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Republic of the Philippines

SUPREME COURT

Manila

FIRST DIVISION

G.R. Nos. 65957-58 July 5, 1994

ELEAZAR V. ADLAWAN and ELENA S. ADLAWAN,petitioners,

vs.

Hon. Judge RAMON AM. TORRES, as Presiding Judge of Branch 6, Regional Trial Court CebuCity, ABOITIZ & COMPANY, INC. and THE PROVINCIAL SHERIFFS OF CEBU, DAVAO, RIZAL andMETRO MANILA, Respectively,respondents.

Pablo P. Garcia for petitioners.

Isaias P. Dicdican and Sylva G. Aguirre-Paderanga for Aboitiz & Co., Inc.

QUIASON,J.:

This is a petitioner for certiorari and mandamus with preliminary injunction or restraining order to nullify:(1) the Order dated September 14, 1983 of respondent Judge Ramon Am. Torres of the Regional TrialCourt, Branch 6, Cebu City, in Civil Case No. CEB-1185 and the Order dated September 26, 1983 ofJudge Emilio A. Jacinto of Branch 23 of the same court in Civil Case No. CEB-1186, which granted themotion for the issuance of writs of preliminary attachment for the seizure of the property of petitioners byrespondent Provincial Sheriffs; and (2) the Order dated December 12, 1983 of respondent Judge RamonAm. Torres in the consolidated cases, Civil Case No. CEB-1185 and Civil Case No. CEB-1186.

I

In a complaint dated April 24, 1982 filed with the Court of First Instance of Cebu, now Regional TrialCourt, (Civil Case No. R-21761), respondent Aboitiz and Company, Inc. (Aboitiz) sought to collect frompetitioners a sum of money representing payments for: (1) the unpaid amortizations of a loan; (2)technical and managerial services rendered; and (3) the unpaid installments of the equipment provided byrespondent Aboitiz to petitioners ( Rollo , p. 37).

Acting on the ex parte application for attachment, the Executive Judge of the Court of First Instance ofCebu, issued on May 14, 1982, an order directing the issuance of the writ of preliminary attachmentagainst the property of petitioners upon the filing by respondent Aboitiz of an attachment bond.

Subsequently, the case was raffled to Branch 11 of the Court of First Instance of Cebu, which issued awrit of attachment addressed to the Provincial Sheriffs of Cebu and the City Sheriff of Davao City. It was


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the Sheriff of Davao City who enforced the writ of attachment, resulting in the seizure of heavyconstruction equipment, motor vehicle spare parts, and other personal property with the aggregate valueof P15,000,000.00. The said court also granted the motion of respondent Aboitiz to take possession andcustody of the attached property of petitioners and ordered the Provincial Sheriff of Davao to deliver theproperty to respondent Aboitiz.

Petitioners moved for a bill of particulars and to set aside the ex parte writ of attachment. Finding merit inthe motion to set aside the writ, Branch 11 ordered on July 6, 1982 the lifting of the writ and,consequently, the discharge of the property levied upon.

Respondent Aboitiz filed an urgent ex parte motion, praying for the stay of the July 6, 1982 Order for aperiod of 15 days for it to be able to appeal the order. The motion was favorably acted upon.

However, on July 13, 1982, respondent Aboitiz filed a notice of dismissal of its complaint in accordancewith Section 1, Rule 17 of the Revised Rules of Court. Consequently, Branch 11 issued an orderconfirming the notice of dismissal, emphasizing that all orders of the court issued prior to the filing of saidnotice of dismissal had been rendered functus oficio, and considering all pending incidents in the case asmoot and academic.

Petitioner Eleazar Adlawan filed a motion praying that the July 6, 1982 Order be implemented andenforced. On December 20, however, Branch 11 denied the motion on account of the filing by respondentAboitiz before Branch 16 of the Court of First Instance of Cebu in Lapu-lapu City of an action for deliveryof personal property (Civil Case No. 619-L), and the filing by petitioner Eleazar Adlawan before Branch 10of the same court of an action for damages in connection with the seizure of his property under the writ ofattachment.

In the replevin suit, Branch 16 ordered the seizure and delivery of the property described in the complaint.Said property were later delivered by the provincial sheriff to respondent Aboitiz. Alleging that while hisoffice was situated in Cebu City, Adlawan was a resident of Minglanilla, and therefore, the Lapu-lapu Citycourt should not entertain the action for replevin. Petitioner Eleazar Adlawan filed an omnibus motionpraying for the reconsideration and dissolution of the writ of seizure, the retrieval of the property seized,and the dismissal of the complaint. He also averred that the property seized were in custodia legis byvirtue of the writ of attachment issued by Branch 11. His omnibus motion was denied. Subsequently, hefiled a motion for reconsideration which was not granted.

The denial of his omnibus motion led petitioner Eleazar Adlawan to file a petitionfor certiorari and mandamus in the Supreme Court (G.R. No. 63225). The Third Division of this Courtruled on April 3, 1990 that since attachment is an ancillary remedy, the withdrawal of the complaint left itwith no leg to stand on. Thus, the Court disposed of the case as follows:

WHEREFORE, in view of the foregoing, this Court rules that the attached properties left in the custody ofprivate respondent Aboitiz and Company, Inc. be returned to petitioner Eleazar V. Adlawan withoutprejudice to the outcome of the cases filed by both parties ( Rollo , p. 324).

Respondent Aboitiz filed a motion for reconsideration of the decision, contending that the replevin casewas distinct and separate from the case where the writ of attachment was issued. It argued that the writ ofreplevin, therefore, remained in force as the Third Division of the Supreme Court had not found it illegal.The motion was, however, denied with finality in the Resolution of July 11, 1990.

Undaunted, respondent Aboitiz filed a second motion for reconsideration with a prayer that the dispositiveportion of the decision be clarified. It asserted that because the writ of preliminary attachment wasdifferent from the writ of replevin, we should rule that the property subject of the latter writ should remainin custodia legis of the court issuing the said writ.


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In the Resolution dated September 10, 1990, the Third Division stated that "the properties to be returnedto petitioner are only those held by private respondent (Aboitiz) by virtue of the writ of attachment whichhas been declared non-existent." Accordingly, the dispositive portion of the April 3, 1990 decision of theThird Division of this Court was modified to read as follows:

WHEREFORE, in view of the foregoing, this Court rules that the properties in the custody of the private

respondent Aboitiz & Company by virtue of the writ of attachment issued in Civil Case No. R-21761 bereturned to the petitioner, but properties in the custody of the private respondent by virtue of the writ ofreplevin issued in Civil Case No. 619-L be continued in custodia legis of said court pending litigationtherein.

The Decision in G.R. No. 63225 having become final and executory, entry of judgment was made onNovember 15, 1990. This should have terminated the controversy between petitioners and respondentAboitiz insofar as the Supreme Court was concerned, but that was not to be. On September 9, 1983respondent Aboitiz filed against petitioners two complaints for collection of sums of money with prayersfor the issuance of writs of attachment in the Regional Trail Court, Branch 23, Cebu City, docketed asCivil Cases Nos. CEB-1185 and CEB-1186. The complaint in Civil Case No. CEB-1185 alleged thatpetitioner Eleazar Adlawan (defendant therein) was awarded a contract for the construction of the TagoDiversion Works for the Tago River Irrigation Project by the National Irrigation Administration and that

respondent Aboitiz (plaintiff therein) loaned him money and equipment, which indebtedness as of June30, 1983 totaled P13,430,259.14. Paragraph 16 of the complaint states:

16. That, in view of the enormous liabilities which the defendants have with the plaintiff, defendantsexecuted a real estate mortgage covering eleven (11) parcels of land in favor of Philippine Commercialand Industrial Bank (PCIB) to secure a P1,000,000.00 loan with said bank and was able to remove,conceal and dispose of their properties, obviously to defraud the plaintiff, . . . ( Rollo , pp. 65-66).

The complaint in Civil Case No. CEB-1186 alleged that petitioner Eleazar Adlawan (defendant therein)was awarded a contract for the construction of the Lasang River Irrigation Project by the NationalIrrigation Administration and that respondent Aboitiz (plaintiff therein) loaned him money and equipment,which indebtedness as of June 30, 1983 totalled P5,370,672.08. Paragraph 15 of the complaint issimilarly worded as paragraph 16 of the complaint in Civil Case No. CEB-1185.

Civil Case No. CEB-1185 was raffled to the Regional Trial Court, Branch 6, presided by respondentJudge Ramon Am. Torres. On September 14, 1983, respondent Judge ordered the issuance of a writ ofattachment upon respondent Aboitiz' filing of a bond of P5,000,000.00. Similarly, in Civil Case No. CEB-1186, which was raffled to Branch 23, presiding Judge Emilio A. Jacinto ordered the issuance of a writ ofattachment upon the filing of a bond of P2,500,000.00. Accordingly, in Civil Case No. CEB-1185, theActing Provincial Sheriff of Cebu issued separate writs dated September 26, 1983 addressed to theSheriffs of Cebu, Davao and Metro Manila. No writ of preliminary attachment was, however, issued inCivil Case No. CEB-1186.

Petitioners then filed in Civil Cases Nos. CEB-1185 and CEB-1186 urgent motions to hold in abeyancethe enforcement of the writs of attachments. They alleged in the main that since their property had beenpreviously attached and said attachment was being questioned before the Supreme Court in G.R. No.

63225, the filing of the two cases, as well as the issuance of the writs of attachment, constituted undueinterference with the processes of this court in the then pending petition involving the same property.

Upon motion of respondent Aboitiz, Branch 23 issued on October 13, 1983, an order directing the transferto Branch 6 of Civil Case No. CEB-1186 for consolidation with Civil Case No. CEB-1185.

