G.R. No.
135830 September 30, 2005 Facts:
JUAN DE DIOS CARLOS, Petitioners, vs. FELICIDAD SANDOVAL, et.al.
Respondent.
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G.R. No. 136035
SIDDCOR (now MEGA PACIFIC) INSURANCE CORPORATION,
Petitioners, vs. FELICIAD SANDOVAL VDA. DE CARLOS and TEOFILO
CARLOS II, Respondent.
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G.R. No. 137743
SIDDCOR (now MEGA PACIFIC) INSURANCE CORPORATION,
Petitioners, vs. COURT OF APPEALS, Respondent.
Topic: Preliminary Attachment
Emergency Recit: Carlos, arguing that he was the sole compulsory heir of
the estate of Teofilo, filed a Complaint with the RTC, with a prayer for a Writ
of Preliminary Attachment. Such writ was issued and granted by the RTC
upon posting of a bond. Respondents assailed such issuance by a Certiorari
to the CA. CA ruled in favor of respondents and discharged the writ of
preliminary attachment. While the main case of Carlos was pending,
respondents filed a Motion for Judgment on the Attachment Bond, arguing
that such writ was improperly issued, so they were entitled to damages. This
was granted by the CA and was affirmed by the SC, attaining finality. Carlos
and SIDDCOR now filed various petitions assailing the Resolution of the CA
ordering them to pay respondents the damages. The petitioners argue that
the judgment on the attachment bond cannot be done prior to the
adjudication of the main case, that no proper hearing was held, and that the
damages were improperly ascertained. The SC denied all these arguments,
ruling in favor of respondents. First, although it is true that the judgment on
the attachment bond cannot be done prior to the adjudication of the main
case, this case is exceptional as the issue on the entitlement to such
damages have already been affirmed by the SC, and such has attained
finality. Second, there was a proper hearing as all parties were given notices
and opportunities to present their sides. Lastly, the damages were properly
ascertained proven by the Manifestation of the PNB as to the amount given
to the Sheriff, and that such bond is not limited to those damages only
incurred during the pendency of the appeal as it is a rule that the bond
covers all the damages that may be sustained because of such unlawful
attachment.
Doctrine: [pls just check the paragraphs in bold in the held ]
1. In his Complaint before the RTC, Carlos asserted that he was the
sole surviving compulsory heir of his parents who had acquired
during their marriage, six parcels of land (subject properties). His
brother, Teofilo, died intestate in 1992. At the time of his death,
Teofilo was apparently married to Sandoval. Nonetheless, Carlos
alleged in his Complaint that Teofilo and Sandoval were not validly
married as they had not obtained any marriage license.
2. Carlos also claimed that Teofilo, prior to their fathers death in 1963,
developed a scheme to save the estate from inheritance taxes.
Under the scheme, the properties of the father would be transferred
to Teofilo who would see to it that the shares of the legal heirs are
protected and delivered to them. Felix assented to the plan, and the
subject properties were transferred in the name of Teofilo. After
Teofilos death, Carlos entered into certain agreements with
Sandoval in connection with the subject properties. Carlos did so,
believing that the latter was the lawful wife of his brother Teofilo.
3. Carlos now sought to nullify these agreements with Sandoval for
want of consideration, and prayed of the RTC to declare the alleged
marriage between Teofilo and Sandoval void ab initio, order that new
titles covering the subject properties be issued in the name of Carlos,
and require Sandoval to restitute Carlos in the amount of
18,924,800.00.
4. Carlos likewise prayed for the issuance of the provisional relief
of preliminary attachment. The RTC granted the prayer for
preliminary attachment, and the writ was issued. Carlos posted a
bond for 20,000,000.00 issued by herein petitioner SIDDCOR
Insurance Corporation (SIDDCOR).
5. Shortly thereafter, a Notice of Garnishment was served upon the
Philippine National Bank (PNB) over the deposit accounts
maintained by respondents.
6. Respondents filed an Urgent Motion to Discharge the Writ of
Attachment, which the RTC denied. This caused respondents to file
a Petition for Certiorari with the Court of Appeals.
7. CA 2nd Division granted the Pet. For Certiorari, ordering the
dissolution and discharge of the writ of preliminary attachment
as well as the garnishment.
8. Upon Motion for Summary Judgment of both parties, RTC rendered
a summary judgment in favor of Carlos, declaring Teofilo and
Sandovals marriage void ab initio, ordering Sandoval to pay the
sum, and declaring Carlos as the sole and exclusive owner of the
parcel of land.
9. Carlos moved for execution pending appeal, which the RTC granted
and it issued a writ of execution.
10. Respondents filed an MR to the RTC Summary Judgment, which
was denied. They appealed to the CA. Meanwhile, Sandoval filed a
Petition for Certiorari, question the allowance of the execution
pending appeal.
11. Respondents also filed a Motion for Judgment on the
Attachment Bond in the CA, arguing that the Writ of Preliminary
Attachment issued by the RTC (in fact #4) was improperly
granted, and such was affirmed by the SC, attaining finality.
Because such improper grant, respondents argue that they were
entitled to damages under Sec. 20, R57, which governs damages on
account of unlawful attachment, as the garnishment has already
caused PNB to deliver said amount to the Sheriff.
12. CA Special 4th Division issued a Resolution, certifying that all
the necessary pleadings have been filed, and that the case may
already be referred to the Raffle Committee for assignment to a
ponente.
