1st Set Cases - Digests

7/28/2019 1st Set Cases - Digests

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El Banco Espaol-Filipino vs Vicente PalancaG.R. No. L-11390 March 26, 1918

FACTS:Engracio Palanca Tanquinyeng y Limquingco mortgaged various parcels of real property in

Manila to El Banco Espanol-Filipino. Afterwards, Engracio returned to China and there he diedon January 29, 1810 without returning again to the Philippines. The mortgagor then instituted

foreclosure proceeding but since defendant is a non-resident, it was necessary to give notice by

publication. The Clerk of Court was also directed to send copy of the summons to the

defendants last known address, which is in Amoy, China. It is not shown whether the Clerk

complied with this requirement. Nevertheless, after publication in a newspaper of the City of

Manila, the cause proceeded and judgment by default was rendered. The decision was likewise

published and afterwards sale by public auction was held with the bank as the highest bidder.

On August 7, 1908, this sale was confirmed by the court. However, about seven years after the

confirmation of this sale, a motion was made by Vicente Palanca, as administrator of the estate

of the original defendant, wherein the applicant requested the court to set aside the order ofdefault and the judgment, and to vacate all the proceedings subsequent thereto. The basis of this

application was that the order of default and the judgment rendered thereon were void because

the court had never acquired jurisdiction over the defendant or over the subject of the action.

ISSUE:Whether or not the lower court acquired jurisdiction over the defendant and the subject matter

of the action.

RULING:

On Jurisdiction

The word jurisdiction is used in several different, though related, senses since it may have

reference (1) to the authority of the court to entertain a particular kind of action or to administer

a particular kind of relief, or it may refer to the power of the court over the parties, or (2) over

the property which is the subject to the litigation.

The sovereign authority which organizes a court determines the nature and extent of its powers

in general and thus fixes its competency or jurisdiction with reference to the actions which it

may entertain and the relief it may grant.

How Jurisdiction is Acquired

Jurisdiction over the person is acquired by the voluntary appearance of a party in court and his

submission to its authority, or it is acquired by the coercive power of legal process exerted over

the person.


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Jurisdiction over the property which is the subject of the litigation may result either from a

seizure of the property under legal process, whereby it is brought into the actual custody of the

law, or it may result from the institution of legal proceedings wherein, under special provisions

of law, the power of the court over the property is recognized and made effective. In the latter

case the property, though at all times within the potential power of the court, may never be

taken into actual custody at all. An illustration of the jurisdiction acquired by actual seizure isfound in attachment proceedings, where the property is seized at the beginning of the action, or

some subsequent stage of its progress, and held to abide the final event of the litigation. An

illustration of what we term potential jurisdiction over the res, is found in the proceeding to

register the title of land under our system for the registration of land. Here the court, without

taking actual physical control over the property assumes, at the instance of some person

claiming to be owner, to exercise a jurisdiction in rem over the property and to adjudicate the

title in favor of the petitioner against all the world.

In the terminology of American law the action to foreclose a mortgage is said to be a proceeding

quasi in rem, by which is expressed the idea that while it is not strictly speaking an action inrem yet it partakes of that nature and is substantially such. The expression "action in rem" is, in

its narrow application, used only with reference to certain proceedings in courts of admiralty

wherein the property alone is treated as responsible for the claim or obligation upon which the

proceedings are based. The action quasi rem differs from the true action in rem in the

circumstance that in the former an individual is named as defendant, and the purpose of the

proceeding is to subject his interest therein to the obligation or lien burdening the property. All

proceedings having for their sole object the sale or other disposition of the property of the

defendant, whether by attachment, foreclosure, or other form of remedy, are in a general way

thus designated. The judgment entered in these proceedings is conclusive only between the

parties.

ANITA MANGILA,petitioner, vs. COURT OF APPEALS and LORETA GUINA, respondents.

G.R. No. 125027. August 12, 2002

FACTS:This is a petition for review on certiorari under Rule 45 of the Rules of Court, seeking to set

aside the Decision of the Court of Appeals affirming the Decision of the Regional

Trial Court, Branch 108,Pasay City. The trial court upheld the writ of attachment and the

declaration of default on petitioner while order ing her to pay pr ivate responden t

P109,376.95 plus 18 percent interest per annum, 25 percent attorneys fees and costs of

suit. On December 15, 1995, the Court of Appeals rendered adecision affirming the

decision of the trial court. The Court of Appeals upheld the validity of

theissuance of the writ of attachment and sustained the filing of the action in the

RTC of Pasay. TheCourt of Appeals also affirmed the declaration of default on

peti tio ner and conc lud ed that the tr ial court did not commit any reversible error.


