RULE 57: PRELIMINARY ATTACHMENT

PROVISIONAL REMEDIES - for preservation of rights and interests during pendency of the principal action

SEC. 1: GROUNDS; WHEN

ATTACHMENT
 Actually a levy BEFORE finality of judgment
 In 39, already final and executory
 Property of defendant may be taken into custody of the law either at the commencement of the action OR at anytime before entry, purpose as a SECURITY
for the satisfaction of any judgment that the plaintiff or any proper party may recover (Ex. Any claimant)
o Therefore the writ may be issued IFO PF OR DF who sets up a claim (CC, etc)
KINDS
1. Preliminary
2. Permanent - rule 39: levy on attachment, on judgment which has become final and executory
3. Garnishment - rule 39: specie of attachment/execution by reaching for credits from 3rd person

GARNISHMENT PRELIMINARY ATTACHMENT

3 parties involved (JO, JOR, 3rd person) 2 parties involved (JO and JOR)
No actual seizure of property, remains with the garnishee Property is actually taken into the possession of the officer
enforcing the writ
No specific lien acquired Specific lien was acquired
Usually directed to intangible properties Tangible properties

NATURE OF PROCEEDING - quasi in rem because against a particular property. Judgment against the res, because with lien to secure the payment

GROUNDS: A. Action to collect specified amount of money OR damages other than moral/exemplary (kasi unliquidated pa
yan), arising from ALL sources of obligation, against party who is about to depart from country with intent to
defraud creditors
B. Action for money OR property (SPECIFIC) embezzled, misapplied, converted to own use by person in fiduciary
capacity OR willful violation of duty
C. Recover property (SPECIFIC) unjustly or fraudulently detained/taken/converted/concealed/removed
 Ex. Chattel mortgage, remedy either here or replevin
D. Action against party guilty of fraud in contracting the debt OR incurring the obligation
 BOTH dolo causante and incidente
E. Action against person who removed/disposed of property in fraud of creditors
F. Any action against party who DOES NOT RESIDE AND NOT FOUND IN PH; or on whom summons may be
served by publication

 Grounds are EXCLUSIVE

MIRANDA V. CA (re: letter D) --> NOT APPLICABLE ANYMORE
 Deed of sale with assumption of mortgage
 Document prepared by Rayos (seller); Miranda (buyer) assume the mortgage
 Bank refused to accept payment of Miranda, because Rayos already paid and asked to not give the TCT to Miranda. Miranda filed an action with prayer for
writ of PI
 Rayos moved to discharge the PI. Claim: NO FRAUD in CONTRACTING the obligation (no dolo causante, only incidente)
SEC. 2: ISSUANCE AND CONTENTS
 May be issued ex parte (no notice and hearing) OR upon MOTION with notice and hearing
Q: If motu proprio, is the court called upon to determine the truth/falsity in affidavit? Can the court just rely on it?
 CAN RELY ON THE affidavits only
 Kasi kung nagsisinungaling man, the bond will answer for that naman. So magbabayad parin siya
Q: may the writ of attachment be issued if the claim is already secured?
 YES. For instance, if the security is abandoned na and brings the ordinary case for collection, may still attach the property over which the lien was imposed
 Or in foreclosure proceedings, and shown that the money is not sufficient to cover the debt
SEC. 3: AFFIDAVIT AND BOND REQUIRED
 INDISPENSABLE requirements
 Court will issue the ORDER, on basis of the affidavits, and the clerk of court will issue the WRIT OF ATTACHMENT when there is a bond na
 Writ is directed to the sheriff for enforcement
1. AFFIDAVIT
o Sufficient COA exists
o Case is one of those mentioned in SEC. 1: GROUNDS
o No other sufficient security for the claims sought to be enforced
 o Amount due to the applicant/ value of the property to which he is entitled is as much as the sum for which the order is granted above all legal
counterclaims
 If any of these shown to be FALSE, the bond WILL BE MADE TO ANSWER
2. BOND (SEC. 4)
o CONDITION: that the applicant will pay ALL COSTS and ALL DAMAGES which the adverse party may sustain by reason of attachment if the court shall
FINALLY ADJUDGE that the applicant is NOT ENTITLED to the attachment
 Kasi dapat with just cause other than the merits of the case
Q: remedies against a writ of attachment?
A: SEC. 12 and 13 --> DISCHARGE: ALWAYS with notice and hearing. Only the application is pwedeng ex parte
 ONLY THESE TWO. NO OTHER remedy
SEC. 12: DISCHARGE OF ATTACHMENT UPON GIVING A COUNTER-BOND
 Party whose property has been attached may move for DISCHARGE of the attachment
 With NOTICE AND HEARING
 AFTER the writ has been ENFORCED

