.

FESICO’s bond is not covered by Section 20, Rule 57

While Visayan Surety could not be held liable under Section 20, Rule 57, the
same cannot be said of FESICO. In the case at bench, to forestall the
enforcement of the writ of preliminary attachment, petitioner issued Equitable
PCI Bank Check No. 160149, dated February 16, 2004, in the amount of
P8,634,448.20 payable to the Clerk of Court of the RTC. Pursuant to the RTC
Order, dated April 29, 2004, the garnished funds of petitioner were deposited to
the cashier of the Clerk of Court of the RTC. Win Multi-Rich, however, took a
step further and filed a motion to release petitioner’s cash deposit to it.
Immediately, the RTC granted the motion and directed Win Multi-Rich to post a
bond in favor of petitioner in the amount of P9,000,000.00 to answer for the
damages which the latter may sustain should the court decide that Win Multi-
Rich was not entitled to the relief sought. Subsequently, Win Multi-Rich filed a
surety bond of FESICO before the RTC and was able to obtain the
P8,634,448.20 cash deposit of petitioner, even before the trial commenced.

Strictly speaking, the surety bond of FESICO is not covered by any of the
provisions in Rule 57 of the Rules of Court because, in the first place, Win Multi-
Rich should not have filed its motion to release the cash deposit of petitioner
and the RTC should not have granted the same. The release of the cash
deposit to the attaching party is anathema to the basic tenets of a preliminary
attachment.

In this case, however, Win Multi-Rich was able to withdraw the cash deposit
and, in exchange, it posted a surety bond of FESICO in favor of petitioner to
answer for the damages that the latter may sustain. Corollarily, the surety bond
of FESICO substituted the cash deposit of petitioner as a security for the
judgment. Thus, to claim damages from the surety bond of FESICO, Section 17,
Rule 57 could be applied.
 From a reading of the above provision, it is evident that a surety on a counter-
bond given to secure the payment of a judgment becomes liable for the
payment of the amount due upon: (1) demand made upon the surety; and (2)
notice and summary hearing on the same action. Noticeably, unlike Section 20,
Rule 57, which requires notice and hearing before the finality of the judgment in
an application for damages, Section 17, Rule 57 allows a party to claim
damages on the surety bond after the judgment has become executory.

The question remains, in contrast to Section 20, why does Section 17 sanction
the notice and hearing to the surety after the finality of judgment? The answer
lies in the kind of damages sought to be enforced against the bond.

Under Section 20, Rule 57, in relation to Section 4 therein, the surety bond shall
answer for all the costs which may be adjudged to the adverse party and all
damages which he may sustain by reason of the attachment. In other words, the
damages sought to be enforced against the surety bond are unliquidated.
Necessarily, a notice and hearing before the finality of judgment must be
undertaken to properly determine the amount of damages that was suffered by
the defendant due to the improper attachment. These damages to be imposed
against the attaching party and his sureties are different from the principal case,
and must be included in the judgment.

On the other hand, under Section 17, Rule 57, in relation to Section 12 therein,
the cash deposit or the counter-bond shall secure the payment of any judgment
that the attaching party may recover in the action. Stated differently, the
damages sought to be charged against the surety bond are liquidated. The final
judgment had already determined the amount to be awarded to the winning
litigant on the main action. Thus, there is nothing left to do but to execute the
judgment against the losing party, or in case of insufficiency, against its sureties.

Here, the Court is convinced that a demand against FESICO had been made,
and that it was given due notice and an opportunity to be heard on its defense.
Based on the foregoing, the requirements under Section 17, Rule 57 have been
more than satisfied.

Indeed, FESICO cannot escape liability on its surety bond issued in favor of
petitioner. The purpose of FESICO’s bond was to secure the withdrawal of the
cash deposit and to answer any damages that would be inflicted against
petitioner in the course of the proceedings. Also, the undertaking signed by
FESICO stated that the duration of the effectivity of the bond shall be from its
approval by the court until the action is fully decided, resolved or terminated.

Thus, the Court holds that FESICO is solidarily liable under its surety bond with
its principal Win Multi-Rich.

Case 19. ALFREDO C. LIM, JR., vs. SPOUSES TITO S. LAZARO AND CARMEN T.
LAZARO, G.R. No. 185734, July 3, 2013
Principle 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.

Facts Petitioner Lim Jr filed a complaint for a sum of money with a prayer for the
issuance of a writ of preliminary attachment against the respondent Sps Lazaro
seeking to recover the sum of P2,160,000.00, which represented the amounts
stated in several dishonored checks issued by the latter to the former.The RTC
granted the writ of preliminary attachment application and upon the posting of
the required bond issued the corresponding writ on October 14, 2005. Three (3)
parcels of land owned by the respondent spouses were levied upon.

The parties later entered into a Compromise Agreement whereby Sps. Lazaro
agreed to pay Lim, Jr. the amount of P2,351,064.80 on an installment basis
which was approved by the RTC.

Thereafter, Sps. Lazaro then filed an Omnibus Motion, seeking to lift the writ of
preliminary attachment annotated on the subject TCTs.

In granting the Motion, the RTC 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 decision based on the compromise agreement, the writ of preliminary
attachment should be lifted and quashed.

Petitioner Lim, Jr. filed a motion for reconsideration which was, however, denied
by the RTC prompting him to file a petition for certiorari before the CA.

The CA find 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.

Hence, this petition.

Issue Whether or not the writ of preliminary attachment was properly lifted.

Ruling NO. 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 Court finds 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 in its January 5, 2007
Amended Decision, the obligations thereunder have yet to be fully complied with
— particularly, the payment of the total compromise amount of P2,351,064.80.
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, viz.:

xxxx
The case at bench admits of peculiar character in the sense that it involves a
compromise agreement. Nonetheless, x x x. 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.
xxxx

In fine, the Court holds 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. Lest it be
misunderstood, the lien or security obtained by an attachment even before
judgment, is in the nature of a vested interest which affords specific security for
the satisfaction of the debt put in suit. Verily, the lifting of the attachment lien
would be tantamount to an abdication of Lim, Jr.’s rights over Sps. Lazaro’s
properties which the Court, absent any justifiable ground therefor, cannot allow.
Case 26.
FIRST SARMIENTO PROPERTY HOLDINGS, INC., Petitioner, v. PHILIPPINE
BANK OF COMMUNICATIONS, Respondent.

G.R. No. 202836, June 19, 2018

Principle
A temporary restraining order cannot be extended indefinitely to take the place
of a writ of preliminary injunction, since a temporary restraining order is intended
only to have a limited lifespan and is deemed automatically vacated upon the
expiration of 72 hours or 20 days, as the case may be.

Facts
First Sarmiento obtained from Philippine Bank of Communications (PBCOM) a
P40 M loan, which was secured by a real estate mortgage over 1,076 parcels of
land.

The loan agreement was amended until it was increased to P100M.

PBCOM filed a Petition for Extrajudicial Foreclosure of Real Estate Mortgage. It

claimed in its Petition that it sent First Sarmiento several demand letters, yet
First Sarmiento still failed to pay the principal amount and accrued interest on
the loan. This prompted PBCOM to resort to extrajudicial foreclosure of the
mortgaged properties, a recourse granted to it under the loan agreement.

First Sarmiento attempted to file a Complaint for annulment of real estate

mortgage with the RTC. However, the Clerk of Court refused to accept the
Complaint in the absence of the mortgaged properties' tax declarations, which
would be used to assess the docket fees.

(Judge Francisco) and first, second, and third vice executive judge of the RTC
of City of Malolos, Bulacan, granted First Sarmiento's Urgent Motion to Consider
the Value of Subject Matter of the Complaint as Not Capable of Pecuniary
Estimation, and ruled that First Sarmiento's action for annulment of real estate
mortgage was incapable of pecuniary estimation.

Also, the mortgaged properties were auctioned and sold to PBCOM as the
highest bidder.

First Sarmiento filed a Complaint for annulment of real estate mortgage and its
amendments, with prayer for the issuance of temporary restraining order and
preliminary injunction. It paid a filing fee of P5,545.00.

First Sarmiento claimed in its Complaint that it never received the loan proceeds
of P100,000,000.00 from PBCOM, yet the latter still sought the extrajudicial
foreclosure of real estate mortgage. It prayed for the issuance of a temporary
 restraining order and preliminary injunction to enjoin the Ex-Officio Sheriff from
proceeding with the foreclosure of the real estate mortgage or registering the
certificate of sale in PBCOM's favor with the Registry of Deeds of Bulacan.

That same day, Judge Francisco issued an ex-parte temporary restraining order
for 72 hours, enjoining the registration of the certificate of sale with the Registry
of Deeds of Bulacan.

The RTC directed the parties to observe the status quo ante.

Later, the Clerk of Court and Ex-Officio Sheriff of Malolos City, Bulacan issued a
certificate of sale to PBCOM.

In its Opposition (Re: Application for Issuance of Temporary Restraining Order),

PBCOM asserted that the RTC failed to acquire jurisdiction over First
Sarmiento's Complaint because the action for annulment of mortgage was a real
action; thus, the filing fees filed should have been based on the fair market
value of the mortgaged properties.

PBCOM also pointed out that the RTC’s directive to maintain the status quo
order beyond 72 hours constituted an indefinite extension of the temporary
restraining order, a clear contravention of the rules.

The RTC of Malolos City, Bulacan dismissed the Complaint for lack of
jurisdiction. It also denied First Sarmiento’s motion for reconsideration.

First Sarmiento sought direct recourse to this Court with its Petition for Review
under Rule 45. It insists that its Complaint for the annulment of real estate
mortgage was incapable of pecuniary estimation. It points odut that the
Executive Judge and Vice-Executive Judges of the Regional Trial Court likewise
acknowledged that its action was incapable of pecuniary estimation.

Issue
Whether or not the RTC January 4, 2012 Order, which directed the parties to
observe the status quo ante, effectively extending indefinitely its 72-hour ex-
parte temporary restraining order issued on January 2, 2012, is legal.

Ruling
Rule 58, Section 5 of the Rules of Court provides the instances when a
temporary restraining order may be issued:

Section 5. Preliminary injunction not granted without notice; exception. — No

preliminary injunction shall be granted without hearing and prior notice to the
party or person sought to be enjoined. If it shall appear from facts shown by
affidavits or by the verified application that great or irreparable injury would
result to the applicant before the matter can be heard on notice, the court to
which the application for preliminary injunction was made, may issue a
temporary restraining order to be effective only for a period of twenty (20) days
from service on the party or person sought to be enjoined, except as herein
provided. Within the said twenty-day period, the court must order said party or
person to show cause, at a specified time and place, why the injunction should
not be granted, determine within the same period whether or not the preliminary
injunction shall be granted, and accordingly issue the corresponding order.

However, and subject to the provisions of the preceding sections, if the matter is
of extreme urgency and the applicant will suffer grave injustice and irreparable
injury, the executive judge of a multiple-sala court or the presiding judge of a
single-sala court may issue ex-parte a temporary restraining order effective for
only seventy-two (72) hours from issuance but he shall immediately comply with
the provisions of the next preceding section as to service of summons and the
documents to be served therewith. Thereafter, within the aforesaid seventy-two
(72) hours, the judge before whom the case is pending shall conduct a summary
hearing to determine whether the temporary restraining order shall be extended
until the application for preliminary injunction can be heard. In no case shall the
total period of effectivity of the temporary restraining order exceed twenty (20)
days, including the original seventy-two hours provided herein.

In the event that the application for preliminary injunction is denied or not
resolved within the said period, the temporary restraining order is deemed
automatically vacated. The effectivity of a temporary restraining order is not
extendible without need of any judicial declaration to that effect and no court
shall have authority to extend or renew the same on the same ground for which
it was issued.

However, if issued by the Court of Appeals or a member thereof, the temporary

restraining order shall be effective for sixty (60) days from service on the party
or person sought to be enjoined. A restraining order issued by the Supreme
Court or a member thereof shall be effective until further orders.

It is clear that a temporary restraining order may be issued by a trial court in

only two (2) instances: first, when great or irreparable injury would result to the
applicant even before the application for writ of preliminary injunction can be
heard; and second, if the matter is of extreme urgency and the applicant will
suffer grave injustice and irreparable injury. The executive judge of a multi-sala
court or the presiding judge of a single-sala court may issue a 72-hour
temporary restraining order.

In both instances, the temporary restraining order may be issued ex parte.

However, in the first instance, the temporary restraining order has an effectivity
of only 20 days to be counted from service to the party sought to be enjoined.
Likewise, within those 20 days, the court shall order the enjoined party to show
why the injunction should not be granted and shall then determine whether or
not the injunction should be granted.

In the second instance, when there is extreme urgency and the applicant will
suffer grave injustice and irreparable injury, the court shall issue a temporary
restraining order effective for only 72 hours upon issuance. Within those 72
hours, the court shall conduct a summary hearing to determine if the temporary
restraining order shall be extended until the application for writ of preliminary
injunction can be heard. However, in no case shall the extension exceed 20
days.

If the application for preliminary injunction is denied or not resolved within the
given periods, the temporary restraining order is automatically vacated and the
court has no authority to extend or renew it on the same ground of its original
issuance.

Despite the clear wording of the rules, the Regional Trial Court issued a status
quo ante order dated January 4, 2012, indefinitely extending the temporary
restraining order on the registration of the certificate of sale with the Registry of
Deeds.

Petitioner applied for a writ of preliminary injunction, yet the Regional Trial Court
did not conduct any hearing for that purpose and merely directed the parties to
observe the status quo ante.

Miriam College Foundation, Inc v. Court of Appeals explained the difference

between preliminary injunction and a restraining order as follows:

Preliminary injunction is an order granted at any stage of an action or

proceeding prior to the judgment or final order, requiring a party or a court,
agency or a person to perform to refrain from performing a particular act or acts.
As an extraordinary remedy, injunction is calculated to preserve or maintain the
status quo of things and is generally availed of to prevent actual or threatened
acts, until the merits of the case can be heard. A preliminary injunction persists
until it is dissolved or until the termination of the action without the court issuing
a final injunction.

The basic purpose of restraining order, on the other hand, is to preserve the
status quo until the hearing of the application for preliminary injunction. Under
the former A§5, Rule 58 of the Rules of Court, as amended by A§5, Batas
Pambansa Blg. 224, a judge (or justice) may issue a temporary restraining order
with a limited life of twenty days from date of issue. If before the expiration of the
20-day period the application for preliminary injunction is denied, the temporary
order would thereby be deemed automatically vacated. If no action is taken by
the judge on the application for preliminary injunction within the said 20 days,
the temporary restraining order would automatically expire on the 20th day by
the sheer force of law, no judicial declaration to that effect being necessary. In
the instant case, no such preliminary injunction was issued; hence, the TRO
earlier issued automatically expired under the aforesaid provision of the Rules of
Court.

A temporary restraining order cannot be extended indefinitely to take the place

of a writ of preliminary injunction, since a temporary restraining order is intended
only to have a limited lifespan and is deemed automatically vacated upon the
expiration of 72 hours or 20 days, as the case may be. As such, the temporary
 restraining order has long expired and, in the absence of a preliminary
injunction, there was nothing to stop the sheriff from registering the certificate of
sale with the Registry of Deeds.

This Court has repeatedly expounded on the nature of a temporary restraining

order and a preliminary injunction. Yet lower courts consistently interchange
these ancillary remedies and disregard the sunset clause inherent in a
temporary restraining order by erroneously extending it indefinitely. Such
ignorance or defiance of basic remedial measures is a gross disservice to the
public, who look towards the court for legal guidance and legal remedy. More
importantly, this cavalier attitude towards these injunctive reliefs might even be
construed as a deliberate effort to look the other way to favor a party, which will
then sully the image of the entire judiciary. Henceforth, this Court will demand
stricter compliance with the rules from the members of the bench as regards
their issuances of these injunctive reliefs.

The case is ordered REMANDED to Branch 11, Regional Trial Court, City of
Malolos, Bulacan for continued trial on First Sarmiento Property Holdings, Inc.'s
Complaint for annulment of real estate mortgage and its amendments.

Case 27.
SPOUSES PRUDENTE D. SOLLER AND PRECIOSA M. SOLLER, RAFFY
TELOSA, AND GAVINO MANIBO, JR. PETITIONERS, V. HON. ROGELIO
SINGSON, IN HIS CAPACITY AS SECRETARY OF DEPARTMENT OF
PUBLIC WORKS AND HIGHWAYS, ENGR. MAGTANGGOL ROLDAN, IN HIS
CAPACITY AS DISTRICT ENGINEER OF THE DEPARTMENT OF PUBLIC
WORKS AND HIGHWAYS-ORIENTAL MINDORO, SECOND DISTRICT
OFFICE, KING'S BUILDERS AND DEVELOPMENT CORPORATION, AND
ITS PRESIDENT, ENGR. ELEGIO MALALUAN, RESPONDENTS.

G.R. No. 215547, February 03, 2020

Principle
To emphasize, the principal action for injunction is distinct from the provisional
or ancillary remedy of preliminary injunction which cannot exist except only as
part or an incident of an independent action or proceeding.

Facts In their Complaint, petitioners averred that they are the owners of parcels of
land located near the Strong Republic Nautical Highway at Poblacion, Bansud,
Oriental Mindoro.

As a result, however, of the commencement of the elevation project between

kilometer 90 and 92 of the national highway near the Bansud River Bridge by
King's Builder and Development Corporation, their safety was placed in
 imminent danger.

Further bolstering their claim, petitioners alleged that the respondents initiated
the elevation of the national highway to around one meter, thereby blocking and
retaining floodwaters naturally coming from the nearby Bansud River and farm
lands from the direction of the mountains of Conrazon; and submerging houses
and lands on the left side of the road including their properties.

Aside from safety issues, petitioners maintained that the elevation of the
highway impaired their use and enjoyment of their houses and properties as
pedestrians and vehicles alike will have to negotiate a steep climb and descent
in going to and from their properties.

Instead of filing their Answer, Secretary Rogelio Singson and Engr. Magtanggol
Roldan filed a Motion to Dismiss alleging that the issuance of injunctive writs is
prohibited by Presidential Decree No. 18189; and that the doctrine of State's
immunity from suit applies in this case.

In a Resolution, RTC granted the Motion to Dismiss, finding that it has no

jurisdiction over the case as stated in Republic Act (R.A.) No. 8975. Petitioners
filed a Motion for Reconsideration, which was denied.
Aggrieved, petitioners elevated the matter before this Court.

In its Comment, the Office of the Solicitor General (OSG) essentially avers that
the petition must be dismissed outright as it raises factual issues; and that the
dismissal of the case was proper as petitioners prayed for the issuance of a
TRO in its complaint.

Petitioners, in their Reply insist that their petition involves a pure question of law
as the issue raised therein delves into the jurisdiction of the RTC over the case.

Issue Whether the RTC has jurisdiction over the subject matter

Ruling
In the exercise of its equity jurisdiction, the Court finds it proper to resolve the
case on the merits.

Section 3 of R.A. No. 8975 expressly vests jurisdiction upon the Supreme Court
to issue any TRO, preliminary injunction or preliminary mandatory injunction
against the government, or any of its subdivisions, officials or any person or
entity, whether public or private acting under the government's direction, to
restrain, prohibit or compel specified acts. To be specific:

Section 3. Prohibition on the Issuance of Temporary Restraining Orders,

Preliminary Mandatory Injunctions. - No court, except the Supreme Court, shall
issue any temporary restraining order, preliminary injunction or preliminary
mandatory injunction against the government, or any of its subdivisions, officials
or any person or entity, whether public or private acting under the government
direction, to restrain, prohibit or compel the following acts:
(a) Acquisition, clearance and development of the right-of-way and/or site or
location of any national government project;

(b) Bidding or awarding of contract/project of the national government as

defined under Section 2 hereof;

(c) Commencement prosecution, execution, implementation, operation of any

such contract or project;

(d) Termination or rescission of any such contract/project; and

(e) The undertaking or authorization of any other lawful activity necessary for
such contract/project.

xxxx

In the case of Philco Aero, Inc. v. Secretary Tugade, this Court recognized the
remedy of resorting directly before this Court in cases covered under R.A. No.
8975. Section 3 of R.A. No. 8975 was explicit in excluding other courts in the
issuance of injunctive writs. However, in the case of Bases Conversion and
Development Authority v. Uy, this Court clarified that the prohibition applies only
to TRO and preliminary injunction, viz.:

A perusal of these aforequoted provisions readily reveals that all courts, except
this Court, are proscribed from issuing TROs and writs of preliminary injunction
against the implementation or execution of specified government projects. Thus,
the ambit of the prohibition covers only temporary or preliminary restraining
orders or writs but NOT decisions on the merits granting permanent injunctions.
Considering that these laws trench on judicial power, they should be strictly
construed. Therefore, while courts below this Court are prohibited by these laws
from issuing temporary or preliminary restraining orders pending the
adjudication of the case, said statutes however do not explicitly proscribe the
issuance of a permanent injunction granted by a court of law arising from an
adjudication of a case on the merits.

As conferred by Section 1924 of Batas Pambansa Blg. 129, the RTC has
jurisdiction over all civil cases in which the subject matter under litigation is
incapable of pecuniary estimation. One of which, as established by
jurisprudence, is a complaint for injunction.

It is a well-settled rule that jurisdiction of the court is determined by the

allegations in the complaint and the character of the relief sought.

In this case, the allegations and the reliefs prayed for in the complaint reveal
that petitioner, as landowners of the surrounding estate of the highway elevation
project, sought to enjoin such construction; or if completed, to restore the
affected portion thereof, to their original state. Clearly, the principal action is one
for injunction, which is within the jurisdiction of the RTC.
 To emphasize, the principal action for injunction is distinct from the provisional
or ancillary remedy of preliminary injunction which cannot exist except only as
part or an incident of an independent action or proceeding. Contrary to the
OSG's stance, herein complaint is one for injunction with a prayer for issuance
of a TRO and/or preliminary injunction. In determining the jurisdiction of the
RTC, what is controlling is the principal action, and not the ancilliary remedy
which is merely an incident thereto.

WHEREFORE, the instant petition is hereby GRANTED. The Resolutions dated

July 10, 2014 and November 18, 2014 of the Regional Trial Court of
Pinamalayan, Oriental Mindoro, Branch 41 are REVERSED and SET ASIDE.
The case is REMANDED to the Regional Trial Court of Pinamalayan, Oriental
Mindoro, Branch 41 for further proceedings with deliberate dispatch.

RULE 58. PRELIMINARY INJUNCTION

Case 1. PHILIPPINE PORTS AUTHORITY (PPA), represented by Oscar M.

Sevilla, General Manager, Benjamin B. Cecilio, Assistant Manager
for Operations, and Sisali B. Arap, Port Manager, vs NASIPIT
INTEGRATED ARRASTRE AND STEVEDORING SERVICES, INC.
(NIASSI), represented by Ramon Calo,
G.R. No. 214864 March 22, 2017
Principle The term law of the case has been held to mean that "whatever is once irrevocably
established as the controlling legal rule or decision between the same parties in the
same case continues to be the law of the case, whether correct on general
principles or not, so long as the facts on which such decision was predicated
continue to be the facts of the case before the court. As a general rule, a decision
on a prior appeal of the same case is held to be the law of the case whether that
question is right or wrong, the remedy of the party deeming himself aggrieved being
to seek a rehearing.

Facts PPA is a government agency created by virtue of Presidential Decree No. 505 (PD
505) which is charged with the management and control of all ports in the
Philippines while NIASSI is a duly organized Philippine corporation engaged in the
business of cargo handling.

Sometime in November 2000, PPA, through its Pre-qualification, Bids and Awards
Committee (PBAC) accepted bids for a 10-year contract to operate as the sole
cargo handler at the port of Nasipit, Agusan del Norte (Nasipit Port). 7 Subsequently,
PBAC issued a Resolution recommending that the 10-year cargo-handling contract
be awarded to NIASSI as the winning bidder.

However, the second highest bidder, Concord Arrastre and Stevedoring Corporation
(CASCOR) filed a protest alleging that two of NIASSI's stockholders on record are
legislators who are constitutionally prohibited from having any direct or indirect
financial interest in any contract with the government or any of its agencies during
the term of their office.

Notwithstanding the protest, PPA issued a Notice of Award in favor of NIASSI which
directed NIASSI to signify its concurrence thereto by signing the conforme portion
and returning the same to PPA within 10 days from receipt. PP A received notice of
NIASSI's conformity to the Notice of Award on January 3, 2001.

Instead of formally executing a written contract, NIASSI requested PPA to issue a

Hold-Over Authority (HOA) in its favor, in view of CASCOR's pending protest. PPA
granted NIASSI's request and issued a HOA dated August 1, 2001, effective until
October 31, 2001, "or until [such time] a cargo[-]handling contract shall have been
awarded, whichever comes first."

Meanwhile, the Office of the Government Corporate Counsel (OGCC) issued

Opinion No. 028 which confirmed the authority of PPA to bid out the cargo-handling
contract and affirmed the validity of the award in NIASSI's favor. Despite this, the
HOA was subsequently extended several times upon NIASSI' s request. While the
exact number of extensions and their particulars cannot be ascertained from the
records, the last extension of the HOA appears to have been issued on October 13,
2004, for a term of six months.

However, barely two months after the last extension of the HOA, PPA issued a letter
revoking the extension and in such letter, it advised NIASSI that PPA received
numerous complaints regarding the poor quality of its services due to the use of
inadequately maintained equipment. The letter further relayed that PPA would take
over the cargo-handling services at the Nasipit Port.

