Case Digest: Arabesque Industrial Philippines, Inc. vs. Court of Appeals, G.R. No. 101431.December 14, 1992


CASE TITLE:  Arabesque Industrial Philippines, Inc. vs. Court of Appeals

GR No/ Date: G.R. No. 101431.December 14, 1992

PONENTE: Bellosillo, J.

CASE WITH THE SC: Petition for Review under Rule 45

PROCEDURAL ANTECEDENTS:

  1. RTC - Nullification of the public auction sale plus accounting, with prayer for preliminary injunction

  2. CA -  Petition for certiorari and prohibition under rule 65 

FACTS:

  • Arabesque Industrial Philippines, Inc. (AIPI) bought the tugboat MT Rover from PNOC Dockyard and Engineering Corp. (PDEC) at a public auction.

  • Despite PDEC's notice of lay day charges for not removing the boat, AIPI engaged PDEC to repair the boat.

    • The repair bill totaled P1,681,896.30, but AIPI only paid P329,115.00

    • AIPI later expressed willingness to pay an additional P494,593.60.

  • AIPI received a notice from Atty. Rosendo Chaves for a public auction of the boat due to unpaid repair charges.

  • AIPI sued PDEC and Notary Public Rosendo Chaves for the nullification of the public auction sale plus accounting, with prayer for preliminary injunction.

  • RTC-Makati: Issued an injunction against the auction until a hearing.

  • PDEC filed an omnibus motion opposing the injunction, seeking a summary judgment and dismissal of the complaint. 

  • AIPI opposed this motion.

  • RTC: Issued a preliminary injunction against the auction upon AIPI posting a P100,000.00 bond.

    • Upon AIPI posting a P1 million bond, the court granted replevin and ordered the return of the boat to AIPI.

    • The sheriffs enforced the writ of replevin and delivered the boat to AIPI.

  • CA: Set aside the RTC's order, directing the return of the boat to PDEC, ruling that PDEC's mechanic's lien was valid.

ISSUES:

Whether the writ of replevin was properly issued by the court a quo. YES

Whether the interlocutory orders issued herein are appealable. NO

ARGUMENTS/LEGAL BASES  

PETITIONER

RESPONDENTS

  1. AIPI argued that its ownership rights were superior to PDEC’s lien, lay day fees were being incurred due to PDEC’s refusal to release the boat, 

  2. The Court of Appeals should have dismissed PDEC’s petition as the trial court's orders were interlocutory and unappealable.

  1. PDEC emphasized its right to retain the boat under a mechanic’s lien until repair fees were fully paid.

  2. AIPI’s partial payment and delivery of the boat for repairs as admissions of liability.

PREVAILING PARTY:  CA

DECISION/DOCTRINE:


On the first issue, respondent Court of Appeals correctly set aside the writ of replevin. 

Such writ cannot be properly directed against a lawful possessor of a chattel, and the matter of ownership as well as incurring of additional lay day fees by the continued detention of the boat by PDEC is therefore inconsequential. The requirement of posting a counterbond to reacquire possession of the chattel subject of the writ, does not apply in the case at bar because that presupposes a previous valid writ. In the case before Us, however, the chattel was ordered returned to PDEC because the writ was improperly issued. Definitely, it was not issued on the basis of the non-posting of a counterbond.


As regards the second issue, interlocutory orders, because they do not dispose of the case on the merits, are not appealable; consequently, they were correctly made subject of a petition for certiorari/prohibition before the Court of Appeals under Rule 65 of the Rules of Court.


WHEREFORE, finding no reversible error committed by respondent Court of Appeals, We RESOLVE to DENY DUE COURSE to the Petition.


SO ORDERED.



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