Preliminary Attachment Time to file- commencement of the action, or anytime thereafter before judgment A writ of preliminary attachment is a provisional

remedy issued upon order of the court where an action is pending to be levied upon the properties of the defendant therein, and the same to be held thereafter by the Sheriff as security for the satisfaction of whatever judgement might be secured in said action.

It is purely statutory which the law requires strict construction of the provisions granting it. Purpose: To secure the outcome of the trial which is the satisfaction of the pecuniary obligation really contracted by him, either by virtue of a civil obligation and the writ issued that granted it is executed by attaching and safely keeping all the movable property of the defendant, or so much thereof as may be sufficient to satisfy the plaintiffs demands. This remedy can not be granted where indebtedness is already secured, hence, it should be shown that there is no other sufficient security for the claim sought to be enforced by the action. To sustain an order of attachment, the 2 facts should be established: a. The obligation had not been secured originally; or b. That if secured at its beginning, the security later became valueless. Grounds a. In an action for the recovery of a specified amount of money or damages, other than moral and exemplary, on a cause of action arising from law, contract, quasi-contract, delict, quasi-delict against a party who is about to depart from the Philippines with intent to defraud his creditors. Here, it must be shown that the defendants is about to depart from the Philippines with the intent of defrauding his creditors or that he is non-resident alien Note, that the attachment is available where demand is not due and payable. Also, attachment may not issue for moral and exemplary or for an unspecified amount of damages.

b. In an action for money or property embezzled or fraudulently misapplied or converted to his own use by a public officer of a corporation, or an attorney, factor or broker , agent or clerk in the course of his employment as such or by any other person in a fiduciary capacity; c. In an action to recover the possession of property unjustly or fraudulently taken, detained or converted when the property , or any part thereof, has been concealed, removed, or disposed of to prevent its being found or taken by the applicant or an authorized person.

By concealment, its means that there should be a physical hiding or secreting of property so that it cannot be seized to satisfy creditors claim. d. In an action against a party who has been guilty of fraud in contracting the debt upon which the action is brought or in the performance thereof; Here, insolvency is not a ground. It has now been held that fraud is a ground for issuance of the writ. e. In an action against a party who has removed or disposed of his property, or is about to do so, with intent to defraud his creditors; Here, actual transfer is not necessary as mere design to dispose of property and intent to carry it out is sufficient. Removal or disposal should be coupled with intent to defraud defendants creditors to justify the issuance of the writ. Fraudulent disposal here does not contemplate of mortgaging the property f. In an action against a party who does not reside and is not found in the Philippines, or on whom summons may be served by publication

This is applicable only where plaintiffs claim is liquidated but not to unliquidated damages. Note that a preliminary attachment may not be applied for and granted solely on the asserted fact that the defendant is a foreign corporation authorized to do business in the Philippines and is consequently and necessarily a party who resides out of the Philippines. Attachment is intended to confer jurisdiction by the court over the res. SC held that the writ may be issued only after the court has acquired jurisdiction over the subject matter or over the person of the defendant in the principal action. In Cuartero vs. CA Carpio v. Macadaeg, 9 SCRA 552 (1963) Mere removal or disposal does not justify an attachment. There must been a showing of intent to defraud defendants creditors before the writ of attachment was issued. Besides, the applicant did not execute an affidavit as required by the rules.
G.R. No. L-17797 November 29, 1963

ISABELO CARPIO, petitioner, vs. HON. HIGINIO MACADAEG, as presiding Judge of Branch X, Court of First Instance of Manila; OSCAR C. ABAYA, Provincial Sheriff of Rizal and City Sheriff of Manila, respondents. W. S. Fajardo and J. P. Cortez for petitioner. O.C. Baria and F. Manalo for respondents.