REQ 1. Cash deposit
2. File a counter-bond IFO attaching party
 Amount EQUAL to the order of attachment --> the BOND FILED IN SEC. 4. kasi icocounter mo yun
 If wrt particular property, equal to value of that property as determined by the court

Q: utang 1M lang, attached a property worth 5M, but bond is only 1M kasi that is the amount of the utang. HOW MUCH COUNTER-BOND? 1M lang ba which is the
amount of the bond OR 5M which is the value of the property?
 1M LANG!!
 if UTANG lang subject of the claim (debt/money) - the AMOUNT of the DEBT
 If PROPERTY ang subject of the claim (ex.embezzled jewelry) - the VALUE OF THE PROPERTY

 In either case, the cash/counter-bond shall SECURE the payment of ANY JUDGMENT that the attaching party may recover in the action
o Kasi pinapalitan mo yung property/money initally attached. It will STAND IN PLACE of the PROPERTY RELEASED so there is still a security
 Re: counter-bond becomes insufficient: can file for another order of attachment

SEC. 13: DISCHARGE ON OTHER GROUNDS

 By MOTION, with NOTICE and HEARING
 File the motion BEFORE or AFTER LEVY
o If before, motion is against the AFFIDAVIT of the applicant

GROUNDS: 1. Attachment improperly issued
1. Attack the affidavits/bond
2. Irregularly enforced
 Violate conditions for attachment in Sec. 5
Bond is insufficient
 Ex. Kulang amount, bonding company is insolvent
Attachment excessive, discharge LIMITED to excess

SEC. 5: ENFORCEMENT

CONDITIONS 1. Preceeded/accompanied by service of summons
2. With copy of the complaint, applciation, affidavit and bond, order and writ
 Other words, NO LEVY UNLESS ALREADY ACQUIRED JURISDICTION against the PERSON of the party against whom the writ is issued --> for execution part
o
XPN summons cannot be served PERSONALLY or by SUBSTITUTED service despite diligent efforts
 Person's IDENTITY/WHEREABOUTS is UNKNOWN
Resident of PH temporarily out
Non-resident of PH
Action is in rem/ quasi in rem
 But in APPLICATION and the ISSUANCE of the ORDER, NEED NOT have jurisdiction over the person yet

Q: may property discharged be attached again by the same creditor in the same case?
 NO! because 2nd attachment will have the effect of nullifying w/o legal ground the previous order of discharge
 UNLESS in another case by another creditor

 ALL properties exempt from execution are also exempt from attachment

SEC. 7:
 Property in custodia legis may be attached? YES, but just notify the court, cannot get it
SEC. 9:
Q: can you attach interest of an heir?
 YES, even if subject to settlement proceedings
 But executor/administrator will still possess the property
 Pag lang nag file na ng petition for distribution. Deliver the property attached nalang after distribution
SEC. 10: EXAMINATION OF PARTY WHOSE PROPERTY IS ATTACHED AND PERSONS INDEBTED TO HIM/ CONTROLLING HIS PROPERTY
 Connect with RULE 39, SEC. 43
Q: what cases may attached property be sold pendente lite?
SEC. 11:
1. Property attached is PERISHABLE
2. Interest of all parties in the action will be subserved thereby

Q: remedy of 3rd person who claims right to the property attached?

