De la Rama v.

Villarosa, 8 SCRA 413 (1963)

FACTS:

-Lourdes de la Rama brought an action in the Court of first Instance of Negros Occidental against lessee
Augusto R. Villarosa and the latter's surety, the Luzon Surety Co., Inc. for judicial confirmation of the
cancellation, rescission and annulment of a contract of lease of sugarland, and the payment of the unpaid
balance of the rental for the 1953-54 sugarcane crop year, the rental for the 1954-55 crop year, rental and
partly the reasonable value for the use and occupation of the leased premises for the 1955-56 crop year,
with stipulated attorney's fees, and interests, etc.

-The court rendered a partial summary judgment decreeing the lease rescinded, cancelled and ordering
defendant Augusto R. Villarosa to surrender and deliver to De la Rama or her representatives the
possession of the leased premises, etc.

-Luzon Surety appealed.

-Upon Motion of De La Rama, the Lower Court issued an order for the issuance of writ of execution.

-Accordingly, the sheriff garnished the deposit of Luson Surety with the Philippine Trust Company to the
amount of P71,533.99.

-Only the sum of P31,535.57 was paid to the sheriff.

-CA modified the decision of the Trial Court with respect to the amount.

-Luzon Surety thereafter invoked the provisions of Sec. 5 of Rule 39, of the Rules of Court and demanded
that an interest of 6% should be paid on the difference between the sum actually garnished and the sum
obtained in the final judgment.

-Motion was denied. Hence, this appeal.

HELD:
-The mere garnishment of funds belonging to the party upon order of the court does not have the effect of
delivering the money garnished to the sheriff or to the party in whose favor the attachment is issued. The
fund is retained by the garnishee or the person holding the money for the defendant.
-The garnishee, or one in whose hands property is attached or garnished, is universally regarded as
charged with its legal custody pending the outcome of the attachment of garnishment, unless, by local
statute and practice, he is permitted to surrender or pay the garnished property or funds into court, to the
attaching officer, or to a receiver or trustee appointed to receive them.
-The effect of the garnishment, therefore, was to require the Philippine Trust Company, holder of the
funds of the Luzon Surety Co., to set aside said amount from the funds of the Luzon Surety Co. and keep
the same subject to the final orders of the Court. In the case at bar there was never in order to deliver the
full amount garnished to the plaintiff-appellee; all that was ordered to be delivered after the judgment had
become final was the amount found by the Court of Appeals to be due. The balance of the amount
garnished, therefore, remained all the time in the possession of the bank as part of the funds of the Luzon
Surety Co., although the same could not be disposed of by the owner.