MAKALINTAL, J.: Isabelo Carpio filed this petition for certiorari and prohibition to annul and stop implementation of respondent Judge's orders of October 24 and November 25, 1960, directing the sale of five race horses and goods previously attached upon motion of respondent Oscar Abaya. We issued a writ of preliminary injunction to restrain the sale, with instructions to respondent Sheriff of Rizal to allow the daily training of the said horses and their participation in races whenever they were included in the racing programs. On January 17, 1960 respondent Oscar Abaya filed a complaint against petitioner for the recovery of various sums aggregating P25,000 (Civil Case No. 42450, C.F.I. Manila). Before summons was served, and upon ex partemotion of respondent Abaya (Annex B), respondent Judge issued two orders of attachment dated February 8 (Annex C-1) and February 10, 1960 (Annex C), pursuant to which the Sheriff of Manila garnished goods consisting of hardware imported by petitioner, and the Sheriff of Rizal seized petitioner's five racing horses named Mohamad, Mohamad's Pride, Magic Spell, Nashua and Sirius. On February 12, 1960 petitioner filed an urgent petition to discharge the orders of attachment (Annex 1). Acting thereon, respondent Judge, on March 11, 1960, set aside the two orders of February 8 and 10, 1960 (Annex F). Upon two motions of respondent Abaya (Annexes H and 1), respondent Judge, on March 29, 1960, set aside his order of March 11, 1960 (Annex K). Though no new petition was filed for issuance of a writ of attachment and no new order or alias writ of attachment was issued, respondent Sheriff of Manila garnished the aforementioned goods and respondent Sheriff of Rizal attached the five racing horses. Upon petition of respondent Abaya (Annex L), respondent Judge issued an order directing the sale at public auction of the five racing horses (Annex M). However, the sale was halted by petitioner's putting up a bond of P4,000 and the horses were released to him by respondent Sheriff of Rizal. Upon motion of respondent Abaya (Annex R), respondent Judge, on October 24, 1960, ordered the increase of the bond to P10,000, and ordered respondent Sheriff of Rizal to proceed with the sale of the horses should petitioner failed to file the additional bond of P6,000 (Annex S). Motions filed by petitioner seeking reconsideration of the said order of October 24 were denied by respondent Judge on November 25, 1960 (Annex X). So, respondent Sheriff of Rizal advertised the sale at public auction of the five racing horses. Upon motion of respondent Abaya (Annex T), and despite the opposition of petitioner(Annex U), respondent Judge, on the same day November 25 issued an order authorizing the sale of the garnished goods (Annex Z). Petitioner seeks annulment of the order of October 24, 1960 ordering him to file an additional bond of P6,000; the order of November 25, 1960 denying his motion for reconsideration of the order of October 24; and the order of the same date authorizing the sale of the garnished goods, on the ground that in issuing them respondent Judge acted without jurisdiction and/or with grave abuse of discretion. Respondent Judge should not have issued the two writs of preliminary attachment (Annexes C and C-1) on Abaya's simple allegation that the petitioner was about to dispose of his property, thereby leaving no security for the satisfaction of any judgment.1 Mere removal or disposal of property, by itself, is not ground for issuance of preliminary attachment, notwithstanding absence of any security for the satisfaction of any judgment against the defendant. The removal or disposal, to justify preliminary attachment, must have been made with intent to defraud defendant's creditors.2

Respondent Judge in fact corrected himself. Acting on petitioner's motion to discharge attachment and apparently believing the correctness of the grounds alleged therein,3 he set aside the orders of attachment (Order of March 11, 1960, Annex F). But reversing himself again, he set aside his order of March 11, 1960 (Annex K, dated March 29, 1960.4 This he did apparently on Abaya's contention that petitioner was about to remove or dispose of his property in order to defraud his creditors, as examples of which disposals he pointed to the alleged sale of the horses and of petitioner's office furniture (Abaya's motion for reconsideration dated March 15, 1960, Annex H). These averments of fraudulent disposals were controverted by petitioner who, in his opposition to Abaya's motions for reconsideration (Annex J), reiterated the defenses against preliminary attachment which he had previously enumerated in his petition to discharge the two orders of attachment. Thus the question of fraudulent disposal was put in issue; and respondent Judge, before issuing the preliminary attachment anew, should have given the parties opportunity to prove their respective claims or, at the very least, should have provided petitioner with the chance to show that he had not been disposing of his property in fraud of creditors.5 But for much more than the above reason, respondent Judge should not have again ordered the issuance of the writ of preliminary attachment since Abaya never made any affidavit as required by Rule 59, Rules of Court, which states that: SEC. 3. Order issued only when affidavit and bond filed An order of attachment shall be granted when it is made to appear by the affidavit of the plaintiff, or of some other person who personally knows the facts, that a sufficient cause of action exists, that the case is one of those mentioned in section 1 hereof, that there is no other sufficient security for the claim sought to be enforced by the action, and that the amount due to the plaintiff, or the value of the property which he is entitled to recover the possession of, is as much as the sum for which the order is granted above all legal counterclaims; which affidavit, and the bond required by the next succeeding section, must be duly filed with the clerk or judge of the court before the order issues. For the purposes of issuance of preliminary attachment, the affidavit (Annex B-1) attached to Abaya's motion therefor (Annex B), as we have said, is not sufficient, and it does not appear that he ever executed another affidavit that complies with the above section. None appears attached either to his motion for reconsideration dated March 15, 1960 (Annex H) or to his motion for reconsideration dated March 16, 1960 (Annex I), upon which the order of attachment (Annex K) was based. Having construed that the preliminary attachment should not have been ordered, we believe it is no longer necessary to discuss the subsequent actuations of respondent Judge which were all based on the erroneous assumption that his order of March 29, 1960 was valid (Annex K). WHEREFORE, the order of March 29, 1960 and all succeeding orders of respondent Judge with respect to said preliminary attachment, are hereby declared null and void; the attached properties are ordered released; and the preliminary injunction issued by this Court is made permanent. Costs against respondent Abaya. Bengzon, C.J., Padilla, Bautista Angelo, Concepcion, Barrera, Paredes, Dizon and Regala, JJ., concur.