DBP v. CARPIO

DEVELOPMENT BANK OF THE PHILIPPINES, Petitioner  vs. HON. EMMANUEL C. CARPIO, et al., Respondent

G.R. No. 195450.

February 1, 2017

FACTS:

On August 21, 2001, Dabay Abad, Hatab Abad, Omar Abas, Hanapi Abdullah, Rojea Ab Abdullah, Abdullah Abedin, Alex Abedin, et al .(Abad, et al.), represented by their attorney-in-fact, Manuel L. Te, filed a complaint for delivery of certificates of title, damages, and attorney's fees against petitioner Development Bank of the Philippines (DBP) and Guarantee Fund for Small and Medium Enterprise (GFSME) before the RTC.

In their, Complaint, Abad, et al. prayed, among others, for the issuance of a writ of seizure, pending hearing of the case, for delivery of their certificates of title they claimed to be unlawfully detained by DBP and GFSME. They alleged that their certificates of title were submitted to DBP for safekeeping pursuant to the loan agreement they entered into with DBP. The same certificates of title were turned over by DBP to GFSME because of its call on GFSME's guarantee on their loan, which became due and demandable, and pursuant to the guarantee agreement between DBP and GFSME.

As prayed for, the RTC issued the Writ of Seizure on August 24, 2001. The writ was accompanied by Plaintiffs Bond for Manual Delivery of Personal Property issued by Country Bankers Insurance Corporation (CBIC).

On September 5, 2001, DBP filed its Omnibus Motion to Dismiss Complaint and to Quash Writ of Seizure on the ground of improper venue, among others. Abad, et al. filed their Opposition and later, their Supplemental Opposition, to which they attached the Delivery Receipt showing that the court sheriff took possession of 228 certificates of title from GFSME.

In its Order, dated September 25, 2001, the RTC granted DBP's omnibus motion and dismissed the case for improper venue.

On December 20, 2001, DBP and GFSME filed their Joint Motion to Order Plaintiffs to Return Titles to Defendants DBP and GFSME. After Abad, et al. filed their opposition, the RTC issued the Order, dated January 27, 2003, directing Abad, et al. to return the 228 certificates of title.

Abad, et al. filed a petition for certiorari and prohibition with the Court praying, among others, for the nullification and reversal of the January 27, 2003 Order of the RTC. The Court, however, in its June 9, 2003 Resolution, dismissed the petition.

On September 18, 2003, DBP filed its Motion for Writ of Execution of the January 27, 2003 Order before the RTC. On December 16, 2003, the RTC issued the corresponding Writ of Execution. The Sheriffs Return of Service, however, indicated that Abad, et al. failed to deliver the certificates of title

ISSUE:

Whether or not the court erred in its blind adherence to and strict application of section 20, Rule 57 of the 1997 Rules of Civil Procedure

RULING:

No. Accordingly, the CA did not commit any reversible error when it applied the rules of procedure in resolving the issue at hand. The application for damages was belatedly filed.

 SEC. 20. Claim for damages on account of illegal attachment. - If the judgment on the action be in favor of the party against whom attachment was issued, he may recover, upon the bond given or deposit made by the attaching creditor, any damages resulting from the attachment. Such damages may be awarded only upon application and after proper hearing, and shall be included in the final judgment. The application must be filed before the trial or before appeal is perfected or before the judgment becomes executory, with due notice to the attaching creditor and his surety or sureties, setting forth the facts showing his right to damages and the amount thereof.

If the judgment of the appellate court be favorable to the party against whom the attachment was issued, he must claim damages sustained during the pendency of the appeal by filing an application with notice to the party in whose favor the attachment was issued or his surety or sureties, before the judgment of the appellate court becomes executory. The appellate court may allow the application to be heard and decided by the trial court.

Nothing precludes DBP from instituting an action for collection of sum of money against respondents.1âwphi1Besides, if the parcels of land covered by the certificates of title, which DBP sought to recover from respondents, were mortgaged to the former, then DBP, as mortgage-creditor, has the option of either filing a personal action for collection of sum of money or instituting a real action to foreclose on the mortgage security. The two remedies are alternative and each remedy is complete by itself. If the mortgagee opts to foreclose the real estate mortgage, he waives the action for the collection of the debt, and vice versa.