[477 SCRA 266] Carlos v. Sandoval (Go Biao) 2.
2. Carlos, petitioner, asserted that he was the sole surviving compulsory heir of
September 30, 2005 | Tinga | Third Party Complaint
PETITIONER: JUAN DE DIOS CARLOS
RESPONDENTS: FELICIDAD SANDOVAL
SUMMARY: (super long and super complicated case. Took me 3 days to make
it. Please bear with me) Carlos filed a case against Sandoval and Teofilo II for
nullification of various agreements entered into between Carlos and Sandoval
regarding 6 parcels of land. Carlos, brother of Teofilo (not II), asserted that his
brother was cohabiting with Sandoval and their alleged child, Teofilo II, when he
died intestate. Carlos and Sandoval entered into agreements after his death
regarding the parcels of land, which were transferred from their (Carlos’s and
Teofilo’s) parents to Teofilo to save on inheritance taxes. However, Carlos later
learned that Sandoval and Teofilo were married without a valid marriage license
and so he wants to nullify these agreements for want of consideration. He also
filed for preliminary attachment, which the RTC granted after he posted a P20M
bond from SIDDCOR. A Notice of Garnishment was issued and Sandoval
elevated the Writ to the CA, which ruled that there was improper attachment. So
now Sandoval went after the P20M bond BUT Carlos won the main case
(nullification with damages) in the RTC, which is now elevated to the CA and
now the SC. SC held that (1) it was proper for the CA to rule on the entitlement
of Sandoval and Teofilo II to damages for wrongful attachment separately from
the main case. Sec. 20 of Rule 57 allows this (check wording of law); (2) CA
complied with the hearing requirement since the fact of wrongful attachment and
amount of damages was already judicially ascertained, there was no longer any
need for a full-blown trial, which will only hamper the functions of the CA; (3)
yes Rule 57 requires that the damages awarded for wrongful attachment be
included in the judgment in the main case or by another ponente in the CA (rules
of CA requires two raffles) but the non-observance of this was not mortal to the
case because SC already made CA’s decision final; (4) under the 1997 RoC, a
person may be entitled to damages for wrongful attachment even though he lost
the main case unlike in the 1964 RoC; (5) amount of damages for wrongful
attachment covers ALL periods of the case, not just during pendency of appeal.
DOCTRINE: Section 20 of Rule 57 of the 1997 Rules of Civil Procedure requires
that there be a “proper hearing” before the application for damages on the
attachment bond may be granted. No judgment for damages may be entered and
executed against the surety without giving it an opportunity to be heard as to the
reality or reasonableness of the damages resulting from the wrongful issuance of
the writ.
FACTS:
1. These consolidated petitions emanated from a civil case filed by Juan de Dios
Carlos (Carlos) against Felicidad Sandoval (Sandoval) and Teofilo Carlos II
(Teofilo II) with the RTC of Muntinlupa City.
his parents, Felix Carlos and Felipa Elemia, who had acquired during their
marriage, 6 parcels of land (subject properties). His brother Teofilo (not II),
died intestate in 1992. At the time of his death, Teofilo was apparently
married to Sandoval, and cohabiting with her and their child, Teofilo II, who
Carlos asserted could not be considered as Teofilo’s child and therefore he
was also the sole heir of his brother.
3. Prior to their father Felix’s death, Carlos developed a scheme to save the elder
Carlos’s estate from inheritance taxes. Under the scheme, the properties of
the father would be transferred to Teofilo who would, in turn, see to it that
the shares of the legal heirs are protected and delivered to them.
4. After Teofilo’s death, Carlos entered into certain agreements with Sandoval
in connection with the subject properties. He did so believing that the latter
was the lawful wife of his brother. Subsequently though, Carlos discovered
that Sandoval and his brother were never validly married, as their marriage
was contracted without a marriage license.
5. Carlos now sought to nullify these arrangements with Sandoval for want of
consideration. He also prayed of the RTC to declare the alleged marriage void
ab initio, to order that new titles covering the properties be issued in the name
of Carlos, and require Sandoval to restitute Carlos.