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ISSUES:W H E T H E R R E S P O N D E N T C O U R T E R R E D I N N O T H O L D I N G T H A T T H E

W R I T O F ATTACHMENT WAS IMPROPERLY ISSUED AND SERVED; WHETHER THERE

WAS IMPROPER VENUE.

HELD:The petition is GRANTED on the grounds of improper venue and invalidity of the service ofthe writ of attachment. The decision of the Court of Appeals and the order of respondent judge

denying the motion to dismiss are REVERSED and SET ASIDE.The grant of the provisional remedy of attachment involves three stages: first, the

court issues the order granting the application; second, the writ of attachment issues

pursuant to the order granting the writ; and third, the writ is implemented. For the

initial two stages, it is not necessary that jurisdiction over the person of the

defendant be first obtained. However, once the implementation of the writ

c om me nc es , t h e c o u r t m u s t h a v e a c q u i r e d j u r i s d i c t i o n o v e r t h e de fe ndan tfor without such jurisdiction, the court has no power and authority to act in any

manner against the defendant. Any order issuing from the Court will not bind the

defendant. The trial court cann ot enforce such a coercive process on petitioner

without first obtaining jurisdiction over her person. The preliminary writ of attachment

must be served after or simultaneous with the service of summons on the de fe nd ant

whether by personal service, substituted service or by publication as warranted by

the circumstances of the case. The subsequent service of summons does not confer a retroactive

acquisition of jurisdiction over her person because the law does not allow for retroactivity of a

belated service.

The rules on venue, like other procedural rules, are designed to insure a just and orderly

administration of justice or the impartial and evenhanded determination of every action and

proceeding. Obviously, this objective will not be attained if the plaintiff is given unrestricted

freedom to choose where to file the complaint or petition.

EMMANUEL C. OATE and ECON HOLDINGS CORPORATION, petitioners,vs.

HON. ZUES C. ABROGAR, as Presiding Judge of Branch 150 of the Regional Trial Court ofMakati, and SUN LIFE ASSURANCE COMPANY OF CANADA, respondents.

G.R. No. 107303 February 21, 1994

FACTS:Sun Life filed a complaint for sum of money with a prayer for the issuance of a writ of

preliminary attachment against Onate, et. al. The prayer for the writ was granted by the Court.

The Sheriff attempted to serve summons to Onate, et. al. but he was unsuccessful. Despite of


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this, the sheriff started to serve notices of garnishment upon banks, and notices of attachment

upon other properties of Onate. The Sheriff was able to serve summons after the notice of

garnishment. Onate argues that the attachment is improper because the RTC has not yet

acquired jurisdiction over their persons. The SC said that whatever defects attended the

attachment, these were cured when the sheriff was finally able to serve them the summons later

on. Onate filed an MR.

ISSUE:Whether or not the attachment is valid for having been cured by a subsequent service of

summons

HELD:No. Sun Life uses Davao Lights v CA to bolster its argument that the defects in the attachment

were cured by the subsequentservice of summons. But this is a misreading of the Davao Lights

case. What the Davao Lights case said is that a write of attachment may be issued and granted

by the court, but it cannot be implemented until jurisdiction is acquired over the persons whoseproperties are subject to attachment. The subsequent service of summons, therefore, will not

cure any defect in the attachment.

The Court emphasized that at the very least, the writ of attachment must be served

simultaneously with the service of summons before the writ may be enforced.

PERLA COMPANIA vs. RAMOLETE

G.R. No. L-60887 November 13, 1991

FACTS:Enriquezs vehicle collided with the vehicle of Palmes, causing his death and injuries to Borbon.

Palmes widow filed a complaint against Nelia Enriquez before CFI Cebu, claiming actual,

moral, nominal and exemplary damages as a result of the accident. Judgment was rendered in

favour of Palmes.

The judgment of the trial court became final and executory and a writ of execution was

thereafter issued. The writ of execution was, however, returned unsatisfied. Enriquez declared

under oath that the Cimarron PUJ registered in her name was covered by a third-party liability

insurance policy issued by petitioner Perla.

Palmes filed a motion for garnishment praying that an order of garnishment be issued againstthe insurance policy issued by Perla in favor of Enriquez. Court issued an Orderdirecting theProvincial Sheriff or his deputy to garnish the third-party liability insurance policy.

Perla moved for the quashal of the writ of garnishment, contending that it was not a party to the

case and that jurisdiction over its person had never been acquired by the trial court by service of

summons or by any process.


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ISSUE: WON the insurance contract can be subjected to garnishment or execution to satisfy thejudgment in a case where the garnishee was not a party to the case and the trial court did not

acquire jurisdiction over garnishee's person?

