SECOND DIVISION

[G.R. No. 107303. February 21, 1994.]

EMMANUEL C. OÑATE and ECON HOLDINGS CORPORATION ,

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

[G.R. No. 107491. February 21, 1994.]

BRUNNER DEVELOPMENT CORPORATION , petitioner, vs. HON. ZUES

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

DECISION

NOCON , J : p

These are separate petitions for certiorari with a prayer for temporary restraining
order led by Emmanuel C. Oñate and Econ Holdings Corporation (in G.R. No. 107303),
and Brunner Development Corporation (in G.R. No. 107491), both of which assail several
orders issued by respondent Judge Zues C. Abrogar in Civil Case No. 91-3506. Cdpr

The pertinent facts are as follows: On December 23, 1991, respondent Sun Life
Assurance Company of Canada (Sun Life, for brevity) led a complaint for a sum of money
with a prayer for the immediate issuance of a writ of attachment against petitioners, and
Noel L. Diño, which was docketed as Civil Case No. 91-3506 and ra ed to Branch 150 of
the RTC Makati, presided over by respondent Judge. The following day, December 24,
1991, respondent Judge issued an order granting the issuance of a writ of attachment, and
the writ was actually issued on December 27, 1991.
On January 3, 1992, upon Sun Life's ex-parte motion, the trial court amended the writ
of attachment to re ect the alleged amount of the indebtedness. That same day, Deputy
Sheriff Arturo C. Flores, accompanied by a representative of Sun Life, attempted to serve
summons and a copy of the amended writ of attachment upon petitioners at their known
o ce address at 108 Aguirre St., Makati but was not able to do so since there was no
responsible o cer to receive the same. 1 Nonetheless, Sheriff Flores proceeded, over a
period of several days, to serve notices of garnishment upon several commercial banks
and nancial institutions, and levied on attachment a condominium unit and a real property
belonging to petitioner Oñate.
Summons was eventually served upon petitioners on January 9, 1992, while
defendant Diño was served with summons on January 16, 1992.
On January 21, 1992, petitioners led an "Urgent Motion to Discharge/Dissolve Writ
of Attachment." That same day, Sun Life led an ex-parte motion to examine the books of
accounts and ledgers of petitioner Brunner Development Corporation (Brunner, for brevity)
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 at the Urban Bank, Legaspi Village Branch, and to obtain copies thereof, which motion was
granted by respondent Judge. The examination of said account took place on January 23,
1992. Petitioners led a motion to nullify the proceedings taken thereat since they were
not present. Cdpr

On January 30, 1992, petitioners and their co-defendants led a memorandum in

support of the motion of discharge attachment. Also on that same day, Sun Life led
another motion for examination of bank accounts, this time seeking the examination of
Account No. 0041-0277-03 with the Bank of Philippine Islands (BPI) — which, incidentally,
petitioners claim not to be owned by them — and the records of Philippine National Bank
(PNB) with regard to checks payable to Brunner. Sun Life asked the court to order both
banks to comply with the notice of garnishment.
On February 6, 1992, respondent Judge issued an order (1) denying petitioners' and
the co-defendants' motion to discharge the amended writ of attachment, (2) approving
Sun Life's additional attachment bond, (3) granting Sun Life's motion to examine the BPI
account, and (4) denying petitioners' motion to nullify the proceedings of January 23,
1992.
On March 12, 1992, petitioners led a motion for reconsideration of the February,
1992 order. On September 6, 1992, respondent Judge denied the motion for
reconsideration.
Hence, the instant petitions. Petitioners' basic argument is that respondent Judge
had acted with grave abuse of discretion amounting to lack or in excess of jurisdiction in
(1) issuing ex parte the original and amended writs of preliminary attachment and the
corresponding notices of garnishment and levy on attachment since the trial court had not
yet acquired jurisdiction over them; and (2) allowing the examination of the bank records
though no notice was given to them. LLphil

We find both petitions unmeritorious.

