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[LUNETA MOTOR COMPANY v. VS.ALPONSO LOPEZ](https://www.lawyerly.ph/juris/view/c2da7?user=fbGU2WFpmaitMVEVGZ2lBVW5xZ2RVdz09)
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[ GR No. L-12343, Mar 23, 1959 ]

LUNETA MOTOR COMPANY v. VS.ALPONSO LOPEZ +

DECISION

105 Phil. 327

[ G.R. No. L-12343, March 23, 1959 ]

LUNETA MOTOR COMPANY, PLAINTIFF AND APPELLEE, VS.ALPONSO LOPEZ, ET AL., DEFENDANTS. ALTO SURETY & INSURANCE CO. INC., SURETY AND APPELLANT.

D E C I S I O N

REYES, J.B.L., J.:

From the order of the Court of First Instance of Manila (Civil  Case No.  22733)  granting  the plaintiff-appellee's (Luneta  Motor Company) motion for the issuance of an alias  writ of  execution against the appellant Alto Surety & Insurance  Co.,  Inc.,  and from  the order  denying  the latter's motion  for reconsideration,  the surety company has  interposed  the present appeal.

On June 6, 1953,  defendant  Alfonso Lopez  bought  the motor vehicle described  in the  complaint, and borrowed from the  appellee Luneta Motor Company P8,800,  which he promised to pay in 15 monthly installments.  As security  therefore, Lopez executed a chattel mortgage on  the same vehicle,  said lien being duly registered in the Office of the Register of Deeds  of Manila.  Lopez  made several payments, but defaulted in the sum  of P4,630.32.  After repeated demands to settle this balance of the indebtedness had been made and disregarded, the company commenced foreclosure proceedings  on the chattel mortgage.

On January 2, 1954, before sale at public auction could be made, Lopez together with his  co-defendant Faustino Dy (to whom the vehicle was sold subject to the chattel mortgage)  effected  a settlement with  appellee, whereby the two promised to pay, jointly and  severally, the unpaid portion of the promissory note.  Thereupon, the sale was withdrawn and the  truck released to Dy,  still subject to the chattle mortgage.

Dy paid the  appellee company  P1.000,  again  leaving a balance of P3,827.17  including interest, which amount remained unpaid  when the  present action  was instituted.

Upon petition of appellee and the filing of a replevin bond, the court issued a writ for  the seizure  of the car. The writ was later recalled upon petition of Dy, who filed a counter-bond in the amount of P12,000 furnished and subscribed  by Dy  as principal and the  appellant Alto Surety & Insurance Co., Inc.,  as guarantor,  under  which the latter bound itself  to  answer, jointly and severally, with defendant Dy, for the  delivery of the truck, if "such delivery is adjudged,  and for  the payment of such  sum to him as may be recovered against  the defendant and the costs of the action."

On August 10, 1956, the lower  court rendered judgment, the dispositive part of which reads:
"In view of the  foregoing1, the  court orders defendants  Alfonso Lopez and Faustino  N.  Dy to pay  jointly and severally  to the plaintiff Luneta Motor Co. the sum of P3,825.17, with  12%  interest annually from July  9, 1954,  until  the whole amount is fully paid, plus 20% of  said amount for attorney's fees and plus costs.  The chattel mortgage Exhibit "C" is  hereby foreclosed.

Once this decision has become final and upon failure of the defendants to pay the said amounts, the Sheriff of Manila shall proceed to sell the truck in question at  public auction as the law  directs.  For this purpose  defendant Faustino N. Dy is ordered to deliver the truck in question to the Sheriff of Manila.  The proceeds  of said sale shall be applied in satisfaction of this decision. Counterclaim and/or reconvention of defendant  is dismissed."
The decision having become final  and executory,  upon motion of appellee,  the  lower court, on  October  4,  1956, issued a writ of execution against defendants Lopez and Dy.   This  writ  was  later returned unsatisfied  by the Sheriff of Manila.  Accordingly, on June 28, 1957,  appellee filed a motion seeking for the issuance of an alias writ of execution  against the appellant  surety  company  for the amount awarded in the  judgment.  This was opposed on the ground, among  others, that appellee  failed  to comply with  section  10,  Rule 62, in conjunction with  section 20, Rule 59 of the Rules of Court.   Nevertheless, on February 11, 1957, the lower court ordered the issuance of the alias writ  and  denied on March 8,  1957,  a motion for reconsideration of the same.