Meanwhile, in its comment on petitioners' motion to withhold the enforcement of the writs of attachment,respondent Aboitiz alleged that the voluntary dismissal of Civil Case No. R-21761 under Section 1, Rule17 of the Revised Rules of Court was without prejudice to the institution of another action based on the


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The affidavit submitted by respondent Aboitiz in support of its prayer for the writ of attachment does notmeet the requirements of Rule 57 of the Revised Rules of Court regarding the allegations on impendingfraudulent removal, concealment and disposition of defendant's property. As held in Carpio v. Macadaeg ,9 SCRA 552 (1963), to justify a preliminary attachment, the removal or disposal must have been madewith intent to defraud defendant's creditors. Proof of fraud is mandated by paragraphs (d) and (e) ofSection 1, Rule 57 of the Revised Rules of Court on the grounds upon which attachment may issue.Thus, the factual basis on defendant's intent to defraud must be clearly alleged in the affidavit in supportof the prayer for the writ of attachment if not so specifically alleged in the verified complaint. The affidavitsubmitted by respondent Aboitiz states:

REPUBLIC OF THE PHILIPPINES

CITY OF CEBU ...............) S.S.

I, ROMAN S. RONQUILLO, of legal age, married and a resident of Cebu City, after being sworn inaccordance with law, hereby depose and say:

That I am the Vice-President of the plaintiff corporation in the above-entitled case;

That a sufficient cause of action exists against the defendants named therein because the saiddefendants are indebted to the plaintiffs in the amount of P13,430,259.14 exclusive of interests thereonand damages claimed;

That the defendants have removed or disposed of their properties with intent to defraud the plaintiff, theircreditor, because on May 27, 1982 they executed a real estate mortgage in favor of PhilippineCommercial and Industrial Bank (PCIB) covering eleven (11) of their fifteen (15) parcels of land in Cebuto secure a P1,000,000.00 loan with the same bank;

That this action is one of those specifically mentioned in Section 1, Rule 57 of the Rules of Court,

whereby a writ preliminary attachment may lawfully issue because the action therein is one againstparties who have removed or disposed of their properties with intent to defraud their creditor, plaintiffherein;

That there is no sufficient security for the claims sought to be enforced by the present action;

That the total amount due to the plaintiff in the above-entitled case is P13,430,259.14, excluding interestsand claim for damages and is as much the sum for which an order of attachment is herein sought to begranted; above all legal counter-claims on the part of the defendants.

IN VIEW WHEREOF, I hereunto set my hand this 24th day of August 1983 at Cebu City, Philippines.

(Sgd.)

RAMON S. RONQUILLO

Affiant

(Rollo , pp. 171-172)


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It is evident from said affidavit that the prayer for attachment rests on the mortgage by petitioners of 11parcels of land in Cebu, which encumbrance respondent Aboitiz considered as fraudulent concealment ofproperty to its prejudice. We find, however, that there is no factual allegation which may constitute as avalid basis for the contention that the mortgage was in fraud of respondent Aboitiz. As this Court saidin Jardine-Manila Finance, Inc. v. Court of Appeals, 171 SCRA 636 (1989), "[T]he general rule is that theaffidavit is the foundation of the writ, and if none be filed or one be filed which wholly fails to set out somefacts required by law to be stated therein, there is no jurisdiction and the proceedings are null and void."

Bare allegation that an encumbrance of a property is in fraud of the creditor does not suffice. Factualbases for such conclusion must be clearly averred.

The execution of a mortgage in favor of another creditor is not conceived by the Rules as one of themeans of fraudulently disposing of one's property. By mortgaging a piece of property, a debtor merelysubjects it to a lien but ownership thereof is not parted with.

Furthermore, the inability to pay one's creditors is not necessarily synonymous with fraudulent intent notto honor an obligation (Insular Bank of Asia & America, Inc. v. Court of Appeals, 190 SCRA 629 [1990]).

Consequently, when petitioners filed a motion for the reconsideration of the order directing the issuanceof the writ of attachment, respondent Judge should have considered it as a motion for the discharge ofthe attachment and should have conducted a hearing or required submission of counter-affidavits fromthe petitioners, if only to gather facts in support of the allegation of fraud (Jopillo, Jr. v. Court of Appeals,167 SCRA 247 [1988]). This is what Section 13 of Rule 57 mandates.

This procedure should be followed because, as the Court has time and again said, attachment is a harsh,extraordinary and summary remedy and the rules governing its issuance must be construed strictlyagainst the applicant. Verily, a writ of attachment can only be granted on concrete and specific groundsand not on general averments quoting perfunctorily the words of the Rules (D.P. Lub Oil MarketingCenter, Inc. v. Nicolas, 191 SCRA 423 [1990]).

The judge before whom the application is made exercises full discretion in considering the supportingevidence proffered by the applicant. One overriding consideration is that a writ of attachment issubstantially a writ of execution except that it emanates at the beginning, instead of at the termination ofthe suit (Santos v. Aquino, Jr., 205 SCRA 127 [1992]; Tay Chun Suy v. Court of Appeals, 212 SCRA 713[1992]).

We need not discuss the issue of whether or not Civil Cases Nos. CEB-1185 and CEB-1186 constitutedundue interference with the proceedings in G.R. No. 63225 in view of the entry of judgment in the lattercase.

WHEREFORE, the petition is GRANTED and the Temporary Restraining Order issued on January 6,1984 is made PERMANENT. Respondent Judge or whoever is the presiding judge of the Regional TrialCourt, Branch 6, Cebu City, is DIRECTED to PROCEED with the resolution of Civil Cases Nos. CEB-1185 and CEB-1186 with deliberate dispatch.

SO ORDERED.


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SUPREME COURT

Manila

FIRST DIVISION

G.R. No. L-35951 August 31, 1977

PIONEER INSURANCE & SURETY CORP. AND HADJI ESMAYATEN LUCMAN,petitioners-appellants,

vs.

THE HON. AGAPITO HONTANOSAS, JUDGE OF THE COURT OF FIRST INSTANCE OF CEBU,BRANCH XI AND THE SPOUSES BEN UY RODRIGUEZ,respondents-appellees.


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Eriberto D. Ignacio for appellant.

Francisco E.F. Remotigue & Hilario G. Davide, Jr. for private respondent.

GUERRERO,J:

We reverse the decision of the Court of Appeals 1 promulgated, on October 30, 1972 in CA-G.R. No.00951-R entitled "Pioneer Insurance & Surety Corp., et al., petitioners, vs. Hon Judge AgapitoHontanosas, et al., respondents," which decision had denied for lack of merit the petition filed therein forcertiorari. prohibition and/or mandamus with preliminary injunction seeking to nullify the order of default ofFebruary 29, 1972 and the decision of March 9, 1972 in Civil Case No. R-12069, entitled "B en Rodriguez,et al. vs. Allied Overseas Commercial Co., et al. " issued by the respondent Presiding Judge of the Courtof First Instance of Cebu.

The case commenced on October 12, 1970 when Allied Overseas Commercial Co., Ltd., a foreigncorporation domiciled in Hongkong, filed in the Court of First Instance of Manila a complaint against therespondent-appellee Ben Uy Rodriguez for the collection of a sum of money arising out of a transactionbetween them in the amount of P450,533.00, the agreed peso equivalent of the HK$418,279.60 balanceunpaid. Plaintiff therein having prayed for the issuance of a writ of preliminary attachment, the game wasgranted by the Court against Rodriguez upon the filing by said plaintiff of a bond in the amount ofP450,000.00, which petitioner-appellant Pioneer Insurance & Surety Corp. duly posted. Thecorresponding levy in attachment was made by annotation on the properties of Rodriguez whichconsisted of 4 pieces of lots; notices of garnishment on different Cebu banks turned out negative, whilepersonal properties found at the Rodriguez residence, although attached, were, however, not removedtherefrom.

A motion to dismiss the complaint was thereupon filed by Rodriguez, followed by an application fordamages against the bond, praying that he be permitted to present evidence of damages he sustained byreason of the wrongful attachment, and to enforce said claim against the surety on its bond, allegingfurther that otherwise his claim against the bond will forever be barred as said claim cannot be the subjectof an independent civil action under Sec. 20, Rule 57 of the Rules of Court. The court iii its order ofDecember 22, 1970 dismissed the complaint on the ground of improper venue since defendant Rodriguezwas a resident of Cebu, and lifted the writ of preliminary attachment setting. the hearing on the claim fordamages against the bond on January 14, 1971.

With the intention of filing a separate civil action in the Court t T of Firs instance of Cebu, respondent-appellee Rodriguez withdrew his claim for damages against Pioneer Insurance and Surety Corp., whichmotion for withdrawal was granted by the Court Thereafter, the respondents-appellees Rodriguezspouses filed a complaint for damages on February 15, 1971 against Pioneer Insurance & Surety Corp.and Allied Overseas (the Hongkong-based corporation), docketed as Civil Case No. R-12069, Court ofFirst Instance of Cebu presided by respondent judge lion Agapito Hontanosas, the complaint praying thatRodriguez be declared as not in any manner indebted to the defendant Allied Overseas Commercial Co.and that Pioneer Insurance & Surety Corp. be held liable for damages, attorneys foes and expenses oflitigation by reason of the and malicious attachment issued by the Manila Court.

Defendant Pioneer Insurance and Surety Corp. filed its manner to the complaint (Civil Case No. R-12069)alleging affirmative and special defenses. With respect to the other defendant Allied OverseasCommercial Co., summons was (coursed thru the Philippine Consulate General in Honkong which turnedit down as it had no authority to serve the process under the Rules of Court.

On April 27, 1971, defendant Pioneer Insurance & Surety Corp. filed a motion for a preliminary hearing ofits affirmative defenses of lack of cause of action and bar by prior judgment and/or abandonment, which


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are grounds for a motion to dismiss. This was denied by the respondent Judge in his Order dated May 15,1971, so also was the motion for reconsideration per its Order of June 2, 1971.

