G.R. No. 66075-76 - Agustin vs. Intermediate Appellate Court

On August 21, 2001, Dabay Abad, Hatab Abad, Omar Abas, Hanapi Abdullah, Rojea Ab Abdullah, Abdullah Abedin, Alex Abedin, et al. (collectively, 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 the Development Bank of the Philippines (DBP) and the Guarantee Fund for Small and Medium Enterprise (GFSME) before the Regional Trial Court (RTC) Branch 16, Davao City. They alleged that DBP had submitted their titles for safekeeping and subsequently turned them over to GFSME under a guarantee agreement. They prayed for a writ of seizure pending hearing.
On August 24, 2001, the RTC issued the writ of seizure, secured by a bond issued by Country Bankers Insurance Corporation (CBIC).

On September 5, 2001, DBP filed an omnibus motion to dismiss the complaint and to quash the writ of seizure for improper venue. Abad et al. opposed and showed a delivery receipt of 228 titles seized from GFSME. On September 25, 2001, the RTC granted DBP’s motion and dismissed the case for improper venue.
On December 20, 2001, DBP and GFSME jointly moved to order plaintiffs to return the titles. After opposition by Abad et al., the RTC directed return of the 228 titles on January 27, 2003. Abad et al. filed a petition for certiorari, which the Court of Appeals dismissed on June 9, 2003.
On September 18, 2003, DBP moved for a writ of execution of the January 27, 2003 order. The RTC issued the writ on December 16, 2003, but the sheriffs’ return indicated that Abad et al. failed to deliver the titles.
On February 3, 2004, DBP filed a motion to call on plaintiff’s surety bond for damages due to non-delivery. In an order dated May 17, 2004, the RTC denied the motion for lack of residual jurisdiction, and in a July 9, 2004 order denied reconsideration.
DBP filed a petition for certiorari and mandamus with the Court of Appeals, which on July 9, 2008 dismissed the petition for failure to timely claim damages under Section 20, Rule 57 of the Rules of Court, and denied reconsideration on January 21, 2011. DBP then elevated the case to this Court.

Whether the Court of Appeals erred in strictly applying Section 20, Rule 57 of the Rules of Court to bar DBP’s belated claim for damages on the replevin bond, despite the respondents’ refusal to return the certificates of title.