6. Carlos likewise prayed for the issuance of the provisional relief of
preliminary attachment. The RTC issued an Order granting the prayer for
preliminary attachment and Carlos posted a bond for P20M issued by
SIDDCOR Insurance Corporation (SIDDCOR).
7. Thereafter, a Notice of Garnishment was served upon PNB over the deposit
accounts of respondents, who filed an Urgent Motion to Discharge the Writ
of Attachment. This was denied by the RTC, which caused the respondents
to file a Petition for Certiorari with the CA. This was granted by the CA and
found that there was no sufficient cause of action to warrant the preliminary
attachment since Carlos had merely alleged general averments in order to
support his prayer. Carlos elevated said Decision to this Court by way of
Petition for Review on Certiorari, which was denied, and thus the CA’s
Decision ordering the dissolution of the Writ of Attachment and Notice of
Garnishment became final.
8. In the meantime, the hearing on Carlos’s Complaint (main case since what
happened before this is for the attachment) ensued before the RTC. The RTC
rendered a summary judgment in favor of Carlos. Upon promulgation, RTC
granted the motion for execution pending appeal upon the filing of a bond.
9. Respondents filed a Motion for Judgment On the Attachment Bond. They
noted that the CA had already ruled that the Writ of Preliminary Attachment
issued by the RTC was improperly granted and that its Decision has attained
finality. Accordingly, they were entitled to damages under the then CivPro,
which governed claims for damages on account of unlawful attachment.
10. The CA found the claim for damages meritorious and ruled that it was not
necessary for the determination of damages on the injunction bond to await
the decision on appeal (of the main case). CA also denied the MRs filed by
 Carlos and SIDDCOR and granted the Motion for Immediate Execution of
the respondents.
11. Now these petitions:
a. GR No. 135830: This Appeal by Certiorari with Prayer for
Temporary Restraining Order/Preliminary Injunction filed by
Carlos. Carlos argues that the CA could not have resolved the
Motion for Judgment on the Attachment Bond since the case had not
yet been re-raffled under the two-raffle system for study and report;
that the CA erred in resolving the motion without conducting any
hearing; that the CA had no jurisdiction over the motion as the
docketing fees had not yet been filed;
b. GR No. 136035: This concerns a Petition for Review filed by
SIDDCOR, who argues therein that the CA erred in ruling on the
motion for damages without awaiting judgment in the main case;
granting that damages may be awarded, these should encompass
only such damages incurred during the pendency of the appeal; and
that a hearing was necessary to prove the claim for damages and the
appellate court erred in granting the award for damages despite lack
of hearing.
c. GR No. 137743: This is a Petition for Certiorari under Rule 65 with
Prayer for Temporary Restraining Order or Preliminary Injunction
filed by SIDDCOR, which specifically assails the allowance by the
CA of the immediate execution of the award of damages.
Facts Subsequent to the Filing of the Petitions:
1. The CA issued a Writ of Execution directing the enforcement of the judgment
on the attachment bond but the SC issued a TRO, enjoining the enforcement
of the said Writ.
2. The CA rendered a Decision setting aside the Summary Judgment and
ordering the remand of the case for further proceedings.
3. The factual background may be complicated, but the court need only concern
itself with the propriety of the judgment on the attachment bond and the
subsequent moves to secure immediate execution of such judgment.
ISSUE:
1. WoN the assailed judgment on the attachment bond could have been
rendered, as it was, prior to the adjudication of the main case - YES
2. WoN the CA properly complied with the hearing requirement under Sec. 20,
Rule 57 prior to its judgment on the attachment bond - YES
3. WoN the CA properly ascertained the amount of damages it awarded in the
judgment on the attachment bond – YES
HELD: WHEREFORE, the petitions are DISMISSED. The TRO issued is hereby
LIFTED. The assailed Resolution of the CA is AFFIRMED with the
MODIFICATIONS that the legal interest on the award of actual damages should
commence from the date of the finality of the Decision of the CA and that the award
of attorney’s fees is in the amount of P500K. Costs against petitioners.