Proceedings before the RTC:

On the scheduled date of the take-over, NIASSI filed with the RTC a Petition for
Injunction with Prayer for the Writ of Preliminary Injunction and/or Temporary
Restraining Order. The petition was later amended to a Petition for Mandamus with
Prayer for the Writ of Preliminary Mandatory Injunction and/or Temporary
Restraining Order.

The Amended Petition prayed for the issuance of a writ of mandamus directing PPA
to formally execute a written contract, and a writ of preliminary mandatory injunction
directing PPA to turn over the management and operations of Nasipit Port's cargo-
handling services back to NIASSI.

RTC issued a resolution granting NIASSI's prayer for a writ of preliminary

mandatory injunction.

In summation, this Court recognizes and declares that petitioner's right to continue
the cargo handling operations should be protected. It cannot be denied that the
continued operation by respondents will probably work injustice to the petitioner,
causing irreparable damage to the latter. The better ends of justice [will] be served if
the state of affairs [will] be maintained prior to respondent's actual takeover, until
finally the main action is disposed.

After NIASSI posted the required surety bond, the RTC issued the writ of
preliminary mandatory injunction on March 28, 2005.
PP A filed a Motion for Reconsideration by a Supplemental Motion . Supplemental
Motion alleged that the writ of preliminary mandatory injunction should be quashed
since its corresponding surety bond designated NIASSI's President Ramon Calo as
principal, instead of NIASSI itself.

On April 11, 2005, the RTC issued an order (April 2005 RTC Order) granting PPA's
Motion for Reconsideration and immediately dissolved the writ of preliminary
mandatory injunction and directed NIASSI to surrender the management and control
of Nasipit Port's cargo-handling operations to PPA.

This prompted NIASSI to file a Petition for Certiorari before the CA assailing the
immediately executory nature of the April 2005 RTC Order and questioned the
dissolution of the writ of preliminary injunction without prior hearing. In addition, the
CA petition alleged that the April 2005 RTC Order reversed the RTC's previous
order despite the absence of new matters or issues raised. The CA petition thus
prayed for the reversal of the April 2005 RTC Order, and ultimately, the
reinstatement of the writ of preliminary injunction.

The CA granted the petition observing that Presiding Judge Godofredo B. Abul, Jr.
(Judge Abul) of the RTC committed several procedural errors when he issued the
April 2005 RTC Order.

In view of the foregoing CA decision, and this Court's decision in G.R. No. 174136
affirming the same, the RTC directed the parties to submit their simultaneous
memoranda on the issue of whether the Amended Petition had been rendered moot
and academic. On the basis of such memoranda, Judge Abul issued a Resolution 41
dated June 1, 2011 (June 2011 RTC Resolution) dismissing the Amended Petition
for being moot and academic.

Proceedings before the CA:

Aggrieved, PPA filed an appeal before the CA and contended that the RTC faulted
in reversing the June 2011 RTC Order, insisting that the Amended Petition had
already become moot and academic. The PP A also alleged that the CA erred in
directing it to execute a written 10-year contract with NIASSI reckoned from the
finality of the September 2011 RTC Resolution, as this was tantamount to extending
the original term of the contract between the parties that was perfected on January
3, 2001, the date when PPA received notice of NIASSI's conformity to the Notice of
Award.

The CA partly GRANTED the appeal. The case is remanded to the Regional Trial
Court to determine the total period of time during which NIASSI was in operation of
the cargo handling services of Nasipit port.

On November 4, 2014, PPA filed a motion with the Court asking for an additional
period of 30 days within which to file a Petition for Review on Certiorari. PPA's
motion was granted by the Court in its Resolution dated November 17, 2014.
 Finally, on December 3, 2014, PPA filed the instant Petition.

Issue WON the CA erred when it issued the Amended Decision affirming the September
2011 RTC Resolution and December 2011 RTC Order, and directing PPA to
execute a cargo-handling contract in favor of NIASSI for a full 10-year term without
deducting the period covered by the HOA.

Ruling YES.
The petition is impressed with merit.

In this case, however, no further proceedings were conducted after the Decision of
the Supreme Court relative to the injunction proceedings had become final. To be
sure, the RTC directed the parties to submit their respective memoranda on the
issue of whether or not the main case had become moot and academic because of
the finality of said Decision and, on the basis of the memoranda, the RTC resolved
to dismiss the Amended Petition, as it had nothing left to determine. 68 As such, no
evidence to controvert the findings of the CA in CA-G.R. SP No. 00214 were
presented in the main case. This being the case, the factual findings of the CA in
respect of the perfected cargo-handling contract in the injunction proceedings
became conclusive upon finality of this Court's decision affirming the same. These
circumstances thus render the application of the law of the case doctrine proper.

In any case, it is worth noting that NIASSI recognized the perfection of the cargo-
handling contract in its Comment to the instant Petition, thus:
x x x When NIASSI received and signed the "conforme" portion [of the Notice of
Award], there [was] already [a] meeting of minds between the parties as to the
object and cause of the cargo handling contract, including the terms and duration
thereof.
To NIASSI, the cargo-handling contract was a valid and binding agreement, and it
was thus bound by the concomitant rights and obligations arising therefrom.
The term of the perfected contract has already expired.
While the Court agrees with PPA's submission that the perfected contract has
already expired, the Court clarifies that such expiration is not because of the mere
lapse of 10 years reckoned from the date when the same was perfected. To hold as
such would be to feign ignorance of the events that transpired thereafter, which led
to the institution of this very Petition.

It bears emphasizing that PPA assumed the management and operations of the
cargo-handling services at Nasipit Port on two separate instances- first, by virtue of
its letter dated December 6, 2004 revoking the last extension of the HOA, and
second, by virtue of the April 2005 RTC Order lifting the preliminary mandatory
injunction granted in NIASSI's favor. The 10-year term of the perfected contract
must be deemed interrupted during the periods when PPA assumed management
and control over NIASSI's cargo-handling operations.

Clearly, the 10-year term of the perfected contract had already expired, leaving the
R TC with nothing to enforce.

Finally, it bears stressing that PPA issued the Notice of Award on December 21,
2000. To compel PPA to formally execute a 10-year cargo-handling contract at this
 time on the basis of conditions prevailing nearly two decades ago would certainly be
unreasonable and iniquitous.

For the foregoing reasons, the Court resolves to grant the instant Petition.

Case 2.
LIBERTY BROADCASTING NETWORK, INC., now known as WI-TRIBE
TELECOMS, INC., Petitioner, vs. ATLOCOM WIRELESS SYSTEM, INC.,
Respondent., G.R. No. 205875, June 30, 2015

Principle
A preliminary injunction is defined as "[a]n order granted at any stage of an
action prior to the judgment or final order, requiring a party or a court, agency or
a person to refrain from a particular act or acts." It may be a prohibitory
injunction, which requires a party to refrain from doing a particular act, or a
mandatory injunction, which commands a party to perform a positive act to
correct a wrong in the past. It is a provisional remedy that a party may resort to
in order to preserve and protect certain rights and interests during the pendency
of an action.

The grant or denial of a writ of preliminary injunction is discretionary upon the

trial court because the assessment and evaluation of evidence towards that end
involve findings of fact left to the said court for its conclusive determination. For
this reason, the grant or denial of a writ of preliminary injunction shall not be
disturbed unless it was issued with grave abuse of discretion amounting to lack
or in excess of jurisdiction.

Facts
Atlocom Wireless System, Inc. (Atlocom) is a grantee of a legislative franchise
under R.A. No. 8605.4 On October 8, 2003, the National Telecommunications
Commission (NTC) issued an Order in NTC for a Certificate of Public
Convenience (CPC), granting ATLOCOM WIRELESS SYSTEM, INC. a
Provisional Authority (PA) to install, operate and maintain a Multi-Point Multi-
Channel Distribution System [MMDS] in METRO MANILA, subject to the
assignment of frequency by the Frequency Management Division of NTC.

The Provisional Authority (PA) shall be valid for a period of eighteen (18)
months, or until April 8, 2005. In a letter, Atlocom thru its counsel requested for
"an extension of time of the PA.

On August 23, 2005, NTC issued Memorandum Circular No. (MC) 06- 08-
200511 re-allocating several bands for broadband wireless access for fixed,
nomadic and mobile networks.

NTC denied Atlocom's motion for extension of PA, citing the reallocation of
 MMDS frequencies for Broadband Wireless Access in accordance with MC 06-
08-2005 and the unavailability of other alternative frequencies.

Atlocom filed in the RTC a Petition to enjoin the implementation of MC 06-08-

2005 and reinstate the frequencies of Atlocom.

Liberty Broadcasting Network, Inc. (LBNI), also a grantee of a legislative

franchise for radio and television broadcasting were allowed to intervene in the
case, joining the defendant NTC in opposing Atlocom's claims. Pursuant to MC
06-08-2005, frequency bands were re-allocated and assigned to LBNI, which
covered the 2572-2596 MHz being claimed by Atlocom as allegedly assigned to
it.

On December 9, 2010, the RTC, after due hearing, issued an Order denying
Atlocom's application for a writ of preliminary prohibitory or mandatory
injunction.

In a petition for certiorari filed before the CA, Atlocom questioned the validity of
the aforesaid orders of the RTC. In its Resolution, the CA denied Atlocom's
prayer for the issuance of a writ of preliminary prohibitory injunction and its
alternative prayer for a provisional mandatory injunction. However, in its
Decision dated June 29, 2012, the CA ruled in favor of Atlocom and reversed
the RTC's denial of application for preliminary injunction.

LBNI filed its petition (G.R. No. 205875) in this Court on April 22, 2013. Acting
on LBNI's motion for the issuance of a temporary restraining order (TRO) and/or
writ of preliminary injunction, we issued a TRO enjoining the implementation of
the writ of preliminary injunction issued by the CA, conditioned upon LBNI's
posting of a cash bond in the sum of P300,000.00.

Issue
Whether Atlocom complied with the requisites for issuance of a writ of
preliminary injunction.

Ruling
The petitions are meritorious.

A preliminary injunction is defined as "[a]n order granted at any stage of an

action prior to the judgment or final order, requiring a party or a court, agency or
a person to refrain from a particular act or acts." It may be a prohibitory
injunction, which requires a party to refrain from doing a particular act, or a
mandatory injunction, which commands a party to perform a positive act to
correct a wrong in the past. It is a provisional remedy that a party may resort to
in order to preserve and protect certain rights and interests during the pendency
of an action.

Section 3, Rule 58 of the Rules of Court provides:

SEC. 3. Grounds for issuance of preliminary injunction. - A preliminary injunction

may be granted when it is established:

(a) That the applicant is entitled to the relief demanded, and the whole or
part of such relief consists in restraining the commission or continuance
of the act or acts complained of, or in requiring the performance of an act
or acts, either for a limited period or perpetually;

(b) That the commission, continuance or nonperformance of the act or

acts complained of during the litigation would probably work injustice to
the applicant; or

(c) That a party, court, agency or a person is doing, threatening, or is

attempting to do, or is procuring or suffering to be done, some act or acts
probably in violation of the rights of the applicant respecting the subject
of the action or proceeding, and tending to render the judgment
ineffectual.

The following requisites must be proved before a writ of preliminary injunction

will issue: (1) The applicant must have a clear and unmistakable right to be
protected, that is, a right in esse; (2) There is a material and substantial invasion
of such right; (3) There is an urgent need for the writ to prevent irreparable injury
to the applicant; and (4) No other ordinary, speedy, and adequate remedy exists
to prevent the infliction of irreparable injury.

The grant or denial of a writ of preliminary injunction is discretionary upon the

trial court because the assessment and evaluation of evidence towards that end
involve findings of fact left to the said court for its conclusive determination. For
this reason, the grant or denial of a writ of preliminary injunction shall not be
disturbed unless it was issued with grave abuse of discretion amounting to lack
or in excess of jurisdiction.

A right to be protected by injunction, means a right clearly founded on or

granted by law or is enforceable as a matter of law. An injunction is not a
remedy to protect or enforce contingent, abstract, or future rights; it will not
issue to protect a right not in esse, and which may never arise, or to restrain an
act which does not give rise to a cause of action.

From the evidence on record, no clear, actual and existing right to the subject
frequencies or to the extension of PA had been shown by Atlocom. Accordingly,
no grave abuse of discretion was committed by the RTC in denying Atlocom's
application for a writ of preliminary injunction to restrain the implementation of
MC 06-08-2005 insofar as the use of the re-allocated frequencies claimed by
Atlocom. The CA thus seriously erred in reversing the RTC and holding that
Atlocom was entitled to injunctive relief due to alleged violation of its right by the
NTC.

A writ of preliminary injunction being an extraordinary event, one deemed as a

strong arm of equity or a transcendent remedy, it must be granted only in the
face of actual and existing substantial rights. In the absence of the same, and
 where facts are shown to be wanting in bringing the matter within the conditions
for its issuance, the ancillary writ must be struck down for having been rendered
in grave abuse of discretion.

Pursuant to Section 6, Rule 5 8 of the 1997 Rules of Civil Procedure, a

preliminary injunction may be dissolved if it appears after hearing that although
the applicant is entitled to the injunction or restraining order, the issuance or
continuance thereof, as the case may be, would cause irreparable damage to
the party or person enjoined while the applicant can be fully compensated for
such damages as he may suffer, and the former files a bond in an amount fixed
by the court on condition that he will pay all damages which the applicant may
suffer by the denial or the dissolution of the injunction or restraining order. Two
conditions must concur: first, the court, in the exercise of its discretion, finds that
the continuance of the injunction would cause great damage to the defendant,
while the plaintiff can be fully compensated for such damages as he may suffer;
second, the defendant files a counterbond.

In light of all the foregoing established facts, we hold that the CA gravely abused
its discretion when it issued a writ of preliminary injunction against the
implementation of MC 06-08-2005 in the absence of a clear legal right on the
part of Atlocom, and subsequently denying LBNI' s offer to file counter bond
despite compliance with the requisites provided in Section 6 of Rule 58.
However, with our ruling that the writ of preliminary injunction was improperly
issued, hence, null and void, the matter of allowing LBNI to post a counter-bond
has been rendered moot.

The main issue presented in this case is the validity of Atlocom' s application for
a writ of preliminary injunction against the NTC. This issue can be resolved
without passing upon the constitutionality of LBNI' s franchise. The resolution of
the issue on LBNI's eligibility thus has no bearing on whether Atlocom has the
right to be granted a frequency allocation for Broadband Wireless Access by the
NTC. The constitutional issue raised by the respondent may be raised and
resolved in proper cases when necessary in the future.

Case No. 3 SPOUSES VICTOR P. DUNLUAN and JACQUELINE P. DULNUAN, .

vs METROPOLITAN BANK & TRUST COMPANY, G .R. No. 196864,
July 8, 2015
Principle to be entitled to the injunctive writ, petitioners must show that
(1) there exists a clear and unmistakable right to be protected;
(2) this right is directly threatened by an act sought to be enjoined;
(3) the invasion of the right is material and substantial; and
(4) There is an urgent and paramount necessity for the writ to prevent serious
and irreparable damage

Facts Spouses Dulnuan obtained loans from Metropolitan Bank and Trust Company
(Metrobank), the total of which reached the sum P3,200,000.00, executing a
 Real Estate Mortgage (REM) over a parcel of land located at La Trinidad,
Benguet with an area of 392 square meters, as security. However, the Spouses
Dulnuan incurred default and therefore the loan obligations became due and
demandable.

On 22 April 2008, Metrobank filed an application for extra-judicial foreclosure

proceedings over the subject property before the RTC of La Trinidad, Benguet.
After due notice and publication, the mortgaged property was sold at a public
auction where Metrobank was declared as the highest bidder. In order to validly
effect the foreclosure, a copy of the said Notice of Public Auction Sale was
posted on the bulletin boards of Barangay Betag, Municipal Hall of La Trinidad,
Benguet, Provincial Capitol Benguet. Before the expiration of the one-year
redemption period allowed by law, Metrobank filed a Petition for the Issuance of
Writ of Possession.

On 30 September 2008, the Spouses Dulnuan instituted a Complaint seeking

the issuance of a temporary restraining order and preliminary and final
injunction and, for the annulment of extra-judicial foreclosure and real estate
mortgage before the RTC of La Trinidad, Benguet, Branch 10, alleging that the
mortgage constituted over the property is null and void because at the time the
agreement was entered on 18 October 2000, no contract of loan was yet
executed by the parties. It was only on 19 December 2003 that they received
the proceeds of the loan, as evidenced by the Promissory Note. In other words,
there is no principal obligation upon which the ancillary contract of mortgage
was attached to.

After summary hearing, the court a quo in an Order dated 5 November 2008,
issued a Temporary Restraining Order and set the hearing for the issuance of
Writ of Preliminary Injunction. Both parties proceeded to adduce evidence for
and against the issuance of the writ of preliminary injunction. On 3 December
2008, RTC issued an Order enjoining Metrobank from taking possession of the
subject property until the final disposition of the annulment of mortgage case.

On 14 January 2011, the Court of Appeals rendered a Decision reversing the

questioned Orders and declared that the issuance of the writ of preliminary
injunction is unjustified under the circumstances

Issue Whether or not it was only proper to dissolve the WPI. YES.

Ruling The SC held that the WPI was erroneous, and Metrobank had the right to
exercise the writ of possession.

Pertinent are the provisions of Section 3, Rule 58 of the Rules of Court,

enumerates the grounds for the issuance of a writ of preliminary injunction, to
wit:

SEC. 3. Grounds for issuance of preliminary injunction. — A preliminary

injunction may be granted when it is established:

(a) That the applicant is entitled to the relief demanded, and the whole or part of
 such relief consists in restraining the commission or continuance of the act or
acts complained of, or in requiring the performance of an act or acts, either for a
limited period or perpetually;

(b) That the commission, continuance or non-performance of the act or acts

complained of during the litigation would probably work injustice to the applicant;
or

(c) That a party, court, agency or a person is doing, threatening, or is

attempting to do, or is procuring or suffering to be done, some act or acts
probably in violation of the rights of the applicant respecting the subject of the
action or proceeding, and tending to render the judgment ineffectual.
As such, a writ of preliminary injunction may be issued only upon clear showing
of an actual existing right to be protected during the pendency of the principal
action. The requisites of a valid injunction are the existence of the right and its
actual or threatened violations. Thus, to be entitled to an injunctive writ, the
right to be protected and the violation against the right must be shown.[18]

Thus, to be entitled to the injunctive writ, petitioners must show that (1)
there exists a clear and unmistakable right to be protected; (2) this right is
directly threatened by an act sought to be enjoined; (3) the invasion of the
right is material and substantial; and (4) there is an urgent and paramount
necessity for the writ to prevent serious and irreparable damage.

Extant from the pleadings of the parties is the failure of the Spouses Dulnuan to
establish the essential requisites for the issuance of the writ of preliminary
injunction.

The burden is on petitioner to show in his application that there is meritorious

ground for the issuance of TRO in his favor. When the complainant’s right is
doubtful or disputed, he does not have a clear legal right and, therefore, the
issuance of injunctive writ is improper. Herein, the Spouses Dulnuan failed to
show that they have clear and unmistakable right to the issuance of writ in
question.

The record shows that Metrobank caused the extrajudicial foreclosure of the
mortgage on the subject realties as a consequence of the Spouses Dulnuan’s
default on their mortgage obligation. As the highest bidder at the foreclosure
sale, Metrobank can exercise its right of possession over the subject realty, and
the issuance of writ of preliminary injunction, enjoining the bank from occupying
the property in question, is erroneous

Case 5. CHINA BANKING CORPORATION vs. SPOUSES CIRIACO

July 11, 2012

Principle Before a writ of preliminary injunction may be issued, a clear showing must be
made that there exists a right to be protected and that the acts against which
 the writ is to be directed are violative of an established right. The holding of a
hearing, where both parties can introduce evidence and present their side, is
also required before the courts may issue a TRO or an injunctive writ.

Facts On March 11, 1996, Spouses Harry and Esther Ciriaco (respondents) obtained
a P1,500,000.00 loan from the petitioner, secured by a real estate mortgage
over their 526-square meter land in La Trinidad, Benguet. When the
respondents defaulted in the payment of their loan, the petitioner extrajudicially
foreclosed the mortgaged property and sold it at public auction where the
petitioner emerged as the highest bidder. The Sheriff executed a Certificate of
Sale in the petitioner’s favor on March 11, 1998. The Register of Deeds
annotated the Certificate of Sale on TCT No. T-21710 on March 24, 1998.

On March 23, 1999, a day before the expiration of the redemption period, the
respondents filed a complaint with the Regional Trial Court (RTC) of La Trinidad,
Benguet, Branch 8, for Injunction to enjoin the consolidation of title in the
petitioner s favor, assailing the redemption price of the foreclosed property.

On July 26, 1999, the RTC dismissed the complaint for being moot due to the
consolidation of title in the petitioner's favor on March 31, 1999, "without
prejudice to the filing of an appropriate action."

On March 16, 2000, the respondents filed an Omnibus Motion for Leave to
Amend Complaint and to Admit Attached Amended Complaint as well as Motion
for Hearing on the Issuance of a Writ of Preliminary Injunction and/or Temporary
Restraining Order (TRO), with a notice of hearing on the omnibus motion
scheduled on March 22, 2000. The respondents sought to amend the complaint
to allege further that fraud attended the consolidation of title in the petitioner s
favor and to include a prayer for the issuance of a writ of preliminary injunction
and/or TRO to enjoin the petitioner from disposing of the foreclosed property or
taking possession thereof.

RTC: In its August 1, 2000 Order, the RTC admitted the amended complaint
and directed the petitioner to file an answer. It noted that the 1997 Rules of Civil
Procedure relaxed the rule on amendments to pleadings, subject only to the
limitation that they are not dilatory. It also granted the respondents application
for the issuance of a writ of preliminary injunction and/or TRO, since the
respondents were entitled to prove their claim of fraud, and their claim that the
interests and penalty charges imposed by the bank had no factual basis.

On August 24, 2000, the RTC issued a writ of preliminary injunction, restraining
the petitioner from disposing of the foreclosed property or taking possession
thereof.

The petitioner then filed a Rule 65 petition for certiorari with the CA, arguing that
the RTC gravely abused its discretion in precipitately granting the respondents
application for the issuance of a writ of preliminary injunction without any
hearing.

CA: denied the petition. It found that the RTC did not commit any grave abuse
 of discretion since it gave the parties ample opportunity to present their
respective positions on the propriety of an injunctive writ during the hearings on
March 22, 2000 and April 24, 2000, and that the petitioner was also heard on its
Motion for Reconsideration of the August 1, 2000 Order.

Issue Whether the CA erred in finding that the RTC did not commit any grave abuse of
discretion in granting the respondents application for the issuance of a writ of
preliminary injunction and/or TRO.

Ruling YES. A preliminary injunction is an order granted at any stage of an action prior
to the judgment or final order requiring a party or a court, agency or a person to
refrain from a particular act or acts. It is the "strong arm of equity," an
extraordinary peremptory remedy that must be used with extreme caution,
affecting as it does the respective rights of the parties.

Sections 3 and 5, Rule 58 of the 1997 Rules of Civil Procedure on preliminary

injunction, pertinent to this case, provide the requirements for the issuance of a
writ of preliminary injunction or a TRO:

SEC. 3. Grounds for issuance of preliminary injunction. - A preliminary

injunction may be granted when it is established:
(a) That the applicant is entitled to the relief demanded, and the
whole or part of such relief consists in restraining the commission
or continuance of the act or acts complained of, or in requiring
the performance of an act or acts, either for a limited period or
perpetually;

(b) That the commission, continuance or non-performance of the

act or acts complained of during the litigation would probably
work injustice to the applicant; or

(c) That a party, court, agency or a person is doing, threatening,

or is attempting to do, or is procuring or suffering to be done,
some act or acts probably in violation of the rights of the applicant
respecting the subject of the action or proceeding, and tending to
render the judgment ineffectual.

SEC. 5. Preliminary injunction not granted without notice; exception. - No

preliminary injunction shall be granted without hearing and prior notice to
the party or persons sought to be enjoined. If it shall appear from facts
shown by affidavits or by the verified application that great or irreparable
injury would result to the applicant before the matter can be heard on
notice, the court to which the application for preliminary injunction was
made, may issue ex parte a temporary restraining order to be effective
only for a period of twenty (20) days from service on the party or person
sought to be enjoined, except as herein provided. Within the twenty-day
period, the court must order said party or person to show cause at a
specified time and place, why the injunction should not be granted. The
court shall also determine, within the same period, whether or not the
 preliminary injunction shall be granted, and accordingly issue the
corresponding order.

However, subject to the provisions of the preceding sections, if the

matter is of extreme urgency and the applicant will suffer grave injustice
and irreparable injury, the executive judge of a multiple-sala court or the
presiding judge of a single-sala court may issue ex parte a temporary
restraining order effective for only seventy-two (72) hours from issuance
but shall immediately comply with the provisions of the next preceding
section as to service of summons and the documents to be served
therewith. Thereafter, within the aforesaid seventy-two (72) hours, the
judge before whom the case is pending shall conduct a summary
hearing to determine whether the temporary restraining order shall be
extended until the application for preliminary injunction can be heard. In
no case shall the total period of effectivity of the temporary restraining
order exceed twenty (20) days, including the original seventy-two hours
provided herein.