On May 5, 1971, the case was called for pre-trial. Plaintiffs with counsel attended; defendant PioneerInsurance & Surety Corp. thru counsel was present The other defendant, Allied Overseas Commercial Cowas not yet summoned, hence absent. The parties manifested failure to settle the case amicably, thus the

Court set the trial of the case on the merits for June 11, 1971.

A petition for certiorari and prohibition was then filed by Pioneer Insurance and Surety Corp. on August 3,1971 in the Court of Appeals, CA-G.R. No. 00369-R (Record on Appeal, p. 133) with prayer to enjoin ahearing scheduled on August 7, 1971, alleging that respondent Judge committed grave abuse ofdiscretion amounting to lack and/or excess of jurisdiction in lending the motion for preliminary hearing.The Court of Appeals In its Resolution dated August 7, 1971 distributed this petition for certiorari. Recordon Appeal, pp. 133-137)

An amended complaint was now submitted to ad admitted by the Court on August 14, 1971 by impleadingleft petitioner-appellant Hadji Esmayaten Lucman as additional, defendant., making allegations tendingshow confabulation between the new defendant, and the foreign-based corporation to collect a non-existing debt. To the amended complaint, Pioneer Insurance & Surety Corp filed its answer.

Lucman having been impleaded as assignee defendant Allied Overseas Commercial filed a motion todismiss on the ground of auter action pendant, that is an action pending in the Court of First Instance ofRizal, Civil Case No. 14351 between the same parties with the same allegation and defences ofcounterclaims. On November 25, 1971, respondent Judge denied the motion to dismiss, whereuponLucman filed his answer to the amended complaint.

Upon an ex parte motion of Rodriguez, the Court declared Lucman in default in its Order of January 10,1972 and thereafter promulgated a decision dated January 28, 1972 against Lucman only, ordering himto pay damage,- in the amount of P150,000.00; declaring that Rodriguez was no in any manner indebtedto Lucman or to Allied Overseas Commercial Co and that the Metropolitan Bank & Trust Co. (CebuBranch) Check No. CB2169 (xerox copy marked Exhibit M issued iv Rodriguez to pay the indebtednesswas a forgery.

Lucman moved on February 11, 1972 to set aside the order of default and to admit the answer earlierfiled by him to the amended complaint. On February 21. 1972, respondent Judge set aside the order ofdefault against Lucman including the decision against him, the dispositive portion of which order reads asfollows:

WHEREFORE, the Order of Default dated January 10, 1972 as well as the decision (Re: HadjiEsmayaten Lucman) dated January 28, 1972, are hereby reconsidered and set aside. Let the hearing ofthis case on the merits be scheduled as previously set for February 28, 1972 at 8:30 o'clock in themorning.

The parties thru their respective counsels are to be immediately notified of this order. The Clerk of Courtis directed to notify defendant Hadji Esmayaten Lucman thru counsel Atty. Eriberto D. Ignacio At Rm.414, Madrigal Bldg., Escolta, Manila by telegram.

SO ORDERED.

Cebu City, Philippines, February 21, 1972.

(SGD.) AGAPITO HONTANOSAS


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JUDGE

(Record on Appeal, pp. 297-298)

Forthwith, the clerk of court sent the telegram notices in the following wise:

YOUR MOTION SET ASIDE ORDER, DEFAULT AND DECLARE PROCEEDINGS NULL AND VOID RECIVIL CASE BEN RODGIGUEZ ET AL VERSUS HADJI ESMAYATEN LUCMAN GRANTED STOPPRETRIAL SHALL PROCEED AS PREVIOUSLY SCHEDULED FEBRARY 28 1972 MORNING

(Record on Appeal, p. 298)

Counsel for the petitioners received the telegram notices on February 21, 1972; and on February 23,1972 counsel filed an urgent motion for postponement of the pre-trial, claiming that he was not aware ofany such pre-trial having been previously set for February 28, 1972 in the morning, as indeed no suchpre-trial can as yet be set as the issues with respect to the amended complaint are not yet fully joinedsince plaintiffs have not answered the compulsory conterclaims separately set up by the defendants insaid summons to theforeign corporations Allied Overseas Commercial Co. Ltd. of Hongkong, nor haveplaintiffs asked that said foreign corporation be dropped from the amended complaint; that counsel has ahearing in Manila of a criminal case which is of intransferable character, and prayed that the pre-trial beset at some other date in March preferably either March 22 or 23, 1972 at 9:00 a.m. which were the onlyfree dates for the month of March 1972 in the calendar of the counsel. (Record on Appeal, pp. 301-303)

Apparently, the above urgent motion for postponement although sent through registered airmail specialdelivery and received by the Dispatching Section of the Post Office of Cebu on February 28, 1972(Resolution, Court of Appeals, Recrod on Appeal, pp. 365-366) was not received by the Court for onFebruary 28, 1972 when the case was called, an order was issued by the Court postponing the pre-trial ofthe case to March 20, 1972 in ivew of the absence of the defendants and counsel notwithstanding noticesof hearing and telegrams sent to them, on the condition that should defendants be found that as toplaintiffs will be allowed to present their evidence and the defendants will be declared in default for failureto appear at the pre-trial. (Record on Appeal, pp. 304-305)

Upon verification from the radio Communications of the Philippines that the telegrams mentioned abovewere delivered and received by the addresses on February 21, 1972, the Court on February 29, 1972declared the defendants in default and allowed the plaintiffs to present their evidence in support of theircomplaint before the Clerk of Court. (Record on Appeal, pp. 306-307). The evidence was thereuponpresented and on March 9, 1977 the respondent Judge promulgated his Decision declaring that theplaintiff Rodriguez is not in any manner indebted to defendant Lucman or to Allied Overseas CommercialCo., declaring the personal check of the plaintiff to be a forgery; that the attachment of the properties ofplaintiff in the Manila case was wrongfu; amd malicious, and ordering defendant Pioneer Insurance andSurety Co. to pay P350,000.00 as moral damages, P50,000.00 as exemplary damages and P50,000.00for expenses of litigation in Manila. Defendant Lucman was also ordered to pay plaintiffs the sum ofP50,000,00 as exemplary damages and P30,000.00 as attorney's fees.

Within 30 days reglementary period to perfect the appeal, defendants Pioneer Insurance & Surety Corp.and Hadji Esmayaten Lucman filed the Notice of Appeal and the Original record on Appeal, the latterordered corrected and amended but finally approved by the Court on July 31, 1972.

Meanwhile, petitioner's filed on April 4, 1972 before the Court of Appeals a petition for certiorari,prohibition and/or mandamus with preliminary injunction CA-G.R. No. 00951-R) seeking to nullify theorder of default of February 29, 1972 and the Decision of March 9, 1972 of respondent Judge, tocommand said Judge to elevate the records of the case for review and to prohibit him from enforcing hisdecision and from taking further action in the case, No. 12069.


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On April 13, 1972, the Court of Appeals promulgated its resolution dismissing the petition aforestated andruled among others as follows:

Furthermore, petitioners instant remedy is not proper because of their own admission that appeal isavailable from the decision of respondent Judge (Discussion, pp. 12-13 of their Petition). This is shown bythe handwriting at the upper right hand corner of Annex R (Decision) when they received the decision on

March 25, 1972 and the period to appeal will expire on April 24, 1972.

We are not, therefore, convinced that the remedy of appeal is inadequate, considering that whatevererrors respondent Judge might have committed can be assigned as specific errors on appeal. It has beenconsistently held that certiorari is not available where the remedy of appeal is present .


On a motion for reconsideration, the Court of Appeals reconsidered the resolution cited above, andissued another resolution dated July 25, 1972 giving due course to the petition and required therespondents to answer the petition (not a motion to dismiss), and among others, stated, to wit:

Upon this fact alone, we believe as petitioners contend that although appeal is available, such remedy isnot sufficiently speedy and adequate to cure the defects in the proceedings therein or to remedy thedisadvantageous position of Petitioners because, since they were deprived of raising any issue ordefense that they have in the respondent court by reason of the order of default, they cannot raise saidissues or defenses for the first time on appeal.

(Rollo, P. 98)

The petition having been given due course, the respondents herein answered the same, and on October30, 1972, the Court of Appeals rendered its Decision denying the petition for lack of merit, and heldamong others, thus

Finally we are not also convinced that the remedy of appeal is inadequate under the circumstances

obtaining in the principal cue Whatever errors respondent Judge might have committed in his order or judgment may be assigned as specific errors in their appeal. This Court can review any all such errors offact and law in the appeal.

(Rollo, p. 138)

Petitioners filed a motion for reconsideration which was denied, hence this appeal by certiorari from thedecision of the Court of Appeals and is now before Us being assailed and faulted on three principalissues: 1. the illegality of th order of the default and the decision arising therefrom; 2. the inadequacy ofthe remedy of appeal; and 3. the lack of jurisdiction of the Court in the principal case.

The petitioner's main thrust in this legal attack is directed to the other dated February 29, 1972 declaringdefendants (now the petitioners) in default at the second pre-trial hearing and allowing the plaintiffs (thepresent private respondents) to present evidence ex parte before the Clerk of Court, which evidenceuncotradicted and unrebutted was lifted almost en toto as the basis of the decision granting damages soenormous and so huge in amount as to exceed the bounds of reason and fairness.

The procedure for the pre-trial of a case is laid down by Rule 20, Revised Rules of court, which provides,to wit:

Sec. 1. Pre-trial mandatory. In any action, after the last pleading has been filed, the ourt shall direct theparties and their attorneys to appear before it for a conference to consider':


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(a) The possibility of an amicable settlement or of a submission to arbitration;

(b) The simplification of the issues;

(c) The necessity or desirability of amendments to the pleadings;

(d) The possibility of obtaining stipulations or admissions of facts and of documents to avoid unnecessaryproofs;

(e) The limitation of the number of witnesses;

(f) The advisability of a preliminary reference of isues to a commissioner,

(g) Such other matters as may aid in the prompt disposition of the action.

