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VOL. 230, FEBRUARY 21, 1994 181


Oñate vs. Abrogar
*
G.R. No. 107303. February 21, 1994.

EMMANUEL C. OÑATE and ECON HOLDINGS


CORPORATION, petitioners, vs. HON. ZEUS C.
ABROGAR, as Presiding Judge of Branch 150 of the
Regional Trial Court of Makati, and SUN LIFE
ASSURANCE COMPANY OF CANADA, respondents.
*
G.R. No. 107491. February 21, 1994.

BRUNNER DEVELOPMENT CORPORATION, petitioner,


vs. HON. ZEUS C. ABROGAR, as Presiding Judge of
Branch 150 of the Regional Trial Court of Makati, and SUN
LIFE ASSURANCE COMPANY OF CANADA,
respondents.

Actions; Attachments; Jurisdiction; It is well-settled that a writ


of preliminary attachment may be validly applied for and granted
even before the defendant is summoned or is heard from.·
Petitioners initially argue that respondent Judge erred in granting
Sun LifeÊs prayer for a writ of preliminary attachment on the
ground that the trial court had not acquired jurisdiction over them.
This argument is clearly unavailing since it is well-settled that a
writ of preliminary attachment may be validly applied for and
granted even before the defendant is summoned or is heard from.
The rationale behind this rule was stated by the Court in this wise:
„A preliminary attachment may be defined, paraphrasing the Rules
of Court, as the provisional remedy in virtue of which a plaintiff or
other proper party may, at the commencement of the action or any
time thereafter, have the property of the adverse party taken into
the custody of the court as security for the satisfaction of any

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judgment that may be recovered. It is a remedy which is purely


statutory in respect of which the law requires a strict construction
of the provisions granting it. Withal no principle, statutory or
jurisprudential, prohibits its issuance by any court before
acquisition of jurisdiction over the person of the defendant.
Same; Same; An attachment may not be dissolved by a showing
of its irregular or improper issuance if it is upon a ground which is
at the same time the applicantÊs cause of action in the main case.
·Petitioners then contend that the writ should have been
discharged since the

________________

* SECOND DIVISION.

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182 SUPREME COURT REPORTS ANNOTATED

Oñate vs. Abrogar

ground on which it was issued·fraud in contracting the obligation


·was not present. This cannot be considered a ground for lifting
the writ since this delves into the very complaint of the Sun Life. As
this Court stated in Cuatro v. Court of Appeals: „Moreover, an
attachment may not be dissolved by a showing of its irregular or
improper issuance if it is upon a ground which is at the same time
the applicantÊs cause of action in the main case since an anomalous
situation would result if the issues of the main case would be
ventilated and resolved in a mere hearing of the motion (Davao
Light and Power Co., Inc. vs. Court of Appeals, supra, The
Consolidated Bank and Trust Corp. (Solidbank) vs. Court of
Appeals, 197 SCRA 663 [1991]).
Same; Same; Writ of attachment may not validly be effected
until and unless preceded or contemporaneously accompanied by
service of summons.·Finally, petitioners argue that the
enforcement of the writ was invalid since it undisputedly preceded
the actual service of summons by six days at most. Petitioners cite
the decisions in Sievert vs. Court of Appeals, et al. and BAC

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Manufacturing and Sales Corp. vs. Court of Appeals, et al., wherein


this Court held that enforcement of the writ of attachment can not
bind the defendant in view of the failure of the trial court to acquire
jurisdiction over the defendant through either summons or his
voluntary appearance. We do not agree entirely with petitioners.
True, this Court had held in a recent decision that the enforcement
of writ of attachment may not validly be effected until and unless
proceeded or contemporaneously accompanied by service of
summons.
Same; Same; Same; Exception to rule of contemporaneous
service of summons and writ; Enforcement of the writ of attachment
valid even if it preceded the actual service of summons by six days
where a previous attempt to serve the summons and the writ of
attachment failed due to factors beyond the control of either the
plaintiff or the process server.·But we must distinguish the case at
bar from the Sievert and BAC Manufacturing cases. In those two
cases, summons was never served upon the defendants. The
plaintiffs therein did not even attempt to cause service of summons
upon the defendants, right up to the time the cases went up to this
Court. This is not true in the case at bar. The records reveal that
Sheriff Flores and Sun Life did attempt a contemporaneous service
of both summons and the writ of attachment on January 3, 1992,
but were stymied by the absence of a responsible officer in
petitionersÊ offices. Note is taken of the fact that petitioners Oñate
and Econ Holdings admitted in their answer that the offices of both
Brunner Development Corporation and Econ Holdings were located
at the same address, and that petitioner Oñate is the President of
Econ Holdings