From the provisions, it appears clearly that before a writ of preliminary injunction
may be issued, a clear showing must be made that there exists a right to be
protected and that the acts against which the writ is to be directed are violative
of an established right. The holding of a hearing, where both parties can
introduce evidence and present their side, is also required before the courts
may issue a TRO or an injunctive writ.

In granting or denying injunctive relief, a court abuses its discretion when it lacks
jurisdiction; fails to consider and make a record of the factors relevant to its
determination; relies on clearly erroneous factual findings; considers clearly
irrelevant or improper factors; clearly gives too much weight to one factor; relies
on erroneous conclusions of law or equity; or misapplies its factual or legal
conclusions.

In this case, we find that the RTC abbreviated the proceedings and
precipitately granted the respondents application for injunctive relief. The
RTC did not conduct a hearing for reception of a "sampling" of the parties
respective evidence to give it an idea of the justification for its issuance pending
the decision of the case on the merits. It failed to make any factual finding to
support the issuance of the writ of preliminary injunction since it did not conduct
any hearing on the application for the issuance of the writ of preliminary
injunction or TRO. The RTC conducted the March 22, 2000 and April 24, 2000
hearings on the respondents Omnibus Motion only whether to admit the
amended complaint and whether to hold a hearing on the respondents
application for a writ of preliminary injunction.

In fact, a perusal of the August 1, 2000 Order shows that the RTC granted the
respondents application for a writ of preliminary injunction based only on the
respondents unsubstantiated allegations.
Clearly, the respondents right to injunctive relief has not been clearly and
unmistakably demonstrated. The respondents have not presented evidence,
testimonial or documentary, other than the bare allegations contained in their
 pleadings, to support their claim of fraud that brings about the irreparable injury
sought to be avoided by their application for injunctive relief. Thus, the RTC’s
grant of the writ of preliminary injunction in favor of the respondents, despite the
lack of any evidence of a clear and unmistakable right on their part, constitutes
grave abuse of discretion amounting to lack of jurisdiction.

Every court should remember that an injunction is a limitation upon the freedom
of the defendant’s action and should not be granted lightly or precipitately. It
should be granted only when the court is fully satisfied that the law permits it
and the emergency demands it; no power exists whose exercise is more
delicate, which requires greater caution and deliberation, or is more dangerous
in a doubtful case, that the issuance of an injunction.

WHEREFORE, the petition is GRANTED. The April 15, 2005 decision and the
October 10, 2005 resolution of the Court of Appeals in CA-G.R. SP No. 64349
are REVERSED and SET ASIDE. The August 1, 2000 and March 7, 2001
orders of the Regional Trial Court of La Trinidad, Benguet, Branch 63 are
MODIFIED. The Writ of Preliminary Injunction issued in Civil Case No. 99-CV-
1395 is declared VOID and is therefore SET ASIDE.

Case No. 6 BPI vs. HONTANOSAS, GR No. 157163, June 25, 2014

Principle Injunction should not issue except upon a clear showing that the applicant has
a right in esse to be protected, and that the acts sought to be enjoined are
violative of such right. A preliminary injunction should not determine the merits
of a case, or decide controverted facts, for, being a preventive remedy, it only
seeks to prevent threatened wrong, further injury, and irreparable harm or
injustice until the rights of the parties can be settled.

Facts Respondents Spouses Silverio et.al. filed a case against BPI to seek the
declaration of the nullity of the promissory notes, real estate and chattel
mortgages and continuing surety agreement they had executed in favor of the
petitioner. They further sought damages and attorney’s fees and applied for a
temporary restraining order (TRO) or writ of preliminary injunction to prevent the
petitioner from foreclosing on the mortgages against their properties.

The complaint alleged that the respondents had obtained a loan from the
petitioner and had executed promissory notes binding themselves solidarily.
and constituted real estate mortgages on several parcels of land in favor of the
petitioner; and that they had been made to sign a continuing surety agreement
and a chattel mortgage on their Mitsubishi Pajero as security. The petitioner
required them to issue postdated checks to cover the loan under threat of
foreclosing on the mortgages.

Petitioner filed its answer with affirmative defenses and counterclaim, as well as
its opposition to the issuance of the writ of preliminary injunction, contending
that the foreclosure of the mortgages was within its legal right to do. A motion to
 dismiss was filed by petitioner but was denied. RTC granted the application for
Preliminary Injunction. Petitioner appealed to the CA. CA affirmed the RTC
decision.

Issue Whether or not the RTC erred in the issuance of the writ of preliminary
injunction.

Ruling NO. The RTC’s issuance of the writ of preliminary injunction to enjoin the
petitioner from proceeding with the foreclosure of the mortgages was plainly
erroneous and unwarranted. The issuance of the writ of preliminary injunction
upon the application of the respondents was improper. They had admittedly
constituted the real estate and chattel mortgages to secure the performance of
their loan obligation to the petitioner, and, as such, they were fully aware of the
consequences on their rights in the properties given as collaterals should the
loan secured be unpaid.

The foreclosure of the mortgages would be the remedy provided by law for the
mortgagee to exact payment. In fact, they did not dispute the petitioner’s
allegations that they had not fully paid their obligation. Civil Case No. CEB-
26468 was precisely brought by them in order to stave off the impending
foreclosure of the mortgages based on their claim that they had been
compelled to sign pre-printed standard bank loan forms and mortgage
agreements.

Injunction only seeks to prevent threatened wrong, further injury, and

irreparable harm or injustice until the rights of the parties can be settled. The
respondents failed to prove that they would suffer an irreparable injury. Fear of
potential loss of possession and ownership, or facing a criminal prosecution did
not constitute the requisite irreparable injury that could have warranted the
issuance of the writ of injunction.

As a general rule, the courts will not issue writs of prohibition or injunction –
whether preliminary or final – in order to enjoin or restrain any criminal
prosecution. But there are extreme cases in which exceptions to the general
rule have been recognized, including:

a. When the injunction is necessary to afford adequate protection to the

constitutional rights of the accused;
b. When it is necessary for the orderly administration of justice or to avoid
oppression or multiplicity of actions;
c. When there is a prejudicial question that is sub judice;
d. When the acts of the officer are without or in excess of authority;
e. When the prosecution is under an invalid law, ordinance or regulation;
f. When double jeopardy is clearly apparent;
g. When the court has no jurisdiction over the offense;
h. When it is a case of persecution rather than prosecution;
i. When the charges are manifestly false and motivated by the lust for
vengeance; and
j. When there is clearly no prima facie case against the accused and a
 motion to quash on that ground has been denied.

However, the respondents did not sufficiently show that Civil Case No. CEB-
26468 came under any of the foregoing exceptions. Hence, the issuance by the
RTC of the writ of preliminary injunction to enjoin the petitioner from instituting
criminal complaints for violation of BP No. 22 against the respondents was
unwarranted.

Case No. 7 ROSARIO E. CAHAMBING, vs. VICTOR ESPINOSA and JUANA ANG, G.R.
No. 215807, January 25, 2017

Principle Preliminary Injunction; For a Writ of Preliminary Injunction to issue, the

following requisites must be present, to wit: (1) the existence of a clear
and unmistakable right that must be protected, and (2) an urgent and
paramount necessity for the writ to prevent serious damage.—For a Writ of
Preliminary Injunction to issue, the following requisites must be present, to wit:
(1) the existence of a clear and unmistakable right that must be protected, and
(2) an urgent and paramount necessity for the writ to prevent serious damage.
Indubitably, this Court has likewise stressed that the very foundation of the
jurisdiction to issue a writ of injunction rests in the existence of a cause of action
and in the probability of irreparable injury, inadequacy of pecuniary
compensation, and the prevention of multiplicity of suits. Sine dubio, the grant or
denial of a writ of preliminary injunction in a pending case, rests in the sound
discretion of the court taking cognizance of the case since the assessment and
evaluation of evidence towards that end involve findings of facts left to the said
court for its conclusive determination. Hence, the exercise of judicial discretion
by a court in injunctive matters must not be interfered with except when there is
grave abuse of discretion. Grave abuse of discretion in the issuance of writs of
preliminary injunction implies a capricious and whimsical exercise of judgment
that is equivalent to lack of jurisdiction, or where the power is exercised in an
arbitrary or despotic manner by reason of passion, prejudice or personal
aversion amounting to an evasion of positive duty or to a virtual refusal to
perform the duty enjoined, or to act at all in contemplation of law.

The issuance of a writ of preliminary injunction rests entirely on the

discretion of the court and is generally not interfered with except in cases
of manifest abuse.—It must always be remembered that the issuance of a writ
of preliminary injunction rests entirely on the discretion of the court and is
generally not interfered with except in cases of manifest abuse. In this case, no
manifest abuse can be attributed to the RTC that issued the questioned writ.
This Court has also held that no grave abuse of discretion can be attributed to a
judge or body issuing a writ of preliminary injunction where a party has not been
deprived of its day in court as it was heard and it exhaustively presented all its
arguments and defenses. Verily, petitioner was given her day in court to present
her side but as in all litigations, only one party prevails.

Facts Petitioner and respondent Victor Espinosa are siblings and the children of
deceased spouses Librado and Brigida Espinosa, the latter bequeathing their
 properties to the said siblings through their last will and testament.

Deceased Librado and Brigida bequeathed their respective shares over Lot 354
to respondent Victor Espinosa, however, Brigida subsequently revoked and
cancelled her will, giving her one-half (1/2) share over Lot 354 to petitioner.

Brigida Espinosa and respondent Victor Espinosa, after the death of Librado
Espinosa, entered into an Extrajudicial Partition of Real Estate subdividing Lot
354.

Not being included in the partition of Lot 354, petitioner filed a complaint against
respondent Victor Espinosa and his representative, respondent Juana Ang, for,
among others, the annulment of the Extrajudicial Partition of Real Property. A
commercial building named as Espinosa Building stands on Lot No. 354. At the
time of the filing of the complaint, the same building had twelve (12) lessees,
four (4) of whom pay rentals to petitioner.

Petitioner alleged that respondent Juana Ang prevailed upon Pacifica Agrivet
Supplies not to renew its lease contract with petitioner but to enter into a
contract of lease with respondent Victor Espinosa instead. According to
petitioner, respondent Juana Ang also threatened to do the same thing with
Julie’s Bakeshop.

In one of the pretrial conferences, the Clerk of Court, acting as Commissioner,

issued an Order directing the parties to maintain the status quo.

Thereafter, respondent Victor Espinosa filed an Application for the Issuance of a

Writ of Preliminary Injunction with Prayer for the Issuance of a Temporary
Restraining Order against petitioner alleging that the latter violated the status
quo ante order by allowing her sons to occupy the space rented by Jhanel’s
Pharmacy which is one of respondent Victor Espinosa’s tenants.

The RTC ordered for the issuance of a writ of preliminary injunction. Petitioner
filed a petition on certiorari under Rule 65 of the Rules of Court.

According to petitioner, respondents themselves violated the status quo ante

order when they wrested the space rented by Pacifica Agrivet Supplies from
petitioner’s control and that there was no compliance with the requisites for the
issuance of the writ of preliminary injunction. The CA dismissed the petition.

Issue Whether or not the grant of Preliminary Injunction was proper.

Ruling YES.

The present petition is void of any merit. This Court agrees with the CA and the
RTC that the elements for the issuance of a writ of preliminary injunction are
present in this case.

SEC. 3. Grounds for issuance of preliminary injunction.—A preliminary

injunction may be granted when it is established:
a. That the applicant is entitled to the relief demanded, and the whole or part of
such relief consists in restraining the commission or continuance of the act or
acts complained of, or in requiring the performance of an act or acts, either for a
limited period or perpetually;

b. That the commission, continuance or nonperformance of the act or acts

complained of during the litigation would probably work injustice to the applicant;
or

c. That a party, court, agency or a person is doing, threatening, or is attempting

to do, or is procuring or suffering to be done, some act or acts probably in
violation of the rights of the applicant respecting the subject of the action or
proceeding, and tending to render the judgment ineffectual.

Otherwise stated, for a Writ of Preliminary Injunction to issue, the following

requisites must be present, to wit:
(1) the existence of a clear and unmistakable right that must be protected, and
(2) an urgent and paramount necessity for the writ to prevent serious damage.

The Sole object of a preliminary injunction is to maintain the status quo until
the merits can be heard.

A preliminary injunction is an order granted at any stage of an action prior to

judgment or final order, requiring a party, court, agency, or person to refrain
from a particular act or acts. It is a preservative remedy to ensure the protection
of a party’s substantive rights or interests pending the final judgment in the
principal action. A plea for an injunctive writ lies upon the existence of a claimed
emergency or extraordinary situation which should be avoided for otherwise, the
outcome of a litigation would be useless as far as the party applying for the writ
is concerned.

The very foundation of the jurisdiction to issue a writ of injunction rests in

the existence of a cause of action and in the probability of irreparable injury,
inadequacy of pecuniary compensation, and the prevention of multiplicity of
suits.

It must always be remembered that the issuance of a writ of preliminary

injunction rests entirely on the discretion of the court and is generally not
interfered with except in cases of manifest abuse. In this case, no manifest
abuse can be attributed to the RTC that issued the questioned writ.

The grant or denial of a writ of preliminary injunction in a pending case,

rests in the sound discretion of the court taking cognizance of the case since
the assessment and evaluation of evidence towards that end involve findings of
facts left to the said court for its conclusive determination. Hence, the exercise
of judicial discretion by a court in injunctive matters must not be interfered with
except when there is grave abuse of discretion

Grave abuse of discretion in the issuance of writs of preliminary injunction

 implies a capricious and whimsical exercise of judgment that is equivalent to
lack of jurisdiction, or where the power is exercised in an arbitrary or despotic
manner by reason of passion, prejudice or personal aversion amounting to an
evasion of positive duty or to a virtual refusal to perform the duty enjoined, or to
act at all in contemplation of law.

Case 10
SPOUSES SILVESTRE O. PLAZA AND ELENA Y. PLAZA vs. GUILLERMO
LUSTIVA, ELEODORA VDA. DE MARTINEZ AND VICKY SAYSON GOLOSENO

G.R. No. 172909 March 5, 2014

Principle
Upon the dismissal of the main action, the question of the non-issuance of a writ of
preliminary injunction automatically died with it. A writ of preliminary injunction is a
provisional remedy; it is auxiliary, an adjunct of, and subject to the determination of
the main action. It is deemed lifted upon the dismissal of the main case, any appeal
therefrom notwithstanding.

Facts
On August 28, 1997, the CA ruled that among the Plaza siblings, namely: Aureliano,
Emiliana, Vidal, Marciano, and Barbara, Barbara was the owner of the subject
agricultural land. The decision became final and executory and Barbara's
successors, respondents Guillermo Lustiva, Eleodora Vda. de Martinez and Vicky
Sayson Goloseno, have continued occupying the property.

On September 14, 1999, Vidal’s son and daughter-in-law, the petitioners, filed a
Complaint for Injunction, Damages, Attorney’s Fees with Prayer for the Issuance of
the Writ of Preliminary Injunction and/or Temporary Restraining Order against the
respondents and the City Government of Butuan. They prayed that the respondents
be enjoined from unlawfully and illegally threatening to take possession of the
subject property. According to the petitioners, they acquired the land from Virginia
Tuazon in 1997; Tuazon was the sole bidder and winner in a tax delinquency sale
conducted by the City of Butuan on December 27, 1996.

In their answer, the respondents pointed out that they were never delinquent in
paying the land taxes and were in fact not aware that their property had been
offered for public auction. Moreover, Tuazon, being a government employee, was
disqualified to bid in the public auction, as stated in Section 89 of the Local
Government Code of 1991. As Tuazon’s participation in the sale was void, she
could have not transferred ownership to the petitioners. Equally important, the
petitioners merely falsified the property tax declaration by inserting the name of the
petitioners’ father, making him appear as a co-owner of the auctioned land. Armed
with the falsified tax declaration, the petitioners, as heirs of their father, fraudulently
redeemed the land from Tuazon. Nonetheless, there was nothing to redeem as the
land was not sold. For these irregularities, the petitioners had no right to the Writ of
Preliminary Injunction and/or Temporary Restraining Order prayed for against them.

In its December 14, 1999 order, the RTC of Butuan City, reconsidered its earlier
order, denied the prayer for a Writ of Preliminary Injunction, and ordered that the
 possession and occupation of the land be returned to the respondents. The RTC
found that the auction sale was tainted with irregularity as the bidder was a
government employee disqualified in accordance with Section 89 of the Local
Government Code of 1991. The petitioners are not buyers in good faith either. On
the contrary, they were in bad faith for having falsified the tax declaration they
redeemed the property with.

In its October 24, 2005 decision, the CA affirmed the RTC’s ruling, found the
petitioners guilty of forum shopping, dismissed the case, and referred the case to
the Court and to the Integrated Bar of the Philippines for investigation and institution
of the appropriate administrative action. On April 6, 2006, the CA rejected the
petitioners’ motion for reconsideration.

Issue
Whether or not the petitioners were entitled to a writ of preliminary injunction.

Ruling
The petitioners failed to show clear and unmistakable rights to be protected by the
writ; the present action has been rendered moot and academic by the dismissal of
the main action

As the lower courts correctly found, Tuazon had no ownership to confer to the
petitioners despite the latter’s reimbursement of Tuazon’s purchase expenses.
Because they were never owners of the property, the petitioners failed to establish
entitlement to the writ of preliminary injunction. "[T]o be entitled to an injunctive writ,
the right to be protected and the violation against that right must be shown. A writ of
preliminary injunction may be issued only upon clear showing of an actual existing
right to be protected during the pendency of the principal action. When the
complainant’s right or title is doubtful or disputed, he does not have a clear legal
right and, therefore, the issuance of injunctive relief is not proper."

Likewise, upon the dismissal of the main case by the RTC on August 8, 2013, the
question of issuance of the writ of preliminary injunction has become moot and
academic. In Arevalo v. Planters Development Bank, the Court ruled that a case
becomes moot and academic when there is no more issue between the parties or
object that can be served in deciding the merits of the case. Upon the dismissal of
the main action, the question of the non-issuance of a writ of preliminary injunction
automatically died with it. A writ of preliminary injunction is a provisional remedy; it is
auxiliary, an adjunct of, and subject to the determination of the main action. It is
deemed lifted upon the dismissal of the main case, any appeal therefrom
notwithstanding.

OTHER RULING:

The petitioners may not raise factual issues

The petitioners maintain that they did not falsify the tax declaration they reimbursed
 the property with. According to them, the document already existed in 1987, way
before they acquired the land in 1997. Contrary likewise to the lower courts’ finding,
they did not purchase the land from Tuazon as redemptioners; they directly bought
the property from the City Government of Butuan.

These factual contests are not appropriate for a petition for review on certiorari
under Rule 45. The Court is not a trier of facts. The Court will not revisit, re-
examine, and re-evaluate the evidence and the factual conclusions arrived at by the
lower courts. In the absence of compelling reasons, the Court will not disturb the
rule that factual findings of the lower tribunals are final and binding on this Court.

The petitioners are guilty of forum shopping

We agree with the CA that the petitioners committed forum shopping when they filed
the specific performance case despite the pendency of the present case before the
CA.

WHEREFORE, premises considered, the Court DENIES the petition for review on
certiorari. The decision dated October 24, 2005 and the resolution dated April 6,
1âwphi1

2006 of the Court of Appeals in CA-G.R. SP No. 59859 are hereby AFFIRMED.

SO ORDERED.

Case 11 LOCAL WATER UTILITIES ADMINISTRATION EMPLOYEES

ASSOCIATION FOR PROGRESS (LEAP) vs. LOCAL WATER
UTILITIES ADMINISTRATION (LWUA) and DEPARTMENT OF
BUDGET AND MANAGEMENT THIRD DIVISION

G.R. No. 206808-09, September 07, 2016

Facts On February 2, 2004, former President Gloria MacapagalArroyo

enacted Executive Order (E.O.) No. 2795 for the purpose of reviewing
and rationalizing the then existing financing policies for the Philippine
water supply and sewerage sector to allow for the efficient flow of
resources thereto. President Arroyo also issued E.O. No. 366 directing
all departments of the executive branch and their component
units/bureaus to conduct a strategic review of the operations. Then,
E.O. No. 421 was issued to give affected LWUA personnel the option
to remain or retire, or be separated from government service.
Pursuant to the provisions of E.O. No. 421, the Task Force 421 and its
Action Team were created. The said Task Force was charged, among
others, with the duty of preparing the LWUA's staffing pattern and the
 corresponding plantilla positions therein as directed by E.O. No. 421.
On October 18, 2006, LWUA issued Office Order No. 168-06 provided
that the guidelines for the implementation of the approved staffing
pattern shall include a general provision declaring that all employees
may apply for a maximum of five positions in the rationalized
structure where they may qualify. On October 19, 2006, petitioners
filed a petition for certiorari, prohibition and mandamus with prayer
for temporary restraining order (TRO) and preliminary injunction with
the RTC of Quezon City. Alleging that LWUA and DBM acted with
grave abuse of discretion in adopting and implementing the
reorganization plan of LWUA on the ground that petitioners will suffer
injustice and sustain irreparable injury as 233 LWUA employees face
immediate and outright dismissal from service. RTC granted the
prayer for preliminary injunction, rejecting LWUA and DBM’s
separation Motions for Reconsideration. LWUA and DBM then filed
separate special civil actions for certiorari with the CA questioning the
subject RTC Order and Resolution. These petitions were subsequently
consolidated

Issue Whether or not the dismissal of petitioners' principal action for

certiorari, prohibition and mandamus filed with the RTC results in the
automatic dissolution of the ancillary writ of preliminary injunction
issued by the same court. YES.

Ruling A writ of preliminary injunction is an order granted at any stage of an

action or proceeding prior to the judgment or final order, requiring a
party or a court, agency or a person to refrain from a particular act or
acts.20 It is merely a provisional remedy, adjunct to the main case
subject to the latter's outcome. It is not a cause of action in itself. The
writ is provisional because it constitutes a temporary measure availed
of during the pendency of the action and it is ancillary because it is a
mere incident in and is dependent upon the result of the main
action.21 Being an ancillary or auxiliary remedy, it is available during
the pendency of the action which may be resorted to by a litigant to
preserve and protect certain rights and interests therein pending
rendition, and for purposes of the ultimate effects, of a final judgment
in the case. It is well settled that the sole object of a preliminary
injunction, whether prohibitory or mandatory, is to preserve the
status quo until the merits of the case can be heard.23 It is usually
granted when it is made to appear that there is a substantial
controversy between the parties and one of them is committing an act
or threatening the immediate commission of an act that will cause
irreparable injury or destroy the status quo of the controversy before
a full hearing can be had on the merits of the case.24 It persists until
it is dissolved or until the termination of the action without the court
issuing a final injunction. Indubitably, in the present case, the writ of
preliminary injunction was granted by the RTC based on its finding
 that there was a need to protect petitioners' rights to security of
tenure during the pendency of the principal action. After trial,
however, the lower court found, among others, that, in questioning
the constitutionality of E.O. Nos. 279, 366 and 421 as well as
Resolution No. 69 of the LWUA Board of Trustees, petitioners failed to
establish the existence of an actual case or controversy which is ripe
for judicial determination. Thus, the RTC dismissed the principal
action for certiorari, prohibition and mandamus. The principal action
having been heard and found dismissible as it was in fact dismissed,
the writ of preliminary injunction issued by the RTC is deemed lifted,
its purpose as a provisional remedy having been served, the appeal
from the main case notwithstanding.26 In this regard, this Court's
ruling in the case of Unionbank of the Philippines v. Court of
Appeals27 is instructive, to wit: x x x "a dismissal, discontinuance or
non-suit of an action in which a restraining order or temporary
injunction has been granted operates as a dissolution of the
restraining order or temporary injunction," regardless of whether the
period for filing a motion for reconsideration of the order dismissing
the case or appeal therefrom has expired. The rationale therefore is
that even in cases where an appeal is taken from a judgment
dismissing an action on the merits, the appeal does not suspend the
judgment, hence the general rule applies that a temporary injunction
terminates automatically on the dismissal of the action.
AGOO RICE MILL CORPORATION (represented by its President, Kam Biak Y. Chan, Jr.),
Case No. 12 Petitioner,
vs. LAND BANK OF THE PHILIPPINES, Respondent.

Principle · "Injunction is a judicial writ, process or proceeding whereby a party is ordered to do

or refrain from doing a certain act. It may be the main action or merely a provisional
remedy for and as an incident in the main action. For an injunction to issue, the
following essential requisites must be present: (1) there must be a right in esse or
the existence of a right to be protected; and (2) the act against which the injunction
is directed to constitute a violation of such right.
· An injunction may either be an action in itself or a provisional remedy. As an action
in itself, it is a main action for injunction and, as a provisional remedy, it is a
preliminary injunction (P. 56).
· In the present case, both the RTC and the CA found that no agreement was forged
between the ARMC and the LBP on the restructuring of the ARMC’s loans at the time
the LBP filed an application to extra-judicially foreclose the ARMC’s mortgaged
properties; the proposed loan restructuring was not approved by the LBP because
the ARMC failed to offer an additional collateral sufficient enough to cover its
outstanding loan with the bank. Thus, the ARMC, then, had no actual right to protect
or to enforce against the LBP. It failed to satisfy the first requisite, i.e., the existence
of a clear and unmistakable right for the issuance of an injunction.