Sec. 2. Failure to appear at pre-trial conference. A party who fails to appear at a pre-trial conferencemay be non-suited or considered as in default.

Sec. 3. Allows the ocurt to render judgment on the pleading or summary judgment as justice require. Sec.4 directs that a reocrd of the pre-trial results be made; and Sec. 5 requires the court to prepare a pre-trialcalendar of cases for consideration as above provided, and that upon the submission of the last pleadingin a particular case, it shall be the duty of the clerk of court to place case in the pre-trial calendar.

Unquestionably, the present Rules make pre-trial mandatory. And the reason for making pre-trialmandatory is that pre-trial conferences bring the parteis together, thus making possible an amicablesettlement or doing away with at least the non-essentials of a case from the beginning. (Borja vs. Roxas,73 Phil. 647).

Philippine jurisprudence has laid down the legal doctrine that while it is true that it is mandatory for theparties and their attorneys to appear before the trial court for a pre-trial conference to to consider inter aliathe possibility of an amicable settlement, the rule wa sby no means intended as an implacable bludgeon but as a tool to assist the trial court in the orderly and expeditious conduct of trial. The rule isaddressed to the sound discretion of the trial court (Rice and Corn Administration vs. Ong Ante, et. al.,G.R. No. L-30558, Oct. 4, 1971).

Both client and counsel must appear at the pre-trial. this is mandatory. Failure of the client to appear is aground for dismissal. (American Ins. Co. vs. Republic 1967D Phil. 63; Home Ins. Co. vs. United StatesLines Co., 1967D Phil. 401, cited in Saulog vs. Custombuilt Manufacturing Corp. No. L-29612, Nov. 15,1968; Taroma v. Sayo, L-37296, Oct. 30, 1975 (67 SCRA 508).

In the case of Insurance Co. of the North America vs. Republic, et. al., G.R. No.L-26794, Nov. 15, 1967,21 SCRA 887, the Supreme Court, speaking thru Justice Bengzon, held that Sec. 1, Rule 20 of the Rulesrequries the court to hold a pre-trial before the case is heard and since in this case, a pre-trial has alreadybeen had, the fact that an amended complaint was later filed, did not necessitate another pre-trial. itwould have been impractical, useless and time-consuming to call another pre-trial.

Under the rules of pleading and practice, the answer ordinarily is the last pleading, but when thedefendant's answer contrains a counterclaim, plaintiff's answer to it is the last pleading. When thedefendant's answer has a cross-claim, the answer or the cross-defendant to it sit he last pleading. Wherethe plaintiff's answer to a counterclaim contains a counterclaim constains a counter-claim agains theopposing party or a cross-claim against a co-defendant, the answer of the opposing party to thecounterclaim or the answer of the co-defendant to the cross-claim is the last pleading. And where the


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plaintiff files a reply alleging facts in denial or avoidance of new matter by way of defense in the answer,such reply constitutes the last pleading. (Francisco, the Revised Rules of Court, Vo. II, pp. 2 -3).

The above citations and authorites are the ground rules upon which the conflictings claims of theopposing partie's may be resolved and decided.

First, the legality of the order of default dated February 29, 1971 and the decision dated March 9, 1972.there is spread out in the Record on Appeal, pp. 92-93 that on May 5, 1971, a pre-trial. was conducted bythe court between the plaintiff Ben Uy Rodriguez spouses and the defendant Pioneer Insurance & SuretyCorp. The record or results of said pre-trial is found in the ordr of the court dated May 5, 1971, whichstates:

When this case was called for pre-trial today, the plaintiffs and their counsel, Atty. Hilario Davide Jr.appeared. On the other hand, the defendant Pioneer Insurance & Surety Corp. represented by itscounsel, Atty. Amando Ignacio also appeared.

When asked by the court if there is any possibility of settling this case amicably, the counsel for thedefendant answered in the negative. Both counsels agreed that the only issue to the resolved bu theCourt is whether the bonding company is laible or not, and if so, how much?

Atty. Hilario Davide, Jr. caused the markings of the following exhibit.

Exhibit "A-pre-trial", the finanacial report of Ben Rodriguez as of December 31, 1969; and

Exhibit "B-pre-trial", the affidavit of handwriting expert Perfecto Espina, and thereafter he reserved hisright to mark additinal exhibits during the trial on the merits.

The counsel for the defendant also reserved his right to object to the Exhibits of the plaintiffs and mark hisexhibits during the trial on the merits of the case.

Both counsels are given ten (10) days from today within which to file their simulatteneous memoranda or

authorities in support of the motion for preliminary hearing and its objection thereto. and thereafter hisincident will be resolved by the Court.

Following agreement of the partiesm, the trial on the the merits of this case is set for June 11, 1971 at8:30 o'clock in the moring.

The parties thru their respective counsels are notified in open court of this order.

SO ORDERED.

Cebu City, Philippines, May 5, 1971.

SGD.) AGAPITO HONTANOSAS

JUDGE


The defendant Pioneer Insurance & Surety Corp. having complied with the order of the Court to appearand attend this pre-trial, and had manifested its opposition to settling the case amicably, said party mayno longer be compelled to attend a second pre-trial hearing, and neither may it be punished by the court


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by its orde declaring said defendant as in default. The mandatory character of a pre-trial nad the seriousconsequences confronting the parties in the event that each party fails to attend the same must impose astrict application of the Rule such that where we find no authority for the the Court to call another pre-trialhearing, as in fact there is none in said Rule, the conclusion is inescapable that the respondent Judgecommitted a grave and serious abuse of discretion and acted in excess of jurisdiction in declaringdefedant Pioneer Insurance & Surety Corp. "as in default" for failure to attend the second pre-trial calledby the Judge on February 29, 1972. In other words, there is nothing in the Rules that empowers or hascalled a first pre-trial duly attended by tha prties, and lacking such authority, the court perforce lack theautority to declare a failure to prosecute on the part of the plaintiff for failing to attend such second pre-trial; it also lack the authority to declare the defendant "as in default" by reason of the latter's failure to bepresent at the said second pre-trial.

It serves no purpose for the court to call again another pre-trial where the parties had previously agreedto disagree, where the issues had been joined and where the court itself had been satisfied that a hearingon the merits is the next step to conduct as int he instant case where the court, after the pre-trial on May5, 1971, set he trial of the case on its merits for June 11, 1971. Indeed, a second pre-trial is impractical,useless and time-consuming.

We have not lost sight of the fact that when the first pre-trial was called and conducted, the party litigants

were the Ben Uy Rodriguez spouses as plaintiffs, while Pioneer Insurance & Surety Corp. and AlliedOverseas Commercial Co. (although not yet summoned) were the defendants, whereas at the time thesecond pre-trial was called, the original complaint had been amended to implead Hadji EsmayatenLucman as additional defendant. The amendment of the complaint to implead Lucman did not, however,alter the impracticability, the uselessness and the absence of authority to call a second pretrial hearingsince the amended complaint merely impleaded Lucman as the assignee of the original defendant AlliedOverseas Commercial Co. and no additional cause of action was alleged; the prayer was the same andthe amount of damages sought was the same as that in the original complaint.

Second, the prematureness of the pre-trial called on February 28, 1972, assuming that there was need tohave another pre-trial. The records (Record on Appeal, p. 293) show that the notice of the clerk of courtsetting the case for pre-trial on February 28, 1972 was issued and dated February 7, 1972. As of thisdate, February 7,1972, the complaint had been amended on August 27, 1971 by impleading the

defendant Hadji Esmayaten Lucman who filed his answer on December 24, 1971, interposing therein acompulsory counterclaim. (Record on Appeal, pp. 239-240). Before this date of February 7, 1972, thecourt had already promulgated the Decision dated January 28, 1972 as against Lucman only.

Likewise, as of February 7, 1972, defendant Pioneer Insurance & Surety Corp. had also filed its answer tothe amended complaint, interposing too a compulsory counterclaim. But as of February 7, 1972, theplaintiffs have not yet filed their answer to the compulsory counterclaims of the defendants (which isnecessarily the last pleading to be filed in order that the case is ready and ripe for the pre-trial). It wasonly on February 22, 1972 that plaintiffs made their reply to the answer, and their answer to thecompulsory, counterclaim of defendant Lucman 'Record on Appeal, pp. 299- 301).

The records do not disclose any reply of the plaintiffs to the answer of Pioneer Insurance & Surety Corp.,nor any answer to the compulsory counterclaim of the Corp. The above state of the case as far as the

pleadings are concerned clearly and manifestly show that the case was not yet ready for pre-trial, that itwas as yet premature because the last pleading had not yet been filed by the plaintiffs.

Even the state of the pleadings as of February 21, 1972 when the telegrams were sent notifying theparties of the pre-trial for February 28, 1972 reveals the prematureness of calendaring the case pre-trial.As of February 21, 1972, the complaint was already amended to implead Lucman who submitted hisanswer with compulsory counterclaim. but plaintiffs had not yet filed their reply and their answer to thecounterclaim, because the records indicate that the plaintiffs' answer to the counterclaim, because therecords indicate that the plaintiffs' answer to the counterclaim is dated February 22, 1972. (Record on


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Appeal, pp. 299-301). And to the compulsory counterclaim of defendant Pioneer Insurance & SuretyCorp., plaintiffs made no answer whatsoever.

Third, the notices given by the clerk of court thru telegrams on February 21, 1972 notifying the parties ofthe pre-trial on February 28, 1972 were insufficient, in law and jurisprudence.

