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614 Phil. 506

SECOND DIVISION

[ G.R. No. 171176, September 04, 2009 ]

NATIONAL CORPORATION, POWER PETITIONER, VS. PHILIPPINE COMMERCIAL AND INDUSTRIAL BANK (NOW PHILIPPINE COMMERCIAL INTERNATIONAL BANK), RESPONDENT.

D E C I S I O N

BRION, J.:

This Decision resolves the petition for review on certiorari[1] filed by the National Power Corporation (NPC) to assail the decision[2] dated January 19, 2006 of the Court of Appeals (CA) in CA-G.R. SP No. 32745, entitled "National Power Corporation v. Hon. Vetino E. Reyes, in his capacity as Presiding Judge of the Regional Trial Court of Manila, Branch 4, and the Philippine Commercial And industrial Bank (now Philippine Commercial International Bank) ".

FACTUAL BACKGROUND

This petition has its roots in the complaint for a sum of money filed by the Philippine Commercial International Bank (PCIB) against B.R. Sebastian and Associates, Inc. (Sebastian), docketed as Civil Case No. 79092 in the then Court of First Instance of Manila, Branch II {CFI Branch II). In its decision dated November 26, 1970, CFI Branch II found defendant Sebastian liable to plaintiff PCIB as follows:

WHEREFORE, the Court hereby renders judgment in favor of the plaintiff and against the defendants, as follows:

1. On the First Cause of Action, ordering defendant B.R. Sebastian & Associates, Inc. to pay the plaintiff the sum of P151,306.40, plus daily interest of P42.569 from February 18, 1970 and other bank charges, until complete payment is made;

2. On the Second, Third and Fourth and/or Alternative Cause of Action, ordering the defendants, jointly and severally, to pay the plaintiff the total sum of P181,786.23 inclusive of marginal deposits, interest, commission and other bank charges as of September 26, 1969 and thereafter, plus interests and other bank  charges until complete payment is made;

3. On all Causes of Action, ordering the defendants, jointly and severally to pay P20,000.00 as attorney's fees and costs of suit.

SO ORDERED. [Emphasis supplied]

The CA affirmed the CFI Branch II decision. The CA decision itself lapsed to finality on March 2, 1972.

Before the CFI Branch II decision in favor of PCIB could be executed, Sebastian filed a complaint against the NPC for the collection of a sum of money. The complaint, filed with the Court of First Instance of Manila, Branch XX (CFI Branch XX) and docketed as Civil Case No. 77140, resulted in a decision requiring the NPC to pay Sebastian the sum of Two Million, Seven Thousand, One Hundred Fifty-Seven Pesos (P2,007,157.00). This CFI Branch XX decision became final on June 20, 1976.

On July 20, 1976, CFI Branch II issued an alias writ of execution in Civil Case No. 79092 that became the basis for the issuance on July 21, 1976 of a Notice of Garnishment by the Sheriff of Manila, attaching and levying on all the "good(s), effects, moneys in the possession and control of NPC, particularly the judgment in Civil Case No. 77140 in the amount of Two Million Seven Thousand One Hundred Fifty-Seven Pesos (P2,007,157.00), to satisfy the amount of Five Hundred Eighty Thousand Two Hundred Twenty-Eight (P580,228.19)." The amount to be satisfied is Sebastian's liability in Civil Case No. 79092.

In due course, CFI Branch II issued an Order dated March 11, 1978 directing NPC to deliver to the Sheriff of Manila or PCIB the amount it held for Sebastian equivalent to the money judgment. The NPC complied by delivering PNB Check No. 739673 dated June 29, 1978 in the amount of Two Hundred Forty-Nine Thousand, Two Hundred Fifty-Six Pesos and Seventy-Four Centavos (P249,256,74) as partial compliance with the Notice of Garnishment.

On November 8, 1988, PCIB filed a motion with the then CFI Branch II (now referred to as the Regional Trial Court of Manila, Branch 4, or RTC) to require the NPC to satisfy the judgment in Civil Case No. 79092 and to remit the unsatisfied amount of Three Hundred Forty Thousand, Nine Hundred Seventy-One Pesos and Forty-Five Centavos (P340,971.45), plus interests and other bank charges from July 21, 1976 until full payment is made. The NPC opposed the motion on the ground that the RTC had not acquired jurisdiction over it, as it had not been duly summoned.