 File a 3rd party claim
Q: how shall judgment be satisfied by the property attached?
SEC. 15: SATISFACTION OF JUDGMENT OUT OF PROPERTY ATTACHED; RETURN OF SHERIFF

SEC. 16:
 If with balance still after realizing upon property attached
 Ordinary execution nalang by the sheriff

SEC. 18
 Disposition of cash deposit
 Applied to the satisfaction of the judgment. If in favor, refund nalang

SEC. 19:
 Disposition of attached property
 Isoli lang

Q: what is the remedy if you want to claim against the counter-bond posted pursuant to Sec. 12?
 Go to sec 17
SEC. 17
 Judgment has become EXECUTORY
o Kasi replacement of the attached property
1. execute first against JOR, execution returned unsatisfied in whole/ in part
2. DEMAND from SURETY
3. Court will then give notice to surety and conduct a summary hearing to determine liability

Q: if against attachment bond pursuant to Sec. 4?

 Go to sec 20
 If example you suffered damages because of the attachment
SEC. 20:
 Damages from improper issuance/ irregular enforcement. Before judgment becomes F&E
 BEFORE trial --> writ was sought BEFORE answer. Application for attachment was at the commencement of the
o COMPULSORY counterclaim
 BEFORE appeal is perfected --> after answer na
 BEFORE judgment becomes executory --> after answer but assuming no appeal
 W DUE NOTICE to the person and the surety as to amount of the damages

 w/ attachment, appealed then reversed, claim damages by application IN APPELLATE COURT, BEFORE judgment of appellate court becomes executory
 Damages that may be awarded is NOT limited to the bond. Pwede pa more than

LEE LIN MKTNG V. C&S AGRO

 Secured writ of attachment. Defendant filed a counter bond
 Judgment rendered against defendants. Final na ang judgment so writ of execution
 Execution unsatisfied. Lee Lin now moved to charge the counterbond
 RTC: deny, dapat daw sundin ang sec. 20
 SC: WRONG! Apply Sec. 17
VANGUARD INSURANCE V. CA
 Action to recover sum of money. Issued a writ of attachment, counterbond filed to dissolve
 Judgment rendered on the basis of compromise
 Writ of execution, failed to obtain full satisfaction. Motion to recover from the counterbond posted by Vanguard
 Vanguard: motion not proper, supplemental complaint should have been filed before judgment became F&E
 SC: No legal basis. Cannot rely on Sec. 20. applicable rule is Sec. 17. when returned unsatisfied, the liability of the surety attaches
TOWERS ASSURANCE V. ORORAMA
 Action to recover sum of money. Writ of attachment obtained, counterbond filed to dissolve
 Ongs and Towers bound themselves solidarily in the counterbond
 Writ of execution issued against Ongs and Towers simultaneously
 SC: under sec. 17, against JOR first. BUT DOES NOT APPLY HERE because solidarily liable. Kung kulang, demand nalang

 Whether discharge is by 12 or 13, there must ALWAYS be a hearing

BENITEZ V. IAC
 Filed action for rescission of contract and damages. Prayer of preliminary attachment granted
 Averred entering a verbal contract w/ Benitez of purchase of real property, tendered 2 checks which were credited na, but the amount was converted for
personal use without transferring the property
 Benitez filed a MOTION TO LIFT the attachment, alleging that only after full payment will the property be transferred, and complainant failed to pay full
amount
o Other words, motion to lift for improper issuance --> NO SUFFICIENT COA
o Motion to discharge was denied
 SC: the affidavit may have been sufficient to grant the preliminary attachment, BUT it is not proof of the correctness of the claim. Hearing must be conducted
to kasi controverted yung affidavit. Hearing can be by affidavits

DP LAB OIL V. NICOLAS

 Filed counterbond
 Prayer for attachment hinges on the allegation that the affidavit was devoid of any
 You must allege facts, not merely conclusions copyiing what is in the rules --> can be denied
SANTOS V. AQUINO
 Action to recover money market placement against coroporation and directors in their personal capacities
 Prelim attachment issued. 3 mos later, proceedings suspended. Defendants went to court offerring to file a counterbond
 Opposed because of inssuficiency. Denied. Motion to SUBSTITUTE attached PROPERTIES with OTHER properties
 Opposed also. Failed to attend the hearing so court ordered the substitution
 Properties so released were sold/ mortgaged
 SC: WRONG! CANNOT SUBSTITUTE the other properties. Only way that you can subs is either CASH or COUNTERBOND under Sec. 12.
o RATIO: once attached, a LIEN IS ACQUIRED by the applicant as of the date of the original levy. If you substitute it, the lien will be lost, constituting
deprivation of property w/o due process of law