We have careffully noted the telegraphic notices sent by the clerk of court and we find this omission whichis fatal to the respondents' cause: no telegram was sent to the defendant Pioneer Insurance & Surety Corp . The telegram was sent to the counsel of this defendant, but none to the defendant itself.

The Court had directed the clerk of court to send notice by telegram to the parties for the February 28pre-trial. The clerk did send the telegram to Atty. Eriberto Ignacio, counsel for Pioneer Insurance & SuretyCorp., but omitted and failed to send telegram to the party itself, the corporation, as required strictly bylaw. Notice to the counsel is not enough. We reiterate that this failure is a jurisdictional defect.

Reading the order of the court dated february 29, it appears in black and white (Record on Appeal, pp.306-307, Annex W, Rollo, p. 194) that only two telegraphic messages were sent by the clerk of court, thus (1) the message addressed to Atty. Eriberto Ignacio delivered to the given address at 3:45 P.M. thesame day it was filed but the signature of he recipient was unreadable; (2) the other message addressedto Hadji Esmayaten Lucman per RCPI San Juan also delivered on the same day, February 21, 1972 andpersonally 4eceived by the addressee himself. This was the offficial advice received by the Court from theRadio Communications of the Philippines thru which the telegrams were wired.

This is also confirmed by the Order of the Court dated April 11, 1972 denying the defendant's UrgentMotion for Reconsideration. The other states.

Per advice from the Radio Communications of the Philippines, Inc. these two messages were received bythe addressees, Atty. Eriberto Ignacio and Hadji Esmayaten Lucman on the same day it was filed, that ison February 21, 1972.


Decidedly, there was no telegram sent to party defendant Pioneer Insurance & Surety Corp., informing itof the February 28 pre-trial hearng. The reason for requiring the presence of the party who must benotified is explained in the case of Home Insurance Co. vs. United Lines Co. (L-25593, November 15,1967, 21 SCRA 863), where the Court, speaking thru Justice Bengzon, said that:

A party who fails to appear at a pre-trial conference may be non-suited or considered as in default. Thisshows the purpose of the Rules to compel the parties to appear personally before the court to reach, ifpossible, a compromise. Accordingly the court is given the discretion to dismiss the case should plaintiffnot appear at the pre-trial.

Fourth, the denial of the motion for postponement was a grave abuse of discretion. We grant the court thediscretion to postpone any hearing, pre-trial or on the merits of the case, but the exercise of discretion

must be based on reasonable grounds. The motion (Record on Appeal, pp. 301-303) had allegedgrounds which are meritorious and not frivolous nor intended for delay, which are 1. no formal order ofthe court scheduling the February 28 pre-trial had been received; 2. pre-trial cannot be had as yet be setas the issues are not yet fully joined; 3. counsel has a hearing previously set in Manila in a criminal casewhich was of an intransferable character. We are also concede that counsel may not presume nor takefor granted that his motion for postponement and the proposed setting to March 22 or 23, 1972 will begranted by the court but where the court had actually postponed the hearing on February 28, 1972 due tothe absence of the defendants and their counsel, and scheduled the pre-trial to March 20, 1972 at 8:30o'clock in the morning (Record on Appeal, pp. 304-306), we find no reason nor fairness in the court's


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order of February 29, 1972 finding defendants as in default since the pre-trial was moved to a later date inMarch as prayed in the motion.

The motion for postponement was received on February 28, 1972 at the Cebu Post Office, as shown inthe postmarks on the envelope (photographed on p. 322, record on Appeal) but was not immediatelydelivered to the court although the envelope bore the words, "registered Air Mail/Special Delivery with

Return Card." If the letter containing the moton was not yet delivered to the Court the next day, February29, 1972 when the court made the order declaring defendants in default, this was clearly a postal neglectand omission to perform its duty, not attributable to defendants, The Court, in the exercise of wisediscretion, could have restored their standing in court and given them an even chance to face theiropponents.

For refusing to set aside said order of default and the decision, we hold the Court of Appeals in reversibleerror therefor. The respondent Court of Appeals has ignored established rulings of the Supreme Courtin Pineda vs. Court of Appeals , 67 SCRA 228, that a party may not be declared in default for future toattend the pre-trial where only his counsel was notified of the pre-trial schedule; in Sta. Maria, Jr. vs.Court of Appeals , 45 SCRA 596 that a pre-trial is unnecessary where the case could not be settled andthat the fact that an amended complaint was later filed with leave of court did not, undue thecircumstances, necessitate another pre-trial; and in Pineda vs. Court of Appeals , 67 SCRA 288 that

Courys should be liberal in setting asiode default judgment.

At this juncture, it is necessary to emphasize once more the pronouncement of this Court speakingthrough Justice Teehankee in Taroma vs. sayo, 67 SCRA 509, pp. 512-513, that:

For the guidelines of the bench and bar, therefore, the Court in reaffirminf the ruling that notice of pre-trialmust be served separately upon the party and his counsel of record, retates that while service of suchnotice to party may be made directly to the party, it is best that the trial courts uniformly serve such noticeto party through or care of his counsel of the obligation of notifying the party of the date, time and palce ofthe pre-trial conference and assuring that the party either appear thereat or deliver to counsel a writtenauthority to represent the party with power to compromise the case, with the warning that a party whofails to do so may be non-suited or declared in default.

The second point at issue is whether the remedy of ordinary appeal in the case is palin, speedy andadequate such that the writ of certiorari will not lie. We have adverted to previously that the Court ofAppeals in its extended Resolution dated July 25, 1972 ruled that although appeal was available, suchremedy is not sufficiently speedy and adequate to cure the defects in the proceedings therein or toremedy the disadvantageous position of petitioners because, since they were deprived of raising anyissue or defense that they have in the respondent court by reason of the order of default, they cannotraise said issue or defense for the first time on appeal. Yet, on October 30, 1972, the Court in its decisionheld that the remedy of appeal is not inadequate in that whatever errors respondent Judge might havecommitted in his order or judgment may be assigned as specific errors in their appeal before said tribunal,and that it can review any errors of fact and of law in the appeal.

This conflicting stand of the Court of Appeals issuing from the same case is as difficult to resolve as it isto reconcile them. We have but to rule on them. hold one to be correct and dislodge the other as an error.

On general principles, the writ of certiorari will lie where there is no appeal, nor any plain, speedy andadequate remedy in the ordinary course of law. The existence of an appeal is a bar to writ of certiorariwhere such appeal is in itself a sufficient and adequate remedy, in that it will promptly relieve thepetitioner from the injurious effects of the order or judgment complained of. (Silvestre v. Torres, 57Philippines 885, 890; Pachoco v. Tumangday L-14500, May 25, 1960; Lopez et al. v. Alvendia, et al. L-20697, Dec. 24, 1964). Courts ordinarily do not deny the writ if the result would be to deprive a party ofhis substantial rights and leave him without remedy, and in those instances wherein the lower court hasacted without jurisdiction over the subject matter, or where the order or judgment complained of is a


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patent nullity, courts have gone even as far as to disregard completely the question of petitioner's fault,the reason being, undoubtedly, that acts performed with absolute want of jurisdiction over the subjectmatter are void ab initio and cannot be validated by consent, express or implied, of the parties. (Moran,Comments on the Rules of Court, Vol. 3, 1970 ed., pp. 169-170).

There are numerous cases where the Supreme Court has granted the writ notwithstanding the existence

of an appeal. Thus, the Supreme Court to avoid future litigations, passed upon a petition for certiorarithough the proper remedy was appeal. Writs have been granted despite the existence of the remedy ofappeal where public welfare and the advancement of public policy so dictate, the broader interests of

justice so require, or where the orders complained of were found to be completely null and void, or thatthe appeal was not considered the appropriate remedy. (Fernando v. Varquez, No. L-26417, Jan. 30,1970)

As to what is an adequate remedy, it has been defined as "a remedy which is equally beneficial, speedyand sufficient, not merely a remedy which at some time in the future will bring about a revival of the

judgment of the lower court complained of in the certiorari proceeding, but a remedy which will promptlyrelieve the petitioner from the injurious effects of that judgment and the acts of the inferior court ortribunal." (Silvestre v. Torres, 57 Phil. 885, 11 CJ., p. 113)

Now to the case at bar, We find here a number of special facts and circumstances which addressesthemselves to the wise discretion of this court with such force to induce Us to grant the writ in order toprevent a total or partial failure of justice, to redress or prevent the wrong done. We are satisfied thatpetitioners are cornered into a desperate position where they have been ordered to pay damages overand above the amount of the bond posted for the attachment of private respondents' properties asordered by the decision of the court based on evidence presented ex parte by reason of the order ofdefault, and more than that, plaintiff Rodriguez is relieved from civil liability on an inexplicable andunprecedented finding that the plaintiffs' check was a forgery, (when the check exhibited was only a xeroxcopy of the original, which original was in the records of the case filed in the court of First instance ofRizal, Civil Case No. 14499 entitled " Hadji Esmayaten Lucman vs. Benjamin Rodriguez, et al. ," (Recordon Appeal, pp. 49-55). Again, the conflicting notices as to the hearing ordered, pre-trial in one and on themerits in the other, is not the doing of the petitioners of their standing in court was in effect a failure of

justice. Petitioners can no longer present their evidence to rebut the claim of damages, or reduce the

unconscionable and excessive damages or question the release of plaintiff's debt, for the same may notbe submitted nor raised for the first time on appeal. We, therefore, hold that the Court of Appeals erred inholding that the appeal is adequate. The court erred in ignoring the doctrine laid down in Omico v.Villegas , 63 SCRA 285, that appeal is not an adequate remedy where party is illegally declared in default.