On April 21, 1989, the RTC issued an order directing NPC to satisfy its November 26, 1970 judgment against Sebastian in Civil Case No. 79092.

This order, in part, states:

This treats of the Motion to Require the National Power Corporation to satisfy the judgment of November 26, 1970 filed by plaintiff thru counsel on December 17, 1988.

Plaintiffs motion stems from the decision of this court dated November 26, 1970 which found favor for the plaintiff. On July 21,1976, the said decision was sought to be enforced by way of garnishment against the monies and credits of defendants which are in the possession of the National Power Corporation. Said entity, however, failed to remit the entire amount of the judgment leaving it partially satisfied. Plaintiff proceeded to institute an independent court action to recover from the NPC the difference of the judgment amounting to P340,971.45 as of July 21, 1976, plus interest before the Regional Trial Court of Pasig, Br. CLVI, docketed as Civil Case No. 39255. Said court rendered judgment in favor of plaintiff.

On appeal to the Court of Appeals, the latter court affirmed the decision of the lower court and further ruled that this court retains jurisdiction to hold the NPC liable to the plaintiff to satisfy the judgment.

xxx

Despite the said order and the assurance of Marcelino C. Ilao, Chief Legal Counsel of the National Power Corporation that he will deliver the money belonging to defendants in its possession, the latter has failed to comply. The NPC cannot now deny the jurisdiction of this court over it. It should likewise be noted at the outset that garnishment is a specie of attachment or execution which consists in the citation of some stranger to the litigation, who is debtor to one of the parties to the action. By these means such debtor stranger becomes a forced intervenor; and the court having acquired jurisdiction over his person by means of the citation, requires him to pay his debt not to his former creditor but to the new creditor who is creditor in the main litigation. (See Tayabas Land Co. vs. Sharuff, 41 Phil. 382).

Considering that the judgment in favor of the plaintiff has been unsatisfied, it is within the powers of the court to order the National Power Corporation, as the entity having legal custody of the same properties of the defendants, to turn over the same to the plaintiff.

WHEREFORE, the National Power Corporation is ordered anew to satisfy the judgment of this court dated November 26,1970.

SO ORDERED. [Emphasis supplied]

The CA dismissed the petition for certiorari the NPC filed to question the above Order. The NPC then went to this Court on a petition for review, docketed as G.R. No. 93238. We dismissed the petition for lack of merit and, in so doing, held:

However, in the case at bar, it was the petitioner who caused the delay in the payment of the remaining balance of the aforesaid Notice of Garnishment. Therefore, the delay of more than 10 years from the time the judgment of November 26, 1970 became final and executory should not be counted in computing the 5-year period in executing a judgment by motion, since the delay was not respondent's doing but petitioner's. It is well-settled that:

In computing the time limited for suing out an execution, although there is authority to the contrary, the general rule is that there should not be included the time when execution is stayed, either by agreement of the parties for a definite time, by injunction, by the taking of an appeal or writ of error so as to operate as a supersedeas, by the death of a party, or otherwise. Any interruption or delay occasioned by the debtor will extend the time within which the writ may be issued without scire facias.

Thus, the filing of respondent PCIB of a motion requiring petitioner to remit the unsatisfied amount of the Notice of Garnishment on November 8, 1988 is still seasonable and well within the 5-year period since the statute of limitations has been devised to operate primarily against those who slept on their rights and not against those desirous to act but cannot do so for causes beyond their control.

WHEREFORE, the petition is hereby DISMISSED for lack of merit.

SO ORDERED.

The NPC's motion for  reconsideration suffered a  similar  fate in  the Resolution we issued on October 7, 1992.