The appeal is  well-taken.  Only one point of law  is in issue  and  it  is the  propriety of  the lower  court's action in ordering the  issuance of  the  alias writ of execution against the appellant company,  such order having  been applied for and granted after the main decision had long become final  and executory.

The provisions of the  Rules of  Court on this point, particularly section  10  of Rule 62, in connection with section 20 of Rule 59, state:
"SEC.  10. Judgment  to include recovery against sureties. The amount, if any, to be awarded to either party upon any bond filed by the other in accordance  with the provisions of this rule, shall be claimed, ascertained, and granted under the same procedure as prescribed  in section 20 of  Rule 59."  (Rule 62).

"SEC. 20. Claim for  damages on  plaintiff's  bond on account of illegal attachment. If  the judgment on the action be  in favor of the defendant, he may recover, upon the bond given by the plaintiff, damages resulting  from  the  attachment.  Such damages may be awarded only upon application and after proper hearing,  and shall be included in the  final judgment.  The application  must be filed before the trial, or, in the  discretion of the court before entry of the final judgment, with due notice  to the plaintiff and his  surety or sureties, setting forth the facts showing his right to damages and the amount thereof. Damages sustained during the pendency of an appeal may be claimed by the defendant, if the judgment of the appellate court be favorable to him, by filing an application therewith, with notice to the plaintiff and his surety or sureties, and the appellate court may allow the application to  be heard and decided by the trial court." (Rule 59)  (Emphasis supplied).
Applying the foregoing rules, this  Court;, in a long line of cases  (subsequent to that of Florentino vs. Domadag, et al., 45  Off.  No.  11,  4937, 4940,  promulgated May 14, 1948  cited by the appellee), has held that the above provisions of law are mandatory and require the application for damages against the surety or bondsmen and the award thereof to be  made after hearing  and before  the entry  of the final judgment; that if the judgment under execution contains no directive for the surety to pay, and the proper party  fails to  make  any  claim for such directive before such judgment had become final and executory, the surety or bondsmen cannot  be later made liable under the bond. (Abelow vs. De la Riva, et al., supra, p. 159; Riel vs. Lacson, L-9863, Sept.  29, 1958; Port Motors Inc.  vs. Raposas, 100 Phil., 732; 53 Off. Gaz., No. 8, p. 2450; Visayan Surety & Insurance Co. vs. Aquino, et al., 96 Phil., 900; Del Rosario vs. Nava, 95 Phil., 637; 50 Off. Gaz., [9]  4189; Liberty Construction Supply  Co. vs.  Pecson,  et  al., 89  Phil., 50; Aguasia vs. Velasquez et al., 88 Phil., 357; Comments on the Rules of Courts,  Moran,  1957  Ed., Vol. 2, p. 50)

Here,  it appears  that  the application  for  damages against the appellant  surety company and the order issuing the alias writ of execution were made months after the decision had already become final and  executory; hence, the alias writ is improperly issued  and cannot be enforced against the surety.

Wherefore, the orders appealed  from,  upon which the alias writ of execution  was issued against the appellant Alto Surety and Insurance Co., Inc.  in  favor of the appellee Luneta Motor Company, are reversed and set aside. Costs against the appellee.   So ordered.

Paras, C.J.,  Bengzon, Padilla, Montemayor,  Reyes,  A., Bautista Angelo, Labrador, Concepcion, and Endencia, JJ., concur.

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