SECURITY BANK vs. GREAT WALL

Security Bank Corporation Vs. Great Wall Commercial Press Company, Inc., et al.

G.R. No. 219345                                                                                   

January 30, 2017

Facts: 

May 12, 2013, Security Bank Corporation, the petitioner, filed a complaint (with application for Issuance of a Writ of Preliminary Attachment) against the respondents, before the Regional Trial Court, Branch 59 of Makati City. The complaint sought to recover from respondents their unpaid obligations under a credit facility covered by several trust receipts and surety agreements, as well as interests, attorney’s fee and cost. The petitioner argued that in spite of the lapse of the maturity date of the obligation from December 11, 2012 to May 7, 2013, respondents failed to pay their obligations. The total principal amount sought was P10,000,000.00.

After due hearing, the RTC granted the application for a Writ of Preliminary Attachment of Security Bank, which then posted a bond in the amount of P10,000,000.00. Then respondent filed to lift Writ of Preliminary Attachment but denied by RTC. The respondent filed a motion for reconsideration but denied by RTC.

Dissatisfied respondents filed a petition for certiorari before CA, December 12, 2014, the CA lifted the Writ of Preliminary Attachment. The petitioner moved for reconsideration but its motion was denied by the CA in its assailed resolution, dated June 26, 2015.

Issue: 

Whether or not the court of appeals erred in nullifying the Writ of Preliminary Attachment issued by the Regional Trial Court.

Held: 

Yes, the CA erred in nullifying the Writ of Preliminary Attachment issued by the Regional Trial Court.

Under section 1 (d), Rule 57 of the Rules of Court, Preliminary Attachment section 1. Grounds upon which attachment may issue.- At the commencement of the action or at any time before entry of judgment, a plaintiff or any proper party may have the property of the adverse party attached as security for the satisfaction of any judgment that may be recovered in the following cases: (d) In an action against a party who has been guilty of a fraud in contracting the debt or incurring the obligation upon which the action is brought, or the performance thereof:

Wherefore, the December 12, 2014 Decision and the June 26, 2015 Resolution of the Court of Appeals in CA-G.R. SP No. 131714 are REVERSED and SET ASIDE. The issuance of the Writ of Preliminary Attachment by the Regional Trial Court, Branch 59, Makati City, in Civil Case No. 13-570, pursuant to its May 31, 2013 Order, is upheld.