With the NPC's legal objections cleared, the RTC, in Civil Case No. 79092, directed the issuance of a writ of execution on June 30, 1993 "pursuant to the order of this court dated April 21, 1989, the same to be implemented by Deputy Sheriff Cezar C. Javier." The writ, issued on July 8, 1993, reads:

NOW WHEREFORE, we command you that of the goods and chattels of National Power Corporation, you cause to be made the sum of P340,971.45, plus interest and other bank charges from July 21, 1976 until fully paid, together with your lawful fees for service of this writ of execution, all in the Philippine currency which the plaintiff recovered in our Regional Trial Court of Manila, Branch IV on April 21, 1989, and that you render the same to the said plaintiff aside from your own fees on this execution and to likewise return this writ unto this Court within sixty (60) days from the date of receipt hereof with your proceedings indorsed hereon.

But if sufficient personal properties cannot be found whereof to satisfy this execution and lawful fees therein, then you are commanded that on the lands and buildings of said National Power Corporation, you cause to be made the said sums of money in the manner required by law and the Rules of Court and make return of your proceedings with this writ within sixty (60) days from the date of receipt hereof. [Emphasis supplied]

On August 9, 1993, the RTC issued an Alias Writ of Execution that provides:

Please be notified that an alias writ of execution was issued in the above-entitled case by the Honorable Vetino E. Reyes, Presiding Judge of the Regional Trial Court of Manila, Branch IV, copy herewith attached and being served upon you.

By virtue of said Writ of Execution, you are hereby ordered to pay the above-stated plaintiff through the undersigned Branch Sheriff the total amount of One Million Eight Hundred Sixty Four Thousand Eight Hundred Ten & 74/100 as of June 30, 1993 (as per plaintiff bank computation-copy of said computation is hereto attached), within five (5) days from receipt of this Notice.

Should you fail to comply with the above-stated demand within the grace period aforementioned, the undersigned Branch Sheriff formally notifies you that he would be constrained to use the full force of the law to implement the said Writ of Execution to fully satisfy the judgment in the above-entitled case.

Please be guided accordingly.

The amount sought to be collected was computed as follows:

Balance (Unsatisfied Court Judgment dated 11/26/70)
P340,971.45
 
Add: Interest at 14% p.a.
 
from 7/21/76 to
 
6/30/93 (6,188 days)
820,528.25
 
Penalty at 12% p.a.
 
from 7/21/76 to
 
6/30/93 (6,188 days)
703,310.44

Total Amount Due as of 6/30/92
P1,864.810.74
 

The NPC sought to quash the alias writ on the ground that it is liable to pay the garnished amount only in the sum of Three Hundred Forty

Thousand, Nine Hundred Seventy-One Pesos and Forty-Five Centavos (P340,971.45), but not the interest and bank charges added thereon. The RTC denied the NPC motion, whereupon the NPC went to the CA on a petition for certiorari, contending in the main that the RTC had no jurisdiction to require it to pay interest and bank charges on the garnished amount where these additional charges went beyond the amount specified in the Notice of Garnishment issued by the Sheriff on July 21, 1976. The CA's ruling requiring the NPC to pay the outstanding balance plus interests and back wages is the subject of this petition for review.

THE PETITION

The issue, as framed in the petition, is whether the CA erred in affirming the orders of the PvTC, that required the NPC to pay interest and bank charges on the garnished amount, where said interest and bank charges are over and beyond the amount specified in the notice of garnishment.

The NPC submits that since it was never a party to Civil Case No. 79092, being a mere garnishee, it cannot be bound by the CFI Branch II decision, which imposed upon Sebastian the obligation to pay interest and bank charges, on top of the monetary amount specified therein. According to the NPC, it is only' bound to pay the amount specified in the Notice of Garnishment dated July 21, 1976, which states;

Attachment/levy is... made upon all the goods, effects, interests, credits, money/monies, stocks, shares, any interest in stocks and shares, and any other personal property in [petitioner's] possession or under [petitioner's] control, belonging to the defendant/s ... B.R. SEBASTIAN & ASSOCIATES, INC. and ail debt? owing by [petitioner] to said defendant/s as of date of service hereof, sufficient to cover the sum of P580,228.19, and specifically the recovered judgment of the defendant B.R. SEBASTIAN & ASSOCIATES, INC. against [petitioner] NATIONAL POWER CORPORATION in the amount of P2,007,157 as per decision of the arbitration board formed by the Court, dated May 22, 1976.

