G.R. No. 196200 - Dy vs. Bibat-Palamos

Ernesto Dy and his wife, Lourdes Dy, proprietors of Limchia Enterprises, engaged in the shipping business, obtained a loan in 1990 from Orix Metro Leasing and Finance Corporation to acquire the cargo vessel M/V Pilar-I.
To secure the loan, Limchia Enterprises executed a Deed of Chattel Mortgage over M/V Pilar-I, with Lourdes Dy as co-maker.

Due to financial losses resulting from an attack by pirates on M/V Pilar-I, the Dy spouses failed to meet the scheduled payments under their promissory note.
After several demand letters from the respondent and failed efforts to restructure the loan—despite issuing checks that were subsequently dishonored—the respondent initiated a criminal complaint for violation of the Bouncing Checks Law.
In August 1992, the respondent filed a Complaint and Petition for Extrajudicial Foreclosure of Preferred Ship Mortgage under Presidential Decree No. 1521 with an urgent prayer for attachment before the RTC.
The RTC ordered the seizure of M/V Pilar-I and turned its possession over to the respondent. Subsequently, in 1994, the respondent transferred its rights, title, and interests in M/V Pilar-I to Colorado Shipyard Corporation.

In July 1997, the RTC ruled in favor of the Dy spouses, deciding that they had not defaulted on their loan since the respondent had consented to a restructured payment schedule; foreclosure was deemed premature, and the vessel was ordered to be returned to them.
The Court of Appeals affirmed the RTC’s ruling with a modification: ordering the Dy spouses to reimburse repair and drydocking expenses incurred by the respondent during its possession of the vessel.
On appeal, the Supreme Court rendered a decision on September 11, 2009, upholding the appellate findings but deleting the reimbursement order.
In August 2010, petitioner Ernesto Dy filed a motion for execution of judgment with the RTC.
During the pendency of the execution, Colorado, now in possession of M/V Pilar-I, filed a motion on July 29, 2010, reporting that the vessel had sustained severe damage, deteriorated, and sunk in its shipyard due to exposure to the elements.
In response, petitioner argued for the return of his vessel in the same condition as when it was seized, or alternatively, for the delivery of another vessel of similar tonnage, length, and beam.
The RTC, in its December 13, 2010 Order, granted execution of the judgment but denied petitioner’s remedy of returning the vessel in its original condition.
Petitioner’s subsequent motion for reconsideration was denied in the RTC’s March 7, 2011 Order, leading to the filing of the present petition for certiorari.

Whether the rule on hierarchy of courts applies and if direct resort to the Supreme Court under Rule 65 is justified by the facts and circumstances, despite the usual requirement to first exhaust remedies at the Court of Appeals.
Whether petitioner’s direct invocation of the Supreme Court constitutes an exception to the established hierarchy of courts due to special and important reasons warranting immediate attention.

Whether the trial court gravely abused its discretion in denying petitioner’s request for the return of M/V Pilar-I in the condition it was seized, or alternatively, for the delivery of a vessel of similar specifications.
Whether petitioner is estopped from demanding the return of the vessel in its original condition and if he had a duty to be more proactive regarding the vessel’s deteriorated state before judgment finality.