Roque v. Court of Appeals
REITERATIONFacts
1. The Antecedents: The underlying dispute originated from a civil action filed by Associated Banking Corporation (the Bank) against Fil-Eastern Wood Industries, Inc. (Fil-Eastern) for the recovery of a sum of money. The Bank obtained a Writ of Preliminary Attachment against Fil-Eastern's assets. Separately, Fil-Eastern had a barge, identified as 'Fil-Eastern V', repaired by Cotabato Visayan Development Corporation. When Fil-Eastern failed to pay the repair costs, Cotabato Visayan Development Corporation, exercising its right to a mechanic's lien, sold the barge at a public auction. Petitioner Eligio Roque emerged as the highest bidder and acquired the barge. 2. Procedural History: The Bank's action led to a Writ of Attachment issued on February 4, 1974, with a notice of levy registered on February 7, 1974, affecting the barge. Despite this, the barge was delivered for repairs and subsequently sold at auction to Roque on April 24, 1974. The Bank later sought another writ of attachment, and on August 30, 1974, the sheriff seized the vessel. A compromise agreement between the Bank and Fil-Eastern was approved on October 9, 1974. When Fil-Eastern defaulted, the Bank moved for execution, and on March 7, 1975, the court ordered the sale of the barge. Petitioners refused to surrender the barge, leading to a court order on April 14, 1975, directing its surrender under penalty of contempt. Petitioners' motion to set aside this order was denied, as were subsequent motions for reconsideration. The Court of Appeals, on November 24, 1975, denied petitioners' petition for certiorari, prohibition, and injunction, finding that they had adequate remedies. 3. The Petition: Petitioners filed a petition for certiorari before the Supreme Court, arguing they were purchasers in good faith and for value. They contended that the Court of Appeals erred in sustaining the lower court's orders and that the levy and attachment were illegal. Specifically, they questioned whether they should be required to avail of remedies under Section 14, Rule 57, or Section 17, Rule 39 of the Rules of Court, given their claim of ownership through a prior auction sale. The Supreme Court, treating the petition as a special civil action for certiorari, found that petitioners had adequate remedies in the ordinary course of law, such as filing a third-party claim or a separate reivindicatory action, and thus dismissed the petition.
Issue(s)
Whether the Court of Appeals erred in ruling that certiorari was not the proper remedy for the petitioners. Whether the petitioners could avail themselves of the remedies provided under Section 14, Rule 57 and Section 17, Rule 39 of the Rules of Court. Whether the levy on the barge was illegal due to its implementation more than sixty days after the issuance of the Writ of Attachment. Whether the trial judge committed grave abuse of discretion in issuing the challenged orders.
Ruling
The petition is dismissed, and the restraining order is lifted. The Supreme Court affirmed the decision of the Court of Appeals.
Ratio Decidendi
On the propriety of certiorari: The Supreme Court agreed with the Court of Appeals that certiorari was not the proper remedy. The Court reiterated that for a writ of certiorari to lie, there must be no appeal, nor any plain, speedy, and adequate remedy in the ordinary course of law. In this case, petitioners had available remedies under the Rules of Court that they failed to avail themselves of. The Court found that the second and third requisites for certiorari were not met. On the availability of remedies under the Rules of Court: The Court held that petitioners could have availed themselves of the remedy provided in Section 14, Rule 57 of the Rules of Court when the Order for the implementation of the Writ of Attachment was issued. This section allows a third party claiming ownership to file an affidavit of title or right to possession. Furthermore, when the Sheriff seized the vessel for sale under the Order of Execution, petitioners could have availed themselves of the remedy under Section 17, Rule 39 of the Rules of Court, which provides a similar procedure for third-party claims during execution sales. The Court emphasized that these remedies are designed to address claims of ownership by third parties. On the validity of the levy: Petitioners argued that they could not avail of the Rules because the vessel was not in the actual custody of the Sheriff at the time of the levy, making it a mere "paper levy." The Court clarified that a levy of attachment on personal property can be actual or constructive. In this case, the registration of the Notice of Levy with the Philippine Coast Guard constituted a constructive levy. The Court found that constructive possession is sufficient when actual possession is not feasible and was followed by actual seizure as soon as possible. The argument that the levy was illegal because it was implemented more than sixty days after issuance was also dismissed, as the Rules do not provide a lifetime for a Writ of Attachment, and the constructive levy occurred within a reasonable timeframe. On grave abuse of discretion: The Court found no grave abuse of discretion on the part of the respondent judge. The judge was enjoined by law to promptly dispatch the controversy. The decision had become final and executory, making the execution a ministerial phase. The trial court had no jurisdiction to pass upon petitioners' claim of ownership because the trial had terminated, and petitioners were not parties to the case nor had they filed a third-party claim. The Court reiterated that claims of ownership by third parties should be ventilated in a separate and independent reivindicatory action.
Main Doctrine
A third person claiming ownership of property attached or levied upon must file a separate and independent action to determine the validity of their claim, rather than raising the issue in the case where the writ was issued. Failure to avail of the remedies under Sections 14, Rule 57 and 17, Rule 39 of the Rules of Court renders a petition for certiorari improper.