Facts
Facts:
· From October 1993 -October 1996 - Agoo Rice Mill Corporation (ARMC) obtained
from the Land Bank of the Philippines (LBP) a Term Loan (TL) for 2M and two (2)
 Short-Term Loan Lines (STLLs) amounting to 15M evidenced by promissory notes.
· These loans were secured by a Real and Chattel Mortgage over the ARMC’s four (4)
commercial lots, including their improvements, and its rice mill machineries and
generator.
· ARMC paid in several payments to cover the loan’s interest but was unable to pay
the whole obligation due to company’s financial problem, negative effect of the
government’s rice importation and El Nino.
· ARMC, thru a letter by its president requested LBP for an extension to pay its
obligation on Feb. 28, 1997. LBP reminded ARMC thru a letter of its payment.
· On Feb. 27, 1997 ARMC wrote LBP for a renewal of its loans, the LBP allegedly
replied to have it restructured instead of renewed.
· ARMC requested LBP to restructure its STLLs and suggested payment of 5M every 6
months until the 15M STLLs to be paid in full but was deferred by LBP which advised
ARMC to first secure a waiver of its penalty charges prior to the loan’s restructuring.
· November 3, 1997- LBP informed ARMC that the bank’s Domestic Banking Loan
Committee require an additional collateral from the ARMC on or before November 7,
1997; otherwise, the LBP would be forced to pursue legal action.
· November 10, 1997 - LBP informed ARMC that its existing collateral was short of
3.4M that ARMC needed to offer additional collateral and to submit the necessary
documents until extension date of November 25, 1997. ARMC responded by asking
for a reappraisal of its properties, but the LBP denied the request, insisting that the
valuation made by its Property Assessors was fair and reasonable.
· LBP wrote ARMC regarding the latter’s noncompliance of additional collateral that
such noncompliance on or before April 30, 1998 would result in the referral of the
matter to the bank’s Legal Office for appropriate action.
· LBP informed ARMC that its request for loan restructuring is under evaluation and
for the mean time the ARMC must settle first the payment of its loan for the month.

Application for Extrajudicial Foreclosure by LBP

· July 8, 1998- LBP sent the ARMC a Final Notice of Payment, informing the ARMC that
it had filed, on the same date, an application for the extrajudicial foreclosure of
ARMC’s mortgaged properties. The extrajudicial foreclosure was set for August 26,
1998 at nine o’clock in the morning.

Complaint for Injunction by ARMC

· August 24, 1998- ARMC, through its President, filed with the RTC, Branch 30, San
Fernando City, La Union, a complaint for injunction with application for a writ of
preliminary injunction and temporary restraining order, and for recovery of damages.
· ARMC mainly alleged that LBP’s proposed extrajudicial foreclosure should be
enjoined for being premature, improper and in violation of ARMC’s contractual and
property rights since negotiations for the restructuring of its loans were still
ongoing.
· ARMC also alleged that the LBP’s petition for extrajudicial foreclosure contained
inconsistent statements on the total amount of its principal obligation.
· ARMC denied receipt of the LBP’s July 8, 1998 Final Notice of Payment.

Temporary Restraining Order and Writ of Preliminary Injunction

· On August 24, 1998, Executive Judge Vicente A. Pacquing, RTC, La Union, issued a
72–hour Temporary Restraining Order (TRO) directing the Ex-Officio Provincial
Sheriff of La Union to cease and desist from proceeding with the August 26, 1998
foreclosure sale. The following day, the RTC ordered the extension of the TRO for
 seventeen (17) days.
· Parties manifested to settle amicable but failed to do so, thus, the RTC proceeded
with the hearing on the issuance of the writ of preliminary injunction on January 12,
1999.
· In an order dated March 18, 1999, Judge Adolfo Alagar, RTC, Branch 30, San
Fernando City, La Union, issued a writ of preliminary injunction upon the ARMC’s
filing of a bond of P 4,000,000.00.

RTC’s Ruling
· (08-05-2004) RTC found no merit in the ARMC’s complaint for injunction.
· The RTC denied the ARMC’s complaint on the ground that injunction cannot issue
against the exercise of a valid right, the right of the creditor/mortgagee to foreclose
on the mortgage where the debtor-mortgagor has defaulted in the payment of its
obligations.
· The RTC likewise ruled that the LBP’s foreclosure was not merely an exercise of its
right, but also the performance of its legal obligation under Presidential Decree No.
(P.D.) 385
· Motion for reconsideration by ARMC was denied.

Foreclosure Sale
· (05-12-2005) Sheriff of the RTC of San Fernando City, La Union issued a Notice of
Extrajudicial Sale that set the auction sale of the mortgaged properties on June 3,
2005.
· The ARMC sought to enjoin the foreclosure sale by filing with the CA an application
for the issuance of a writ of preliminary injunction and temporary restraining order,
which the CA denied in a resolution dated June 14, 2005.
· The LBP emerged as the winning bidder in the auction sale.

CA’s Ruling
· (03-28-2006) CA found no merit in the ARMC’s appeal. The CA affirmed the RTC in
ruling that, under P.D. 385, an injunction, whether permanent or temporary, could not
be issued to enjoin the foreclosure proceedings instituted by the LBP.
· The CA denied the motion for reconsideration

Issue WON ARMC is entitled to an injunctive remedy.

Ruling HELD: NO

· "Injunction is a judicial writ, process or proceeding whereby a party is ordered to do

or refrain from doing a certain act. It may be the main action or merely a provisional
remedy for and as an incident in the main action. For an injunction to issue, the
following essential requisites must be present: (1) there must be a right in esse or
the existence of a right to be protected; and (2) the act against which the injunction
is directed to constitute a violation of such right.
· An injunction may either be an action in itself or a provisional remedy. As an action
in itself, it is a main action for injunction and, as a provisional remedy, it is a
preliminary injunction (P. 56).
· In the present case, both the RTC and the CA found that no agreement was forged
between the ARMC and the LBP on the restructuring of the ARMC’s loans at the time
the LBP filed an application to extra-judicially foreclose the ARMC’s mortgaged
properties; the proposed loan restructuring was not approved by the LBP because
 the ARMC failed to offer an additional collateral sufficient enough to cover its
outstanding loan with the bank. Thus, the ARMC, then, had no actual right to protect
or to enforce against the LBP. It failed to satisfy the first requisite, i.e., the existence
of a clear and unmistakable right for the issuance of an injunction.
· On the other hand, the LBP had every right to foreclose on the Real and Chattel
Mortgage since the ARMC had defaulted in the payment of its overdue loan
obligation with the bank. The foreclosure is supported by the express mandate of
P.D. 385
· Section 2. No restraining order. Temporary or permanent injunction shall be issued
by the court against any government financial institution in any action taken by such
institution in compliance with the mandatory foreclosure provided in Section 1
hereof whether such restraining order. temporary or permanent injunction is sought
by the borrower(s) or any third party or parties, except after due hearing in which it
is established by the borrower and admitted by the government financial institution
concerned that twenty percent (20%) of the outstanding arrearages has been paid
after the filing of foreclosure proceedings.
· Under these terms, the ARMC cannot secure an injunction against the LBP, a
government financial institution.

Injunction Became Moot and Academic

· The present petition must also be denied because the act sought to be enjoined by
the ARMC is already a consummated act. The records show that the foreclosure sale
on the ARMC's properties was held sometime in June 2005 and the LBP emerged as
the winning bidder. An injunction suit becomes moot and academic after the act
sought to be enjoined had already been consummated.

**WHEREFORE, we DENY the present petition for review on certiorari for lack of merit and
for being moot and academic. Costs against petitioner Agoo Rice Mill Corporation.

Case No. 13 Republic vs. Evangelista 466 SCRA 544

Principle Remedial law; Provisional Remedies; Preliminary Injuction; When justified; A

writ of preliminary injunction is an ancilliary or preventive remedy that is resorted
to by a litigant to protect or preserve his rights or interests and for no other
purpose during the pendency of the principal action. It is issued by the court to
prevent threatened or continuous irremediable injury to the applicant before his
claim can be thoroughly studied and adjudicated. Its aim is to preserve the
status quo ante until the merits of the case can be heard fully, upon the
applicant’s showing of two important conditions, viz.: (1) the right to be protected
prima facie exists; and, (2) the acts sought to be enjoined are violative of that
right.

Facts This a complaint for damages, with prayer for the issuance of a writ of
 preliminary injunction, filed by private respondent Dante Legaspi, through his
attorney-in-fact Paul Gutierrez, against petitioners Gen. Jose M. Calimlim,
Ciriaco Reyes and Maj. David Diciano before the Regional Trial Court (RTC) of
Quezon City.

The private respondent Legaspi is the owner of a land located in Bigte,

Norzagaray, Bulacan. In November 1999, petitioner Calimlim, representing the
Republic of the Philippines, and as then head of the Intelligence Service of the
Armed Forces of the Philippines (ISAFP) and the Presidential Security Group
(PSG), entered into a Memorandum of Agreement (MOA) with one Ciriaco
Reyes. The MOA granted Reyes a permit to hunt for treasure in a land in Bigte,
Norzagaray, Bulacan. Petitioner Diciano signed the MOA as a witness. It was
further alleged that, Reyes, together with petitioners, started, digging, tunneling
and blasting works on the said land of Legaspi. The complaint also alleged that
petitioner Calimlim assigned about 80 military personnel to guard the area and
encamp thereon to intimidate Legaspi and other occupants of the area from
going near the subject land.

Upon the filing of the complaint, then Executive Judge Perlita J. Tria Tirona
issued a 72-hour temporary restraining order (TRO) against petitioners. The
case was subsequently raffled to the RTC of Quezon City then presided by
public respondent Judge Victorino P. Evangelista. respondent judge issued
another 72-hour TRO and a summary hearing for its extension was set on
March 7, 2000.

The trial court granted private respondent’s application for a writ of preliminary
injunction on among other grounds, that the diggings and blastings appear to
have been made on the land of Legaspi, hence, there is an urgent need to
maintain the status quo to prevent serious damage to Legaspi’s land. On the
other hand, Motion to Dismiss and Motion for Inhibition filed by the petitioners
were both denied by the lower court. the latter instead ordered the petitioners to
answer the complaint. The Court of Appeals further affirmed the decision of the
trial court. Hence, this petition.

Issue Whether the issuance of the writ of preliminary injunction is justified.

Ruling Yes, the issuance of the writ of preliminary injunction is justified. A writ of
preliminary injunction is an ancilliary or preventive remedy that is resorted to by
a litigant to protect or preserve his rights or interests and for no other purpose
during the pendency of the principal action. It is issued by the court to prevent
threatened or continuous irremediable injury to the applicant before his claim
can be thoroughly studied and adjudicated. Its aim is to preserve the status quo
ante until the merits of the case can be heard fully, upon the applicant’s showing
of two important conditions, viz.: (1) the right to be protected prima facie exists;
and, (2) the acts sought to be enjoined are violative of that right.

Section 3, Rule 58 of the 1997 Rules of Civil Procedure provides that a writ of
preliminary injunction may be issued when it is established:
(a) that the applicant is entitled to the relief demanded, the whole or part of such
 relief consists in restraining the commission or continuance of the act or acts
complained of, or in requiring the performance of an act or acts, either for a
limited period or perpetually;
(b) that the commission, continuance or non-performance of the act or acts
complained of during the litigation would probably work injustice to the applicant;
or
(c) that a party, court, agency or a person is doing, threatening, or is attempting
to do, or is procuring or suffering to be done, some act or acts probably in
violation of the rights of the applicant respecting the subject of the action or
proceeding, and tending to render the judgment ineffectual.

It is crystal clear that at the hearing for the issuance of a writ of preliminary
injunction, mere prima facie evidence is needed to establish the applicant’s
rights or interests in the subject matter of the main action. It is not required that
the applicant should conclusively show that there was a violation of his rights as
this issue will still be fully litigated in the main case. Thus, an applicant for a writ
is required only to show that he has an ostensible right to the final relief prayed
for in his complaint.

In the case at bar, the Supreme Court find that respondent judge had sufficient
basis to issue the writ of preliminary injunction. It was established, prima facie,
that Legaspi has a right to peaceful possession of his land, pendente lite.
Legaspi had title to the subject land. It was likewise established that the
diggings were conducted by petitioners in the enclosed area of Legaspi’s land.
Whether the land fenced by Gutierrez and claimed to be included in the land of
Legaspi covered an area beyond that which is included in the title of Legaspi is
a factual issue still subject to litigation and proof by the parties in the main case
for damages. It was necessary for the trial court to issue the writ of preliminary
injunction during the pendency of the main case in order to preserve the rights
and interests of private respondents Legaspi and Gutierrez.

Case No. 14 EVY CONSTRUCTION AND DEVELOPMENT CORPORATION vs. VALIANT

ROLL FORMING SALES CORPORATION, G.R. No. 207938, October 11, 2017

Principle - In every application for provisional injunctive relief, the applicant must establish the
actual and existing right sought to be protected. The applicant must also establish
the urgency of a writ's issuance to prevent grave and irreparable injury. Failure to do
so will warrant the court's denial of the application. Moreover, the application for the
issuance of a writ of preliminary injunction may be denied in the same summary
hearing as the application for the issuance of the temporary restraining order if the
applicant fails to establish requisites for the entitlement of the writ.

- Injunction is defined as "a judicial writ, process or proceeding whereby a party is

ordered to do or refrain from doing a certain act." It may be filed as a main action
before the trial court or as a provisional remedy in the main action.
 - Under Rule 58 of the Rules of Court, a preliminary injunction "is an order granted
at any stage of an action or proceeding prior to the judgment or final order, requiring
a party or a court, agency or a person to refrain from a particular act or acts" or an
order "requir[ing] the performance of a particular act or acts." It is an ancillary relief
granted by the court where the main action or proceeding is pending.

In order to be granted the writ, it must be established:

(a) That the applicant is entitled to the relief demanded, and the whole
or part of such relief consists in restraining the commission or
continuance of the act or acts complained of, or in requiring
perfornance of an act or acts, either for a limited period or perpetually;

(b) That the commission, continuance or non-performance of the act or

acts complained of during the litigation would probably work injustice to
the applicant; or

(c) That a party, court, agency or a person is doing, threatening, or is

attempting to do, or is procuring or suffering to be done, some act or
acts probably in violation of the rights of the applicant respecting the
subject of the action or proceeding, and tending to render the judgment
ineffectual.

- The issuance of a writ of preliminary injunction is considered an "extraordinary

event," being a ''strong arm of equity or a transcendent remedy. "Thus, the power to
issue the writ "should be exercised sparingly, with utmost care, and with great
caution and deliberation." An injunctive writ is granted only to applicants with "actual
and existing substantial rights" or rights in esse. Further, the applicant must show
"that the invasion of the right is material and substantial and that there is an urgent
and paramount necessity for the writ to prevent serious damage. "Thus, the writ will
not issue to applicants whose rights are merely contingent or to compel or restrain
acts that do not give rise to a cause of action.

Facts This is a Petition for Review on Certiorari assailing the decision and resolution of
CA.

On September 4, 2007, Evy Construction purchased a parcel of land covered by

TCT No. 134890 in Lipa, Batangas from Linda N. Ang (Ang) and Senen T. Uyan
(Uyan).1 They executed a Deed of Absolute Sale, which was notarized on
September 11, 2007. At the time of the sale, no lien or encumbrance was
annotated on the title, except for a notice of adverse claim filed by Ang. On
November 20, 2007, Evy Construction registered the sale with the Register of
Deeds to which TCT No. 168590 was issued but contained the annotation of the
prior attachments by Valiant Corporation.

Subsequently, RTC decided in favor of Valiant and a writ of execution was

issued against the property covered by TCT No. 134890.

Evy Construction filed a Notice of Third-Party Claim informing the court that it
had already filed with the sheriff an Affidavit of Title/Ownership on May 20,
2008, in accordance with Rule 57 of the Rules of Court. However Valiant posted
an Indemnity Bond of ₱745,700.00 to answer for any damages that Evy
 Construction may suffer should execution of the Regional Trial Court Decision
proceed.

By virtue of the writ of execution, the sheriff issued a Notice of Sale for TCT No.
134890and eventually a Certificate of Sale was issued to Valiant as the winning
bidder.

On October 29, 2009, Evy Construction filed with the Regional Trial Court of
Lipa City, Batangas its Complaint for Quieting of Title/Removal of Cloud,
Annulment of Execution Sale and Certificate of Sale, and Damages, with
application for temporary restraining order and/or preliminary injunction.

The Regional Trial Court denied the application as well as the

Motion for Reconsideration.

The Court of Appeals affirmed the decision of the RTC holding that Evy
Construction failed to sufficiently establish its right to the issuance of a
temporary restraining order. The CA likewise pointed out that Evy Construction
could still sue for damages if the trial court eventually finds that the sale of the
property was invalid or proceed against the indemnity bond posted by Valiant for
any damages it might suffer as a result of the sale.

The motion for reconsideration was denied by the Court of Appeals. Hence, this
Petition.

Issue 1. whether or not petitioner Evy Construction and Development Corporation

was denied due process when its application for a writ of preliminary
injunction was denied in the same proceeding as its application for a
temporary restraining order.
2. whether or not the trial court committed grave abuse of discretion in
denying petitioner Evy Construction and Development Corporation's
application for injunctive relief.

Ruling 1. No

Injunction is defined as "a judicial writ, process or proceeding whereby a party is

ordered to do or refrain from doing a certain act." It may be filed as a main action
before the trial court or as a provisional remedy in the main action. Bacolod City
Water District v. Hon. Labayen expounded:

The main action for injunction is distinct from the provisional or

ancillary remedy of preliminary injunction which cannot exist except
only as part or an incident of an independent action or proceeding. As
a matter of course, in an action for injunction, the auxiliary remedy of
preliminary injunction, whether prohibitory or mandatory, may issue.
Under the law, the main action for injunction seeks a judgment
embodying a final injunction which is distinct from, and should not be
confused with, the provisional remedy of preliminary injunction, the
sole object of which is to preserve the status quo until the merits can
be heard. A preliminary injunction is granted at any stage of an action
 or proceeding prior to the judgment or final order. It persists until it is
dissolved or until the termination of the action without the court issuing
a final injunction.

A trial court may issue a temporary restraining order even without a prior
hearing for a limited period of 72 hours "if the matter is of extreme urgency and
the applicant will suffer grave injustice and irreparable injury. "In this instance, a
summary hearing, separate from the application of the preliminary injunction, is
required only to determine if a 72-hour temporary restraining order should be
extended. A trial court may also issue ex parte a temporary restraining order for
20 days if it shall appear from facts shown by affidavits or by the verified
application that great or irreparable injury would result to the applicant before
the matter can be heard on notice. "The trial court has 20 days from its issuance
to resolve the application for preliminary injunction or if no action is taken on the
application for preliminary injunction during this period, the temporary restraining
order is deemed to have expired. Inversely stated, an application for preliminary
injunction may be denied even without the conduct of a hearing separate from
that of the summary hearing of an application for the issuance of a temporary
restraining order.

In this case, the November 9, 2009 hearing was denominated as a "hearing on

the application for temporary restraining order and preliminary injunction."
Petitioner's counsel was allowed to present its arguments and its witness but
conceded that the issues before the trial court were legal in nature. Thus, the
trial court resolved that there was no need to present the witness, which
petitioner's counsel accepted without objection

Petitioner cannot insist on a separate hearing for the application for preliminary
injunction, considering that it accepted that its application would be submitted
for decision without the presentation of its witness. The trial court did not find
any need to conduct a further hearing on the application for preliminary
injunction since petitioner was unable to substantiate its entitlement to a
temporary restraining order. In any case, even if a separate hearing was
granted, petitioner would have presented the same arguments and evidence in
the November 9, 2009 hearing. Thus, there can be no denial of due process if
the party alleging it has already been granted an opportunity to be heard.

2.

No.

Under Rule 58 of the Rules of Court, a preliminary injunction "is an order granted at
any stage of an action or proceeding prior to the judgment or final order, requiring a
party or a court, agency or a person to refrain from a particular act or acts" or an
order "requir[ing] the performance of a particular act or acts." It is an ancillary relief
granted by the court where the main action or proceeding is pending.

In order to be granted the writ, it must be established:

(a) That the applicant is entitled to the relief demanded, and the whole
 or part of such relief consists in restraining the commission or
continuance of the act or acts complained of, or in requiring
performance of an act or acts, either for a limited period or perpetually;

(b) That the commission, continuance or non-performance of the act or

acts complained of during the litigation would probably work injustice to
the applicant; or

(c) That a party, court, agency or a person is doing, threatening, or is

attempting to do, or is procuring or suffering to be done, some act or
acts probably in violation of the rights of the applicant respecting the
subject of the action or proceeding, and tending to render the judgment
ineffectual.

The issuance of a writ of preliminary injunction is considered an "extraordinary

event," being a ''strong arm of equity or a transcendent remedy." Thus, the power to
issue the writ "should be exercised sparingly, with utmost care, and with great
caution and deliberation."

An injunctive writ is granted only to applicants with "actual and existing substantial
rights" or rights in esse. Further, the applicant must show "that the invasion of the
right is material and substantial and that there is an urgent and paramount necessity
for the writ to prevent serious damage." Thus, the writ will not issue to applicants
whose rights are merely contingent or to compel or restrain acts that do not give rise
to a cause of action.

In this case, petitioner alleges that as the registered owner of the property covered
by TCT No. 168590, "[i]t has the undeniable right to the full use and possession [of
it]."

However, The sale between petitioner Evy Construction? Uyan, and Ang was not
annotated on TCT No. 134890 at the time of its sale. A sale of property that is not
1âwphi1

registered under the Torrens system is binding only between the buyer and the
seller and does not affect innocent third persons. The Regional Trial Court could not
have been faulted for ordering the annotation of the notice of levy on attachment on
TCT No. 134890 considering that when the September 18, 2007 Order was issued1
the property was still in Uyan's and Ang's names.

Thus, in determining whether or not petitioner is entitled to injunctive relief, the

courts would have to pass upon the inevitable issue of which between petitioner and
respondent has the better right over the property, the very issue to be resolved in
the main case.

Thus, no injunctive writ could be issued pending a final determination of petitioner's

actual and existing right over the property. The grant of an injunctive writ could
1âwphi1

operate as a prejudgment of the main case.

Even assuming that there is already a final determination of petitioner's right over
the property, petitioner still failed to prove the urgent and paramount necessity to
enjoin the Register of Deeds from making further annotations on TCT No. 168590.
 In Cortez-Estrada v. Heirs of Samut, this Court held:

[T]he grant or denial of a writ of preliminary injunction in a pending

case rests in the sound discretion of the court taking cognizance of the
case since the assessment and evaluation of evidence towards that
end involve findings of facts left to the said court for its conclusive
determination.

The court's discretion is not interfered with unless there is a showing that the grant
or denial was tainted with grave abuse of discretion.

The trial court, in the exercise of its discretion, denied petitioner's application for the
issuance of a temporary restraining order and writ of preliminary injunction on the
ground that petitioner would still have sufficient relief in its prayer for damages in its
Complaint. In the event that the annotations on petitioner's title are found by the trial
court to be invalid, petitioner would have adequate relief in the removal of the
annotations and in the award of damages. Therefore, the trial court acted within the
bounds of its discretion.

Case No. 15 Land Bank of the Philippines vs. Heirs of Listana 649 SCRA 416

Principle An applicant for preliminary injunction is required to file a bond executed to the
party or person enjoined, to the effect that the applicant will pay to such party or
person all damages which he may sustain by reason of the injunction. Section
4(b), Rule 58 of the Rules of Court states: SEC. 4. Verified application and bond
for preliminary injunction or temporary restraining order.—A preliminary
injunction or temporary restraining order may be granted only when: x x x x (b)
Unless exempted by the court, the applicant files with the court where the action
or proceeding is pending, a bond executed to the party or person enjoined, in an
amount to be fixed by the court, to the effect that the applicant will pay to such
party or person all damages which he may sustain by reason of the injunction or
temporary restraining order if the court should finally decide that the applicant
was not entitled thereto. Upon approval of the requisite bond, a writ of
preliminary injunction shall be issued.

The purpose of the injunction bond is to protect the defendant against loss or
damage by reason of the injunction in case the court finally decides that the
plaintiff was not entitled to it, and the bond is usually conditioned accordingly.

Facts Private respondent Listana voluntarily offered to sell his land of 246.0561 ha. in
Sorsogon to the government, through the Department of Agrarian Reform (DAR)
under the Comprehensive Agrarian Reform Program (CARP). DAR valued the
property at P5,871,689.03 but Listana refused to sell at that price, so the
Department of Agrarian Reform Adjudication Board (DARAB), in an
administrative proceeding determined the just compensation of the land at
P10,956,963.25 and ordered the Land Bank of the Philippines to pay the same
to Listana.
 The PARAD issued a writ of execution ordering LBP Manager and Agrarian
Operator’s Head Alex Lorayes to pay Listana. Lorayes however, refused. Thus,
Listana filed with the PARAD a motion for indirect contempt against Lorayes.

Meanwhile, LBP filed with the RTC, acting as special agrarian court (SAC), a
petition for judicial determination of the amount of just compensation for the
property. The PARAD granted Listana’s motion for indirect contempt and
ordered the arrest of Lorayes. LBP filed with the RTC a petition for
injunction with application for the issuance of a writ of preliminary
injunction enjoining PARAD from implementing the warrant of arrest
against Lorayes. The RTC enjoined the PARAD from implementing the warrant
of arrest pending final determination of the amount of just compensation for the
property. LBP posted a ₱5,644,773.02 cash bond.