Petitioners assail the jurisdiction of the court of First Instance of Cebu in Civil Case No. 12069-R filed bythe Rodriguez spouses, seeking damages for the alleged malicious and unlawful is2suance of the writ ofpreliminary attachment against the latter's properties granted by the Court of First Instance of Manilaupon the posting of a security bond in the amount of P450,000.00 given by the petitioner PioneerInsurance & Surety Corp. The petitioners contend that under See. 20, Rule 57 of the Revised Rules ofCourt, the claim for damages against a bond in an alleged wrongful attachment can only be prosecuted inthe same court where the bond was filed and the attachment issued.

Rule 57, Sec. 20 of the Revised Rules of Court provides, to wit:

Claim for damages on account of illegal attachment. If the judgment on the action be in favor of the partyagainst whom attachment was issued, he may recover, upon the bond given or deposit made by theattaching creditor, any damages resulting from the attachment. Such damages may be awarded onlyupon application and after proper hearing, and shall be included in the final judgment. The applicationmust be filed before the trial or before appeal is perfected or before the judgment becomes executory,with due notice to the attaching creditor and his surety or sureties, setting forth the facts shaking his rightif damages and the amount thereof.


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Objections to lack of jurisdiction of the person, and other objections to jurisdiction not based on thecontention that there is an absolute want of jurisdiction of the subject matter, are waived by invoking thecourt's jurisdiction, as by a counterclaim, consent, or voluntary submission, to jurisdiction, or conductamounting to a general appearance.

In Soriano v. Palacio , 12 SCRA 557, this Court held that even if jurisdiction was not originally acquired by

the Court over the defendant due to allegedly defective services of summons, still when the latter filed amotion for reconsideration of the judgment by default, he is considered to have submitted to said court's jurisdiction.

We agree with the petitioners that the Court of Appeals erred in not dismissing the complaint with respectto the petitioner Pioneer Insurance & Surety Corp., over which respondent-appellee Judge had notacquired jurisdiction pursuant to Sec. 20, Rule 57 of the Revised Rules of the Court.

IN VIEW OF THE FOREGOING, the judgment of the Court of Appeals is reversed and another one isentered declaring the order of default dated February 29, 1972 and the decision rendered by therespondent Judge on March 9, 1972 null and void, holding that the Court of First Instance of Cebu lacks

jurisdiction to hear and determine the claim for damages arising from the alleged wrongful attachmentissued by the Court of First Instance of Manila and ordering the dismissal of that case (Civil Case No.

12069 of the Court of First Instance of Cebu), as well as the pending of the judgment herein annuled inthe Court of Appeals which has been rendered moot.

Petition granted.

SO ORDERED.


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SUPREME COURT

Manila

FIRST DIVISION

G.R. No. 82568 May 31, 1988

HON. ALFREDO R.A. BENGZON, in his capacity as Secretary of Health, HON. CATALINA C.SANCHEZ, in her capacity as the Director of Food and Drugs of the NATIONAL DRUG COMMITTEEof the Department of Health, petitioners,

vs.

COURT OF APPEALS and BOIE-TAKEDA CHEMICALS, INC.,respondents.

The Solicitor General for petitioners.

Herrera, Laurel, De los Reyes, Roxas and Teehankee Law Offices for respondents.

GRIO-AQUINO,J.:

The petitioner filed on April 5, 1988 a petition for review on certiorari of the writ of preliminary injunctionthat was issued on March 3, 1988 by the Court of Appeals (Tenth Division) in CA-G.R. No. 13859 entitled,"BOIE-TAKEDA CHEMICALS INC., Petitioner versus DEPARTMENT OF HEALTH, HON. ALFREDOR.A. BENGZON, in his capacity as Secretary of Health, et al., Respondents."


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enjoining respondents and all persons acting under them from enforcing and/or giving effect to RegulationNo. 1 dated 1 April 1987 (Annex "B," Petition), Regulation No. 1-A dated 10 April 1987 (Annex "C") and tothe order dated 1 February 1988 (Annex "Q") and from conducting further proceedings, which shall issueupon petitioners bond for P250,000.00 executed to the respondents to the effect that petitioner will paysuch damages as they may sustain and prove by reason of the writ if it should finally be decided thatpetitioner is not entitled thereto.

The petitioners pray that the said writ of preliminary injunction be annulled and set aside and that itsenforcement be temporarily restrained during the pendency of this case.

Respondent Boie-Takeda Chemicals, Inc. (hereafter referred to as "BOIE-TAKEDA" for brevity) filed amotion to dismiss the petition, and an opposition to the application for a writ of preliminary injunction.

Treating the motion to dismiss and opposition as the respondents' comment or answer to the petition, Wedecided to immediately resolve the merits of the petition.

Under Republic Act No. 3720 of June 22,1963, the petitioner Secretary of Health is charged with the dutyand vested with authority "to insure safe and good quality supply of drugs and to regulate the production,sale, and traffic for the same to protect the health of the people." (Sec. 2) To implement this policy, theGovernment shall:

(a) Establish standards and quality measures for food, drug, and cosmetic.

(b) Adopt measures to insure pure and safe supply of food, drug, and cosmetic in the country.

As amended by Executive Order No. 175 dated May 22, 1987, the statute now empowers the Departmentof Health to:

(a) Establish standards and quality measures for foods, drugs and devices and cosmetics.

(b) Adopt measures to ensure pure and safe supply of foods and cosmetics, and pure, safe, efficacious

and good quality drugs and devices in the country.

(c) Adopt measures to ensure the rational use of drugs and devices, such as, but not limited to, banning,recalling or withdrawing from the market drugs and devices which are not registered unsafe, inefficaciousor of doubtful therapeutic value, the adoption of an official National Drug Formulary, and the use ofgeneric names in the labelling of drugs.

(d) Strengthen the Bureau of Food and Drugs.

Respondent Boie-Takeda is a Philippine corporation which is engaged in the manufacture, distribution,and sale of drugs, among them "Danzen" a tablet which contains serra-peptase, an OPE (oral anti-inflammatory proteolytic enzymes) which it has been licensed to manufacture and sell in the Philippinessince 1970. This drug is also being sold in other countries such as Japan and in the Federal Republic ofGermany. However, it is not sold in the United States.

Based on a decision dated May 30,1985 of the U.S. Food and Drug (FDA) Commissioner, and affirmedby the U.S. Court of Appeals on April 1, 1986, which determined that "oral anti-inflammatory proteolyticenzymes (OPE) which are labelled for use in controlling edema and inflammation associated withsurgical, obstetrical, or dental procedures or accidental trauma to any part of the body or infections orallergic manifestations, have not been shown to be effective for such uses," the petitioner Catalina C.Sanchez, as Director of the Bureau of Food and Drugs, with the approval of petitioner Alfredo R.A.


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Bengzon, as Secretary of Health, "in the interest of consumer protection," issued on April 1, 1987 BFADRegulation No. 1 s. 1987, ordering that:

l. The registration of all pharmaceutical preparations containing anti-inflammatory proteolytic enzymes, aslisted in ANNEXES "A," "A-1," "A-2" and "B," "B-l" and "B-2" hereof are herby ordered recalled, whichmeans that these drugs should no longer be marketed in the Philippines.

2. For the orderly phasing out of stocks which have been distributed to outlets prior to the issuance of thisOrder, all stocks should have been recalled and withdrawn by the manufacturer and distributor byOctober 30, 1987. (Annex "A" of Petition.)

After a week, as an addendum to BFAD Regulation No. 1, the petitioners issued BFAD Regulation No. 1-A s. 1987 dated April 10, 1987, including in the list of banned pharmaceutical preparations Boie-Takeda'sDanzen tablet, 5 mg. with serratio-peptidase 10,000 U. (Annex B, Petition.)

Boie-Takeda filed with the Secretary of Health a request for reconsideration of BFAD Regulation No. 1-Aon the grounds that:

l. Serrapeptase was never registered in the United States and as a consequence, data related to thisenzyme was not part of the review made by the US FDA.

2. Since there has been no hearing called in connection with oral proteolytic enzymes by the Bureau ofFood and Drugs, the Philippine regulatory authority, there has been no opportunity to submit data relatingto serra-peptase.

3. Voluminous data on Serrapeptase has, on 20 April 1987, been submitted to the BFAD, including whatmight be considered carefully designed double-blind studies of serrapeptase against placebo, studiesdemonstrating intestinal absorption of serrapeptase by measureable quantities of the enzymia in lymph,arterial blood and venous blood, by radio-immunoassay techniques.

4. In addition, a considerable number of additional clinical studies showing clinical effectiveness of

serrapeptase in various conditions, done in West Germany, France, Italy and other countries, areavailable and can be submitted to the BFAD.

5. Serrapeptase is registered and approved drug in some 20 countries, including the ASEAN nations, andmost recently in the Federal Republic of Germany.

6. There is evidence that serrapeptase has demonstrable effectiveness not only as an anti-inflammatorydrug, which was the indication for which oral proteolytic enzymes were registered in the United States,but also as a mucolytic and as an agent that enhances penetration of antibiotics and otherchemotherapeutic agents into the sites of pathology. Documentation regarding these uses has beensubmitted to the BFAD and additional material can be supplied if necessary.

7. Additional studies are still being conducted in various parts of the world, the results of which, weanticipate, will further augment the evidence demonstrating the effectivity and uses of serrapeptase."(Annex Code. Petition.)

After a 15-minute hearing before the members of the Technical Advisory Committee on Registration ofProducts (TACORP), Director Sanchez of the Bureau of Food and Drugs denied Boie-Takeda's requestfor reconsideration (Annex E).

Boie-Takeda appealed to the Secretary of Health (Annex F) who referred the appeal to the National DrugCommittee (NDC) which granted the appellant a 20-minute hearing where it submitted voluminous


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documentation proving the efficacy and safety of its product (Annex M), but to no avail. On February 1,1988 Secretary Bengzon informed Boie-Takeda that the National Drug Committee confirmed the recalland cancellation of registration of "Danzen" tablets and directed the company "to discontinue marketingthe said product effective as of receipt of this notice." (Annex N).