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VOL. 230, FEBRUARY 21, 1994 183

Oñate vs. Abrogar

while petitioner Diño is the President of Brunner Development


Corporation as well as a stockholder and director of Econ Holdings.
Thus, an exception to the established rule on the enforcement of the
writ of attachment can be made where a previous attempt to serve
the summons and the writ of attachment failed due to factors

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beyond the control of either the plaintiff or the process server,


provided that such service is effected within a reasonable period
thereafter.
Same; Same; Same; Same; Reason for the exception.·Several
reasons can be given for the exception. First, there is a possibility
that a defendant, having been alerted of plaintiff Ês action by the
attempted service of summons and the writ of attachment, would
put his properties beyond the reach of the plaintiff while the latter
is trying to serve the summons and the writ anew. By the time the
plaintiff may have caused the service of summons and the writ,
there might not be any property of the defendant left to attach.
Second, the court eventually acquired jurisdiction over the
petitioners six days later. To nullify the notices of garnishment
issued prior thereto would again open the possibility that
petitioners would transfer the garnished monies while Sun Life
applied for new notices of garnishment. Third, the ease by which a
writ of attachment can be obtained is counter-balanced by the ease
by which the same can be discharged: the defendant can either
make a cash deposit or post a counter-bond equivalent to the value
of the property attached. The petitioners herein tried to have the
writ of attachment discharged by posting a counter-bond, the same
was denied by respondent Judge on the ground that the amount of
the counterbond was less than that of Sun LifeÊs bond.
Same; Same; In examinations conducted pursuant to Sec. 10,
Rule 57 of the Rules of Court, notice need only to be given to the
garnishee, except when there is need to examine the defendant.·
PetitionersÊ second ground assail the acts of respondent Judge in
allowing the examination of Urban BankÊs records and in ordering
the examination of the bank records of BPI and PNB as invalid
since no notice of said examinations were ever given them. Sun life
grounded its requests for the examination of the bank accounts on
Section 10, Rule 57 of the Rules of Court. It is clear from said
provision that notice need only be given to the garnishee, i.e., the
person who is holding property or credits belonging to the
defendant. The provision does not require that notice be furnished
the defendant himself, except when there is need to examine said
defendant for the purpose of giving information respecting his
property.

184

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184 SUPREME COURT REPORTS ANNOTATED

Oñate vs. Abrogar

Same; Same; Banks; Secrecy of bank deposits; Sec. 10. Rule 57


of the Rules of Court is not incompatible with R.A. 1405.·
Furthermore, Section 10, Rule 57 is not incompatible with Republic
Act No. 1405, as amended, „An Act Prohibiting Disclosure or
Inquiry Into, Deposits With Any Banking Institution and Providing
Penalty Therefore,‰ for Section 2 therefore provides an exception „in
cases where the money deposited or invested is the subject matter
of the litigation.‰ The examination of the bank records is not a
fishing expedition, but rather a method by which Sun Life could
trace the proceeds of the check it paid to petitioners.

PETITIONS for certiorari to set aside the orders of the


Regional Trial Court of Makati, Br. 150. Abrogar, J.

The facts are stated in the opinion of the Court.


Florante A. Bautista for petitioner in G.R. No.
107303.
Andin & Andin Law Offices for Brunner
Development Corporation.
Quasha, Asperilla, Aricheta, Pena & Nolasco for Sun
Life Assurance Company of Canada.

NOCON, J.:

These are separate petitions for certiorari with a prayer for


temporary restraining order filed by Emmanuel C. Oñate
and Econ Holdings Corporation (in G.R. No. 107303), and
Brunner Development Corporation (in G.R. No. 107491),
both of which assail several orders issued by respondent
Judge Zeus C. Abrogar in Civil Case No. 91-3506.
The pertinent facts are as follows: On December 23,
1991, respondent Sun Life Assurance Company of Canada
(Sun Life, for brevity) filed a complaint for a sum of money
with a prayer for the immediate issuance of a writ of
attachment against petitioners, and Noel L. Diño, which
was docketed as Civil Case No. 91-3506 and raffled to
Branch 150 of the RTC Makati, presided over by
respondent Judge. The following day, December 24, 1991,
respondent Judge issued an order granting the issuance of