Sec. 20, Rule 57 of the 1997 Rules of Civil Procedure
SEC. 20. Claim for damages on account of improper, irregular or excessive
attachment.—An application for damages on account of improper, irregular or
excessive attachment must be filed before the trial or before appeal is perfected or
before the judgment becomes executory, with due notice to the attaching obligee or
his surety or sureties, setting forth the facts showing his right to damages and the
amount thereof. Such damages may be awarded only after proper hearing and shall be
included in the judgment on the main case.
If the judgment of the appellate court be favorable to the party against whom the
attachment was issued, he must claim damages sustained during the pendency of the
appeal by filing an application in the appellate court with notice to the party in whose
favor the attachment was issued or his surety or sureties, before the judgment of the
appellate court becomes executory. The appellate court may allow the application to
be heard and decided by the trial court.
Nothing herein contained shall prevent the party against whom the attachment was
issued from recovering in the same action the damages awarded to him from any
property of the attaching obligee not exempt from execution should the bond or deposit
given by the latter be insufficient or fail to fully satisfy the award. (Emphasis supplied.)
1. Sec. 20 essentially allows the application to be filed at any time before the
judgment becomes executory. It should be filed in the same case that is the
main action, and cannot be instituted separately. It should be filed with the
court having jurisdiction over the case at the time of the application.
2. There is no question in this case that the Motion for Judgment on the
Attachment Bond filed by respondents was properly filed since it was filed
with the CA during the pendency of the appeal in the main case and also as
an incident thereto.
Proper Hearing Requirement
1. Sec. 20 of Rule 57 requires that there be a “proper hearing” before the
application for damages on the attachment bond may be granted. Due notice
to the adverse party and its surety setting forth the facts supporting the
applicant’s right to damages and the amount thereof under the bond is
essential.
a. It is neither mandatory nor fatal that there should be a separate
hearing in order that damages upon the bond can be claimed,
ascertained and awarded. What is necessary only is for the attaching
party and his surety or sureties to be duly notified and given the
opportunity to be heard (Paramount Insurance v. CA)
2. In this case, both Carlos and SIDDCOR were duly notified by the appellate
court of the Motion for Judgment on the Attachment Bond and were required
to file their respective comments thereto.
 3. Proper hearing” contemplated would not merely encompass the right of the
parties to submit their respective positions, but also to present evidence in
support of their claims, and to rebut the submissions and evidence of the
adverse party. This is especially crucial considering that the necessary
elements to be established in an application for damages are essentially
factual: namely, the fact of damage or injury, and the quantifiable amount of
damages sustained. Such matters cannot be established on the mere sayso of
the applicant, but require evidentiary support. At the same time, there was no
equivocal statement from the Court that the hearing required under the rule
should be a full-blown hearing on the merits.
4. 4. In this case, we rule that the demands of a “proper hearing” were satisfied
as of the time the CA rendered its assailed judgment on the attachment bond.
The circumstances in this case that we consider particularly telling are the
settled premises that the judicial finding on the wrongfulness of the
attachment was then already conclusive and beyond review, and that the
amount of actual damages sustained was likewise indubitable as it indeed
could be found in the official case record. It should be noted that this case
poses a situation different from what is normally contemplated under Sec. 20,
Rule 57—wherein the very wrongfulness of the attachment remains one of
the issues in contention in the main case. In such a case, there would be a
greater demand for a more extensive hearing on the application of damages.
To impose as mandatory on the CA or the SC to hear the application for
damages through full-blown hearings in open court is supremely unwise and
beyond the demands of Sec. 20, Rule 57.
Damages shall be included in the Judgment Requirement
1. Under Sec. 20, Rule 57 of the 1964 Rules of Court, it was provided that there
must be first a judgment on the action in favor of the party against whom
attachment was issued before damages can be claimed by such party. The
Court however subsequently clarified that under the rule, “recovery for
damages may be had by the party thus prejudiced by the wrongful attachment,
even if the judgment be adverse to him.” The language used in the 1997
revision of the Rules of Civil Procedure leaves no doubt that there is no longer
need for a favorable judgment in favor of the party against whom attachment
was issued in order that damages may be awarded. It is indubitable that even
a party who loses the action in main but is able to establish a right to damages
by reason of improper, irregular, or excessive attachment may be entitled to
damages. This bolsters the notion that the claim for damages arising from
such wrongful attachment may arise and be decided separately from the
merits of the main action.
