Case Summary (G.R. No. 203530)
Petitioner’s and Respondent’s Positions (Factual Summary)
Respondent Erlinda alleged ownership of time deposit certificates worth P28,597,472.70 and on presentation for payment the bank (petitioner) allegedly refused to honor them, prompting respondent to obtain a preliminary writ of attachment (RTC, February 27, 2001). Garnishments included the bank’s accounts in BPI Family Bank (Calamba) for P28,597,472.70 and an account at the Central Bank for P49,000,000.00. Following protracted incident and collateral proceedings, respondent was ordered to file an attachment bond of P35,000,000.00 (June 25, 2009, filed through Visayan Surety and Insurance Corporation and approved July 7, 2009). Petitioners failed to file a required counterbond within court-ordered periods and attempted to secure release of the attachment by depositing bank property (real property or certificates of title) instead of cash or a counterbond.
Key Dates and Procedural History
- Complaint and preliminary writ of attachment: February 2001.
- RTC orders lifting and then dealing with incidents: various orders culminating in orders of September 8, 2003 and December 18, 2003 (nullified by CA certiorari decision later).
- CA order (7th Division) nullifying certain RTC orders and directing filing of counterbond: November 15, 2006.
- Respondent’s attachment bond filed and approved: June–July 2009.
- RTC denied petitioners’ motion to admit bank property in lieu of counterbond: September 24, 2010 (denial of reconsideration May 26, 2011).
- RTC reinstated writ of attachment for petitioners’ failure to file counterbond: June 27, 2011 (amended reinstated writ served June 30, 2011).
- CA affirmed RTC orders: Decision March 27, 2012; reconsideration denied September 11, 2012.
- Petition for review to the Supreme Court denied (decision affirmed April 13, 2015). Applicable constitutional framework: 1987 Constitution (decision rendered post-1990).
Controlling Legal Provisions and Precedent
- Rule 57, Sections 2 and 5, Rules of Court (Attachment and the effect of deposit or counterbond): the Court quoted both sections, emphasizing that an order of attachment requires attachment of sufficient property unless the party “makes deposit or gives a bond … in an amount equal to that fixed in the order,” and that the sheriff shall attach property unless the party “makes a deposit with the court … or gives a counter-bond … in an amount equal to the bond fixed by the court … or to the value of the property to be attached.”
- Precedents cited by the Court: Security Pacific Assurance Corporation v. Tria-Infante (recognizing posting of counterbond or cash deposit as a means to secure discharge of an attachment) and Alcazar v. Arante (statutory construction — words are to be given their plain, ordinary, common usage absent contrary legislative intent).
Issue Presented for Resolution
Whether the petitioners could deposit bank property (real property or certificates of title) in lieu of a cash deposit or a counterbond to discharge or stay the implementation of a writ of attachment, in view of the RTC’s denial of that request and the CA’s affirmation thereof.
Supreme Court’s Legal Analysis: Text and Ordinary Meaning
The Supreme Court focused on the explicit language of Rule 57, Sections 2 and 5. It observed that those provisions condition the release or non-implementation of an attachment on the party making a “deposit” or giving a “bond” “in an amount equal to that fixed in the order,” or on a deposit “in an amount equal to the bond fixed by the court … or to the value of the property to be attached.” The Court emphasized the proximate relation between the terms “deposit” and “amount,” concluding that “amount” is commonly associated with a sum of money. Applying the ordinary-meaning canon of statutory construction (as in Alcazar v. Arante), the Court held that “deposit” in this context must be understood to require a monetary deposit (or the posting of a bond/counterbond), not the admission of bank property or real property titles in lieu of cash.
Reliance on Precedent and Prior Practice
The Court cited Security Pacific Assurance Corporation v. Tria-Infante to underscore that one recognized method to secure discharge of an attachment is the posting of a counterbond or making the requisite cash deposit in an amount equal to that fixed by the court. The Supreme Court treated these authorities as consistent with and supportive of a plain-language interpretation of Rule 57 that limits “deposit” to money (or a bond instrument), not to in-kind deposits of property.
Disposition and Rationale
Because the statutory text requires a deposit “in an amount” and a counter
...continue readingCase Syllabus (G.R. No. 203530)
Title and Nature of the Case
- Petition for Review on Certiorari under Rule 45 of the 1997 Rules of Civil Procedure.
- Petitioners: Luzon Development Bank, Tomas Clemente, Jr., and Oscar Ramirez.
- Respondent: Erlinda Krishnan.
- Relief sought by petitioners: annulment of the Court of Appeals Decision dated March 27, 2012 and Resolution dated September 11, 2012 in CA-G.R. SP No. 120664, which affirmed the RTC Orders dated September 24, 2010 and May 26, 2011 reinstating a writ of attachment for failure to file a counterbond.
Factual Background
- Respondent Erlinda claimed to be a client of Luzon Development Bank and maintained several accounts, including time deposits.