HELD:

Yes. In order that the trial court may validly acquire jurisdiction to bind the person ofthe garnishee, it is not necessary that summons be served upon him. The garnishee need not

be impleaded as a party to the case. All that is necessary for the trial court lawfully to bind

the person of the garnishee or any person who has in his possession credits belonging to

thejudgment debtor is service upon him of the writ of garnishment.

Garnishment has been defined as a species of attachment for reaching any property or credits

pertaining or payable to a judgment debtor. In legal contemplation, it is a forced novation by

the substitution of creditors: the judgment debtor, who is the original creditor of the garnishee

is, through service of the writ of garnishment, substituted by the judgment creditor who thereby

becomes creditor of the garnishee. Garnishment has also been described as a warning to a

person having in his possession property or credits of the judgment debtor, not to pay themoney or deliver the property to the latter, but rather to appear and answer the plaintiff's suit.

The Rules of Court themselves do not require that the garnishee be served with summons or

impleaded in the case in order to make him liable.

Through service of the writ of garnishment, the garnishee becomes a "virtual party" to, or a

"forced intervenor" in, the case and the trial court thereby acquires jurisdiction to bind him to

compliance with all orders and processes of the trial court with a view to the complete

satisfaction of the judgment of the court.

The garnishment of property to satisfy a writ of execution operates as an attachment and fastens

upon the property a lien by which the property is brought under the jurisdiction of the courtissuing the writ. It is brought into custodia legis, under the sole control of such court.

In the present case, there can be no doubt, therefore, that the trial court actually acquired

jurisdiction over petitioner Perla when it was served with the writ of garnishment of the third-

party liability insurance policy it had issued in favor of judgment debtor Nelia Enriquez. Perla

cannot successfully evade liability thereon by such a contention.

On the contention that a separate civil case has to be instituted against Perla:

The Court there held that a separate action needs to be commenced when the garnishee "claims

an interest in the property adverse to him (judgment debtor) or denies the debt." In the instant

case, petitioner Perla did not deny before the trial court that it had indeed issued a third-partyliability insurance policy in favor of the judgment debtor.

PEOPLE'S BANK AND TRUST COMPANY,

plaintiff-appellee, vs.


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SYVEL'S INCORPORATED,ANTONIO Y. SYYAP and ANGEL Y SYYAP,defendants-

appellants.

G.R. No. L-29280 August 11, 1988

FACTS:

This is an action for foreclosure of chattel mortgage executed in favor of the plaintiff by thedefendant Syvel's Incorporated on its stocks of goods, personal properties and other materials

owned by it and located at its stores or warehouses The chattel mortgage was in connection

with a credit commercial line in the amount of P900,000.00 granted the said defendant

corporation, the expiry date of which was May 20, 1966. On May 20, 1965, defendants Antonio

V. Syyap and Angel Y. Syyap executed an undertaking in favor of the plaintiff whereby they

both agreed to guarantee absolutely and unconditionally and without the benefit of excussion

the full and prompt payment of any indebtedness to be incurred on account of the said credit

line. Against the credit line granted the defendant Syvel's Incorporated the latter drew advances

in the form of promissory notes. In view of the failure of the defendant corporation to make

payment in accordance with the terms and conditions agreed upon in the Commercial CreditAgreement the plaintiff started to foreclose extrajudicially

The chattel mortgage. After the filing of this case and during its pendency, Syyap proposed to

have the case settled. Mr. Syyap offered to execute a real estate mortgage on his real property

located in Bacoor, Cavite. Mr. De las Alas consented, and so the Real Estate Mortgage was

executed by the defendant Antonio V. Syyap and his wife Margarita Bengco Syyap on June 22,

1967. In that deed of mortgage, defendant Syyap admitted that as of June 16,1967, the

indebtedness of Syvel's Incorporated was P601,633.01.No part of the amount has been paid by

either of the defendants. Hence their liabilities cannot be questioned

ISSUE:WON the obligation secured by the Chattel Mortgage sought to be foreclosed was novated by

the subsequent execution by Syyap of a real estate mortgage as additional collateral to the

obligation secured by said chattel mortgage.

HELD:Novation takes place when the object or principal condition of an obligation is changed or

altered. It is elementary that novation is never presumed; it must be explicitly stated or there

must be manifest incompatibility between the old and the new obligations in every aspect. In

the case at bar, there is nothing in the RealEstate Mortgage which supports appellants's

ubmission. The contract on its face does not show the existence of an explicit novation norincompatibility on every point between the "old and the "new" agreements as the second

contract evidently indicates that the same was executed as new additional security to the chattel

mortgage previously entered into by the parties. Moreover, appellants agreed that the chattel

mortgage "shall remain in full force and shall not be impaired by this (real estate) mortgage."It

is clear, therefore, that a novation was not intended. The real estate mortgage was evidently

taken as additional security for the performanceof the contract.


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