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a writ of attachment, and the writ was actually issued on


December 27, 1991.
On January 3, 1992, upon Sun LifeÊs ex-parte motion,
the trial court amended the writ of attachment to reflect
the alleged

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VOL. 230, FEBRUARY 21, 1994 185


Oñate vs. Abrogar

amount of the indebtedness. That same day, Deputy Sheriff


Arturo C. Flores, accompanied by a representative of Sun
Life, attempted to serve summons and a copy of the
amended writ of attachment upon petitioners at their
known office address at 108 Aguirre St., Makati, but was
not able to do so 1since there was no responsible officer to
receive the same. Nonetheless, Sheriff Flores proceeded,
over a period of several days, to serve notices of
garnishment upon several commercial banks and financial
institutions, and levied on attachment a condominium unit
and a real property belonging to petitioner Oñate.
Summons was eventually served upon petitioners on
January 9, 1992, while defendant Diño was served with
summons on January 16, 1992.
On January 21, 1992, petitioners filed an „Urgent
Motion to Discharge/Dissolve Writ of Attachment.‰ That
same day, Sun Life filed an ex-parte motion to examine the
books of accounts and ledgers of petitioner Brunner
Development Corporation (Brunner, for brevity) at the
Urban Bank, Legaspi Village Branch, and to obtain copies
thereof, which motion was granted by respondent Judge.
The examination of said account took place on January 23,
1992. Petitioners filed a motion to nullify the proceedings
taken thereat since they were not present.
On January 30, 1992, petitioners and their co-
defendants filed a memorandum in support of the motion to
discharge attachment. Also On that same day, Sun Life
filed another motion for examination of bank accounts, this
time seeking the examination of Account No. 0041-0277-03
with the Bank of Philippine Islands (BPI)·which,
incidentally, petitioners claim not to be owned by them·

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and the records of Philippine National Bank (PNB) with


regard to checks payable to Brunner. Sun Life asked the
court to order both banks to comply with the notice of
garnishment.
On February 6, 1992, respondent Judge issued an order
(1) denying petitionersÊ and the co-defendantsÊ motion to
discharge the amended writ of attachment, (2) approving
Sun LifeÊs additional attachment bond, (3) granting Sun
LifeÊs motion to examine the BPI account, and (4) denying
petitionersÊ motion to nullify the proceedings of January 23,
1992.

________________

1 Sheriff Ês Return, Rollo in G.R. No. 107303, pp. 47-48.

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Oñate vs. Abrogar

On March 12, 1992, petitioners filed a motion for


reconsideration of the February, 1992 order. On September
6, 1992, respondent Judge denied the motion for
reconsideration.
Hence, the instant petitions. PetitionersÊ basic argument
is that respondent Judge had acted with grave abuse of
discretion amounting to lack or in excess of jurisdiction in
(1) issuing ex parte the original and amended writs of
preliminary attachment and the corresponding notices of
garnishment and levy on attachment since the trial court
had not yet acquired jurisdiction over them; and (2)
allowing the examination of the bank records though no
notice was given to them.
We find both petitions unmeritorious.

Petitioners initially argue that respondent Judge erred in


granting Sun LifeÊs prayer for a writ of preliminary
attachment on the ground that the trial court had not
acquired jurisdiction over them. This argument is clearly

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unavailing since it is wellsettled that a writ of preliminary


attachment may be validly applied for and granted 2 even
before the defendant is summoned or is heard from. The
rationale behind this rule was stated by the Court in this
wise:

„A preliminary attachment may be defined, paraphrasing the Rules


of Court, as the provisional remedy in virtue of which a plaintiff or
other proper party may, at the commencement of the action or any
time thereafter, have the property of the adverse party taken into
the custody of the court as security for the satisfaction of any
judgment that may be recovered. It is a remedy which is purely
statutory in respect of which the law requires a strict construction
of the provisions granting it. Withal no principle, statutory or
jurisprudential, prohibits its issuance by any court before
acquisition of jurisdiction over the person of the defendant.
„Rule 57 in fact speaks of the grant of the remedy Âat the
commencement of the action or at any time thereafter.Ê The phrase,
Âat the commencement of the action,Ê obviously refers to the date of
the

_________________

2 Davao Light & Power Co., Inc. vs. Court of Appeals, et al., G.R. No. 93262,
204 SCRA 343 (1991); Cuartero vs. Court of Appeals, et al., G.R. No. 102448,
212 SCRA 260 (1992).