LBP filed with the Court a petition for review on certiorari under Rule 45 of the
Rules of Court.

In Land Bank of the Philippines v. Listana, Sr., the Court set aside the Decision
of the Court of Appeals and reinstated the Orders of the RTC enjoining the
PARAD from implementing the warrant of arrest pending final determination of
the amount of just compensation for the property.

The Court declared void all proceedings that stemmed from Listanas motion for
contempt.

LBP filed with the RTC a motion to withdraw the P5,644,773.02 cash bond.
However, The RTC denied LBPs motion to withdraw the P5,644,773.02 cash
bond.

Hence, LBP filed with the Court of Appeals a petition for certiorari, however, the
CA dismissed LBPs petition and affirmed in toto the RTC's Orders.

Consequently, petitioner LBP filed a petition for review with the Supreme Court.

Issue WON the LBP’s injunction bond may be withdrawn?

Ruling No. The petition is unmeritorious.

The Order of the RTC clearly states that the respondent Provincial Adjudicator
of the DARAB x x x is enjoined x x x from enforcing its order of arrest against
Mr. Alex A. Lorayes pending the final termination of the case before RTC upon
the posting of a cash bond by Land Bank.

Thus, LBP cannot withdraw the bond pending final determination of the
amount of just compensation for the property.

The DARAB set the amount of just compensation for the property at
P10,956,963.25 and ordered LBP to pay Listana the amount.
On 18 June 1999, the PARAD issued a writ of execution ordering Lorayes to
pay Listana the amount. Lorayes refused and, later, LBP filed with the RTC a
petition for injunction with application for the issuance of a writ of preliminary
injunction

An applicant for preliminary injunction is required to file a bond executed to the

party or person enjoined, to the effect that the applicant will pay to such party or
person all damages which he may sustain by reason of the injunction. Section
4(b), Rule 58 of the Rules of Court states:

SEC. 4. Verified application and bond for preliminary injunction or

temporary restraining order.—A preliminary injunction or temporary
restraining order may be granted only when:

xxxx

(b) Unless exempted by the court, the applicant files with the court where the
action or proceeding is pending, a bond executed to the party or person
enjoined, in an amount to be fixed by the court, to the effect that the applicant
will pay to such party or person all damages which he may sustain by reason of
the injunction or temporary restraining order if the court should finally decide
that the applicant was not entitled thereto. Upon approval of the requisite bond,
a writ of preliminary injunction shall be issued.

As correctly ruled by the lower courts, the P5,644,773.02 bond shall answer for
the damages Listana may sustain if the courts finally uphold the P10,956,963.25
just compensation set by the DARAB. Land Bank of the Philippines vs. Heirs of
Severino Listana, 649 SCRA 416, G.R. No. 182758 May 30, 2011. The purpose
of the injunction bond is to protect the defendant against loss or damage by
reason of the injunction in case the court finally decides that the plaintiff was not
entitled to it, and the bond is usually conditioned accordingly.

In the present case, LBP filed with the SAC a petition for determination of the
amount of just compensation on 6 September 1999. The PARAD issued the
alias writ of execution and warrant of arrest on 27 November 2000 and 3
January 2001, respectively. The writ of execution and warrant of arrest were
invalid because the 14 October 1998 Decision of the DARAB setting the amount
at P10,956,963.25 was merely preliminary and not executory.

In any event, the Court has reinstated the 29 January 2001 Order of the RTC
enjoining the PARAD from implementing the warrant of arrest pending final
determination of the amount of just compensation for the property. Land Bank of
the Philippines v. Listana, Sr. has long become final and executory and can no
longer be disturbed. Consequently, LBP cannot withdraw the P5,644,773.02
cash bond which is a condition for the issuance of the writ of preliminary
injunction.

WHEREFORE, the Court DENIES the petition. The Court AFFIRMS the 30
January 2008 Decision and 6 May 2008 Resolution of the Court of Appeals in
CA-G.R. SP No. 92701.
Case No. 17 Boncodin v. Nat’l Power Corporation Employees Consolidated Union,
G.R. No. 162716, September 27, 2006

Principle
To be entitled to a writ of injunction, a party must establish the following
requisites: (a) the right of the complainant is clear and unmistakable; (b) the
invasion of the right sought to be protected is material and substantial; and (c)
there is an urgent and paramount necessity for the writ to prevent serious
damage.

A clear legal right means one clearly founded in or granted by law or is

enforceable as a matter of law. Injunction is not designed to protect contingent,
abstract or future rights whose existence is doubtful or disputed. It cannot be
grounded on the possibility of irreparable damage without proof of an actual
existing right.

Facts
-Board Resolution No. 99-35 granted a step increment to all qualified
NAPOCOR officials and employees who have been in their position for 10
years.

- Board Resolution No. 2001-113 reduced the 10 year requirement to 3 years.

- Circular No. 2001-51 provided for the IRR of Board Resolution No. 2001-113.

- Circular No. 2002-22 provided for additional guidelines relative to the

implementation of the step increment based on length of service in the position
to qualified NAPOCOR officials and employees.

Petitioner held that NAPOCOR has already been granting seniority pay based
on the length of service as embodied in the Collective Negotiation Agreement
(CNA). Consequently, the processing of the succeeding step increment based
on length of service was suspended.

Believing that NPC Circular Nos. 2001-51 and 2002-22 are legal that they have
already acquired a vested right in it, respondent National Power Corporation
Employees Consolidated Union (NECU) filed a Petition for Prohibition with
Application for TRO/Preliminary Injunction before the RTC.

RTC: Issued the writ of preliminary injunction. At that stage of the proceedings,
it was not shown that Circular No. 2001-51 and Board Resolution No. 2001-113,
are in contravention of any law. A roll back of the salaries of all the NAPOCOR
employees, while the merits of the case is yet to be heard, would result to a
grave and irreparable damage to them. T
 CA: Agreed with lower court. The grim prospect of uncertainty facing the
[respondents] owing to their inevitable separation from the service further
compels this Court to act decisively and with dispatch while the main case is
being heard.

Issue
(1) W/N Preliminary Injudction is Proper

(2) W/N Rule 58 of the 1997 Rules of Civil Procedure authorized the
issuance of a writ of preliminary injunction even if the relief/protection applied for
is the subject of controversy in the main action.

Ruling
(1) NO

To be entitled to a writ of injunction, a party must establish the following

requisites: (a) the right of the complainant is clear and unmistakable; (b) the
invasion of the right sought to be protected is material and substantial; and (c)
there is an urgent and paramount necessity for the writ to prevent serious
damage.

A clear legal right means one clearly founded in or granted by law or is

enforceable as a matter of law. Injunction is not designed to protect contingent,
abstract or future rights whose existence is doubtful or disputed. It cannot be
grounded on the possibility of irreparable damage without proof of an actual
existing right.

In this case, the right claimed by respondent is far from clear. The enforcement
of the suspension order (w/c would result to rollback of salaries) would be
prejudicial to respondent members interest, but merely showing this fact is not
sufficient. It must also be established that the party applying for the writ has a
clear legal right that must be protected. Thus, a finding that the applicant for
preliminary injunction may suffer damage not capable of pecuniary estimation
does not suffice to support an injunction, when it appears that the right to be
protected is unclear or is seriously disputed.

(2) NO. The only ground relied upon for injunctive relief is the alleged nullity
of petitioners Memorandum and Auditor Cabibihans suspension order.

By issuing a writ premised on that sole justification, the trial court in effect
sustained respondents claim that petitioner and the Auditor had exceeded their
authority in ordering the suspension of the implementation of the step
increments; and that the suspension was patently invalid or, or of doubtful
validity. Thus, the lower court prejudged the main case and reversed the rule on
 the burden of proof, because it assumed to be true the very proposition that
respondent-complainant in the RTC was duty-bound to prove in the first place.

A court may issue a writ or preliminary injunction only when the respondent has
made out a case of invalidity or irregularity. That case must be strong enough to
overcome, in the mind of the judge, the presumption of validity; and it must
show a clear legal right to the remedy sought.

Case No. 18 Golding vs. Balatbat (36 Phil. 941)

Principle PROPERTY; WRIT OF INJUNCTION TO OBTAIN POSSESSION.—

While the writ of injunction may be issued to restrain acts of trespass and the
illegal interference with the possession of land, the cases are very few when
said writ should issue ex parte and before the defendant is given a hearing; and
it should never issue when an action for damages would adequately
compensate the injuries caused. The very foundation of the jurisdiction to issue
the writ of injunction rests in the probability of irreparable injury, inadequacy of
pecuniary compensation and the prevention of the multiplicity of suits, and
where facts are not shown to bring the case within these conditions, the relief of
injunction should be refused.

Facts Petitioner Golding alleged that he was the owner of a piece or parcel of land and
that defendants Balatbats were illegally and maliciously interfering with his
possession of said land. The petitioner prayed for both a preliminary and
permanent injunction. He gave a bond, and a preliminary injunction was issued.

Each of the defendants Balatbats was served with the copy of the complaint and
the issued preliminary injunction. None of the defendants Balatbats answered
the petition within the time fixed by law, thus petitioner Golding presented a
motion for a judgment by default, which was granted. The case was set down
for hearing and judgment was rendered enjoining the defendants their agents
and representatives to desist in their acts of whatever character which molested
or tended to molest the plaintiff in the peaceful enjoyment of the possession of
his property.

Later, plaintiff presented an affidavit alleging that the defendant had maliciously
and illegally and by means of violence committed acts in violation of the terms of
said injunction. Balatbat confessed that he was guilty of violation of said
injunction but attempted to excuse his acts upon the theory that he was the
owner of the parcel of land. He was found guilty and was imposed a fine. On
appeal, he alleged the following: 1) that he had not been duly notified of the
injunction 2) that inasmuch as the lower court had issued the injunction, it is not
just for it to consider the questions presented for a violation of the same 3) that
there was no proof showing that the defendant had violated the terms of said
injunction
Issue WON the issuance of injunction against the defendant was proper.

Ruling Yes, the issuance of injunction against the defendant was proper

In reply: 1) record shows that he had such notice 2) The judge who grants an
injunction may punish those who violate its mandates. 3) It is sufficient to say
that he himself admitted that he had violated the terms of said injunction and
attempted to excuse by claiming to be the owner of such property The court
finds nothing in the record which would justify the reversal of the decision of the
lower court. However, it reduced the amount of fine from P50 to P5. Moreover,
the court deemed it proper to make the following observations: 1) Injunction
should not be granted to take property out of the possession and control of one
party and to place it in the hands of another whose title has not been clearly
established by law.

2) It should not be issued except upon condition that no other ordinary, speedy
and adequate remedy is available to avoid or repair the damage done, or which
may be done by a new violation of the plaintiff’s rights.

3) That an injunction, while it resemble the interdictal actions of the Spanish

law, is wholly distinct therefrom

4) The very foundation of the jurisdiction to issue the writ rests in the probability
of irreparable injury, the inadequacy of pecuniary compensation, and the
prevention of the multiplicity of suits, and where facts are not shown to bring the
case within these conditions, the relief of injunction should be refused

5) Injunctions to prevent trespass and the illegal interference with the

possession of land should not be granted, when the plaintiff's title is in dispute
and has not been established at law, until the question of title is settled in a
proper proceeding brought for that purpose.

6) There are cases, however, where an injunction may be granted in order to

preserve the statu quo of property until the title can be determined in a proper
action. But even then it should not be granted ex parte. The defendant should
be given an opportunity to be heard.

7) The remedy by injunction is never the proper remedy to deprive a person of

the possession of property. If the person in possession is in possession illegally
there exist other adequate, speedy and summary remedies — forcible entry and
detainer and ejectment.

In the present action had the defendants appeared when they were cited so to
do and alleged and showed that they were in possession of the land in question
as owners thereof, the action would have resolved itself into one of ejectment,
and a motion properly presented and properly supported to dissolve the
temporary injunction would have been denied. Of course, upon the theory of the
plaintiff, as presented in the record, that he was the owner of the land in
question and in possession thereof — and that fact not having been denied —
and that the defendants were mere trespassers thereon and were illegally and
 maliciously interfering and molesting the plaintiff in his quiet and peaceable
enjoyment of the possession of his property, then injunction was the proper
remedy for the purpose of preventing a repetition of said illegal acts. The
remedy by injunction is the proper remedy to prevent repeated trespass upon
real property. But the trespass which will be enjoined must be of such a nature
that an action for damages will not adequately compensate the loss occasioned
thereby.

Case No. 19
FRANCIS A. CHURCHILL and STEWART TAIT, plaintiffs-appellees,

vs.

JAMES J. RAFFERTY, Collector of Internal Revenue, defendant-appellant.

Principle
The Government does, by section 139 and 140, take away the preventive remedy of
injunction, if it ever existed, and leaves the taxpayer, in a contest with it, the same
ordinary remedial actions which prevail between citizen and citizen.

Section 84 of Act No. 82 provides that "No court shall entertain any suit assailing
the validity of a tax assessed under this act until the taxpayer shall have paid, under
protest, the taxes assessed against him, . . . ."

Section 52 of Act No. 1189 provides "That no courts shall have authority to grant an
injunction restraining the collection of any taxes imposed by virtue of the provisions
of this Act, but the remedy of the taxpayer who claims that he is unjustly assessed
or taxed shall be by payment under protest of the sum claimed from him by the
Collector of Internal Revenue and by action to recover back the sum claimed to
have been illegally collected."

Sections 139 and 140 of Act No. 2339 contain, as we have indicated, the same
prohibition and remedy. The result is that the courts have been expressly forbidden,
in every act creating or imposing taxes or imposts enacted by the legislative body of
the Philippines since the American occupation, to entertain any suit assailing the
validity of any tax or impost thus imposed until the tax shall have been paid under
protest.

2 KINDS OF INJUCTION (preliminary and Final)

The provisions of the Code of Civil Procedure (Act No. 190), effective October 1,
1901, which deals with the subject of injunctions, are sections 162 to 172, inclusive.
Injunctions, as here defined, are of two kinds; preliminary and final.

The Preliminary Injunction may be granted at any time after the commencement of
the action and before final judgment, and the latter at the termination of the trial as
 the relief or part of the relief prayed for (sec. 162). Any judge of the Supreme Court
may grant a preliminary injunction in any action pending in that court or in any Court
of First Instance. A preliminary injunction may also be granted by a judge of the
Court of First Instance in actions pending in his district in which he has original
jurisdiction (sec. 163).

But such injunctions may be granted only when the complaint shows facts entitling
the plaintiff to the relief demanded (sec. 166), and before a final or permanent
injunction can be granted, it must appear upon the trial of the action that the plaintiff
is entitled to have commission or continuance of the acts complained of perpetually
restrained (sec. 171).

These provisions authorize the institution in Courts of First Instance of what are
known as "injunction suits," the sole object of which is to obtain the issuance of a
final injunction. They also authorize the granting of injunctions as aiders in ordinary
civil actions.

Facts
The judgment appealed from in this case perpetually restrains and prohibits the
defendant and his deputies from collecting and enforcing against the plaintiffs and
their property the annual tax mentioned and described in subsection (b) of section
100 of Act No. 2339, effective July 1, 1914, and decrees the cancellation of the
bond given by the plaintiffs to secure the issuance of the preliminary injunction
granted soon after the commencement of this action.

Issue 1.) whether the court of equity is forbidden to use the remedy by
injunction in collection of taxes

Sub issues:

a.) whether SECTION 139 VIOLATES DUE PROCESS OF LAW AND EQUAL
PROTECTION CLAUSE

b.) whether Section 139 is unconstitutional

Ruling
The first question is one of the jurisdiction and is of vital importance to the
Government. The sections of Act No. 2339, which bear directly upon the subject,
are 139 and 140.

Section 139 expressly forbids the use of an injunction to stay the collection of any
internal revenue tax;

Section 140 provides a remedy for any wrong in connection with such taxes, and
this remedy was intended to be exclusive, thereby precluding the remedy by
injunction, which remedy is claimed to be constitutional.

The two sections, then, involve the right of a dissatisfied taxpayers to use an
exceptional remedy to test the validity of any tax or to determine any other question
connected therewith, and the question whether the remedy by injunction is
exceptional.

Preventive remedies of the courts are extraordinary and are not the usual remedies.
The origin and history of the writ of injunction show that it has always been regarded
as an extraordinary, preventive remedy, as distinguished from the common course
of the law to redress evils after they have been consummated. No injunction issues
as of course, but is granted only upon the oath of a party and when there is no
adequate remedy at law.

The Government does, by section 139 and 140, take away the preventive remedy of
injunction, if it ever existed, and leaves the taxpayer, in a contest with it, the same
ordinary remedial actions which prevail between citizen and citizen.

DEFENDANT: The Attorney-General, on behalf of the defendant, contends that

there is no provisions of the paramount law which prohibits such a course.

PLAINTIFF: While, on the other hand, counsel for plaintiffs urge that the two
sections are unconstitutional because

(a) they attempt to deprive aggrieved taxpayers of all substantial remedy for the
protection of their property, thereby, in effect, depriving them of their property
without due process of law, and

(b) they attempt to diminish the jurisdiction of the courts, as conferred upon them by
Acts Nos. 136 and 190, which jurisdiction was ratified and confirmed by the Act of
Congress of July 1, 1902.

In the first place, it has been suggested that section 139 does not apply to the tax in
question because the section, in speaking of a "tax," means only legal taxes; and
that an illegal tax (the one complained of) is not a tax, and, therefore, does not fall
within the inhibition of the section, and may be restrained by injunction. There is no
force in this suggestion. The inhibition applies to all internal revenue taxes imposes,
or authorized to be imposed, by Act No. 2339.

(Snyder vs. Marks, 109 U.S., 189.) And, furthermore, the mere fact that a tax is
illegal, or that the law, by virtue of which it is imposed, is unconstitutional, does not
authorize a court of equity to restrain its collection by injunction. There must be a
further showing that there are special circumstances which bring the case under
some well recognized head of equity jurisprudence, such as that irreparable injury,
multiplicity of suits, or a cloud upon title to real estate will result, and also that there
is, as we have indicated, no adequate remedy at law.

It is also the settled law in the United States that "due process of law" does not
always require, in respect to the Government, the same process that is required
between citizens, though it generally implies and includes regular allegations,
opportunity to answer, and a trial according to some well settled course of judicial
proceedings. The case with which we are dealing is in point. A citizen's property,
both real and personal, may be taken, and usually is taken, by the government in
payment of its taxes without any judicial proceedings whatever.

With these principles to guide us, we will proceed to inquire whether there is any
merit in the two propositions insisted upon by counsel for the plaintiffs.

SECTION 139 DOES NOT VIOLATE DUE PROCESS OF LAW AND EQUAL
PROTECTION CLAUSE

Section 139, with which we have been dealing, reads: "No court shall have authority
to grant an injunction to restrain the collection of any internal-revenue tax."

Section 5 of the Philippine Bill provides: "That no law shall be enacted in said
Islands which shall deprive any person of life, liberty, or property without due
process of law, or deny to any person therein the equal protection of the law."

Section 3224 of the Revised Statutes of the United States, effective since 1867,
provides that: "No suit for the purpose of restraining the assessment or collection of
any tax shall be maintained in any court."

A comparison of these two sections show that they are essentially the same. Both
expressly prohibit the restraining of taxes by injunction. If the Supreme Court of the
United States has clearly and definitely held that the provisions of section 3224 do
not violate the "due process of law" and "equal protection of the law" clauses in the
Constitution, we would be going too far to hold that section 139 violates those same
provisions in the Philippine Bill. That the Supreme Court of the United States has so
held, cannot be doubted.

In Cheatham vs. United States (92 U.S., 85,89) which involved the validity of an
income tax levied by an act of Congress prior to the one in issue in the case of
Pollock vs. Farmers' Loan & Trust Co. (157 U.S., 429) the court, through Mr. Justice
Miller, said: "If there existed in the courts, state or National, any general power of
impeding or controlling the collection of taxes, or relieving the hardship incident to
taxation, the very existence of the government might be placed in the power of a
hostile judiciary.

And again, in Snyder vs. Marks (109 U.S., 189), the court said: "The remedy of a
suit to recover back the tax after it is paid is provided by statute, and a suit to
restrain its collection is forbidden. The remedy so given is exclusive, and no other
remedy can be substituted for it. Such has been the current of decisions in the
Circuit Courts of the United States, and we are satisfied it is a correct view of the
law."
itc-a1f

In the consideration of the plaintiffs' second proposition, we will attempt to show (1)
that the Philippine courts never have had, since the American occupation, the power
to restrain by injunction the collection of any tax imposed by the Insular Government
for its own purpose and benefit, and (2) that assuming that our courts had or have
such power, this power has not been diminished or curtailed by sections 139 and
140.

Section 84 of Act No. 82 provides that "No court shall entertain any suit assailing
the validity of a tax assessed under this act until the taxpayer shall have paid, under
protest, the taxes assessed against him, . . . ."

Section 52 of Act No. 1189 provides "That no courts shall have authority to grant an
injunction restraining the collection of any taxes imposed by virtue of the provisions
of this Act, but the remedy of the taxpayer who claims that he is unjustly assessed
or taxed shall be by payment under protest of the sum claimed from him by the
Collector of Internal Revenue and by action to recover back the sum claimed to
have been illegally collected."

Sections 139 and 140 of Act No. 2339 contain, as we have indicated, the same
prohibition and remedy. The result is that the courts have been expressly forbidden,
in every act creating or imposing taxes or imposts enacted by the legislative body of
the Philippines since the American occupation, to entertain any suit assailing the
validity of any tax or impost thus imposed until the tax shall have been paid under
protest.

The only taxes which have not been brought within the express inhibition were
those included in that part of the old Spanish system which completely disappeared
on or before January 1, 1905, and possibly the old customs duties which
disappeared in February, 1902.

2 KINDS OF INJUCTION (preliminary and Final)

The provisions of the Code of Civil Procedure (Act No. 190), effective October 1,
1901, which deals with the subject of injunctions, are sections 162 to 172, inclusive.
Injunctions, as here defined, are of two kinds; preliminary and final.

The Preliminary Injunction may be granted at any time after the commencement of
the action and before final judgment, and the latter at the termination of the trial as
the relief or part of the relief prayed for (sec. 162). Any judge of the Supreme Court
may grant a preliminary injunction in any action pending in that court or in any Court
of First Instance. A preliminary injunction may also be granted by a judge of the
Court of First Instance in actions pending in his district in which he has original
jurisdiction (sec. 163).

But such injunctions may be granted only when the complaint shows facts entitling
the plaintiff to the relief demanded (sec. 166), and before a final or permanent
injunction can be granted, it must appear upon the trial of the action that the plaintiff
is entitled to have commission or continuance of the acts complained of perpetually
restrained (sec. 171).

These provisions authorize the institution in Courts of First Instance of what are
known as "injunction suits," the sole object of which is to obtain the issuance of a
final injunction. They also authorize the granting of injunctions as aiders in ordinary
civil actions.

We have defined in Davesa vs. Arbes (13 Phil. Rep., 273), an injunction to be "A
"special remedy", as in other cases where equitable relief is sought, to those cases
where there is no "plain, adequate, and complete remedy at law,"which will not be
granted while the rights between the parties are undetermined, except in
extraordinary cases where material and irreparable injury will be done,"which
cannot be compensated in damages . . .

By paragraph 2 of section 56 of Act No. 136, supra, and the provisions of the
various subsequent Acts heretofore mentioned, the Insular Government has
consented to litigate with aggrieved persons the validity of any original tax or impost
imposed by it on condition that this be done in ordinary civil actions after the taxes
or exactions shall have been paid.

But it is said that paragraph 2 confers original jurisdiction upon Courts of First
Instance to hear and determine "all civil actions" which involve the validity of any
tax, impost or assessment, and that if the all-inclusive words "all" and "any" be given
their natural and unrestricted meaning, no action wherein that question is involved
can arise over which such courts do not have jurisdiction.

It is also urged that the power to restrain by injunction the collection of taxes or
imposts is conferred upon Courts of First Instance by paragraph 7 of section 56,
supra. This paragraph does empower those courts to grant injunctions, both
preliminary and final, in any civil action pending in their districts, provided always,
that the complaint shows facts entitling the plaintiff to the relief demanded.

We must, therefore, conclude that paragraph 2 and 7 of section 56 of Act No. 136,
construed in the light of the prior and subsequent legislation to which we have
referred, and the legislative and judicial history of the same subject in the United
States with which the Commission was familiar, do not empower Courts of first
Instance to interfere by injunction with the collection of the taxes in question in this
case.

If we are in error as to the scope of paragraph 2 and 7, supra, and the Commission
did intend to confer the power upon the courts to restrain the collection of taxes, it
does not necessarily follow that this power or jurisdiction has been taken away by
section 139 of Act No. 2339, for the reason that all agree that an injunction will not
issue in any case if there is an adequate remedy at law. The very nature of the writ
itself prevents its issuance under such circumstances. Legislation forbidding the
issuing of injunctions in such cases is unnecessary.

SECOND ISSUE: whether the remedy provided for in section 140 of Act No. 2339 is
adequate or sufficient.