Since neither the Notice of Garnishment nor the dispositive portions of the decisions of the CA1 and the Supreme Court4 mentioned that it is liable for interest and bank charges, and the NPC had already paid P249,256.74 out of the P580,228.19 indicated in the Notice of Garnishment, it is liable to pay the balance of P340,971.45 only, without any interests and bank charges.

OUR RULING


We deny the petition for lack of merit.

Nature of Garnishment


The legal basis of garnishment is found in Section 9 (c), Rule 39 of the Rules of Court, which states:

Sec. 9. Execution of judgments for money, how enforced.

xxx

(c) Garnishment of debts and credits. - The officer may levy on debts due the judgment obligor and other credits, including bank deposits, financial interests, royalties, commissions and other personal property not capable of manual delivery in the possession or control of third parties. Levy shall be made by serving notice upon the person owing such debts or having m his possession or control such credits to which the judgment obligor is entitled. The garnishment shall cover only such amount as will satisfy the judgment and all lawful fees, xxx [Emphasis supplied.]

Garnishment has been defined as a specie of attachment for reaching credits belonging to the judgment debtor and owing to him from a stranger to the litigation. Under this rule, the garnishee [the third person] is obliged to deliver the credits, etc. to the proper officer issuing the writ and "the law exempts from liability the person having in his possession or under his control any credits or other personal property belonging to the defendant x x x if such property be delivered or transferred x x x to the clerk, sheriff, or other officer of the court in which the action is pending."[5]

A self-evident feature of this rule is that the court is not required to serve summons on the garnishee, nor is it necessary to implead the garnishee in the case in order to hold him liable. As we have consistently ruled, all that is necessary for the trial court to lawfully bind the person of the garnishee or any person who has in his possession credits belonging to the judgment debtor is service upon him of the writ of garnishment.[6] Through service of this writ, the garnishee becomes a "virtual party" to or a "forced intervenor" in the case, and the trial court thereby acquires jurisdiction to bind him to compliance with all orders and processes of the trial court, with a view to the complete satisfaction of the judgment of the court.

NPC's contention that it cannot be bound by the CFI Branch II judgment on the ground that it was not a party to Civil Case No. 79092 is therefore unavailing.

Notice of Garnishment to be
considered in conjunction with the
decision sought to be executed


As correctly pointed out by the PCIB in its Comment,' the Notice of Garnishment was issued pursuant to, and in the execution of, the decision of the CFI Branch II which undoubtedly required Sebastian to pay not only the unsatisfied amount of P340,971.45. bat also the interests and bank charges. The NPC, in satisfying its obligation towards the PCIB, its new creditor, is thus required to refer to the dispositive portion of the CFI Branch IPs decision dated November 26, 1970, since it is the very decision that the Notice of Garnishment sought to satisfy.

Stated more directly for the benefit of the NPC so as to remove any possible source of ambiguity and doubt, the NPC is obliged to pay, aside from the remaining P340,971.45, all interests and bank charges that have accumulated on this amount from July 21, 1976 until it has made complete payment.

The NPC next tries to argue that it cannot be made to pay interests and bank charges since there is nothing in the dispositive portions of the CA decision in CA-G.R. SP No. 18475, or in our decision in G.R. No. 93238 that requires NPC to do so; the NPC bases its argument on the principle that only the dispositive portion of the decision becomes the subject of execution.

We find this argument completely misplaced. The very purpose of CA-G.R. SP No. 18475 was to resolve the petition for certiorari filed by the NPC to question the RTC order dated April 21, 1989 that states:

WHEREFORE, the National Power Corporation is ordered anew to satisfy the judgment of this court dated November 26, 1970.

In its petition, the NPC mainly argued that the RTC gravely abused its discretion in issuing the April 21, 1989 order because NPC was never made a party to Civil Case No. 79092 and, thus, could not be bound by the CFI Branch II decision issued in the same case. When the CA issued its decision in CA-G.R. SP No. 18475 denying NPC's petition for certiorari, this effectively affirmed the questioned RTC order directing the NPC to satisfy the CFI Branch IPs November 26. 1970 decision.

In like manner, when we denied NPC's petition for review on certiorari in G.R. No. 93238, we also affirmed the validity and operational force of the same April 21, 1989 order. This is but the natural effect of denying the petition questioning the order, and it would be preposterous to conclude otherwise.