Petitioners initially argue that respondent Judge erred in granting Sun Life's prayer
for a writ of preliminary attachment on the ground that the trial court had not acquired
jurisdiction over them. This argument is clearly unavailing since it is well-settled that a writ
of preliminary attachment may be validly applied for and granted even before the
defendant is summoned or is heard from. 2 The rationale behind this rule was stated by the
Court in this wise: llcd

"A preliminary attachment may be de ned, paraphrasing the Rules of

Court, as the provisional remedy in virtue of which a plaintiff or other proper party
may, at the commencement of the action or any time thereafter, have the property
of the adverse party taken into the custody of the court as security for the
satisfaction of any judgment that may be recovered. It is a remedy which is purely
statutory in respect of which the law requires a strict construction of the
provisions granting it. Withal no principle, statutory or jurisprudential, prohibits its
issuance by any court before acquisition of jurisdiction over the person of the
defendant.
"Rule 57 in fact speaks of the grant of the remedy 'at the commencement
of the action or at any time thereafter.' The phrase 'at the commencement of the
action,' obviously refers to the date of the ling of the complaint — which, as
abovepointed out, is the date that marks 'the commencement of the action;' and
the reference plainly is to a time before summons is served on the defendant, or
even before summons issues. What the rule is saying quite clearly is that after an
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 action is properly commenced — by the ling of the complaint and the payment
of all requisite docket and other fees — the plaintiff may apply for and obtain a
writ of preliminary attachment upon ful llment of the pertinent requisites laid
down by law, and that he may do so at any time, either before or after service of
summons on the defendant. And this indeed, has been the immemorial practice
sanctioned by the courts: for the plaintiff or other proper party to incorporate the
application for attachment in the complaint or other appropriate pleading
(counterclaim cross-claim, third-party claim) and for the Trial Court to issue the
writ ex-parte at the commencement of the action if it nds the application
otherwise sufficient in form and substance. 3

Petitioners then contend that the writ should have been discharged since the ground
on which it was issued — fraud in contracting the obligation — was not present. This
cannot be considered a ground for lifting the writ since this delves into the very complaint
of the Sun Life. As this Court stated in Cuatro v. Court of Appeals: 4
"Moreover, an attachment may not be dissolved by a showing of its
irregular or improper issuance if it is upon a ground which is at the same time the
applicant's cause of action in the main case since an anomalous situation would
result if the issues of the main case would be ventilated and resolved in a mere
hearing of the motion (Davao Light and Power Co., Inc. vs. Court of Appeals,
supra, The Consolidated Bank and Trust Corp. (Solidbank) vs. Court of Appeals,
197 SCRA 663 [1991]).
"In the present case, one of the allegation in petitioner's complaint below is
that the defendant spouses induced the plaintiff to grant the loan by issuing
postdated checks to cover the installment payments and a separate set of
postdated checks for payment of the stipulated interest (Annex "B"). The issue of
fraud, then, is clearly within the competence of the lower court in the main action.
5

The fact that a criminal complaint for estafa led by Sun Life against the petitioners
was dismissed by the Provincial Prosecutor of Rizal for Makati on April 21, 1992 and was
upheld by the Provincial Prosecutor on July 13, 1992 is of no moment since the same can
be indicative only of the absence of criminal liability, but not of civil liability. Besides, Sun
Life had elevated the case for review to the Department of Justice, where the case is
presently pending. LLjur

Finally, petitioners argue that the enforcement of the writ was invalid since it
undisputedly preceded the actual service of summons by six days at most. Petitioners cite
the decisions in Sievert vs. Court of Appeals, et al. 6 and BAC Manufacturing and Sales
Corp. vs. Court of Appeals, et al., 7 wherein this Court held that enforcement of the writ of
attachment can not bind the defendant in view of the failure of the trial court to acquire
jurisdiction over the defendant through either summons or his voluntary appearance.
We do not agree entirely with petitioners. True, this Court had held in a recent
decision that the enforcement of writ of attachment may not validly be effected until and
unless proceeded or contemporaneously accompanied by service of summons. 8
But we must distinguish the case at bar from the Sievert and BAC Manufacturing
cases. In those two cases, summons was never served upon the defendants. The plaintiffs
therein did not even attempt to cause service of summons upon the defendants, right up
to the time the cases went up to this Court. This is not true in the case at bar. The records
reveal that Sheriff Flores and Sun Life did attempt a contemporaneous service of both
summons and the writ of attachment on January 3, 1992, but were stymied by the absence
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 of a responsible o cer in petitioners' o ces. Note is taken of the fact that petitioners
Oñate and Econ Holdings admitted in their answer 9 that the o ces of both Brunner
Development Corporation and Econ Holdings were located at the same address and that
petitioner Oñate is the President of Econ Holdings while petitioner Diño is the President of
Brunner Development Corporation as well as a stockholder and director of Econ Holdings.
cdphil