187

VOL. 230, FEBRUARY 21, 1994 187


Oñate vs. Abrogar

filing of the complaint·which, as abovepointed out, is the date that


marks the commencement of the action;Ê and the reference plainly is
to a time before summons is served on the defendant, or even before
summons issues. What the rule is saying quite clearly is that after
an action is properly commenced·by the filing of the complaint and
the payment of all requisite docket and other fees·the plaintiff
may apply for and obtain a writ of preliminary attachment upon
fulfillment of the pertinent requisites laid down by law, and that he
may do so at any time, either before or after service of summons on
the defendant. And this indeed, has been the immemorial practice

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sanctioned by the courts: for the plaintiff or other proper party to


incorporate the application for attachment in the complaint or other
appropriate pleading (counterclaim, cross-claim, third-party claim)
and for the Trial Court to issue the writ ex-parte at the
commencement of the action if it finds the application otherwise
3
sufficient in form and substance.‰

Petitioners then contend that the writ should have been


discharged since the ground on which it was issued·fraud
in contracting the obligation·was not present. This cannot
be considered a ground for lifting the writ since this delves
into the very complaint of Sun
4
Life. As this Court stated in
Cuatro v. Court of Appeals:

„Moreover, an attachment may not be dissolved by a showing of its


irregular or improper issuance if it is upon a ground which is at the
same time the applicantÊs cause of action in the main case since an
anomalous situation would result if the issues of the main case
would be ventilated and resolved in a mere hearing of the motion
(Davao light and Power Co., Inc. vs. Court of Appeals, supra, The
Consolidated Bank and Trust Corp. (Solidbank) vs. Court of
Appeals, 197 SCRA 663 [1991]).
„In the present case, one of the allegation in petitionerÊs
complaint below is that the defendant spouses induced the plaintiff
to grant the loan by issuing postdated checks to cover the
installment payments and a separate set of postdated checks for
payment of the stipulated interest (Annex „B‰). the issue of fraud,
then, is clearly within the competence of the lower court in the main
5
action.‰

_________________

3 Davao Light & Power Co., Inc. vs. Court of Appeals, supra, 204 SCRA
343, 349-350. Citations omitted.
4 212 SCRA 260.
5 Id., at 267.

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Oñate vs. Abrogar

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The fact that a criminal complaint for estafa filed by Sun


Life against the petitioners was dismissed by the Provincial
Prosecutor of Rizal for Makati on April 21, 1992 and was
upheld by the Provincial Prosecutor on July 13, 1992 is of
no moment since the same can be indicative only of the
absence of criminal liability, but not of civil liability.
Besides, Sun Life had elevated the case for review to the
Department of Justice, where the case is presently
pending.
Finally, petitioners argue that the enforcement of the
writ was invalid since it undisputedly preceded the actual
service of summons by six days at most. Petitioners 6
cite the
decisions in Sievert vs. Court of Appeals, et al. and BAC7
Manufacturing and Sales Corp. vs. Court of Appeals, et al.,
wherein this Court held that enforcement of the writ of
attachment can not bind the defendant in view of the
failure of the trial court to acquire jurisdiction over the
defendant through either summons or his voluntary
appearance.
We do not agree entirely with petitioners. True, this
Court had held in a recent decision that the enforcement of
writ of attachment may not validly be effected until and
unless proceeded or8 contemporaneously accompanied by
service of summons.
But we must distinguish the case at bar from the Sievert
and BAC Manufacturing cases. In those two cases,
summons was never served upon the defendants. The
plaintiffs therein did not even attempt to cause service of
summons upon the defendants, right up to the time the
cases went up to this Court. This is not true in the case at
bar. The records reveal that Sheriff Flores and Sun Life did
attempt a contemporaneous service of both summons and
the writ of attachment on January 3, 1992, but were
stymied by the absence of a responsible officer in
petitionersÊ offices. Note is taken of the fact that petitioners
9
Oñate and Econ Holdings admitted in their answer that
the offices of both Brunner Development Corporation and
Econ Holdings were located at the same address, and that
petitioner Oñate is the

________________

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6 G.R. No. L-84034, 168 SCRA 692 (1988).