Final Note

It has not escaped our attention that the NPC has employed a variety of seemingly legitimate tactics to delay the execution of the CFI Branch II decision. In fact, due to its various legal maneuverings, the NPC succeeded in avoiding its obligation to pay PCIB since 1976, or for more than 30 years, to PCIB's great prejudice. In so doing, the NPC has made a mockery of justice. We therefore take this opportunity to admonish the NPC and to remind NPC's counsels that while we agree that lawyers owe their entire devotion to the interest of their clients, they should not forget that they are also officers of the court, bound to exert every effort to assist in the speedy and efficient administration of justice. They should not, therefore, misuse the rules of procedure to defeat the ends of justice or unduly delay a case, impede the execution of a judgment or misuse court processes.

As we declared in Banogan et al v. Zerna, et al.:[9]

This Court has repeatedly reminded litigants and lawyers alike:

Litigation must end and terminate sometime and somewhere, and it is essential to an effective and efficient administration of justice that, once a judgment has become final, the winning party be not, through a mere subterfuge, be deprived of the fruits of the verdict. Courts must therefore guard against any scheme calculated to bring about that result. Constituted as they are to put an end to controversies, courts should frown upon any attempt to prolong them.

x x x

One reason why there is a degree of public mistrust for lawyers is the way some of them misinterpret the law to the point of distortion in a cunning effort to achieve their purpose. By doing so, they frustrate the ends of justice and at the same time lessen popular faith in the legal profession as the sworn upholders of the law. While this is not to say that every wrong interpretation of the law is to be condemned, as indeed most of them are only honest errors, this Court must express its disapproval of the adroit and intentional misreading designed precisely to circumvent or violate it.

As officers of the court, lawyers have a responsibility to assist in the proper administration of justice. They do not discharge this duty by filing pointless petitions that only add to the workload of the judiciary, especially this Court, which is burdened enough as it is. A judicious study of the facts and the law should advise them when a case such as this, should not be permitted to be filed to merely clutter the already congested judicial dockets. They do not advance the cause of law or their clients by commencing litigations that for sheer lack of merit do not deserve the attention of the courts. [Emphasis supplied.]

WHEREFORE, premises considered, we hereby DENY the petition and AFFIRM the Court of Appeals' Decision dated January 19, 2006 in CA-G.R. SP No. 32745. We further AFFIRM the Orders dated July 8, 1993, August 9, 1993, and August 24, 1993 of the Regional Trial Court of Manila, Branch 4, presided by Judge Vetino E. Reyes. Double costs against petitioner National Power Corporation pursuant to Section 3, Rule 142 of the Rules of Court.

SO ORDERED.

Quisumbing, (Chairperson), Carpio-Morales, Del Castillo, and Abad, JJ., concur.



[1] Under Rule 45, Rules of Court; rollo, pp. 11-30.

[2] Penned by Associate Justice Monina Ajrevalo-Zenarosa, with the concurrence of Associate Justice Andres Reyes, Jr. and Associate Justice Rosmari D. Carandang; id, pp. 82-95.

[3] In CA-G.R. SP No. 18475.

[4] In G.R. No. 93238.

[5] RCBC v. de Castro, G.R. No. L-34548, November 29, 1988, 168 SCRA 49. citing Engineering Construction Inc., v. NPC, 163 SCRA 9 0988).

[6] See: Tayabas Land Co. v. Sharruf. 41 Phil. 382 (1921), Bautista v. Barredo, G.R. No. L-20653. April 30. 1965. 13 SCRA 744; Perla Companm de Seguros, Inc. v. Ramolete, G.R. No. 60887, November 13, 1991, 203 SCRA 487; PNB Management v. R&R Metal Casting, G.R. No. 132245.  January 2. 2002. 373 SCRA I.

[7] Dated June 6, 2006; rollo, pp. 59-81.

[8] See: Eternal Gardens vs. CA, G.R. No  123698. August 5, 1998. 293 SCRA 622.

[9] G.R. No. L-35469. October 9. 1987. 154 SCRA 593, cited in Chua Hunt, et al. v. CA. G.R. No. L-53851. July 9. 1991, 199 SCRA 15.

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