If it is, the writs which form the basis of this appeal should not have been issued. If
this is the correct view, the authority to issue injunctions will not have been taken
away by section 139, but rendered inoperative only by reason of an adequate
remedy having been made available.

The legislative body of the Philippine Islands has declared from the beginning (Act
No. 82) that payment under protest and suit to recover is an adequate remedy to
test the legality of any tax or impost, and that this remedy is exclusive. Can we say
that the remedy is not adequate or that it is not exclusive, or both?

In discussing the adequacy of the remedy provided by the Tennessee Legislature,

as above set forth, the Supreme Court of the United States, in the case just cited,
said: "This remedy is simple and effective. A suit at law to recover money unlawfully
exacted is as speedy, as easily tried, and less complicated than a proceeding by
mandamus. ... In revenue cases, whether arising upon its (United States) Internal
Revenue Laws or those providing for the collection of duties upon foreign imports, it
(United States) adopts the rule prescribed by the State of Tennessee. It requires the
contestant to pay the amount as fixed by the Government, and gives him power to
sue the collector, and in such suit to test the legality of the tax. There is nothing
illegal or even harsh in this. It is a wise and reasonable precaution for the security of
the Government."

ISSUE OF CONSTITUTIONALITY

It was claimed by the complainants that the above quoted provisions of the Act of
1885 were unconstitutional and void as being in conflict with article 6, sec. 8, of the
Constitution, which provides that: "The circuit courts shall have original jurisdiction
in all matters, civil and criminal, not excepted in this Constitution, and not prohibited
by law. ... They shall also have power to issue writs of habeas corpus, mandamus,
injunction, quo warranto, certiorari, and other writs necessary to carry into effect
their orders, judgments, and decrees."

Mr. Justice Champlin, speaking for the court, said: "I have no doubt that the
Legislature has the constitutional authority, where it has provided a plain, adequate,
and complete remedy at law to recover back taxes illegally assessed and collected,
to take away the remedy by injunction to restrain their collection."

POWER TO CHANGE THE METHOD OF PROCEDURE: Section 9 of the

Philippine Bill reads in part as follows: "That the Supreme Court and the Courts of
First Instance of the Philippine Islands shall possess and exercise jurisdiction as
heretofore provided and such additional jurisdiction as shall hereafter be prescribed
by the Government of said Islands, subject to the power of said Government to
change the practice and method of procedure."

It will be seen that this section has not taken away from the Philippine Government
the power to change the practice and method of procedure. If sections 139 and 140,
considered together, and this must always be done, are nothing more than a mode
of procedure, then it would seem that the Legislature did not exceed its
constitutional authority in enacting them.

Conceding for the moment that the duly authorized procedure for the determination
of the validity of any tax, impost, or assessment was by injunction suits and that this
method was available to aggrieved taxpayers prior to the passage of Act No. 2339,
 may the Legislature change this method of procedure?

That the Legislature has the power to do this, there can be no doubt, provided some
other adequate remedy is substituted in lieu thereof.

Case No. 20 FLORD NICSON CALAWAG, PETITIONER, vs.

UNIVERSITY OF THE PHILIPPINES VISAYAS AND DEAN CARLOS C.
BAYLON (G.R. No. 207412) / MICAH P. ESPIA, JOSE MARIE F. NASALGA
AND CHE CHE B. SALCEPUEDES, PETITIONERS, vs.
DR. CARLOS C. BA YLON, DR. MINDA J. FORMACI ON AND DR.
EMERLINDA ROMAN (TO BE SUBSTITUTED BY ALFREDO E. PASCUAL,
BEING THE NEW UP PRESIDENT), UNIVERSITY OF THE PHILIPPINES
BOARD OF REGENTS, (G.R. No. 207542)

Principle
"To be entitled to a writ of preliminary injunction, x x x the petitioners must
establish the following requisites: (a) the invasion of the right sought to be
protected is material and substantial; (b) the right of the complainant is clear and
unmistakable; and (c) there is an urgent and permanent necessity for the writ to
prevent serious damage. Since a preliminary mandatory injunction commands
the performance of an act, it does not preserve the status quo and is thus more
cautiously regarded than a mere prohibitive injunction. Accordingly, the
issuance of a writ of preliminary mandatory injunction [presents a fourth
requirement: it] is justified only in a clear case, free from doubt or dispute. When
the complainant’s right is thus doubtful or disputed, he does not have a clear
legal right and, therefore, the issuance of injunctive relief is improper."

Facts
The petitioners are students that were enrolled in the Master of Science in
Fisheries Biology at UP Visayas. The petitioners then enrolled in the thesis
program, drafted their tentative thesis titles, and obtained the consent of Dr. Rex
Baleña to be their thesis adviser, as well as the other faculty members’ consent
to constitute their respective thesis committees. These details were enclosed in
the letters the petitioners sent to Dean Baylon, asking him to approve the
composition of their thesis committees. The letter contained the thesis
committee members and the thesis adviser’s approval of their titles, as well as
the approval of Professor Roman Sanares, the director of the Institute of Marine
Fisheries and Oceanology.
 Upon receipt of the letter; Dean Baylon questioned the propriety of the thesis
topics and he subsequently disapproved the composition of the petitioner’s
thesis committees and their tentative thesis topics. He then ordered the
petitioners to submit a two-page proposal containing an outline of their tentative
thesis titles, and informed them that he is forming an ad hoc committee that
would take over the role of the adviser and of the thesis committees.

The petitioners thus filed a petition for certiorari and mandamus before the RTC,
asking it to order Dean Baylon to approve and constitute the petitioners’ thesis
committees and approve their thesis titles. They also asked that the RTC issue
a writ of preliminary mandatory injunction against Dean Baylon, and order him to
perform such acts while the suit was pending.

The RTC granted a writ of preliminary mandatory injunction, which Dean Baylon
allegedly refused to follow. UP Visayas eventually assailed this order before the
CA through a Rule 65 petition for certiorari, with prayer for a temporary
restraining order.

The CA issued a TRO against the implementation of the RTC’s order holding
that the petitioner’s had no right to compel Dean Baylon to approve the
composition of their thesis committees. As the college dean, Dean Baylon
exercises supervisory authority in all academic matters affecting the college.

Calawag’s argument is that he has clear rights under the law which were
violated by the Dean’s actions: specifically the right to education, the right to due
process and the equal protection under the law.

Petitioners Espia, Nasalga, and Salcepudes, argues that First, the Graduate
Program Manual of UP Visayas and the Guidelines for the Master of Science in
Fisheries Program are clear in providing that Dean Baylon has a formal duty to
approve the composition of the petitioners’ thesis committees upon the latter’s
compliance with several requirements. Thus, when the petitioners complied with
these requirements and Dean Baylon still refused to approve the composition of
their thesis committees, the petitioners had a right to have him compelled to
perform his duty.

Second, Dean Baylon cannot arbitrarily change and alter the manual and the
guidelines, and cannot use academic freedom as subterfuge for not performing
his duties.

Third, the thesis adviser and the thesis committees, in consultations with the
students, have the right to choose the thesis topics, and not the dean.

Issue Whether or not the petitioners are entitled to a writ of preliminary injunction

Ruling
No. The court said that:
"To be entitled to a writ of preliminary injunction, x x x the petitioners must
establish the following requisites: (a) the invasion of the right sought to be
protected is material and substantial; (b) the right of the complainant is clear and
unmistakable; and (c) there is an urgent and permanent necessity for the writ to
prevent serious damage. Since a preliminary mandatory injunction commands
the performance of an act, it does not preserve the status quo and is thus more
cautiously regarded than a mere prohibitive injunction. Accordingly, the
issuance of a writ of preliminary mandatory injunction [presents a fourth
requirement: it] is justified only in a clear case, free from doubt or dispute. When
the complainant’s right is thus doubtful or disputed, he does not have a clear
legal right and, therefore, the issuance of injunctive relief is improper."

Calawag’s citation of Executive Order No. 628, s. 1980 and Republic Act No.
9500 to show that the dean of a college exercises only administrative functions
and, hence, has no ascendancy over the college’s academic matters, has no
legal ground to stand on. The functions and duties of a college dean are
outlined in the university’s Faculty Manual, which details the rules and
regulations governing the university’s administration. Section 11.8.2, paragraph
b of the Faculty Manual enumerates the powers and responsibilities of a college
dean, which include the power to approve the composition of a thesis
committee, to wit:

11.8.2 Administration

xxxx

b. Dean/Director of UP System or UP Diliman-based Programs * The

Dean/Director shall be responsible for the planning and

implementation of the graduate programs. In particular, the Dean/Director shall

exercise the following powers and responsibilities based on the
recommendations forwarded to him/her, through channels:

xxxx

Approve the composition of the Thesis, Dissertation or Special Project**

Committees and Master’s or doctoral examination/oral defense panel for each
student[.]

By necessary implication, the dean’s power to approve includes the power to

disapprove the composition of a thesis committee. Thus, under the UP System’s
faculty manual, the dean has complete discretion in approving or disapproving
the composition of a thesis committee. Harmonizing this provision with the
Graduate Program Manual of UP Visayas, and the Guidelines for the Master of
Science in Fisheries Program, we agree with the CA’s interpretation that the
thesis committee’s composition needs the approval of the dean after the
students have complied with the requisites provided in Article 51 of the
Graduate Program Manual and Section IX of the Guidelines for the Master of
 Science in Fisheries Program.

Dean Baylon did not act arbitrarily in imposing additional requirements for the
composition of the thesis committee as it is part of the dean’s authority to
approve or disapprove the composition of a thesis committee.

The Court also notes the CA’s finding that these additional requirements were
meant to assist the petitioners in formulating a thesis title that is in line with the
college’s master of fisheries program. Absent any finding of grave abuse of
discretion, we cannot interfere with the exercise of the dean’s prerogative
without encroaching on the college’s academic freedom.

Verily, the academic freedom accorded to institutions of higher learning gives

them the right to decide for themselves their aims and objectives and how best
to attain them. They are given the exclusive discretion to determine who can
and cannot study in them, as well as to whom they can confer the honor and
distinction of being their graduates. The courts may not interfere with their
exercise of discretion unless there is a clear showing that they have arbitrarily
and capriciously exercised their judgment.

Lastly, the right to education invoked by Calawag cannot be made the basis for
issuing a writ of preliminary mandatory injunction. In Department of Education,
Culture and Sports v. San Diego, we held that the right to education is not
absolute. Section 5(e), Article XIV of the Constitution provides that "[e]very
citizen has a right to select a profession or course of study, subject to fair,
reasonable, and equitable admission and academic requirements." The thesis
requirement and the compliance with the procedures leading to it, are part of the
reasonable academic requirements a person desiring to complete a course of
study would have to comply with.

Case No. BICOL MEDICAL CENTER and DOH vs. NOE B. BOTOR,et.,al G.R. No.
23 214073. October 4, 2017

Principle
Rule 58, Section 3 of the Rules of Court provides the instances when a writ of
preliminary injunction may be issued.

A writ of preliminary injunction is issued to: [P]reserve the status quo

ante, upon the applicant’s showing of two important requisite conditions,
namely:

(1) the right to be protected exists prima facie, and

 (2) the acts sought to be enjoined are violative of that right. It
must be proven that the violation sought to be prevented would
cause an irreparable injustice.

Rule 58, Section 3 of the Rules of Court provides the instances when a writ of
preliminary injunction may be issued:

Section 3. Grounds for issuance of preliminary injunction.—A

preliminary injunction may be granted when it is established:

(a) That the applicant is entitled to the relief demanded, and the
whole or part of such relief consists in restraining the commission
or continuance of the act or acts complained of, or in requiring the
performance of an act or acts, either for a limited period or
perpetually;

(b) That the commission, continuance or nonperformance of the

act or acts complained of during the litigation would probably
work injustice to the applicant; or

(c) That a party, court, agency or a person is doing, threatening, or

is attempting to do, or is procuring or suffering to be done, some
act or acts probably in violation of the rights of the applicant
respecting the subject of the action or proceeding, and tending to
render the judgment ineffectual.

Requisites for the Issuance of Writ of Preliminary Injunction, Whether

Mandatory or Prohibitory.

Jurisprudence has likewise established that the following requisites must

be proven first before a writ of preliminary injunction, whether
mandatory or prohibitory, may be issued:

(1) The applicant must have a clear and unmistakable right to be

protected, that is a right in esse;

(2) There is a material and substantial invasion of such right;

(3) There is an urgent need for the writ to prevent irreparable

injury to the applicant; and (4) No other ordinary, speedy, and
adequate remedy exists to prevent the infliction of irreparable
injury.

In satisfying these requisites, the applicant for the writ need not
 substantiate his or her claim with complete and conclusive evidence since
only prima facie evidence or a sampling is required “to give the court an
idea of the justification for the preliminary injunction pending the
decision of the case on the merits.”

Writs of preliminary injunction are granted only upon prior notice to the party
sought to be enjoined and upon their due hearing.

Rule 58 requires “a full and comprehensive hearing for the determination of

the propriety of the issuance of a writ of preliminary injunction,” giving the
applicant an opportunity to prove that great or irreparable injury will result if
no writ is issued and allowing the opposing party to comment on the
application.

Temporary Restraining Order” and “Preliminary Injunction,” Distinguished.

Preliminary injunction is an order granted at any stage of an

action or proceeding prior to the judgment or final order,
requiring a party or a court, agency or a person to perform to
refrain from performing a particular act or acts. As an
extraordinary remedy, injunction is calculated to preserve or
maintain the status quo of things and is generally availed of to
prevent actual or threatened acts, until the merits of the case can
be heard. A preliminary injunction persists until it is dissolved or
until the termination of the action without the court issuing a final
injunction.

The basic purpose of restraining order, on the other hand, is to

preserve the status quo until the hearing of the application for
preliminary injunction. Under the former §5, Rule 58 of the
Rules of Court, as amended by §5, Batas Pambansa Blg.224, a
judge (or justice) may issue a temporary restraining order with a
limited life of twenty days from date of issue. If before the
expiration of the 20-day period the application for preliminary
injunction is denied, the temporary order would thereby be
deemed automatically vacated. If no action is taken by the judge
on the application for preliminary injunction within the said 20
days, the temporary restraining order would automatically expire
on the 20thday by the sheer force of law, no judicial declaration to
that effect being necessary.

Facts Sometime in 1982, the Camarines Sur Provincial Government donated about five
(5) hectares of land which includes the Training and Teaching Hospital, now
known as the Bicol Medical Center (BMC), and Road Lot No. 3 to the the
Department of Health.

In 2009, BMC constructed a steel gate along J. Miranda Avenue to control the
flow of vehicle and pedestrian traffic entering the hospital premises. The gate
closure drew a lot of criticism from the community for being a public nuisance.

The Sangguniang Panlungsod of Naga City passed a resolution authorizing

Mayor Bongat to dismantle the gate.However, instead of dismantling it, Mayor
Bongat filed a Verified Petition with Prayer for a Writ of Preliminary Injunction
against BMC before the Naga City Regional Trial Court (Branch 24). On
December 21, 2012, the RTC denied Naga City’s application for injunctive
relief, ruling that Naga City failed to prove a clear and unmistakable right to the
writ prayed for.

On February 22, 2013, the Regional Trial Court denied the motion for
reconsideration filed by the Intervenors. Only the Intervenors (Respondents)
filed a petition for certiorari before the Court of Appeals.

On February 28, 2014, the CA granted the petition and concluded that Naga City
and the Intervenors were able to present prima facie evidence of their right to the
writ and directed the RTC to issue a writ of mandatory preliminary injunction.

On August 26, 2014, the Court of Appeals denied the motions for
reconsideration filed by BMC and the Department of Health.

On September 29, 2014, petitioners BMC and the Department of Health filed a
Petition for Review on Certiorari before the SC and claimed that although Road
Lot No. 3 has been open to vehicles and pedestrians as BMC’s service road, it
was never intended for use by the general public and was not owned by Naga
City, as evidenced by the certification issued by the Office of the City Engineer
of Naga City.

Petitioners likewise underscore that the intervenors, now respondents, failed to

support their claim that Road Lot No. 3 was a public road or that they had a clear
right to the injunctive relief prayed for. Furthermore, respondents also allegedly
“failed to prove that the invasion of the[ir] right sought to be protected [was]
material and substantial” and that there was an urgent necessity for the issuance
of the writ to prevent serious damage.

Finally, petitioners applied for a temporary restraining order and/or writ of

preliminary injunction to prevent the reopening of the gate since doing so would
affect the construction of the Cancer Center Building.

On October 8, 2014, the SC issued two (2) Resolutions. The first Resolution
granted petitioners’ motion for extension to file their petition. The second
Resolution issued a temporary restraining order enjoining the implementation of
 the Court of Appeals February 28, 2014 Decision and August 26, 2014
Resolution, which directed the Regional Trial Court to issue a writ of mandatory
preliminary injunction on the closure of Road Lot No. 3.

Issue Whether or not the Court of Appeals erred in directing the Regional Trial Court
to issue a writ of preliminary injunction on the closure of Road Lot No. 3

Ruling The Petition is meritorious.

A writ of preliminary injunction is issued to: Preserve the status quo ante, upon
the applicant’s showing of two important requisite conditions, namely: (1) the
right to be protected exists prima facie, and (2) the acts sought to be enjoined are
violative of that right. It must be proven that the violation sought to be prevented
would cause an irreparable injustice

Rule 58, Section 3 of the Rules of Court provides the instances when a writ of
preliminary injunction may be issued:

Section 3. Grounds for issuance of preliminary injunction.—A

preliminary injunction may be granted when it is established:

(a) That the applicant is entitled to the relief demanded, and the
whole or part of such relief consists in restraining the commission
or continuance of the act or acts complained of, or in requiring the
performance of an act or acts, either for a limited period or
perpetually;

(b) That the commission, continuance or nonperformance of the

act or acts complained of during the litigation would probably
work injustice to the applicant; or

(c) That a party, court, agency or a person is doing, threatening, or

is attempting to do, or is procuring or suffering to be done, some
act or acts probably in violation of the rights of the applicant
respecting the subject of the action or proceeding, and tending to
render the judgment ineffectual.

Jurisprudence has likewise established that the following requisites must be

proven first before a writ of preliminary injunction, whether mandatory or
prohibitory, may be issued:

(1) The applicant must have a clear and unmistakable right to be

 protected, that is a right in esse;

(2) There is a material and substantial invasion of such right;

(3) There is an urgent need for the writ to prevent irreparable injury to the
applicant; and

(4) No other ordinary, speedy, and adequate remedy exists to prevent the
infliction of irreparable injury.

In satisfying these requisites, the applicant for the writ need not substantiate
his or her claim with complete and conclusive evidence since only prima facie
evidence or a sampling is required “to give the court an idea of the justification
for the preliminary injunction pending the decision of the case on the merits.”

Spouses Nisce v. Equitable PCI Bank then discussed the requisites and the proof
required for the issuance of a writ of preliminary injunction:

The plaintiff praying for a writ of preliminary injunction must further

establish that he or she has a present and unmistakable right to be
protected; that the facts against which injunction is directed violate such
right; and there is a special and paramount necessity for the writ to
prevent serious damages. In the absence of proof of a legal right and the
injury sustained by the plaintiff, an order for the issuance of a writ of
preliminary injunction will be nullified. Thus, where the plaintiff’s right
is doubtful or disputed, a preliminary injunction is not proper. The
possibility of irreparable damage without proof of an actual existing right
is not a ground for a preliminary injunction.

However, to establish the essential requisites for a preliminary injunction,

the evidence to be submitted by the plaintiff need not be conclusive and
complete. The plaintiffs are only required to show that they have an
ostensible right to the final relief prayed for in their complaint. A writ of
preliminary injunction is generally based solely on initial or incomplete
evidence. Such evidence need only be a sampling intended merely to give
the court an evidence of justification for a preliminary injunction pending
the decision on the merits of the case, and is not conclusive of the
principal action which has yet to be decided.69 (Emphasis supplied,
citations omitted)

To prove its clear legal right over the remedy being sought, Naga City presented
before the trial court the 1970’s Revised Assessor’s Tax Mapping Control Roll
and its Identification Map which both identified Road Lot No. 3 as being in the
name of the Province of Camarines Sur. Witnesses’ testimonies were also
presented to corroborate Naga City’s claims of the public nature of Road Lot No.
3. Respondents claimed that as members of the general public, they had every
right to use Road Lot No. 3, a public road.

On the other hand, BMC presented TCT No. 13693, which covered a total land
area of 53,890 m2 within Barrio Concepcion, Naga City with the Ministry of
Health, now Department of Health, as the registered owner. It is not disputed that
Road Lot No. 3 is part of the property covered by TCT No. 13693. BMC
likewise presented a certification from the City Engineer of Naga City.

A careful reading of the records convinces the SC that respondents failed to

establish prima facie proof of their clear legal right to utilize Road Lot No. 3.
Instead of merely relying on a tax map and claims of customary use, Naga City
or respondents should have presented a clear legal right to support their claim
over Road Lot No. 3.

Likewise, the Court of Appeals failed to appreciate the nature of the ancillary
remedy of a writ of preliminary injunction as against the ex parte nature of a
temporary restraining order.

Writs of preliminary injunction are granted only upon prior notice to the party
sought to be enjoined and upon their due hearing. Rule 58, Section 5 of the Rules
of Court provides:

Section 5. Preliminary injunction not granted without notice;

exception.—No preliminary injunction shall be granted without
hearing and prior notice to the party or person sought to be
enjoined. If it shall appear from facts shown by affidavits or by
the verified application that great or irreparable injury would
result to the applicant before the matter can be heard on notice,
the court to which the application for preliminary injunction was
made, may issue ex parte a temporary restraining order to be
effective only for a period of twenty (20) days from service on the
party or person sought to be enjoined, except as herein provided.
Within the said twenty-day period, the court must order said party
or person to show cause, at a specified time and place, why the
injunction should not be granted, determine within the same
period whether or not the preliminary injunction shall be granted,
and accordingly issue the corresponding order.

However, and subject to the provisions of the preceding sections,

if the matter is of extreme urgency and the applicant will suffer
grave injustice and irreparable injury, the executive judge of a
multiple-sala court or the presiding judge of a single sala court
may issue ex parte a temporary restraining order effective for only
seventy-two (72) hours from issuance but he shall immediately
comply with the provisions of the next preceding section as to
service of summons and the documents to be served therewith.
 Thereafter, within the aforesaid seventy-two (72) hours, the Judge
before whom the case is pending shall conduct a summary hearing
to determine whether the temporary re straining order shall be
extended until the application for preliminary injunction can be
heard. In no case shall the total period of effectivity of the
temporary restraining order exceed twenty (20) days, including
the original seventy-two (72) hours provided herein.

In the event that the application for preliminary injunction is

denied or not resolved within the said period, the temporary
restraining order is deemed, automatically vacated. The effectivity
of a temporary restraining order is not extendible without need of
any judicial declaration to that effect and no court shall have
authority to extend or renew the same on the same ground for
which it was issued.

However, if issued by the Court of Appeals or a member thereof,

the temporary restraining order shall be effective for sixty (60)
days from service on the party or person sought to be enjoined. A
restraining order issued by the Supreme Court or a member
thereof shall be effective until further orders.

Thus, Rule 58 requires “a full and comprehensive hearing for the determination
of the propriety of the issuance of a writ of preliminary injunction,”giving the
applicant an opportunity to prove that great or irreparable injury will result if no
writ is issued and allowing the opposing party to comment on the application.

On the other hand, a temporary restraining order that is heard only with the
evidence presented by its applicant is ex parte, but it is issued to preserve the
status quo until the hearing for preliminary injunction can be conducted.

In the case of Miriam College Foundation, Inc. v. Court of Appeals, the

difference between preliminary injunction and a restraining order is explained
as follows:

Preliminary injunction is an order granted at any stage of an action or

proceeding prior to the judgment or final order, requiring a party or a
court, agency or a person to perform to refrain from performing a
particular act or acts. As an extraordinary remedy, injunction is calculated
to preserve or maintain the status quo of things and is generally availed
of to prevent actual or threatened acts, until the merits of the case can be
heard. A preliminary injunction persists until it is dissolved or until the
termination of the action without the court issuing a final injunction.

The basic purpose of restraining order, on the other hand, is to preserve

the status quo until the hearing of the application for preliminary
 injunction. Under the former §5, Rule 58 of the Rules of Court, as
amended by §5, Batas Pambansa Blg. 224, a judge (or justice) may
issue a temporary restraining order with a limited life of twenty days
from date of issue. If before the expiration of the 20-day period the
application for preliminary injunction is denied, the temporary order
would thereby be deemed automatically vacated. If no action is taken by
the judge on the application for preliminary injunction within the said 20
days, the temporary restraining order would automatically expire on the
20th day by the sheer force of law, no judicial declaration to that effect
being necessary. In the instant case, no such preliminary injunction was
issued; hence, the TRO earlier issued automatically expired under the
aforesaid provision of the Rules of Court. (Citations omitted)

By focusing solely on Naga City and respondents’ evidence to determine if there

was prima facie evidence to issue the writ of preliminary injunction while the
case was being heard in the lower court, the Court of Appeals misappreciated the
nature of a writ of preliminary injunction. To reiterate, a preliminary injunction
is an ancillary remedy issued after due hearing where both parties are given
the opportunity to present their respective evidence. Thus, both their evidence
should be considered.