7 G.R. No. 96748, 200 SCRA 130 (1991).
8 Id., p. 357.
9 Rollo in G.R. No. 107303, p. 90.

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VOL. 230, FEBRUARY 21, 1994 189


Oñate vs. Abrogar

President of Econ Holdings while petitioner Diño is the


President of Brunner Development Corporation as well as a
stockholder and director of Econ Holdings.
Thus, an exception to the established rule on the
enforcement of the writ of attachment can be made where a
previous attempt to serve the summons and the writ of
attachment failed due to factors beyond the control of
either the plaintiff or the process server, provided that such
service is effected within a reasonable period thereafter.
Several reasons can be given for the exception. First,
there is a possibility that a defendant, having been alerted
of plaintiff Ês action by the attempted service of summons
and the writ of attachment, would put his properties
beyond the reach of the plaintiff while the latter is trying to
serve the summons and the writ anew. By the time the
plaintiff may have caused the service of summons and the
writ, there might not be any property of the defendant left
to attach.
Second, the court eventually acquired jurisdiction over
the petitioners six days later. To nullify the notices of
garnishment issued prior thereto would again open the
possibility that petitioners would transfer the garnished
monies while Sun Life applied for new notices of
garnishment.
Third, the ease by which a writ of attachment can be
obtained is counter-balanced by the ease by which the same
can be discharged: the defendant can either make a cash
deposit or post a counter-bond
10
equivalent to the value of
the property attached. The petitioners herein tried to
have the writ of attachment discharged by posting a
counter-bond, the same was denied by respondent Judge on
the ground that the amount of the counterbond was less

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than that of Sun LifeÊs bond.

II.

PetitionersÊ second ground assails the acts of respondent


Judge in allowing the examination of Urban BankÊs records
and in ordering that the examination of the bank records of
BPI and PNB as invalid since no notice of said
examinations were ever

________________

10 Rule 57, sec. 12, Rules of Court.

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190 SUPREME COURT REPORTS ANNOTATED


Oñate vs. Abrogar

given them. Sun Life grounded its requests for the


examination of the bank accounts on Section 10, Rule 57 of
the Rules of Court, which provided, to wit:

„Sec. 10. Examination of party whose property is attached and


persons indebted to him or controlling his property; delivery of
property to officer.·Any person owing debts to the party whose
property is attached or having in his possession or under his control
any credit or other personal property belonging to such party, may
be required to attend before the court in which the action is
pending, or before a commissioner appointed by the court, and be
examined on oath respecting the same. The party whose property is
attached may also be required to attend for the purpose of giving
information respecting his property, and may be examined on oath.
The court may, after such examination, order personal property
capable of manual delivery belonging to him, in the possession of
the person so required to attend before the court, to be delivered to
the clerk or court, sheriff, or other proper officer on such terms as
may be just, having reference to any lien thereon or claim against
the same, to await the judgment in the action.‰

It is clear from the foregoing provision that notice need


only be given to the garnishee, i.e., the person who is
holding property or credits belonging to the defendant. The

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provision does not require that notice be furnished the


defendant himself, except when there is a need to examine
said defendant „for the purpose of giving information
respecting his property.
Furthermore, Section 10, Rule 57 is not incompatible
with Republic Act No. 1405, as amended, „An Act
Prohibiting Disclosure or Inquiry Into, Deposits With Any
Banking Institution and Providing Penalty Therefore,‰ for
Section 2 therefore provides an exception „in cases where
the money deposited or invested is the subject matter of the
litigation.‰
The examination of the bank records is not a fishing
expedition, but rather a method by which Sun Life could
trace the proceeds of the check it paid to petitioners.
WHEREFORE, the instant petitions are hereby
DISMISSED. The temporary restraining order issued on
June 28, 1993 is hereby lifted.
SO ORDERED.

Narvasa (C.J., Chairman), Padilla, Regalado and


Puno, JJ., concur.

191

VOL. 230, FEBRUARY 21, 1994 191


Hipolito vs. Court of Appeals

Petitions dismissed.

Notes.·Failure of the petitioner to prove the ground


relied upon for issuance of the writ of attachment cannot be
equated with bad faith or malicious intent (BA Finance
Corporation vs. Court of Appeals, 161 SCRA 608 [1988]).
The exception to the rule against disclosure of bank
deposits is in cases of unexplained wealth (Banco Filipino
and Mortgage Bank vs. Purisima, 161 SCRA 576 [1988]).

··o0o··

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