Alleging that the cancellation of the registration of its product was done without due process of law, Boie-

Takeda filed in the Court of Appeals a petition for certiorari and prohibition with preliminary injunction (CA-G.R. SP No. 13859 entitled, "Boie-Takeda Chemicals Inc. versus Department of Health, Hon. AlfredoR.A. Bengzon, et al.") praying, among other reliefs, that a writ of preliminary injunction be issued torestrain the Secretary of Health from enforcing BFAD Regulation No. 1-A pending the determination ofthe case.

Upon receipt of the petition, the Court of Appeals issued a temporary restraining order and set thehearing of the application for preliminary injunction on February 22, 1988. After oral arguments at thehearing, the parties submitted their respective memoranda.

On March 3, 1988, the Court of Appeals granted the writ prayed for (Annex A, p. 98, Rollo).

This resolution of the Court of Appeals was elevated to Us by the Secretary of Health on a petition forcertiorari and prohibition with preliminary injunction alleging grave abuse of discretion in issuing the same.

As the issuance of a writ of preliminary injunction is an exercise of the Court's sound discretion, the onlypoint of inquiry in the petition before Us is whether the Court of Appeals committed a grave abuse ofdiscretion in issuing the writ. The matter of whether the respondent herein, Boie-Takeda (petitioner in theAppellate Court) was denied due process of law in the proceedings before the administrative bodies,namely, the Secretary of Health, the Bureau of Food and Drugs (BFAD), the National Drug Committee(NDC), and the Technical Advisory Committee on Registration of Products (TACORP), is not for Us todetermine as it is still pending adjudication in CA-G.R. SP No. 13859.

A writ of preliminary injunction, as an ancillary or preventive remedy may only be resorted to by a litigantfor the preservation or protection of his rights or interests, and for no other purpose, during the pendencyof the principal action (Calo vs. Roldan, 76 Phil. 425).

Here, the writ was issued to protect and preserve the right or license of the private respondent Boie-Takeda to market its product "Danzen" in the Philippines, which it has been doing since 1970 or for thepast 17 years. Hence the object of the writ is to preserve the status quo , or the last actual peaceableuncontested status which preceded the pending controversy (Rodulfa vs. Alfonso, 76 Phil. 225) which, ascorrectly noted by the Court of Appeals, "is the status before the withdrawal order" was issued. The status quo before the ban or withdrawal order was issued, was that Boie-Takeda's product, "Danzen" tablets,was registered and being sold in the Philippines under proper license from the Bureau of Food andDrugs. That status quo is what the writ of preliminary injunction seeks to preserve pending a finaldetermination of the merits of Boie-Takeda's petition in CA-G.R. SP No. 13859.

Significantly, the writ was granted after a hearing where both parties were given an opportunity to presenttheir arguments which they amplified with memoranda. (Said hearing SCRA 796). As ageneral rule, this Court should refrain, in certiorari proceedings, from interfering with the lower court'sexercise of its discretion in issuing a writ of preliminary injunction except in cases of manifest abuse(Rodulfa vs. Alfonso, 76 Phil. 225; Agno River Gold Dredging Co. vs. De Leon, 61 Phil. 190; Detective &Protective Bureau, Inc. vs. Cloribel, 26 SCRA 255).

We rule, therefore, that respondent Court of Appeals did not commit a grave abuse of discretion in issuinga writ of preliminary injunction ordering the petitioners to desist from enforcing and implementing thewithdrawal order (BFAD Regulation No. 1-A dated April 10, 1988) at least while the aggrieved party'spetition for judicial review of the administrative proceedings is still pending determination by that Court.


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WHEREFORE, the petition for certiorari and prohibition is denied.

SO ORDERED.


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SUPREME COURT

Manila

SECOND DIVISION

G.R. No. L-53772 October 4, 1990

ZOSIMO RIVAS and NORDY P. DIPLOMA,petitioners,

vs.

SECURITIES AND EXCHANGE COMMISSION, EZEKIEL F. TOEG ORLANDO C. DULAY, MIGUEL SARAMBULO, JR., RODOLFO H. DULAY, RODRIGO C. REYES, EMIGDIO S. TANJUATCO, JR.,JACOB (JAMES) ISAAC and TEODORO BUNDANGrespondents.

Lolita A. Quisumbing and Antonio Rodriguez Bautista Law Offices for petitioners.

Tanjuatco, Oreta Tanjuatco & Factoran for respondents.

PADILLA,J.:

This is a petition for certiorari with prayer for the issuance of a writ of preliminary injunction and/orrestraining order, to annul and set aside the order of the Securities and Exchange Commission (SEC) en banc , dated 21 April 1980, in SEC Case AC No. 025, lifting the writ of preliminary injunction previouslyissued by SEC Hearing Officer Antonio R. Manabat in SEC Case No. 1719.

The antecedents are as follows:

On 26 March 1979, petitioners filed with the Securities and Exchange Commission (SEC), a petition 1 fornullification of transfer of shares and of directors' election, with prayer for the issuance of a writ ofpreliminary injunction, docketed therein as SEC Case No. 1719.

The petition alleged inter alia that sometime in November 1976, petitioner Nordy Diploma endorsedWOODWORKS, INC. stock certificate Nos. 151 (229 shares), 152 (281 shares), 154 (75 shares), 155(150 shares), 156 (270 shares) and 157 (150 shares), covering a total of 1,155 shares, and depositedthese certificates in Safety Deposit Box No. 243 maintained jointly under his name and that of privaterespondent Ezekiel P. Toeg at the Associated Citizens Bank branch on T.M. Kalaw Street, Ermita,Manila.

The petition further alleged that petitioner Diploma entrusted the duplicate key to the deposit box torespondent Toeg his close business associate, friend, confidant and client for ten (10) solid yearssince 1968 with the instruction for Toeg to have access to his box should anything happen to him,since he (Diploma) was frequently traveling here and abroad; that sometime in November 1978, petitioner


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Diploma discovered, soon after he returned from a 2-month sojourn abroad, that the stock certificateswere in Toeg's possession and upon inquiry with the depository bank, petitioner Diploma learned that on16 August 1978, Toeg opened the safety deposit box; that upon learning of Toeg's faithless act ofopening the safety deposit box and stealing Diploma's share certificates therein, which were endorsed inblank, Diploma confronted, and later negotiated with Toeg and some of the other respondents, who wereeither Toeg's transferees or nominees, but to no avail; that on 13 February 1979, Diploma charged Toegwith theft in the Office of the City Fiscal of Manila, docketed therein as I.S. No. 79-2740; that in hiscounter affidavit, Toeg took the position that Diploma had sold his 1,155 shares way back in February1978 to Toeg, Jacob (James) Isaac and Teodoro Bundang; that sometime in the early part of February1979, they (petitioners) received a secretary's certificate issued by respondent Emigdio S. Tanjuatco, Jr.,certifying to the election of directors 2 and officers 3 at a supposed stockholders' meeting and that thedirectors' meeting held on 22 January 1979 was absolutely illegal, null and void for absence of notice tostockholders of record, especially to the petitioners.

On 27 March 1979, SEC Hearing Officer, Antonio R. Manabat issued a restraining order 4 "enjoiningrespondents, their nominees, transferees, agents, representatives or any person acting in their behalf,whether singly or collectively, from voting the shares which were derived from stock certificate Nos. 151,152, 154, 155, 156 and 157 at the annual stockholders' meeting to be held on 29 March 1979, or at anysubsequent meeting of the stockholders of Woodworks, Inc. and, further enjoining said respondents fromexercising any of the powers, privileges, and functions of directors and officers of Woodworks, Inc. in sofar as they derived their authority from the supposed stockholders' meeting held last 22 January 1979,until further orders from the Commission" and set the application for the issuance of a writ of preliminaryinjunction on 30 March 1979, at 9:00 o'clock in the morning.

In due time, the private respondents filed their answer 5 to the petition.

On 31 May 1979, after the hearing on the application for the issuance of a writ of preliminary injunction,the Hearing Officer issued an order 6 the dispositive portion of which reads as follows:

WHEREFORE, let the writ of preliminary injunction be issued as prayed for by the petitioners upon filingof a bond and executed by them in favor of the respondents, in the amount of not less than P100,000.00,by a surety acceptable to the Commission, the condition of such bond being that the petitioners shall pay

to the respondents all damages which the latter may sustain by reason of the issuance of the injunctionshould the Commission finally decide, in the course of the hearing of this case, that the petitioners are notentitled thereto; further, respondents are hereby enjoined from voting the contested shares in the annualstockholders' meeting of the corporation and in any subsequent meetings thereafter, or from disposing ofsuch shares in any manner, furthermore, the respondents are hereby likewise enjoined from representingthemselves as duly elected officers or members of the board of directors of Woodworks, Inc. until after thefinal resolution and disposition of the principal issue.

It is understood that the hold-over board are not precluded or prohibited from executing corporate acts inaccordance with the by-laws of the corporation and to discharge their ordinary duties to protect theinterest of the company, save the reorganization of the corporate structure. Payments in the ordinarycourse of the business to meet the normal obligations shall be made. And, with reference to the contractsof the corporation with Triad Marketing Corporation, Equatorial Lumber Products Co., Ltd. and Supra

Marketing Corporation, the same shall be honored and fulfilled in accordance with the pertinent terms andconditions thereof in due time.

SO ORDERED.