As it is, absent a finding of grave abuse of discretion, there was no reason for the
Court of Appeals to reverse the trial court’s denial of respondents’ application
for the issuance of a writ of preliminary injunction. Respondents were unable to
present prima facie evidence of their clear and unmistakable right to use Road
Lot No. 3.

WHEREFORE, the Petition is GRANTED. The assailed February 28, 2014

Decision and August 26, 2014 Resolution of the Court of Appeals are
REVERSED and SET ASIDE.

Case No. Morales vs. Court of Appeals G.R. No. 217126-27, November 10,
24 2015
Principle

Facts A complaint/affidavit was filed by Atty. Renato L. Bondal and Nicolas "Ching" Enciso
VI before the Office of the Ombudsman against Binay, Jr. and other public officers
and employees of the City Government of Makati (Binay, Jr., et al), accusing them
of Plunder and violation of Republic Act No. (RA) 3019, otherwise known as "The
Anti-Graft and Corrupt Practices Act," in connection with the five (5) phases of the
procurement and construction of the Makati City Hall Parking Building (Makati
Parking Building).

The Ombudsman constituted a Special Panel of Investigators to conduct a fact-

finding investigation, submit an investigation report, and file the necessary
complaint, if warranted (1st Special Panel).

Pursuant to the Ombudsman's directive the 1st Special Panel filed a complaint 16
(OMB Complaint) against Binay, Jr., et al, charging them with six (6) administrative
cases for Grave Misconduct, Serious Dishonesty, and Conduct Prejudicial to the
Best Interest of the Service, and six (6) criminal cases for violation of Section 3 (e)
of RA 3019, Malversation of Public Funds, and Falsification of Public Documents
(OMB Cases).

Binay, Jr.'s First Term (2010 to 2013)

1. Binay, Jr. issued the Notice of Award 21 for Phase III of the Makati
Parking Building project to Hilmarc's Construction Corporation
(Hilmarc's), and consequently, executed the corresponding contract 22 on
September 28, 2010,23 without the required publication and the lack of
architectural design,24 and approved the release of funds therefor;
2. Binay, Jr. issued the Notice of Award 31 for Phase IV of the Makati
Parking Building project to Hilmarc's, and consequently, executed the
corresponding contract32 on August 18, 2011, 33 without the required
publication and the lack of architectural design, 34 and approved the
release of funds theref;
3. Binay, Jr. issued the Notice of Award 40 for Phase V of the Makati
Parking Building project to Hilmarc's, and consequently, executed the
corresponding contract41 on September 13, 2012, 42 without the required
publication and the lack of architectural design, 43 and approved the
release of the funds therefor in the amounts of P32,398,220.05 44 and
P30,582,629.3045 on December 20, 2012;

46
Binay, Jr.'s Second Term (2013 to 2016)

1. Approved the release of funds for the remaining balance of the September 13,
2012 contract with Hilmarc's for Phase V of the Makati Parking Building project and

2. Approved the release of funds for the remaining balance of the contract 48 with
MANA Architecture & Interior Design Co. (MANA) for the design and architectural
services covering the Makati Parking Building project.

Before Binay, Jr., et al.'s filing of their counter-affidavits, the Ombudsman, upon the
recommendation of the 2nd Special Panel, issued the subject preventive suspension
order, placing Binay, Jr., et al. under preventive suspension for not more than six (6)
months without pay, during the pendency of the OMB Cases.

Ombudsman ruled that the requisites for the preventive suspension of a public
officer are present,54 finding that:
(a) the evidence of Binay, Jr., et al.'s guilt was strong given that (1) the losing
bidders and members of the Bids and Awards Committee of Makati City had
attested to the irregularities attending the Makati Parking Building project; (2) the
documents on record negated the publication of bids; and (3) the disbursement
vouchers, checks, and official receipts showed the release of funds; and

(b) (1) Binay, Jr., et al. were administratively charged with Grave Misconduct,
Serious Dishonesty, and Conduct Prejudicial to the Best Interest of the Service; (2)
said charges, if proven to be true, warrant removal from public service under the
Revised Rules on Administrative Cases in the Civil Service (RRACCS), and (3)
Binay, Jr., et al.'s respective positions give them access to public records and allow
them to influence possible witnesses; hence, their continued stay in office may
prejudice the investigation relative to the OMB Cases filed against them.

The Proceedings Before the CA

Binay, Jr. filed a petition for certiorari59 before the CA seeking the nullification of the
preventive suspension order, and praying for the issuance of a TRO and/or WPI to
enjoin its implementation. Primarily, Binay, Jr. argued that he could not be held
administratively liable for any anomalous activity attending any of the five (5)
phases of the Makati Parking Building project since: (a) Phases I and II were
undertaken before he was elected Mayor of Makati in 2010; and (b) Phases III to V
transpired during his first term and that his re-election as City Mayor of Makati for
a second term effectively condoned his administrative liability therefor, if any,
thus rendering the administrative cases against him moot and academic. 61In any
event, Binay, Jr. claimed that the Ombudsman's preventive suspension order
failed to show that the evidence of guilt presented against him is strong,
maintaining that he did not participate in any of the purported irregularities. In
support of his prayer for injunctive relief, Binay, Jr. argued that he has a clear and
unmistakable right to hold public office, having won by landslide vote in the 2010
and 2013 elections, and that, in view of the condonation doctrine, as well as the lack
of evidence to sustain the charges against him, his suspension from office would
undeservedly deprive the electorate of the services of the person they have
conscientiously chosen and voted into office.

The CA issued a Resolution (dated March 16, 2015), granting Binay, Jr.'s prayer for
a TRO, notwithstanding Pena, Jr.'s assumption of duties as Acting Mayor earlier that
day. The CA found that it was more prudent on its part to issue a TRO in view of the
extreme urgency of the matter and seriousness of the issues raised, considering
that if it were established that the acts subject of the administrative cases against
Binay, Jr. were all committed during his prior term, then, applying the condonation
doctrine, Binay, Jr.'s re-election meant that he can no longer be administratively
charged. The CA then directed the Ombudsman to comment on Binay, Jr.'s petition
for certiorari.

The Ombudsman manifested71 that the TRO did not state what act was being
restrained and that since the preventive suspension order had already been served
and implemented, there was no longer any act to restrain.

On the same day, Binay, Jr. filed a petition for contempt accusing Secretary Roxas,
Director Brion, the officials of the Philippine National Police, and Pena, Jr. of
deliberately refusing to obey the CA, thereby allegedly impeding, obstructing, or
degrading the administration of justice. The Ombudsman and Department of Justice
Secretary Leila M. De Lima were subsequently impleaded as additional respondents
upon Binay, Jr.'s filing of the amended and supplemental petition for contempt
(petition for contempt) on March 19, 2015.
 The Proceedings Before the Court
The Ombudsman filed the present petition before this Court, assailing the CA's
March 16, 2015 Resolution, which granted Binay, Jr.'s prayer for TRO.

In view of the CA's supervening issuance of a WPI pursuant to its April 6, 2015
Resolution, the Ombudsman filed a supplemental petition before this Court, arguing
that the condonation doctrine is irrelevant to the determination of whether the
evidence of guilt is strong for purposes of issuing preventive suspension orders. The
Ombudsman also maintained that a reliance on the condonation doctrine is a matter
of defense, which should have been raised by Binay, Jr. before it during the
administrative proceedings, and that, at any rate, there is no condonation because
Binay, Jr. committed acts subject of the OMB Complaint after his re-election in
2013.

Issues 1. WON the CA has subject matter jurisdiction to issue a TRO and/or WPI
enjoining the implementation of a preventive suspension order issued by
the Ombudsman - YES
2. WON the CA gravely abused its discretion in issuing the TRO and
eventually, the WPI in CA-G.R. SP No. 139453 enjoining the
implementation of the preventive suspension order against Binay, Jr.
based on the condonation doctrine - NO

Ruling FIRST ISSUE

YES.
From the inception of these proceedings, the Ombudsman has been adamant that
the CA has no jurisdiction to issue any provisional injunctive writ against her office
to enjoin its preventive suspension orders. As basis, she invokes the first
paragraph of Section 14, RA 6770 in conjunction with her office's independence
under the 1987 Constitution. She advances the idea that "[i]n order to further ensure
[her office's] independence, [RA 6770] likewise insulated it from judicial
intervention,"157 particularly, "from injunctive reliefs traditionally obtainable from the
courts,"158 claiming that said writs may work "just as effectively as direct harassment
or political pressure would."

In this case, the basis for the CA's subject matter jurisdiction over Binay, Jr.'s
main petition for certiorari in CA-G.R. SP No. 139453 is Section 9(1), Chapter I of
BP 129, as amended:

Section 9. Jurisdiction. - The Court of Appeals shall exercise:

1. Original jurisdiction to issue writs of mandamus, prohibition,
certiorari, habeas corpus, and quo warranto, and auxiliary writs
or processes, whether or not in aid of its appellate jurisdiction[.]

Note that the CA's certiorari jurisdiction, as above-stated, is not only original but
also concurrent with the Regional Trial Courts (under Section 21 (1), Chapter II of
BP 129), and the Supreme Court (under Section 5, Article VIII of the 1987 Philippine
Constitution). In view of the concurrence of these courts' jurisdiction over petitions
for certiorari, the doctrine of hierarchy of courts should be followed. In People v.
Cuaresma,188 the doctrine was explained as follows:

[T]his concurrence of jurisdiction is not x x x to be taken as according to parties

seeking any of the writs an absolute, unrestrained freedom of choice of the court to
which application therefor will be directed. There is after all a hierarchy of courts.
That hierarchy is determinative of the venue of appeals, and should also serve as a
general determinant of the appropriate forum for petitions for the extraordinary writs.
A becoming regard for that judicial hierarchy most certainly indicates that petitions
for the issuance of extraordinary writs against first level ("inferior") courts should be
filed with the Regional Trial Court, and those against the latter, with the Court of
Appeals.189

When a court has subject matter jurisdiction over a particular case, as conferred
unto it by law, said court may then exercise its jurisdiction acquired over that
case, which is called judicial power.

Judicial power, as vested in the Supreme Court and all other courts established by
law, has been defined as the "totality of powers a court exercises when it
assumes jurisdiction and hears and decides a case."190 Under Section 1, Article
VIII of the 1987 Constitution, it includes "the duty of the courts of justice to settle
actual controversies involving rights which are legally demandable and
enforceable, and to determine whether or not there has been a grave abuse of
discretion amounting to lack or excess of jurisdiction on the part of any
branch or instrumentality of the Government."

Judicial power is never exercised in a vacuum. A court's exercise of the

jurisdiction it has acquired over a particular case conforms to the limits and
parameters of the rules of procedure duly promulgated by this Court. In other
words, procedure is the framework within which judicial power is exercised. In
Manila Railroad Co. v. Attorney-General, 193 the Court elucidated that "[t]he power or
authority of the court over the subject matter existed and was fixed before
procedure in a given cause began. Procedure does not alter or change that
power or authority; it simply directs the manner in which it shall be fully and
justly exercised. To be sure, in certain cases, if that power is not exercised in
conformity with the provisions of the procedural law, purely, the court attempting to
exercise it loses the power to exercise it legally. This does not mean that it loses
jurisdiction of the subject matter." 194

While the power to define, prescribe, and apportion the jurisdiction of the various
courts is, by constitutional design, vested unto Congress, the power to promulgate
rules concerning the protection and enforcement of constitutional rights,
pleading, practice, and procedure in all courts belongs exclusively to this
Court.

SECOND ISSUE
NO.

E. Consequence of ruling.

As for this section of the Decision, the issue to be resolved is whether or not the
CA committed grave abuse of discretion amounting to lack or excess of
jurisdiction in issuing the assailed injunctive writs.
 It is well-settled that an act of a court or tribunal can only be considered as with
grave abuse of discretion when such act is done in a capricious or whimsical
exercise of judgment as is equivalent to lack of jurisdiction. The abuse of
discretion must be so patent and gross as to amount to an evasion of a positive duty
or to a virtual refusal to perform a duty enjoined by law, or to act at all in
contemplation of law, as where the power is exercised in an arbitrary and despotic
manner by reason of passion and hostility. 311 It has also been held that "grave
abuse of discretion arises when a lower court or tribunal patently violates the
Constitution, the law or existing jurisprudence."312

As earlier established, records disclose that the CA's resolutions directing the
issuance of the assailed injunctive writs were all hinged on cases enunciating the
condonation doctrine. To recount, the March 16, 2015 Resolution directing the
issuance of the subject TRO was based on the case of Governor Garcia, Jr., while
the April 6, 2015 Resolution directing the issuance of the subject WPI was based on
the cases of Aguinaldo, Salalima, Mayor Garcia, and again, Governor Garcia, Jr.
Thus, by merely following settled precedents on the condonation doctrine, which at
that time, unwittingly remained "good law," it cannot be concluded that the CA
committed a grave abuse of discretion based on its legal attribution above.
Accordingly, the WPI against the Ombudsman's preventive suspension order was
correctly issued.

With this, the ensuing course of action should have been for the CA to resolve the
main petition for certiorari in CA-G.R. SP No. 139453 on the merits. However,
considering that the Ombudsman, on October 9, 2015, had already found Binay, Jr.
administratively liable and imposed upon him the penalty of dismissal, which carries
the accessory penalty of perpetual disqualification from holding public office, for the
present administrative charges against him, the said CA petition appears to have
been mooted.313 As initially intimated, the preventive suspension order is only an
ancillary issuance that, at its core, serves the purpose of assisting the Office of the
Ombudsman in its investigation. It therefore has no more purpose - and perforce,
dissolves - upon the termination of the office's process of investigation in the instant
administrative case.

Case No. iKitchen, Inc., Winglip Chang, and/or Danny Pumarega v. Jeffrey U. Omega
25 and the Court of Appeals (Former 8th Division), GR No. 252406, July 27,
2020

Principle
A temporary restraining order and a writ of preliminary injunction both
constitute temporary measures availed of during the pendency of the
action. They are, by nature, ancillary because they are mere incidents in
and are dependent upon the result of the main action.

It is well-settled that the sole object of a temporary restraining order or a

writ of preliminary injunction, whether prohibitory or mandatory, is to
 preserve the status qi/o until the merits of the case can be heard. They
are usually granted when it is made to appear that there is a substantial
controversy between the parties and one of them is committing an act or
threatening the immediate commission of an act that will cause irreparable
injury or destroy the status quo of the controversy before a full hearing can
be load on the merits of the case. In other words, they are preservative
remedies for the protection of substantive rights or interests, and, hence,
not a cause of action in itself, but merely adjunct to a main suit.

Facts IKitchen, Inc., Winglip Chang, and/or Danny Pumarega avers that the Court of
Appeals (CA) committed grave abuse of discretion amounting to lack or excess
of jurisdiction when it denied the urgent application for the issuance of the
Temporary Restraining Order (TRO) and/or Writ of Preliminary Injunction (WP I).

Issue Whether the CA is correct - Yes.

Ruling
A temporary restraining order and a writ of preliminary injunction both
constitute temporary measures availed of during the pendency of the
action. They are, by nature, ancillary because they are mere incidents in
and are dependent upon the result of the main action.

It is well-settled that the sole object of a temporary restraining order or a

writ of preliminary injunction, whether prohibitory or mandatory, is to
preserve the status qi/o until the merits of the case can be heard. They
are usually granted when it is made to appear that there is a substantial
controversy between the parties and one of them is committing an act or
threatening the immediate commission of an act that will cause irreparable
injury or destroy the status quo of the controversy before a full hearing can
be had on the merits of the case. In other words, they are preservative
remedies for the protection of substantive rights or interests, and, hence,
not a cause of action in itself, but merely adjunct to a main suit.

WHEN IT MAY BE ISSUED

Rule 58 of the Rules of Court governs the provisional remedies of a TRO

and a WPI. Section 3, Rule 58 of the said Rules enumerates the instances
when a writ of preliminary injunction may be issued, to wit:

Section. 3. Grounds for issuance of preliminary injunction. — A

Preliminary injunction may be granted when it is established:

a. That the applicant is entitled to the relief

demanded, and the whole or‘ part of such relief
consists in restraining the commission or continuance
of the act or acts complained of, or in requiring the
performance of an act or acts, either for a limited
period or perpetually;
b. That the commission, continuance or non-
 performance of the act or acts complained of during
the litigation would probably work injustice to the
applicant; or
c. That a party, court, agency or a person is doing,
threatening, or is attempting to do, or is procuring or
suffering to be done some act or acts probably in
violation of the rights of the applicant respecting the
subject or the action or proceeding, and tending to
render the judgment ineffectual.

REQUISITES

Jurisprudence has likewise established that the following requisites must be

proven first before a writ of preliminary injunction, whether mandatory or
prohibitory, may be issued:

(1) The applicant must have a clear and unmistakable right

to be protected, that is a right in else;

(2) There is a material and substantial invasion of such right;

(3) There is an urgent need for the writ to prevent

irreparable injury to the applicant; and
(4) To other ordinary, speedy, and adequate remedy exists
to prevent the infliction of irreparable injury

Thus, before the preventive writ may be issued, it is incumbent upon petitioners
to show that the above-mentioned requisites are present.

IN THE CASE AT BAR

In this regard, petitioners failed. Notably, the grounds relied upon by them are
merely speculative.

The arguments that the surety or cash bond deposit with the National Labor
Relations Commission (NLRC) might be released to Jeffrey Omaga (Omaga),
and that in case of favorable judgment, restitution may no longer be possible
are mere probabilities. There was no clear showing that petitioners have
existing right ought to be protected by the issuance of an injunctive
relief. Indeed, the CA acted in keeping with these standards and did not
gravely abuse its discretion in not extending the temporary relief as prayed
for by petitioners.

III. RECEIVERSHIP (Rule 59)

Case No. 1. Arranza vs. B.F. Homes, Inc 333 SCRA 799
Principle A receiver is a person appointed by the court, or in this instance, by a quasi-
judicial administrative agency, in behalf of all the parties for the purpose of
preserving and conserving the property and preventing its possible destruction
or dissipation, if it were left in the possession of any of the parties. It is the duty
of the receiver to administer the assets of the receivership estate; and in the
management and disposition of the property committed to his possession, he
acts in a fiduciary capacity and with impartiality towards all interested persons.

The appointment of a receiver does not dissolve a corporation, nor does it

interfere with the exercise of its corporate rights. In this case where there
appears to be no restraints imposed upon respondent as it undergoes
rehabilitation receivership, respondent continues to exist as a corporation and
hence, continues or should continue to perform its contractual and statutory
responsibilities to petitioners as homeowners.

Receivership is aimed at the preservation of, and at making more secure,

existing rights; it cannot be used as an instrument for the destruction of those
rights

Facts Respondent BF Homes, Inc (BFHI) , is a domestic corporation engaged in

developing subdivision and selling residential lots. One of the subdivisions that
respondent developed was the BF Homes Paranaque Subdivision. With the
withdrawal of substantial investments in BFHI , respondent filed with the SEC a
petition for rehabilitation. Atty Florencio Orendain was appointed as receiver. He
was later relieved by the SEC of his duties as a Receiver. The new Board of
Receivers revoked the authority given by Orendain to use the open spaces at
Concha Cruz Drive and to collect community assessment funds; deferred the
purchase of new pumps ; recognized BF Paranaque Homeowners Association
(BFPHAI) as the representative of all homeowners; took over the management
of the Clubhouse and deployed its own guards.

Petitioners filed with the HLURB a class suit “for and in behalf of the more than
7,000 homeowners” against respondent BFHI et al to enforce the rights of
purchasers of lots in BF Homes Paranaque 3. Respondents asserts that the
SEC, not the HLURB, has jurisdiction arguing that the SEC, being the
appointing authority should be the one to take cognizance of controversies
arising from the performance of the receiver’s duties.

Issue Does HLURB have jurisdiction over petitioner’s complaint for specific
performance to enforce their rights as purchasers of subdivision lots ? YES

Assuming that the HLURB has jurisdiction, may the proceedings therein be
suspended pending the outcome of the receivership before the SEC? NO

Ruling 1. Yes. Petitioner’s complaint for specific performance to enforce their

rights as purchasers of subdivision lots as regards right of way, water,
 open spaces, road and perimeter wall repairs, and security falls within
the jurisdiction of HLURB, not SEC. What petitioners seek to enforce are
respondent’s obligations as a subdivision developer. Petitioners do not
aim to enforce a pecuniary demand. The claim for respondent should be
viewed in the light of respondent’s failure its statutory and contractual
obligations to provide petitioners a “decent human settlement” and
“ample opportunities for improving the quality of their life. The HLURB,
not the SEC, is equipped with the expertise to deal with that matter. The
HLURB should view the issue of whether the Board of Receivers
correctly revoked the agreements entered into between the previous
receiver and the petitioners from the perspective of the homeowners’
interest which PD 957 (The Subdivision and Condominium Buyers’
Protective Decree) aims to protect.

2. No. The fact that respondent is under receivership does not divest the
HLURB of that jurisdiction. A receiver is a person appointed by the court,
or in this instance, by a quasi-judicial administrative agency, in behalf of
all the parties for the purpose of preserving and conserving the property
and preventing its possible destruction or dissipation, if it were left in the
possession of any of the parties. It is the duty of the receiver to
administer the assets of the receivership estate; and in the management
and disposition of the property committed to his possession, he acts in a
fiduciary capacity and with impartiality towards all interested persons. 20
The appointment of a receiver does not dissolve a corporation, nor does
it interfere with the exercise of its corporate rights.

In this case where there appears to be no restraints imposed upon

respondent as it undergoes rehabilitation receivership, respondent
continues to exist as a corporation and hence, continues or should
continue to perform its contractual and statutory responsibilities to
petitioners as homeowners.

Receivership is aimed at the preservation of, and at making more secure,

existing rights; it cannot be used as an instrument for the destruction of those
rights.

No violation of the SEC order suspending payments to creditors would result as

far as petitioners' complaint before the HLURB is concerned. To reiterate, what
petitioners seek to enforce are respondent's obligations as a subdivision
developer. Such claims are basically not pecuniary in nature although it could
incidentally involve monetary considerations. All that petitioners' claims entail is
the exercise of proper subdivision management on the part of the SEC-
appointed Board of Receivers towards the end that homeowners shall enjoy the
ideal community living that respondent portrayed they would have when they
bought real estate from it

WHEREFORE, the questioned Decision of the Court of Appeals is hereby

REVERSED and SET ASIDE. This case is REMANDED to the Housing and
Land Use Regulatory Board for continuation of proceedings with dispatch as the
Securities and Exchange Commission proceeds with the rehabilitation of
 respondent BF Homes, Inc., through the Board of Receivers. Thereafter, any
and all monetary claims duly established before the HLURB shall be referred to
the Board of Receivers for proper disposition and thereafter, to the SEC, if
necessary. No costs.

IV. REPLEVIN (Rule 60)

Case No.1 FORMAT

Principle

Facts

Issue

Ruling

Case No. 3 Sapugay vs. CA 183 SCRA 464

Principle Defendant is not entitled to recover on the plaintiff’s bond in the absence
of pronouncement in the judgment.—A replevin bond is simply intended to
indemnify the defendant against any loss that he may suffer by being compelled
to surrender the possession of the disputed property pending the trial of the
action. He cannot recover on the bond as for a reconversion when he has failed
to have the judgment entered for the return of the property. Nor is the surety
liable for payment of the judgment for damages rendered against the plaintiff on
a counterclaim or punitive damages for fraudulent or wrongful acts committed by
the plaintiffs and unconnected with the defendant’s deprivation of possession by
the plaintiff. Indeed, even where the judgment was that the defendant was
entitled to the property, but no order was made requiring the plaintiff to return it
or assessing damages in default of a return, it was declared that until judgment
was entered that the property should be restored, there could be no liability on
the part of the sureties.

Facts Plaintiff Mobil Philippines, Inc. filed a complaint for replevin with damages
against defendant Lina Joel Sapugay before the Court of First Instance of Rizal,
Pasig, Metro Manila. The complaint, which was duly amended alleges: that
defendant applied to the plaintiff to become a dealer of the latter's products; that
for a period of three (3) months from the date of application, defendant failed to
secure and file the required surety bond, compelling plaintiff to reject
defendant's application and the return and redelivery of the properties; that
defendant refused to return the equipments, and demanded instead that
defendant be paid first the total daily rental and guard's fees. Thus, plaintiff
prays for the return of said properties or its value including damages, attorney's
fees and costs of suit.

The lower court issued an order for the issuance of a writ of replevin upon the
filing of plaintiff's bond.

Defendant filed her answer alleging as affirmative defenses that upon

presentation of defendant's application, plaintiff and it's manager, R.P.
Cardenas, imposed upon them as a condition for the approval of their
application defendant's acquisition of the premises where the business will be
conducted; that a preliminary agreement was signed constituting defendant as
plaintiff's authorized dealer, whereupon plaintiff turned over to the defendant the
equipment to be used therefor; that defendant commenced operation, pending
execution of the formal dealership agreement; that as the formal agreement had
already been signed, defendant and her husband requested plaintiff that they be
allowed to get gas even on a cash basis, but plaintiff denied the request
claiming that they still have to post a surety bond; that defendant and her
husband exerted their best effort to secure a bond but the bonding companies
required a copy of the dealership agreement which was continuously withheld
from them by plaintiff, that defendant discovered that plaintiff and its manager
intended all along, to award said dealership to Island Air Product Corporation;
that in furtherance of said scheme plaintiff caused all the LPGas equipment to
be publicly pulled out from defendant's premises.