2. The surety becomes liable only when and if "the court shall finally adjudge
that the applicant was not entitled to the attachment." This is so regardless of
the nature and character of the judgment on the merits of the principal claims,
counterclaims or cross-claims, etc. asserted by the parties against each other
(Philippine Charter Insurance Corp. v. CA)
3. In this case, we are confronted with a situation wherein the determination that
the attachment was wrongful did not come from the trial court, or any court
having jurisdiction over the main action. It was rendered by the CA in the
exercise of its certiorari jurisdiction. Said ruling attained finality when it was
affirmed by this Court.
4. Nevertheless, Sec. 20, Rule 57 explicitly provides that the award for damages
be included in the judgment on the main case. This point was apparently not
lost on the CA when it rendered its Resolution, certifying that the case may
now be referred to the Raffle Committee for assignment to a ponente.
5. Respondents may be generally correct on the point that a case can only be
deemed submitted for decision only after all pending incidents are resolved.
Yet since Sec. 20, Rule 57 provides that their application for damages on the
attachment bond “shall be included in the judgment on the main case,” it is
clear that the award for damages need not be resolved before the case is
submitted for decision, but should instead be resolved and included in the
judgment on the main case, or the decision on the Appeal by Certiorari filed
by the respondents. Thus, the action of the CA in resolving the application
for damages even before the main judgment was issued does not conform to
Sec. 20, Rule 57. However, the special particular circumstances of this case
lead us to rule that such error is not mortal to the award of damages.
6. We are compelled to appreciate the particular circumstance in this case that
the right of private respondents to acquire relief through the award of
damages on account of the wrongful preliminary attachment has been
conclusively affirmed by the highest court of the land. This differs from the
normal situation under Sec. 20, Rule 57 wherein the court having jurisdiction
over the main action is still required to ascertain whether the applicant
actually has a right to damages. To mandatorily require that the award of
damages be included in the judgment in the main case makes all the sense if
the right to damages would be ascertained at the same time the main judgment
is made. However, when the said right is already made viable by reason of a
final judgment which is no longer subject to review, there should be no
unnecessary impediments to its immediate implementation.
Scope of Damages Properly Awardable
7. Next, we examine the particular award of damages made in this case,
consisting of P15,384,509.98, plus interest, as well as P1,000,000.00 as
attorney’s fees. There seems to be no dispute that the former amount
constituted the amount drawn against the account of Sandoval by reason of
the writ of execution.
8. Carlos lamely argues in his petition that there was no concrete or supporting
evidence to justify the amount of actual damages, a claim that is belied by the
official case records. The more substantive argument is presented by
SIDDCOR, which submits that any damages that may be awarded to
respondents can include only those that were incurred, if any, during the
pendency of the appeal. But the rule is well-settled that the bond issued upon
an application for preliminary attachment answers for all damages, incurred
at whatever stage, which are sustained by reason of the attachment. However,
 interest should start to accrue only from the moment it had been finally
determined that the attachment was unlawful.

Other Issues Raised

1. It is clear that under Sec. 20, Rule 57, the application for damages on the
attachment bond cannot be independently set up, but must be filed in the main
case, before the judgment therein becomes final and executory. Santo Tomas
squarely applies in determining that no certification against forumshopping
was required in the Motion for Judgment on the Attachment Bond. The same
reasoning also sustains a ruling that neither legal fees were required for the
filing of the said motion. Sec. 1, Rule 141 of the Rules of Court provides that
legal fees are prescribed upon the filing of the pleading or other application
which initiates an action or proceeding. Since the said application for
judgment on the attachment bond cannot be considered as an initiatory
pleading, as it cannot be independently set up from the main action, it is not
likewise chargeable with legal fees.
2. Also, we find no grave abuse of discretion on the part of the CA, even though
it allowed execution pending appeal on a legal basis different from that
originally adduced by respondents. After all, the reasoning ultimately
employed by the appellate court is correct, and it hardly would be judicious
to require the lower court to adhere to the movant’s erroneous ratiocination
and preclude the proper application of the law.