PERLA COMPANIA DE SEGUROS V. RAMOLETE

 Writ of execution unsatisfied. Obligor was summoned for examination, declared that the vehicle was covered by 3rd party insurance liability by Perla
 Order of garnishment against the insurance policy. Issued, but MFR filed on ground that the writ of execution was void because Perla is NOT a party to the
case, no jurisdiction over person
 SC: to bind person of garnishee, NOT necessary that summons be served upon hin. Need not be impleaded as party in the case, all that is necessary is
SERVICE OF THE WRIT OF GARNISHMENT
 ROC do not require service of summons to garnishee. Service of writ, garnishee becomes a virtual party and the RTC acquires jurisdiction over him
OLIB V. PASTORAL
 Writ of attachment, after trial judgment rendered IFO defendant. NO pronouncenet made as to resolution of the attachment
 Defendants moved to dissolve the attachment, opposed on the ground of losing jurisdiction over the case since perfected the appeal na --> old rule kasi, but
new rules pwede na kasi residual power for the protection of the parties which do not involve matters in the appeal
 SC: main case is appealed, the attachment is also considered appealed (sir dissents). Obligation on the bond is not extinguished by the non-payment of the
premiums

Q: if the attachment is lifted by filing of counterbond, what is the effect on the obligation of the bondsman in sec 4? Is it lifted because of the counterbond?
CALDERON V. IAC
 Sold Luzon brokerage. But suspended operations for failure to pay customs duties. Calderon paid BOC
 Calderon filed against seller for breach of contract, for deliberately concealing liability of luzon brokerage so that he will buy the company. w/ prelim
attachment, properties of defendants were levied
 Answer with CC, and counterbond of 1.5 M to lift the attachment
 Court DISMISSED the complaint after trial. Calderon and his surety required to pay damages
 In SC, surety contended that the DISSOLUTION of the attachment when defendant filed the counterbond had the effect of extinguishing the surety's liability.
 SC: WRONG! Clear from sec. 4 that the responsibility of the surety arises IF THE COURT SHALL FINALLY ADJUDGE that the APPLICANT IS NOT ENTITLED to the
ATTACHMENT
 Upon dismissal of the attachment WRONGFULLY issued, the surety is liable for damages as a DIRCT RESULT of such attachment
 Claim: Liability dissolved upon filing of the counterbond, wrongful attachment no longer exists
 SC: WRONG! Whether attachment was discharged either of the two ways in 12 and 13, the liability of the surety still subsists kasi reckoning point…
 WHAT DAMAGES SHALL BE AWARDED by party against attachment was issued? Only ACTUAL DAMAGES as result of the improper issuance of the attachment
o XPN: moral and exemplary IF attachment was MALICIOUSLY SUED
Q: assuming na with valid COA, BUT the issuance of the attachment is NOT ONE OF THE GROUNDS for issuance, still liable for damages?
 YES! Kasi reckoning point is if the court determines that the applicant is NOT ENTITLED to the attachment itself
PIONEER INSURANCE V. HONTANGAS
Q: where should you seek the damages against the attachment bond?
 IN THE SAME COURT that ISSUED the attachment. CANNOT pursue it in a separate independent action
CONSOLIDATED BANK V. IAC
 With mortgages, continuing personal guaranties too. Defaulted, so Solidbank moved for EJF of mortgages
 Mortgagee filed action for injunction in the CFI of Pasay, alleging that those who contracted the loan were not authorized by the corporation
 Solidbank filed answer with CC, further prayed for damages AND preliminary attachment w/c was granted
 Judge issued order to maintain status quo and RESIST from enforcing the preliminary attachment
 Filed a SEPARATE action for damages against Solidbank in ANOTHER CASE. MTD because of pendency of the first case and should be resolved in the same
case
 SC: the damages claimed in the second case are the indirect result of the attachment in the first case. Essentially the result of the attachment issued in the
first case. Can only claim in the court that issued the attachment