Thus, an exception to the established rule on the enforcement of the writ of

attachment can be made where a previous attempt to serve the summons and the writ of
attachment failed due to factors beyond the control of either the plaintiff or the process
server, provided that such service is effected within a reasonable period thereafter.
Several reasons can be given for the exception. First, there is a possibility that a
defendant, having been alerted of plaintiff's action by the attempted service of summons
and the writ of attachment, would put his properties beyond the reach of the plaintiff while
the latter is trying to serve the summons and the writ anew. By the time the plaintiff may
have caused the service of summons and the writ, there might not be any property of the
defendant left to attach.
Second, the court eventually acquired jurisdiction over the petitioners six days later.
To nullify the notices of garnishment issued prior thereto would again open the possibility
that petitioners would transfer the garnished monies while Sun Life applied for new
notices of garnishment.
Third, the ease by which a writ of attachment can be obtained is counter-balanced
by the ease by which the same can be discharged: the defendant can either make a cash
deposit or post a counter-bond equivalent to the value of the property attached. 1 0 The
petitioners herein tried to have the writ of attachment discharged by posting a counter-
bond, the same was denied by respondent Judge on the ground that the amount of the
counter-bond was less than that of Sun Life's bond. cdrep

II.
Petitioners' second ground assail the acts of respondent Judge in allowing the
examination of Urban Banks' records and in ordering that the examination of the bank
records of BPI and PNB as invalid since no notice of said examinations were ever given
them. Sun Life grounded its requests for the examination of the bank accounts on Section
10, Rule 57 of the Rules of Court, which provided, to wit:
"Sec. 10. Examination of party whose property is attached and persons
indebted to him or controlling his property; delivery of property to o cer . — Any
person owing debts to the party whose property is attached or having in his
possession or under his control any credit or other personal property belonging to
such party, may be required to attend before the court in which the action is
pending, or before a commissioner appointed by the court and be examined on
oath respecting the same. The party whose property is attached may also be
required to attend for the purpose of giving information respecting his property,
and may be examined on oath. The court may, after such examination, order
personal property capable of manual delivery belonging to him, in the possession
of the person so required to attend before the court, to be delivered to the clerk or
court, sheriff, or other proper o cer on such terms as may be just, having
reference to any lien thereon or claim against the same, to await the judgment in
the action."

It is clear from the foregoing provision that notice need only be given to the
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 garnishee, but the person who is holding property or credits belonging to the defendant.
The provision does not require that notice be furnished the defendant himself, except when
there is a need to examine said defendant "for the purpose of giving information
respecting his property. llcd

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

WHEREFORE, the instant petitions are hereby DISMISSED. The temporary restraining
order issued on June 28, 1993 is hereby lifted.
SO ORDERED.
Narvasa, C .J ., Padilla, Regalado and Puno, JJ ., concur.

Footnotes
1. Sheriffs Return, Rollo in G.R. No. 107303, pp. 47-48.

2. Davao Light & Power., Inc. vs. Court of Appeals, et al., G.R. No. 93262, 204 SCRA 343
(1991); Cuartero vs. Court of Appeals, et al., G.R. No. 102448, 212 SCRA 260 (1992).
3. Davao Light & Power Co., Inc. vs. Court of Appeals, supra, 204 SCRA 343, 349-350. Citations
omitted.
4. 212 SCRA 260.

5. Id., at 267.
6. G.R. No. L-84034, 168 SCRA 692 (1988).

7. G.R. No. 96748, 200 SCRA 130 (1991).

8. Id., p. 357.

9. Rollo in G.R. No. 107303, p. 90.

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

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