As counterclaim, defendant prayed that plaintiff and its manager be made liable
for their pre-operation expenses rental, storage, and guarding fees, unrealized
profit including damages and the return of the LP-Gas equipment to the
premises.

The writ of replevin issued was duly executed.

The trial court, after finding that plaintiff and its manager, R.P. Cardenas, have
reneged on its promise to award the dealership to defendant Sapugay, rendered
judgment in favor of the latter, dismissing the complaint and ordering plaintiff
and its manager to pay the pre-operation expenses and fees of plaintiff's LPG
equipment; unrealized profits, moral damages including litigation expenses,
attorney's fees and costs of the suit.
Defendant filed a motion for application to have plaintiffs bond posted by the
Malayan Surety Company liable for the satisfaction of the judgment.

Plaintiff-corporation filed a notice of appeal to the Court of Appeals. Meanwhile,

the trial court issued an order denying the defendant's motion considering that
the lower court no longer had any jurisdiction to act on the matter with the
perfection of plaintiffs appeal.

Respondent Court of Appeals modified the decision in that the awards of fees
 and the award of unrealized profits, were deleted, and the award of damages
reduced. The decision is AFFIRMED in all other aspects with Mobil Philippines,
lnc. being solely liable.

The motion for reconsideration filed by herein petitioners, praying that the bond
posted by Malayan Insurance Co., Inc. in behalf of herein private respondents
be made liable for damages suffered by petitioners, was denied by respondent
court in its resolution. Hence, this petition.

Issue Whether the Malayan Insurance Co., Inc., is not liable on the replevin bond?

Ruling YES. The Malayan Insurance Co., Inc. should not be made liable on the surety's
liability upon the replevin bond.

As correctly observed by respondent court, "the damages awarded by the trial

court were based on Articles 19 and 20 of the New Civil Code and not on the
deprivation of personal properties subject of the replevin bond. Moreover, no
judgment was entered for the return of the properties subject of the replevin
bond to the defendant, the latter never having raised the issue of rightful
possession to the said properties."

A replevin bond is simply intended to indemnify the defendant against any loss
that he may suffer by being compelled to surrender the possession of the
disputed property pending the trial of the action. He cannot recover on the bond
as for a reconversion when he has failed to have the judgment entered for the
return of the property. Nor is the surety liable for payment of the judgment for
damages rendered against the plaintiff on a counterclaim or punitive damages
for fraudulent or wrongful acts committed by the plaintiffs and unconnected with
the defendant's deprivation of possession by the plaintiff. Indeed, even where
the judgment was that the defendant was entitled to the property, but no order
was made requiring the plaintiff to return it or assessing damages in default of a
return, it was declared that until judgment was entered that the property should
be restored, there could be no liability on the part of the sureties.

Case No. 5
SPOUSES DEO AGNER and MARICON AGNER vs. BPI FAMILY SAVINGS
BANK, INC.

G.R. No. 182963 June 3, 2013

Principle
The remedies provided for in Art. 1484 are alternative, not cumulative. The exercise
of one bars the exercise of the others. This limitation applies to contracts purporting
to be leases of personal property with option to buy by virtue of Art. 1485. The
condition that the lessor has deprived the lessee of possession or enjoyment of the
thing for the purpose of applying Art. 1485 was fulfilled in this case by the filing by
petitioner of the complaint for replevin to recover possession of movable property.
Facts
On February 15, 2001, petitioners spouses Agner executed a Promissory Note with
Chattel Mortgage in favor of Citimotors, Inc. The contract provides, among others,
that: for receiving the amount of Php834, 768.00, petitioners shall pay Php
17,391.00 every 15th day of each succeeding month until fully paid; the loan is
secured by a 2001 Mitsubishi Adventure Super Sport; and an interest of 6% per
month shall be imposed for failure to pay each installment on or before the stated
due date.

On the same day, Citimotors, Inc. assigned all its rights, title and interests in the
Promissory Note with Chattel Mortgage to ABN AMRO Savings Bank, Inc. (ABN
AMRO), which, on May 31, 2002, likewise assigned the same to respondent BPI
Family Savings Bank, Inc.

For failure to pay four successive installments from May 15, 2002 to August 15,
2002, respondent, through counsel, sent to petitioners a demand letter dated
August 29, 2002, declaring the entire obligation as due and demandable and
requiring to pay Php576,664.04, or surrender the mortgaged vehicle immediately
upon receiving the letter. As the demand was left unheeded, respondent filed on
October 4, 2002 an action for Replevin and Damages before the RTC.

A writ of replevin was issued. Despite this, the subject vehicle was not seized. Trial
on the merits ensued. On August 11, 2005, the Manila RTC Br. 33 ruled for the
respondent and ordered petitioners to jointly and severally pay the amount of
Php576,664.04 plus interest at the rate of 72% per annum from August 20, 2002
until fully paid, and the costs of suit.

Petitioners appealed the decision to the CA, but the CA affirmed the lower court’s
decision and, subsequently, denied the motion for reconsideration; hence, this
petition.

Issue
(1) Whether or not petitioners cannot be considered to have defaulted in payment
for lack of competent proof that they received the demand letter; and

(2) respondent’s remedy of resorting to both actions of replevin and collection of

sum of money is contrary to the provision of Article 1484 of the Civil Code and the
Elisco Tool Manufacturing Corporation v. Court of Appeals ruling.

Ruling
As to the first issue, records bear that both verbal and written demands were in fact
made by respondent prior to the institution of the case against petitioners. Even
assuming, for argument’s sake, that no demand letter was sent by respondent,
there is really no need for it because petitioners legally waived the necessity of
notice or demand in the Promissory Note with Chattel Mortgage, which they
voluntarily and knowingly signed in favor of respondent’s predecessor-in-interest.

Further, the Court even ruled in Navarro v. Escobido that prior demand is not a
condition precedent to an action for a writ of replevin, since there is nothing in
Section 2, Rule 60 of the Rules of Court that requires the applicant to make a
demand on the possessor of the property before an action for a writ of replevin
could be filed.

Second, there is no violation of Article 1484 of the Civil Code and the Court’s
decision in Elisco Tool Manufacturing Corporation v. Court of Appeals.

In Elisco, petitioner's complaint contained the following prayer:

ON THE SECOND CAUSE OF ACTION

To forthwith issue a Writ of Replevin ordering the seizure of the motor vehicle in
whose possession the said motor vehicle may be found, complete with accessories
and equipment, and direct deliver thereof to plaintiff in accordance with law, and
after due hearing to confirm said seizure and plaintiff's possession over the same;

The Court therein ruled:

The remedies provided for in Art. 1484 are alternative, not cumulative. The exercise
of one bars the exercise of the others. This limitation applies to contracts purporting
to be leases of personal property with option to buy by virtue of Art. 1485. The
condition that the lessor has deprived the lessee of possession or enjoyment of the
thing for the purpose of applying Art. 1485 was fulfilled in this case by the filing by
petitioner of the complaint for replevin to recover possession of movable property.
By virtue of the writ of seizure issued by the trial court, the deputy sheriff seized the
vehicle on August 6, 1986 and thereby deprived private respondents of its use. The
car was not returned to private respondent until April 16, 1989, after two (2) years
and eight (8) months, upon issuance by the Court of Appeals of a writ of execution.

Compared with Elisco, the vehicle subject matter of this case was never recovered
and delivered to respondent despite the issuance of a writ of replevin. As there was
no seizure that transpired, it cannot be said that petitioners were deprived of the use
and enjoyment of the mortgaged vehicle or that respondent pursued, commenced or
concluded its actual foreclosure. The trial court, therefore, rightfully granted the
alternative prayer for sum of money, which is equivalent to the remedy of "exacting
fulfillment of the obligation." Certainly, there is no double recovery or unjust
enrichment to speak of. 1âwphi1

WHEREFORE, the petition is DENIED and the Court AFFIRMS WITH

MODIFICATION the April 30, 2007 Decision and May 19, 2008 Resolution of the
Court of Appeals in CA-G.R. CV No. 86021. Petitioners spouses Deo Agner and
Maricon Agner are ORDERED to pay, jointly and severally, respondent BPI Family
Savings Bank, Inc. ( 1) the remaining outstanding balance of their auto loan
obligation as of May 15, 2002 with interest at one percent ( 1 o/o) per month from
May 16, 2002 until fully paid; and (2) costs of suit.

SO ORDERED.
 V. SUPPORT PENDENTE LITE (Rule 61)

Case No. FORMAT

Principle

Facts

Issue

Ruling

VI. MISCELLANEOUS PROVISIONAL REMEDIES

i. Interim reliefs under Writ of Amparo (A.M. No. 07-9-12-SC ; 25 September 2007)

Case No. 1 RODOLFO NOEL LOZADA, JR., VIOLETA LOZADA and ARTURO LOZADA, vs.
PRESIDENT GLORIA MACAPAGAL ARROYO, EDUARDO ERMITA, AVELINO RAZON,
ANGEL ATUTUBO and SPO4 ROGER VALEROSO,* G.R. Nos.184379-80, April 24, 2012

Principle The writ of amparo is an independent and summary remedy that provides rapid
judicial relief to protect the people’s right to life, liberty and security. Having been
originally intended as a response to the alarming cases of extrajudicial killings and
enforced disappearances in the country, it serves both preventive and curative roles
to address the said human rights violations. It is preventive in that it breaks the
expectation of impunity in the commission of these offenses, and it is curative in that
it facilitates the subsequent punishment of perpetrators by inevitably leading to
subsequent investigation and action.

Facts
Petitioner Lozada was the former President and Chief Executive Officer of the
Philippine Forest Corporation (PFC), a government-owned- and -controlled
corporation under the Department of Environment and Natural Resources
(DENR). Petitioner Violeta Lozada (Violeta) is his wife, while petitioner Arturo
Lozada (Arturo) is his brother.

This petition stems from the alleged corruption scandal precipitated by a

transaction between the Philippine government, represented by the National
Broadband Network (NBN), and ZTE Corporation (ZTE), a Chinese
manufacturer of telecommunications equipment. NEDA Sec. Neri sought the
services of Lozada as an unofficial consultant in the ZTE-NBN deal. The latter
avers that during the course of his engagement, he discovered several
anomalies in the said transaction involving certain public officials impelling the
Senate Blue Ribbon Committee to conduct an investigation for which a
subpoena was issued.

Instead of appearing before the Blue Ribbon Committee, Lozada left the country
for a purported official trip to London. Consequently, the Senate issued an Order
citing Lozada for contempt, ordering his arrest and detention and directing the
Senate Sergeant-at-arms to implement the same.

Lozada returned from Hongkong upon approval of Sec. Atienza. He claims upon
disembarking from the aircraft, several men held his arms and took his bag. He
then called his brother, petitioner Arturo when he went to the comfort room.
While inside the car, he observed that other cars tailed them. Sec. Atienza then
phoned Lozada, assuring the latter that he was with people from the
government, and that the former was going to confer with "ES and Ma’[a]m."
Lozada surmised that these individuals referred to ES Ermita and former
President Arroyo, respectively.

Sec. Atienza also purportedly instructed Lozada to pacify his wife, petitioner
Violeta, who was making public statements asking for her husband’s return.
Along the way, the men asked Lozada to draft an antedated letter requesting
police protection.

Lozada requested that he be brought home to Pasig, but the men were
allegedly compelled to deny his request on account of unidentified security risks.
He further claimed that he was made to fill in the blanks of a prepared affidavit
when they met Atty. Bautista and Col. Mascarinas of the Police Protection
Office. He stayed in La Salle Green Hills where he met Violeta and his sister.

Violeta filed before this Court a Petition for Habeas Corpus. Arturo likewise filed
before this Court a Petition for a Writ of Amparo and prayed for the issuance of
(a) the writ of amparo; (b) a Temporary Protection Order (TPO); and (c)
Inspection and Production Orders. At that same time, Lozada was then made to
sign a typewritten, antedated letter requesting police protection. Thereafter,
former Presidential Spokesperson Michael Defensor (Sec. Defensor)
supposedly came and requested Lozada to refute reports that the latter was
kidnapped and to deny knowledge of alleged anomalies in the NBN-ZTE deal.

The court issued a resolution consolidating the Habeas Corpus case and
Amparo case and issuing a Writ of Amparo. The respondents prayed for the
dismissal of the Habeas Corpus case asserting that Lozada was never illegally
deprived of his liberty and was, at that time, no longer in their custody.
Respondents asserted that Lozada had knowledge and control of the events
that took place on 5 February 2008, voluntarily entrusted himself to their
company, and was never deprived of his liberty. Hence, respondents prayed for
the denial of the interim reliefs and the dismissal of the Petition.

CA also dismissed the Habeas Corpus case in open court for being moot and
academic, as Lozada was physically present and was not confined or detained
by any of the respondents. Considering that petitioners failed to question the
dismissal of the Habeas Corpus case, the said dismissal had lapsed into finality,
leaving only the Amparo case open for disposition. the CA dropped former
President Arroyo as a respondent on the ground that at the time the Petition in
the Amparo case was filed, she was still the incumbent President enjoying
 immunity from suit.

The CA rendered its Decision denying petitioners the privilege of the Writ of
Amparo and dismissing the Petition. The CA found that petitioners were unable
to prove through substantial evidence that respondents violated, or threatened
with violation, the right to life, liberty and security of Lozada.

Issue
Whether petitioners should be granted the privilege of the writ of amparo – NO.

Whether President Arroyo should be dropped as a respondent in the Amparo

Case – Yes

Ruling
Refer to this working framework for Writ of Amparo:

The writ of amparo is an independent and summary remedy that provides rapid
judicial relief to protect the people’s right to life, liberty and security. Having
been originally intended as a response to the alarming cases of extrajudicial
killings and enforced disappearances in the country, it serves both preventive
and curative roles to address the said human rights violations. It is preventive in
that it breaks the expectation of impunity in the commission of these offenses,
and it is curative in that it facilitates the subsequent punishment of perpetrators
by inevitably leading to subsequent investigation and action.

As it stands, the writ of amparo is confined only to cases of extrajudicial killings

and enforced disappearances, or to threats thereof. Considering that this
remedy is aimed at addressing these serious violations of or threats to the right
to life, liberty and security, it cannot be issued on amorphous and uncertain
grounds, or in cases where the alleged threat has ceased and is no longer
imminent or continuing.66 Instead, it must be granted judiciously so as not to
dilute the extraordinary and remedial character of the writ, thus:

The privilege of the writ of amparo is envisioned basically to protect and

guarantee the rights to life, liberty, and security of persons, free from fears and
threats that vitiate the quality of this life. It is an extraordinary writ
conceptualized and adopted in light of and in response to the prevalence of
extra-legal killings and enforced disappearances. Accordingly, the remedy ought
to be resorted to and granted judiciously, lest the ideal sought by the Amparo
Rule be diluted and undermined by the indiscriminate filing of amparo petitions
for purposes less than the desire to secure amparo reliefs and protection and/or
on the basis of unsubstantiated allegations.

● Sections 17 and 18 of the Rule on the Writ of Amparo requires the

parties to establish their claims by substantial evidence,75 or such
relevant evidence as a reasonable mind might accept as adequate to
support a conclusion.
In cases where the violation of the right to life, liberty or security has already
ceased, it is necessary for the petitioner in an amparo action to prove the
existence of a continuing threat.

In the present case, the totality of the evidence adduced by petitioners failed to
meet the threshold of substantial evidence. that Lozada was not illegally
deprived of his liberty from the point when he disembarked from the aircraft up
to the time he was led to the departure area of the airport, as he voluntarily
submitted himself to the custody of respondents. Lozada personally sought the
help of Sec. Atienza to avoid the Senate personnel, and thus knew that the men
who met him at the airport were there to aid him in such objective. Surely, the
actions of Lozada evinced knowledge and voluntariness, uncharacteristic of
someone who claims to have been forcibly abducted.

However, these men’s subsequent acts of directing Lozada to board the vehicle
and driving him around, without disclosing the exact purpose thereof, appear to
be beyond what he had consented to and requested from Sec. Atienza. These
men neither informed him of where he was being transported nor provided him
complete liberty to contact his family members to assure them of his safety.
These acts demonstrated that he lacked absolute control over the situation, as
well as an effective capacity to challenge their instructions.

Nevertheless, it must be emphasized that if Lozada had in fact been illegally

restrained, so much so that his right to liberty and security had been violated,
the acts that manifested this restraint had already ceased and has consequently
rendered the grant of the privilege of the writ of amparo moot. Whether or not
Lozada was deprived of his liberty was not proven.

The failure to establish that the public official observed extraordinary diligence in
the performance of duty does not result in the automatic grant of the privilege of
the amparo writ. It does not relieve the petitioner from establishing his or her
claim by substantial evidence. Thus, in amparo actions, petitioners must
establish their claims by substantial evidence, and they cannot merely rely on
the supposed failure of respondents to prove either their defenses or their
exercise of extraordinary diligence.

In this case, the totality of the evidence presented by petitioners fails to meet the
requisite evidentiary threshold, and the privilege of the writ of amparo has
already been rendered moot and academic by the cessation of the restraint to
Lozada’s liberty. There is no basis to grant Lozada the privilege of the writ of
amparo, considering that the illegal restraint alleged in this case had already
ceased and there is no imminent or continuing restriction on his liberty.

Propriety of the privilege of the writ of amparo and interim reliefs

It appears that Lozada had already filed before the Department of Justice (DOJ)
a Complaint charging respondents with kidnapping and attempted murder.

First, a criminal complaint for kidnapping and, alternatively, for arbitrary

detention rooted in the same acts and incidents leading to the filing of the
subject amparo petition has been instituted with the OMB.

Second, Sec. 22 of the Amparo Rule proscribes the filing of an amparo petition
should a criminal action have, in the meanwhile, been commenced. The
succeeding Sec. 23, on the other hand, provides that when the criminal suit is
filed subsequent to a petition for amparo, the petition shall be consolidated with
the criminal action where the Amparo Rule shall nonetheless govern the
disposition of the relief under the Rule. Under the terms of said Sec. 22, the
present petition ought to have been dismissed at the outset. But the dismissal is
no longer feasible in light of several factual circumstances.

Given the above perspective and to fully apply the beneficial nature of the writ of
amparo as an inexpensive and effective tool to protect certain rights violated or
threatened to be violated, the Court hereby adjusts to a degree the literal
application of Secs. 22 and 23 of the Amparo Rule to fittingly address the
situation obtaining under the premises. Towards this end, two things are at once
indicated: (1) the consolidation of the probe and factfinding aspects of the
instant petition with the investigation of the criminal complaint before the OMB;
and (2) the incorporation in the same criminal complaint of the allegations in this
petition bearing on the threats to the right to security.

Thus, if the Complaint filed before the DOJ had already progressed into a
criminal case, then the latter action can more adequately dispose of the
allegations made by petitioners. After all, one of the ultimate objectives of the
writ of amparo as a curative remedy is to facilitate the subsequent punishment
of perpetrators.89 On the other hand, if there is no actual criminal case lodged
before the courts, then the denial of the Petition is without prejudice to the filing
of the appropriate administrative, civil or criminal case, if applicable, against
those individuals whom Lozada deems to have unduly restrained his liberty.

● It is settled in jurisprudence that the President enjoys immunity from suit

during his or her tenure of office or actual incumbency.68 Conversely,
this presidential privilege of immunity cannot be invoked by a non-sitting
president even for acts committed during his or her tenure.

Here, the events that gave rise to the petition, filing of original petition and
issuance of CA decision occurred during the incumbency of Pres. Arroyo.

It must be underscored, however, that since her tenure of office has already
ended, former President Arroyo can no longer invoke the privilege of
presidential immunity as a defense to evade judicial determination of her
responsibility or accountability for the alleged violation or threatened violation of
the right to life, liberty and security of Lozada.
Case No. ii LORIE MARIE TOMAS CALLO, VS COMMISSIONER JAIME H. MORENTE, BUREAU
OF IMMIGRATION, OIC ASSOCIATES COMMISSIONERS, BUREAU OF
IMMIGRATION, and BRIAN ALAS, BUREAU OF IMMIGRATION G.R. No. 230324
SEPTEMBER 19, 2017

Principle The protective writ of amparo is a judicial remedy to expeditiously provide relief
to violations of a person’s constitutional right to life, liberty, and security, and
more specifically, to address the problem of extralegal killings and enforced
disappearances or threats thereof.

Facts Parker was taken into the custody of the Bureau of Immigration pursuant to a
Summary Deportation Order (SDO) issued against Danielle Nopuente, also
known as Isabelita Nopuente and Danielle Tan Parker.

The SDO was issued in view of the charge that Parker is an undocumented, and
overstaying alien in violation of our immigration law. It was also alleged that
Danielle Nopuente was a fugitive from justice in the United States of America
with an outstanding arrest warrant issued against her.

That the Bureau of Immigration (BI) cannot carry out her deportation due to the
fact that Parker is charged with falsification and use of falsified documents
before Branch 4, Municipal Trial Court in Cities in Davao City. Hence, her
continued stay in BI’s detention facility.

On Sept. 12, 2014, Parker, as petitioner, filed a Petition for Habeas Corpus
before the RTC of Pasig, which the court dismissed finding that the detention of
Parker was legal.

Later, the CA, on appeal, affirmed the RTC and found that Parker failed to prove
that she was a Filipino citizen to warrant judicial intervention through habeas
corpus.

Subsequently, Callo filed this petition for a writ of amparo with prayer to issue
Interim Reliefs of Immediate Release of Danielle Tan Parker from Detention.
Callo argues that Parker is a natural born Filipino citizen and thus, there is no
reason for her to be detained by the Bureau of Immigration.

Issue 1. Whether or not the writ of amparo, along with the prayed interim reliefs,
shall issue in favor of Parker?
2. Whether or not the petitioner possess the necessary legal standing to file
a petition for writ of amparo?

Ruling 1. NO.
No. Parker’s right to life, liberty and security is not threatened by the
respondents to warrant the issuance of the writ of amparo and the
interim reliefs prayed for.

As provided in Section 1of the Rule on Writ of Amparo , the protective

writ of amparo is a judicial remedy to expeditiously provide relief to
violations of a person's constitutional right to life, liberty, and
security, and more specifically, to address the problem of
 extralegal killings and enforced disappearances or threats thereof.

RA 9851 defines enforced disappearance as the arrest, detention, or

abduction of persons by, or with the authorization, support or
acquiescence of a State or a political organization followed by a refusal
to acknowledge that deprivation of freedom or to give information on the
fate or whereabouts of those persons, with the intention of removing
from the protection of the law for a prolonged period of time. (Extralegal
killings are killings committed without due process of law, i.e., without
legal safeguards or judicial proceedings.)

Elements constituting enforced disappearance as defined under RA No.

9851 are the following:
(a) that there be an arrest, detention, abduction or any form of
deprivation of liberty; ·
(b) that it be carried out by, or with the authorization, support or
acquiescence of, the State or a political organization;
(c) that it be followed by the State or political organization's refusal to
acknowledge or give information on the fate or whereabouts of the
person subject of the amparo petition; and
(d) that the intention for such refusal is to remove subject person from
the protection of the law for a prolonged period of time.

Clearly, the elements of enforced disappearance are not attendant in this

case. There is also no threat of such enforced disappearance. While
there is indeed a detention carried out by the State through the Bureau
of Immigration, the third and fourth elements are not present. There is no
refusal to acknowledge the deprivation of freedom or refusal to give
information on the whereabouts of Parker because as Callo admits,
Parker is detained in the Immigration Detention Facility of the Bureau of
Immigration. The Bureau of Immigration also does not deny this.

For the issuance of the writ, it is not sufficient that a person's life is
endangered. It is even not sufficient to allege and prove that a person
has disappeared. It has to be shown by the required quantum of proof
that the disappearance was carried out by, or with the authorization,
support or acquiescence of the government or a political organization,
and that there is a refusal to acknowledge the same or to give
information on the fate or whereabouts of the missing persons. In this
case, Parker has not disappeared. Her detention has been sufficiently
justified by the Bureau of Immigration, given that there is an SDO and a
pending criminal case against her.

Given that there is no basis for the issuance of the writ of amparo, the
interim reliefs sought for are also denied.

2. No, petitioner does not possess the necessary legal standing to file
a petition for writ of amparo.

Section 2 of the Rule on the Writ of Amparo provides for the exclusive
 and successive order of who can file a petition for a writ of amparo in the
following order:

(a) Any member of the immediate family, namely: the spouse, children
and parents of the aggrieved party;
(b) Any ascendant, descendant or collateral relative of the aggrieved
party within the fourth civil degree of consanguinity or affinity, in default
of those mentioned in the preceding paragraph; or
(c) Any concerned citizen, organization, association or institution, if there
is no known member of the immediate family or relative of the aggrieved
party.

In Boac v. Cadapan, the Court explained the reason for the exclusive
and successive order - "to prevent the indiscriminate and groundless
filing of petitions for amparo which may even prejudice the right to life,
liberty or security of the aggrieved party."

Thus, while "any person" may file a petition for the writ of habeas corpus,
in a petition for the writ of amparo, the order of priority on who can file
the petition should be strictly followed.

In this case, there was no allegation nor proof that Parker had no
immediate family members or any ascendant, descendant, or collateral
relative within the fourth civil degree of consanguinity or affinity.
Therefore, based on the order of priority, Callo had no legal standing to
file this petition.

FORMAT

Case No. FORMAT

Principle

Facts

Issue

Ruling