13. Respondents filed a Motion for Partial Reconsideration, arguing that
under the Revised Internal Rules of the Court of Appeals (RIRCA),
the case may be re-raffled only after there is a resolution that the
case is deemed submitted for decision. They pointed out that re-
raffle could not yet be effected, as there were still pending incidents,
the Motion for Judgment on Attachment Bond.
14. CA Special 4th Division issued a Resolution, agreeing with
respondents that it was necessary to resolve pending incidents first.
Hence, such CA Division resolve the Motion for Judgment on
Attachment Bond, holding that respondents are entitled to damages.
It held that it was not necessary for the determination of such
damages on the attachment bond to await the decision on appeal.
Hence, Carlos and SIDDCOR was ordered to pay Sandoval, et. al.
for damages resulting from the unlawful attachment.
15. Carlos and SIDDCOR filed their MRs, while respondents filed a
Motion for Immediate Execution. CA denied the MRs and granted
respondents Motion.
16. Hence, these consolidated petitions. Carlos filed an Appeal by
Certiorari with Prayer for TRO/Preliminary Injunction, arguing, among
others, that CA 4th Div. could not have resolved Motion for Judgment
on Attachment Bond as the case had not yet been re-raffled under
the two-raffle system for study and report, and that there was no
hearing conducted.
17. SIDDCOR filed a Petition for Review, arguing that the motion for
damages could not be ruled upon unless there is already a judgment
in the main case; that even if damages may be awarded, these
should encompass only damaged incurred during pendency of
appeal; and that there was no hearing conducted.
Issue/s:
1. W/N the judgment on the attachment bond could have been
rendered prior to the adjudication of the main case Generally, no.
But this case is exceptional.
2. W/N the CA complied with the hearing requirement under Sec. 20,
Rule 57 prior to its judgment on the attachment bond YES.
3. W/N the amount of damages was properly ascertained YES.
Held:
Judgment on Attachment Bond Can be Rendered Prior Adjudication of Main
Case
1. Section 20, R57 essentially allows the application to be filed at any
time before the judgment becomes executory. It should be filed in the
same case that is the main action, and cannot be instituted
separately. It should be filed with the court having jurisdiction over
the case at the time of the application.
2. Under Sec. 20, R57, there must be first a judgment on the action
before damages can be claimed by such party. However, the Court
clarified that under the rule, "recovery for damages may be had by
the party thus prejudiced by the wrongful attachment, even if the
judgment be adverse to him."
3. The language used in the Rules of Court leaves no doubt that even a
party who loses the action in main but is able to establish a right to
damages by reason of improper or excessive attachment may be
entitled to damages. This bolsters the notion that the claim for
damages arising from such wrongful attachment may arise and be
decided separately from the merits of the main action.
4. It is clear that the award for damages need not be resolved
before the case is submitted for decision, but should instead be
resolved and included in the judgment on the main case, or, in
this case, the decision on the Appeal by Certiorari filed by the
respondents. Hence, the CA was incorrect in resolving the
application for damages even before the main judgment does not
conform to Sec. 20, R57. However, the special particular
circumstances in this case does not make the error mortal to the
award of damages.
5. It is noted that the award for damages was made after a proper
hearing, and such relief of damages has been conclusively affirmed
by the SC. Being already ruled upon by the highest court of the land,
 it is obvious that said right is already made viable by such final sustain by reason of the attachment, if the court shall finally
judgment. adjudge that the applicant was not entitled thereto."
6. Also, the argument that the case must be re-raffled first before 3. According to Paramount Insurance Corp v CA, the bond is designed
deciding on the damages is correct. However, it does not outweigh to cover all damages which the party enjoined can possibly suffer. Its
the fact that there was already a final determination that the principal purpose is to protect the enjoined party against loss or
attachment was wrongful. damage by reason of an injunction." No distinction was made as to
when the damages should have been incurred.
The proper hearing requirement was met
1. The hearing requirement ties with the indispensable demand of WHEREFORE, the petitions are DISMISSED.
procedural due process. Due notice to the adverse party and its
surety setting forth the facts supporting the applicant's right to
damages and the amount thereof under the bond is essential.
According to Paramount Insurance v CA, what is necessary
only is for the attaching party and his surety or sureties to be
duly notified and given the opportunity to be heard.
2. In this case, both Carlos and SIDDCOR were duly notified by the
appellate court of the Motion for Judgment on the Attachment Bond
and were required to file their respective comments thereto. Clearly,
all the relevant parties had been afforded the bare right to be heard
on the matter. Plainly, there is no express requirement under the rule
that the hearing be done in open court, or that the parties be allowed
to confront adverse witnesses to the claim of damages on the bond.
3. In fine, the due process guarantee has been satisfied in this case. To
impose as mandatory on the CA or SC to hear the application for
damages through full-blown hearings in open court is unwise and
beyond the demands of Section 20, Rule 57. The effect would be
unduly disruptive on the daily workflow of appellate courts which
rarely conduct open court hearings.

The Damages were properly ascertained

1. In this case, since there was already a final judgment held by the SC,
all that was necessary to be proved was the amount of damages
actually sustained. And clearly, the amount of actual pecuniary loss
sustained by respondents has been well established. The
Manifestation submitted by the PNB further affirmed the actual
amount seized by Carlos, an amount which could not have been
acquired had it not been for the writ of preliminary attachment which
was wrongfully issued.
2. Also, SIDDCORs argument that the damages are limited to those
incurred during the pendency of appeal is belied by Sec. 4, R57,
which provides that the bond issued for preliminary attachment is
conditioned that the applicant "will pay all the costs which may be
adjudged to the adverse party and all damages which he may