The private respondents moved for reconsideration, but the same was denied by the Hearing Officer inhis order 7dated 23 July 1979, reasoning out that


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. . ., petitioners have established that respondent Toeg "acquired" the 1,155 shares not through a salemade to him by petitioner Diploma or by any legitimate transfer of ownership thereof. Stated differently,petitioners have demonstrated that respondent Toeg stole the aforesaid shares. The verdict of the CityFiscal of Manila rendered in the criminal case (I.S. No. 79-4740) filed by petitioner Diploma againstrespondents Exekiel ( sic ) Toeg, Teodoro Bundang and Jacob (James) Isaac, involving the same sharesin controversy, ascribed to the existence of a prima facie case of theft against said respondents and, as aresult of which, an information, docketed as Criminal Case No. 46459, was filed before the Court of FirstInstance of Manila ( See petitioners' Ex-Parte Manifestation). The fact that the City Fiscal of Manilabelieved that there exist a prima facie case of theft precludes any stigma of doubt as to the right ofpetitioners to the injunctive relief.

On 20 August 1979, private respondents appealed the order of the Hearing Officer dated 31 May 1979 tothe SEC en banc .

On 13 September 1979, while their appeal was pending with the SEC en banc , private respondents filedwith this Court a petition for certiorari and prohibition, with prayer for the issuance of a restraining order,to annul and set aside the orders of the Hearing Officer dated 31 May 1979 and 23 July 1979 and toenjoin the therein respondents (now petitioners) from continuing with the proceedings in SEC Case No.1719, docketed herein as G.R. No. 51435. On 9 November 1979, the Court dismissed the petition for lack

of merit.

Thereafter, the private respondents filed with the SEC en banc a Manifestation and Motion 8 dated 31March 1980, calling its attention to a letter-directive 9 dated 19 March 1980 of the Minister of Justice, thenHon. Ricardo C. Puno, which reversed the findings of the City Fiscal of Manila in I.S. No. 79-4740,entitled "Diploma vs. Toeg, et al ." and directed the fiscal to move for the dismissal of the criminal case fortheft against therein respondents (also herein respondents) for lack of prima facie evidence. Privaterespondents prayed that the incident pending before the Commission en banc be resolved immediatelywith the lifting of the preliminary injunction earlier issued by the Hearing Officer.

After the petitioners had filed their comment 10 on the aforesaid manifestation and motion, the SEC en banc issued on 21 April 1980 an order 11 the pertinent and dispositive portion of which reads as follows:

Reading the appealed Order, the decisive factor in the issuance of the writ of injunction apparently wasthe resolution of the City Fiscal of Manila in I.S. No. 79-4740 finding prima facie case of theft againstrespondents therein, the same herein appellants Ezekiel F. Toeg, Teodoro Bundang and Jacob (James)Isaac. This finding, however, was lately reversed by the Minister of Justice in his letter-directive to the CityFiscal of Manila ( See Annex 1, appellants' Marine station and Motion). This being the case, the appealedOrder should be reversed, the very foundation upon which the writ of preliminary injunction was issuedhad ceased to exist.

WHEREFORE, the appealed Order is hereby reversed and, accordingly, the writ of preliminary injunctionis hereby lifted and dissolved. Respondents-appellants may now proceed to perform their functions asofficers elected on January 22, 1979 elections.

Let the records of the case be remanded to the Hearing Officer for trial on the merits.

SO ORDERED.

Hence, petitioners interposed the present petition, claiming that respondent SEC en banc acted without jurisdiction and with grave abuse of discretion in issuing the questioned order (21 April 1980), and thatthere is no appeal nor any plain, speedy and adequate remedy in the ordinary course of law other thanthis present petition.


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Petitioner raised a collateral issue by faulting the respondent Court of Appeals for refusing to resolve anassignment of error in his appeal therein, said respondent court holding that the main issue had beenpassed upon by this Court in G.R. No. L-40992. It was petitioner's position that the aforementioned two(2) resolutions of the Court in said case, the first dismissing the petition and the second denying themotion for reconsideration, did not constitute the "law of the case" which would control the subsequentproceedings in the controversy. In resolving this collateral issue, this Court held:

The "doctrine of the law of the case" has no application at the aforesaid posture of the proceedings whenthe two resolutions were handed down. While it may be true that G.R. No. L-40992 may have involvedsome of the issues which were thereafter submitted for resolution on the merits by the two lower courts,the proceedings involved there was for certiorari , prohibition and mandamus assailing an interlocutoryorder of the court a quo , specifically, its order denying therein defendant's motion to dismiss. This court,without rendering a specific opinion or explanation as to the legal and factual bases on which its tworesolutions were predicated, simply dismissed the special civil action for lack of merit. It may very well bethat such resolution was premised on the fact that the Court, at that stage and on the basis of the factsthen presented, did not consider that the denial order of the court a quo was tainted with grave abuse ofdiscretion. To repeat, no rationale for such resolutions having been expounded on the merits of thataction, no law of the case may be said to have been laid down in G.R. No. L-40992 to justify therespondent court's refusal to consider petitioner's claim that his former acquittal barred the separateaction.

The herein petitioners also contend that the issuance of the questioned SEC en banc resolutionconstitutes a pre-judgment of the case because the private respondents may "now proceed to performtheir functions as officers" although their election or appointment is still in issue and that it disturbedthe status quo . The contention is untenable.

The SEC en banc did not pre-judge the case when it issued the questioned order. On the contrary, it wasthe Hearing Officer in SEC Case No. 1719 who had pre-judged the case when he issued the writ ofpreliminary injunction. For, in issuing the said writ, the Hearing Officer assumed as true the allegationscontained in the petitioner's petition, and, in effect, disposed of the main case without trial, thereby shiftingthe burden of proof to the private respondents. In Ortigas & Company Limited Partnership vs . Court of appeals , 14 this Court held:

In general, courts should avoid issuing a writ of preliminary injunction which in effect disposes of the maincase without trial. This is precisely the effect of the writ of preliminary mandatory injunction issued by therespondent appellate court. Having granted through a writ of preliminary mandatory injunction the mainprayer of the complaint, there is practically nothing left for the trial court to try except the plaintiffs' claimfor damages.

Again, in Government Service Insurance System vs . Hon . Alfredo C . Florendo, etc ., et al ., 15 the Courtheld:

. . . Equally pertinent is the rule that courts should avoid issuing a writ of preliminary injunction which, ineffect, would dispose of the main case without trial (or would result in) a prejudgment of the main caseand a reversal of the rule on the burden of proof since it would assume the proposition which the

petitioner is inceptively duty bound to prove . . .

The issuance of the SEC en banc questioned order did not also disturb the status quo , which is the lastactual peaceable uncontested status quo which preceded the controversy. 16 The status quo before thepetitioners filed their petition for nullification of transfer of shares and of directors' election was thatEzekiel Toeg, Teodoro Bundang and Jacob Isaac were in possession of the stock certificates indispute endorsed in blank by petitioner Nordy Diploma; that a stockholders' meeting had been heldelecting the directors of Woodworks, Inc.; and that a directors' meeting had been held electing the officersof the Id corporation. The sole object of a preliminary injunction is to preserve the status quo until the


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merits of the main case can be heard. 17 In issuing the writ of preliminary injunction, the Hearing Officerin SEC Case No. 1719 did not maintain the status quo but restored the corporate situation precedingthe status quo, i .e ., the corporate situation before the stockholders' meeting held on 22 January 1979.The lifting by the SEC en banc of the writ of preliminary injunction merely restored the status quo .

The other issues raised by the petitioners are the main issues in SEC Case No. 1719; hence, the same

should be resolved in said case.

WHEREFORE, the present petition is DISMISSED.

SO ORDERED.

Melencio-Herrera (Chairman), Sarmiento and Regalado, JJ., concur.

Paras, J., is on leave.

EN BANC

[G.R. No. 69863-65 : December 10, 1990.]

192 SCRA 183

LINO BROCKA, BENJAMIN CERVANTES, COSME GARCIA, RODOLFO SANTOS, VALENTINOSALIPSIP, RICARDO VEGA, ERIC MARIANO, JOSE EMMANUEL OYALES, RONNIE MATTA,ALFREDO VIAJE, RUBEN EUGENIO, REYNALDO ORTIZ, ORLANDO ORTIZ, NOEL REYES,EDUARDO IMPERIAL, NESTOR SARMIENTO, FRANCO PALISOC, VIRGILIO DE GUZMAN,ALBERTO REYES, JESSIE PINILI, ROMULO AUGUIS, DOMINADOR RESURRECION III, RONNIELAYGO, ROSAURO ROQUE, CLARENCE SORIANO, OCTAVO DEPAWA, CARLITO LA TORRE,SEVERNO ILANO, JR., DOMINGO CAJIPE, ALAN ALEGRE, RAMON MARTINEZ, MA. GILDAHERNANDEZ, EDNA P. VILLANUEVA, DOLLY S. CANU, MELQUIADES C. ATIENZA, ELIGIO P.VERA CRUZ, ROGER C. BAGAN, ABUNDIO M. CALISTE, Petitioners, vs. JUAN PONCE ENRILE,MAJ. GENERAL FIDEL V. RAMOS, BRIG. GENERAL PEDRO BALBANERO, COL. ABAD, COL.DAWIS, SERGIO APOSTOL, P/LT, RODOLFO M. GARCIA and JUDGE RICARDO TENSUAN,Respondents.

D E C I S I O N

MEDIALDEA,J.:


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This petition was originally filed on February 13, 1985 to secure the release of petitioners on habeascorpus and to permanently enjoin the City Fiscal of Quezon City from investigating charges of "Inciting toSedition" against petitioners Lino Brocka, Benjamin Cervantes, Cosme Garcia and Rodolfo Santos,(hereafter Brocka, et al.). On learning that the corresponding informations for this offense has been filedby the City Fiscal against them on February 11, 1985, a supplemental petition was filed on February 19,1985 (p. 51, Rollo) to implead the Presiding Judge, 1 and to enjoin the prosecution of Criminal CasesNos. Q-38023, Q-38024 and Q-38025 (p. 349, Rollo) and the issuance of warrants for their arrests,including the

civilpro assigned cases

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