Case Digest (G.R. No. 202004)
Facts:
Gil G. Chua v. China Banking Corporation, G.R. No. 202004, November 04, 2020, Supreme Court Third Division, Hernando, J., writing for the Court.Petitioner Gil G. Chua was one of several sureties under two Surety Agreements executed in favor of respondent China Banking Corporation to secure indebtedness of Interbrand Logistics & Distribution, Inc. (formerly Publicis Interbrand, Inc.). Under a series of Domestic Letters of Credit and corresponding trust receipts, China Bank advanced P189,831,288.17 to pay Nestle Philippines for goods to be delivered to Interbrand; the trust receipts required Interbrand to hold the goods in trust and remit proceeds to China Bank. The goods were allegedly delivered to various Interbrand warehouses, and China Bank claims Interbrand later defaulted on the trust receipt obligations.
When Interbrand failed to remit proceeds, China Bank demanded payment from the sureties, including Chua. On March 1, 2010 China Bank filed before the Regional Trial Court (RTC) of Makati City, Branch 59, a Complaint for Sum of Money and Damages with Application for Issuance of Writ of Preliminary Attachment alleging fraud in contracting and performance and attaching Chua’s and others’ properties. On March 3, 2010 the RTC issued a writ of preliminary attachment conditioned on plaintiff’s bond in the amount of P189,831,288.17.
Chua and the other sureties moved to lift the writ, arguing that they were not debtors and that Chua was not an officer, director or stockholder of Interbrand. On May 21, 2010 the RTC granted the motion and lifted the attachment against Chua. China Bank moved for reconsideration and submitted board minutes and amended articles purporting to show Chua’s participation as director/incorporator and noted Chua’s admission that he executed the Surety Agreement; the trial court nevertheless maintained its view that the documents did not show Chua’s status during the material period.
China Bank petitioned the Court of Appeals (CA) for certiorari and mandamus under Rule 65 with application for TRO and/or writ of preliminary injunction. By Decision dated November 10, 2011 the CA granted the petition, reinstated the March 3, 2010 order directing attachment of Chua’s properties, and declined to decide the substantive fraud question because that would reach the merits. The CA emphasized that Chua voluntarily signed the Surety Agreement and that his liability was not confined to his alleged incumbency as officer or stockholder. The CA denied Chua’s motion for reconsideration in a May 16, 2012 Resolution.
Chua filed a Petition for Review on Certiorari with the Supreme Court under Rule 45, challenging the CA’s reinstatement of the writ and asserting violations of due process, improper disregard of his evidence, that the CA effectively made his liability conditional on being a director/officer/stockholder without addressing fraud, and that the proper remedy from the lifting of the attachment...(Pro-only)
Issues:
- Was the writ of preliminary attachment properly issued against petitioner Gil G. Chua? ...(Pro-only)
Ruling:
- (Pro-only)
Ratio:
- (Pro-only)
Doctrine:
- (Pro-only)