- Erlinda alleged that on several occasions, when she presented Time Deposit Certificates amounting to P28,597,472.70 for payment because they had become due, petitioners refused to honor them on the ground that they were fraudulent.
- Erlinda filed a complaint for Collection of Sum of Money and Damages on February 7, 2001.
- On February 27, 2001, the RTC granted a Preliminary Writ of Attachment. By virtue of the writ:
- Petitioners' accounts in BPI Family Bank, Calamba, Laguna amounting to P28,597,472.70 were garnished.
- Petitioners' account amounting to P49,000,000.00 in the Central Bank was garnished.
Early Procedural Steps and Motions
- March 9, 2001: Petitioners filed an urgent ex-parte Motion to Recall, Quash and/or Lift Attachment or Garnishment (in excess of amounts in the writ); respondent Erlinda opposed.
- August 15, 2001: Petitioners filed an Omnibus Motion seeking substitution of their garnished account with government securities and immediate resolution of their motion to discharge attachment; respondent Erlinda opposed.
- May 22, 2002: RTC resolved pending incidents and required petitioners to justify their motion to discharge the attachment.
- May 23, 2002 (pre-trial): Petitioners requested and were granted additional time to file a supplemental motion to justify their earlier motions; petitioners were given ten (10) days from receipt within which to comment or oppose it.
Orders Lifting and Subsequent Collateral Proceedings
- September 8, 2003: RTC issued an order lifting the attachment.
- Respondent Erlinda filed a motion for reconsideration and a Motion for Inhibition.
- December 18, 2003: RTC denied the motion for reconsideration but granted the motion for inhibition.
- Erlinda filed a Petition for Certiorari before the 7th Division contesting the September 8, 2003 and December 18, 2003 orders.
7th Division Decision and Its Directions
- November 15, 2006: 7th Division rendered a decision with the dispositive portion:
- "WHEREFORE, the PETITION FOR CERTIORARI is GRANTED. THE ORDERS dated September 8, 2003, and December 18, 2003 are NULLIFIED and SET ASIDE.
- The private respondents, as defendants in Civil Case No. 01-100046 entitled Erlinda C. Krishnan v. Luzon Development Bank, et al., are ORDERED to file a counterbond in accordance with Sec. 12, Rule 57, 1997 Rules of Civil Procedure, within 10 days from the finality of this decision; otherwise, the REGIONAL TRIAL COURT, BRANCH 36, in Manila shall immediately reinstate the writ of attachment issued and implemented in Civil Case No. 01-100046.
- Costs of suit to be paid by the respondents. SO ORDERED."
- Petitioners' subsequent motion for reconsideration was denied. Their petition and motion for reconsideration before the Supreme Court were likewise denied.
Orders and Bonds After the 7th Division Decision
- May 9, 2008: Respondent judge issued an Order directing respondent Erlinda to file a new attachment bond in the amount of P35,000,000.00 and petitioners to file a counterbond within ten days from notice of the filing and approval of the bond of respondent Erlinda.
- Petitioners moved for reconsideration of the May 9, 2008 Order; the motion was denied and the judge granted a period of fifteen days for Erlinda to file an attachment bond.
- June 25, 2009: Erlinda filed her attachment bond in the amount of P35,000,000.00 through Visayan Surety and Insurance Corporation.
- July 7, 2009: The attachment bond was approved by the respondent judge.
Subsequent Motions by Petitioners Seeking Alternatives to Cash Counterbond
- July 3, 2009: Petitioners filed an Omnibus Motion praying that:
- A hearing be held to determine the sufficiency of the attachment bond; and
- They be allowed to deposit Certificates of Title of real property; and
- The issuance of the writ of attachment be held in abeyance.
- July 20, 2009: Petitioners filed a motion for extension of time to comply and/or file the appropriate pleading and to hold in abeyance the reinstatement of the writ of attachment.
- January 28, 2010: Petitioners filed a motion to admit bank property in lieu of counterbond; respondent Erlinda opposed.
RTC Orders Denying Petitioners’ Request to Admit Bank Property in Lieu of Counterbond
- September 24, 2010: Respondent judge denied petitioners' motion to admit bank property in lieu of counterbond (assailed Order).
- May 26, 2011: The trial court denied petitioners' subsequent motion for reconsideration.
- June 27, 2011: Respondent judge issued an Order reinstating the Writ of Attachment dated March 1, 2001 for failure of petitioners to file the required counterbond.
- An amended Reinstated Writ of Attachment directed Sheriff Oscar L. Rojas to attach the real estate or personal properties of petitioners in the amount of P28,597,472.70.
- June 30, 2011: Sheriff served the Notice of Garnishment and the Amended Reinstated Writ of Attachment.
- July 4, 2011: Petitioners filed an urgent motion to recall, suspend or hold in abeyance and re-examination of the amended reinstated writ of preliminary attachment; respondent Erlinda opposed.
- July 19, 2011: Respondent Sheriff issued a Sheriff's Partial Report.
- Thereafter, petitioners filed a petition for certiorari with the Court of Appeals.