[ G.R. No. 84481. April 18, 1989 ] 254 Phil. 480
FIRST DIVISION
[ G.R. No. 84481. April 18, 1989 ]
MINDANAO SAVINGS & LOAN ASSOCIATION, INC. (FORMERLY DAVAO SAVINGS & LOAN ASSOCIATION) & FRANCISCO VILLAMOR, PETITIONERS, VS. HON. COURT OF APPEALS, POLY R. MERCADO, & JUAN P. MERCADO, RESPONDENTS. D E C I S I O N
GRIÑO-AQUINO, J.:
On September 10, 1986, private respondents filed in the Regional Trial Court of Davao City, a complaint against defendants D.S. Homes, Inc., and its directors, Laurentino G. Cuevas, Saturnino R. Petalcorin, Engr. Uldarico D. Dumdum, Aurora P. De Leon, Ramon D. Basa, Francisco D. Villamor, Richard F. Magallanes, Geronimo S. Palermo, Felicisimo V. Ramos and Eugenio M. De los Santos (hereinafter referred to as D.S. Homes, et al.) for “Rescission of Contract and Damages” with a prayer for the issuance of a writ of preliminary attachment, docketed as Civil Case No. 18263.
On September 28, 1986, Judge Dinopol issued an order granting ex parte the application for a writ of preliminary attachment.
On September 22, 1986, the private respondents amended their complaint and on October 10, 1986, filed a second amended complaint impleading as additional defendants herein petitioners Davao Savings & Loan Association, Inc. and its president, Francisco Villamor, but dropping Eugenio M. De los Santos.
On November 5, 1986, Judge Dinopol issued ex parte an amended order of attachment against all the defendants named in the second amended complaint, including the petitioners but excluding Eugenio C. de los Santos.
D.S. Homes, Inc., et al. and the Davao Savings & Loan Association (later renamed Mindanao Savings & Loan Association, Inc. or “MSLA”) and Francisco Villamor filed separate motions to quash the writ of attachment. When their motions were denied by the court, D.S. Homes, Inc., et al. offered a counterbond in the amount of P1,752,861.41 per certificate issued by the Land Bank of the Philippines, a banking partner of petitioner MSLA. The lower court accepted the Land Bank Certificate of Time Deposit for P1,752,861.41 as counterbond and lifted the writ of preliminary attachment on June 5, 1987 (Annex V).
On July 29, 1987, MSLA and Villamor filed in the Court of Appeals a petition for certiorari (Annex A) to annul the order of attachment and the denial of their motion to quash the same (CA-G.R. SP No. 12467). The petitioners alleged that the trial court acted in excess of its jurisdiction in issuing the ex parte orders of preliminary attachment and in denying their motion to quash the writ of attachment. D.S. Homes, Inc., et al. did not join them.
On May 5, 1988, the Court of Appeals dismissed the petition for certiorari and remanded the records of Civil Case No. 18263 to the Regional Trial Court of Davao City, Branch 13, for expeditious proceedings. It held:
“Objections against the writ may no longer be invoked once a counterbond is filed for its lifting or dissolution.
“The grounds invoked for the issuance of the writ form the core of the complaint and it is right away obvious that a trial on the merits was necessary. The merits of a main action are not triable in a motion to discharge an attachment otherwise an applicant for dissolution could force a trial on the merits on his motion (4 Am. Jur., Sec. 635, 934, cited in G.G. Inc. vs. Sanchez, et al., 98 Phil. 886, 890, 891).” (Annex B, p. 185, Rollo.)
Dissatisfied, the petitioners appealed to this Court.
A careful consideration of the petition for review fails to yield any novel legal questions for this Court to resolve.
The only requisites for the issuance of a writ of preliminary attachment under Section 3, Rule 57 of the Rules of Court are the affidavit and bond of the applicant.
“SEC. 3. Affidavit and bond required. - An order of attachment shall be granted only when it is made to appear by the affidavit of the applicant, or of some other person who personally knows the facts, that a sufficient cause of action exists, that the case is one of those mentioned in section 1 hereof, 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 is granted above all legal counterclaims. The affidavit, and the bond required by the next succeeding section must be duly filed with the clerk or judge of the court before the order issues.”
No notice to the adverse party or hearing of the application is required. As a matter of fact a hearing would defeat the purpose of this provisional remedy. The time which such a hearing would take, could be enough to enable the defendant to abscond or dispose of his property before a writ of attachment issues. Nevertheless, while no hearing is required by the Rules of Court for the issuance of an attachment (Belisle Investment & Finance Co., Inc. vs. State Investment House, Inc., 72927, June 30, 1987; Filinvest Credit Corp. vs. Relova, 117 SCRA 420), a motion to quash the writ may not be granted without “reasonable notice to the applicant” and only “after hearing” (Secs. 12 and 13, Rule 57, Rules of Court).
The Court of Appeals did not err in holding that objections to the impropriety or irregularity of the writ of attachment “may no longer be invoked once a counterbond is filed,” when the ground for the issuance of the writ forms the core of the complaint.
Indeed, after the defendant has obtained the discharge of the writ of attachment by filing a counterbond under Section 12, Rule 57 of the Rules of Court, he may not file another motion under Section 13, Rule 57 to quash the writ for impropriety or irregularity in issuing it.
The reason is simple. The writ had already been quashed by filing a counterbond, hence, another motion to quash it would be pointless. Moreover, as the Court of Appeals correctly observed, when the ground for the issuance of the writ is also the core of the complaint, the question of whether the plaintiff was entitled to the writ can only be determined after, not before, a full-blown trial on the merits of the case. This accords with our ruling in G.B., Inc. vs. Sanchez, 98 Phil. 886 that: “The merits of a main action are not triable in a motion to discharge an attachment, otherwise an applicant for the dissolution could force a trial on the merits of the case on this motion.”
May the defendant, after procuring the dissolution of the attachment by filing a counterbond, ask for the cancellation of the counterbond on the ground that the order of attachment was improperly issued? That question was answered by this Court when it ruled in Uy Kimpang vs. Javier, 65 Phil. 170, that “the obligors in the bond are absolutely liable for the amount of any judgment that the plaintiff may recover in the action without reference to the question of whether the attachment was rightfully or wrongfully issued.”
The liability of the surety on the counterbond subsists until the Court shall have finally absolved the defendant from the plaintiff’s claims. Only then may the counterbond be released. The same rule applies to the plaintiff’s attachment bond. “The liability of the surety on the 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,” (Calderon vs. Intermediate Appellate Court, 155 SCRA 531.)
WHEREFORE, finding no reversible error in the decision of the Court of Appeals in CA-G.R. SP No. 12467, the petition for review is denied for lack of merit with costs against the petitioners.
SO ORDERED.
Cruz, Gancayco, and Medialdea, JJ., concur. Narvasa, (Chairman), see concurring and dissenting opinion.