ROBERT L. WEADOCK AND JAMES T. WALKER, PETITIONERS VS. MACARIO OFILADA, SHERIFF FOR THE CITY OF MANILA, AND BATANGAS BASE R. SURPLUS COMPANY, RESPONDENTS.

This is an “Urgent Ex-Parte Petition to Require Sheriff of
Manila to Re-attach Properties” filed in case No. L-2949, Robert L. Weadock and
James T. Walker vs. Macario Ofilada, Sheriff for the City of Manila, and
Batangas Base R. Surplus Company, entitled “Petition for a Writ of
Prohibition.”

The pertinent facts are as follows:

Robert L. Weadock and James T. Walker, the petitioners, brought
an action in the Court of First Instance of Manila (civil case No. 6877, now
pending in the said court) against Arthur H. Merritt and Insular Trades, Inc. to
compel defendants to render an accounting of the profits in certain business
transactions between them, it being alleged that said profits had been
misapplied by defendants to their own use.

Acting on plaintiffs’ petition, Judge Potenciano Pecson issued
a writ of preliminary attachment, plaintiffs put up a bond, duly approved by the
court, in the amount of P150,000, and the sheriff of the City of Manila attached
the articles of personal property inventoried in Annex B.

On February 15, 1949, W. O. Merritt, said to be a brother of
defendant Arthur H. Merritt, filed for and in behalf of Batangas Base R. Surplus
Company, an alleged California partnership not registered in the Philippines, a
third party claim for all or most of the attached property.

As A result of the
filing of this third party claim, the sheriff required plaintiffs to put up a
bond in the sum of P551,425, said to be the value of the property attached, with
the warning that if they failed to post such bond he, sheriff, would deliver the
said property to the third party claimant.

Plaintiffs opposed the third party claim on the grounds
(a) that the affidavit in support of it was insufficient under section
14, Rule 59, of the Rules of Court; (b) that the valuation of the
property claimed, at P551,425, was highly excessive; and (c) that
Batangas Base R. Surplus Company was not a person under Philippine laws, the
same having been allegedly organized under the California laws but not
registered nor licensed to transact business in the Philippines. As an
affirmative remedy, plaintiffs prayed that the sheriff be prohibited from
releasing the said property and asked the court to make a reasonable assessment
thereof.

On March 23, 1949, Judge Pecson denied plaintiffs’ opposition
and their motion to prohibit the sheriff from releasing the property. It was at
this stage of the case that plaintiffs filed, on May 31, the urgent ex-parte
petition.

Section 14, Rule 59, of the Rules of Court reads:

“If property taken be claimed by any other person than the
defendant or his agent, and such person makes an affidavit of his title thereto
or right to the possession thereof, stating the grounds of such right or title,
and serves the same upon the officer while he has possession of the property,
and a copy thereof upon the plaintiff, the officer shall not be bound to keep
the property under the attachment, unless the plaintiff or his agent, on demand
of said officer, indemnifies him against such claim by a bond in a sum not
greater than the value of the property attached and in case of disagreement as
to such value, the same shall be decided by the court issuing the writ of
attachment.* * *”

The third party claimant’s affidavit, by reason of which he
claimed the release of the properties in question and on the strength of which
the plaintiffs were required to file a bond, states that “the affiant’s right to
the possession of said personal property is derived from the fact that the
attached properties listed in Appendices A, B, and C have been purchased by the
defendant Insular Trades, Inc. with the funds money of the said partnership
Batangas Base R. Surplus Company and are therefore of the ownership of the said
partnership.”

The interest which W.O. Merritt claims to have in the attached
property does not meet the requirements of section 14 of Rule 59, and should be
ignored. He does not allege that Insular Trades, Inc. used Batangas Base R.
Surplus Company’s funds as the latter’s agent or in the latter’s name. The
allegations are more susceptible of the interpretation that Batangas Base R.
Surplus Company is a mere creditor of Insular Trades, Inc. It is not inferable
from these allegations that W. O. Merritt’s interest, or the interest of the
partnership which he claims to represent, constitutes title to, or a lien on,
the attached property and entitles him or his principal to its possession.

This being the case, the discharge of the attachment and the
release of the property were improper and illegal. In consequence, the sheriff
should retake, re-seize or re-attach the property which he has released and keep
it in his possession or under his control, under the original order of
attachment and the bond filed in pursuance of that order.

The urgent ex-parte petition is granted and the sheriff of
Manila is ordered to proceed according to the tenor of this resolution.

Moran, C.J., Ozaeta, Feria, Bengzon, Montemayor, and
Reyes, JJ., concur.
Paras, J., concurs in the result.