Title
Traders Royal Bank vs. Intermediate Appellate Court
Case
G.R. No. 66321
Decision Date
Oct 31, 1984
Traders Royal Bank sued REMCO for debt recovery; La Tondena claimed ownership of attached alcohol. Bulacan court upheld La Tondena's separate action, affirming jurisdiction and non-exclusivity of intervention.

Case Summary (G.R. No. 66321)

Procedural History

Traders Royal Bank sued Remco Alcohol Distillery, Inc. in Civil Case No. 9894‑P (RTC Pasay) seeking recovery of a monetary sum and obtained a writ of preliminary attachment. The Pasay deputy sheriff levied approximately 4,600 barrels of alcohol and molasses. La Tondena filed a third‑party claim with the sheriff and later sought intervention in the Pasay action; the Pasay court initially authorized a withdrawal, later reconsidered, and denied intervention. While matters remained pending in Pasay, La Tondena filed an independent vindicatory action in RTC Malolos, Civil Case No. 7003‑M, seeking a declaration of ownership and a writ of preliminary mandatory and prohibitory injunction to prevent interference with its asserted right to withdraw the goods. The Bulacan judge granted La Tondena’s application and issued an injunction, which prompted Traders Royal Bank to seek certiorari and prohibition with the IAC to annul the Bulacan court’s order. The IAC denied relief, and Traders Royal Bank sought review by the Supreme Court.

Factual Core

  • Traders Royal Bank obtained a writ of preliminary attachment in Pasay and the sheriff levied the alcohol and molasses stored at Remco’s ageing warehouse in Calumpit.
  • La Tondena asserted ownership by filing a third‑party claim with the sheriff, pursued intervention in the Pasay case, and later filed an independent vindicatory action in Bulacan claiming title and seeking injunctive relief.
  • The Pasay court at one point authorized withdrawal of the goods by La Tondena but later declared the goods remained the property of Remco and denied intervention; La Tondena filed a motion for reconsideration and later withdrew it.
  • The Bulacan court, after hearings and memoranda, declared La Tondena owner of the disputed alcohol and issued a preliminary injunction; the Pasay court then ordered its deputy sheriff to enforce the initial attachment and to prevent withdrawal, creating conflicting orders between courts.

Issue Presented

Whether a Regional Trial Court, at the instance of a third‑party claimant, may issue injunctive relief enjoining the sale or removal of property previously levied upon by a sheriff pursuant to a writ of attachment issued by a different Regional Trial Court.

Governing Rule and Precedents

Section 14, Rule 57, Rules of Court prescribes the procedure for third‑party claims to property levied under attachment: the claimant may file an affidavit of title/possession with the officer in possession and serve the attaching creditor; the officer may require the attaching creditor to post an indemnity bond; the claimant may vindicate title by a separate action. The decision relies on established precedent, notably Manila‑Herald Publishing Co. v. Ramos, which holds that a separate action by a third‑party claimant is appropriate and that the court exercising jurisdiction over that action may order interlocutory relief—including directions to the officer in possession—necessary to preserve the subject matter and parties’ rights. The decision also references cases emphasizing that courts of coordinate jurisdiction ordinarily should not injoin each other’s processes, but clarifies the limitation of that rule where a stranger’s property is seized by a sheriff.

Court’s Legal Analysis and Reasoning

The Court found no abuse of discretion in the Bulacan RTC’s issuance of the injunction. It emphasized that Section 14, Rule 57 expressly contemplates a distinct remedy for third‑party claimants: they may file a claim with the officer and, if the attaching creditor posts the required bond, they may bring an independent suit to vindicate title. The judge presiding over such an independent action possesses jurisdiction over interlocutory matters incidental to the cause and may enter orders calculated to preserve the property and protect parties’ interests, including injunctions directing the officer in possession. The rule against one coordinate court interfering with another’s orders is principally aimed at preventing nullification of another court’s process where the property belongs to the defendant in that other action; it does not apply when the sheriff has seized a stranger’s property beyond the bounds of his authority. The Manila‑Herald line of cases supports the proposition that interlocutory relief in a third‑party vindicatory action is proper and does not constitute unlawful interference with a coordinate court’s custody of property when the title is contested. The Court also rejected Traders Royal Bank’s contention that La Tondena’s prior unsuccessful attempt to intervene in the Pasay case precluded a subsequent independent action; intervention is cumulative and not exclusive, and denial of a third‑party claim in attachment doe

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