Title
Alazas vs. Salas
Case
G.R. No. 83693
Decision Date
Dec 4, 1989
Libel case: Mercader won P50K damages from Alazas. Shares auctioned, but ownership disputed. Court ordered Alazas' examination to verify hidden assets, upheld as necessary for judgment satisfaction.
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Case Digest (G.R. No. 83693)

Facts:

  1. Initial Judgment and Appeal:

    • Rosario Mercader filed a libel case against Leandro Alazas and Dioscoro Lazaro in the Regional Trial Court (RTC) of Cebu.
    • On November 4, 1982, the RTC ordered Alazas and Lazaro to pay Mercader P200,000.00 in moral damages, P10,000.00 in attorney’s fees, P5,000.00 in litigation expenses, and costs.
    • On appeal, the Intermediate Appellate Court dismissed the case against Lazaro but affirmed the decision against Alazas.
    • The Supreme Court later reduced the moral damages to P50,000.00 in a resolution dated September 28, 1987.
  2. Execution of Judgment:

    • On March 7, 1988, Mercader moved for the execution of the final judgment.
    • The deputy provincial sheriff garnished Alazas’ shares in Gala Inc. on March 16, 1988.
    • Marilou Valmores, cashier of Gala Inc., informed the sheriff that Alazas only owned one share worth P100.00 as of October 17, 1982.
    • Despite this, the sheriff proceeded with the public auction of Alazas’ shares.
  3. Public Auction and Sale:

    • On March 29, 1988, Mercader bid P47,400.00 for 1,580 shares of Alazas in Gala Inc. and was awarded the shares.
    • A certificate of sale was issued on March 30, 1988, in partial satisfaction of the judgment.
    • On April 4, 1988, Gloria Alazas, corporate secretary of Gala Inc., informed the sheriff that Alazas had only one share, having disposed of his 1,580 shares.
  4. Second Levy and Auction:

    • On April 6, 1988, a second notice of levy and execution was issued based on records showing Alazas had 16,000 unissued shares in Gala Inc.
    • A second public auction was held on April 14, 1988, where Mercader bid P24,090.00 for 803 shares.
    • A certificate of sale was issued on April 15, 1988.
  5. Mercader’s Claims and Examination Motion:

    • On May 6, 1988, Mercader informed Gala Inc. that she had acquired sufficient shares to become a majority stockholder.
    • On May 24, 1988, Mercader filed a motion for the examination of Alazas under Section 39 of Rule 39, alleging that Alazas had concealed his properties.
    • The trial court granted the motion and scheduled the examination for May 30, 1988, which was later rescheduled to June 6, 1988.
  6. Alazas’ Motion for Reconsideration:

    • Alazas filed a motion for reconsideration, arguing that the trial court had lost jurisdiction after the judgment was fully satisfied.
    • The trial court denied the motion on June 6, 1988, and reset the examination for June 20, 1988.
  7. Petition for Certiorari and Prohibition:

    • Alazas filed a petition for certiorari and prohibition, seeking to restrain the trial court from conducting the examination.
    • The Supreme Court issued a temporary restraining order on June 29, 1988, halting the trial court’s proceedings.

Issue:

  • (Unlock)

Ruling:

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Ratio:

  1. Jurisdiction of the Trial Court:

    • While a trial court’s jurisdiction becomes ministerial after a judgment becomes final and executory, it retains the authority to ensure the full satisfaction of the judgment.
    • The examination of a judgment debtor under Section 39 of Rule 39 is a legitimate process to determine if there are hidden or concealed properties that can satisfy the judgment.
  2. Satisfaction of Judgment:

    • The repeated representations by Gala Inc.’s officers that Alazas owned only one share worth P100.00 cast doubt on whether the judgment had been fully satisfied.
    • The trial court’s order for examination was justified to verify if Alazas had other properties or credits that could satisfy the judgment.
  3. Clerical Error:

    • The trial court’s reference to “Gala Enterprises” instead of “Gala Inc.” was a clerical error that did not affect the validity of its orders.
  4. Evasion of Judgment:

    • The Court noted that Alazas’ claim of having sold his shares could be a ruse to evade the execution of the judgment.

Conclusion:

The Supreme Court ruled that the trial court acted within its jurisdiction in ordering the examination of Alazas as a judgment debtor. The petition was dismissed, and the temporary restraining order was lifted.


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