G.R. No. L-7550. April 29, 1955
DONALD A. ROCCO, PLAINTIFF, VS. MORTON MEADS, DEFENDANT AND APPELLEE, PLARIDEL SURETY & INSURANCE CO., BONDSMAN AND APPELLANT.
LABRADOR, J.:
approving the taxation of costs in favor of defendant. The case was certified to
this Court by the Court of Appeals for the reason that only a question of law is
involved in this appeal.
On March 11, 1948, plaintiff herein brought a civil action fin the Court of
First Instance of Manila to recover damages alleged to have been caused by
defendant to plaintiff in instituting a criminal action for estafa against
plaintiff , which criminal action was dismissed. On July 13, 1948, he secured an
order for the attachment of defendant’s properties, filing a bond for the
issuance of the said writ executed by the Plaridel Surety and Insurance Company,
appellant in this proceeding. The properties of the defendant were attached, but
upon defendant’s presenting a counterbond, the order of attachment was lifted.
The defendant then filed an answer containing a counterclaim for P15,000 as
damages alleged to have been occasioned to him by the filing of the complaint
and the attachment of his properties. He also asked for the attachment of the
plaintiff’s properties, which the court granted on April 6, 1949 and which was
carried out by the sheriff. The defendant sought to have the properties attached
sold but the petition was denied upon opposition of the plaintiff. The case was
tried and on April 18, 1949 the court entered judgment dismissing the complaint
on the ground that plaintiff has not proven his cause of action. Instead it
allowed defendant to recover the following damages on his counterclaim:
P125.55 as premium for the counterbond to lift the order of
attachment;
P620.00 for payment of guards detailed by the Sheriff’s
Office;
P500.00 for attorney’s fees; and
P5,000.00 for consequential
damages for inability of defendant to use the transportation equipment
attached.
Against this judgment, the case was appealed by the plaintiff to the Court of
Appeals and this Court affirmed the judgment dismissing the complaint but it
modified the amount of damages that the defendant was allowed to recover on his
counterclaim. The modification consisted in the elimination of the items of
P125.55, P500.00 and P5,000, the last as consequential damages. When the
judgment of the Court of Appeals became final and upon the case being returned
to the Court of First Instance for the execution of the judgment, the clerk of
court made a taxation of the costs, as follows:
“1. Sheriff’s guards fees
…………………………………………..2. Premium on Bond for a Writ of Attachment 3. Other Sheriff’s fees, as per receipts attached ….
Opposition thereto was filed before the Court of First Instance, but this
opposition was denied and the court approved the said taxation. So execution was
issued and upon the return thereof unsatisfied in part, motion was presented
against the Plaridel Surety and Insurance Company to compel it to pay the costs.
The opposition is based on two grounds, namely, that the bondsman is not liable
for the satisfaction of the judgment or any deficiency thereof, and that its
bond is not answerable for the levying of the attachment by the defendant of
plaintiff’s properties. The court overruled this opposition, holding that the
judgment of the Court of Appeals awarding costs to the defendant, and the
sheriff’s fees for services during the attachment of the plaintiff’s properties
are recoverable as part of such costs, citing in support thereof the case of
Macondray & Co., Inc. vs. Bernabe and Ferrer, 67 Phil. 658.
The above facts present for our consideration this legal question: Is
plaintiff’s bond on attachment liable for the sheriff’s fees for guarding
plaintiff’s properties attached by defendant upon his counterclaim
against the plaintiff? The claim of the surety on the bond, now appellant in
this Court, is that the bond is not responsible therefor under Section 4 of Rule
59, whereas the defendant contends that the said fees are recoverable as costs
against the bond on attachment.
It is to be noted at the outset that the liability of the plaintiff for the
costs taxed in this case is not in issue; what is in issue is the supposed
liability of the plaintiff’s attachment bond for said costs, after the execution
therefor had been returned unsatisfied. The liability of the plaintiff’s bond in
attachment is defined in Section 4 of Rule 59, as follows:
“The party applying for the order must give a bond executed to the defendant
in an amount to be fixed by the judge, not exceeding the plaintiff’s claim, that
the plaintiff will pay all the costs which may be adjudged to the defendant and
all damages which he may sustain by reason of the attachment, if the court shall
finally adjudge that the plaintiff was not entitled thereto.”
It is clear from the above provision that the responsibility of the bondsman
arises only “if the court shall finally adjudge that the plaintiff was not
entitled thereto.” According to Chief Justice Moran, the liability attaches if
“the plaintiff is . not entitled to the attachment because the requirements
entitling him to the writ are wanting,” or “if the plaintiff has no right
to the attachment because the facts stated in his affidavit, or some of
them, are untrue.” (II Moran, Comments on the Rules of Court, 1952 ed., p.
21). But there is no finding in the decision of the court a quo, or in
that of the Court of Appeals, that the plaintiff was not entitled to the
attachment. With out a finding to this effect, no liability can be imposed
upon the bondsman, because his liability can not extend beyond that which the
law has fixed for him. The court a quo evidently assumed that in case
of costs, not damages, the bond is responsible if the party who furnished it is
liable, but this is incorrect because the clause “if the court shall finally
adjudge that the plaintiff was not entitled thereto,” which is the foundation
stone on which the bondsman’s liability is based, applies both to damages and to
costs.
The case of Macondray & Co. vs. Bernabe and Ferrer,
supra, cited by the court a quo as authority for ordering the
execution against appellant bondsman, refers to the costs or expenses incurred
by a plaintiff in enforcing his legitimate claim or credit against the
defendant. The liability of a defendant for costs for all the processes that the
plaintiff utilizes or avails of to enforce his legitimate claim or credit
against defendant is justified. But the case cited is not applicable to the case
at bar for the following reasons: In the first place, the costs in that case
(Macondray & Co. vs. Bernabe and Ferrer) were being enforced
against the defendant himself, whereas in the case at bar, the payment of the
costs is being enforced not against a party (plaintiff) but against his
bondsman, whose responsibility is limited to the terms and conditions of the
bond. In the second place, the issuance of the attachment writ in this case was
not found by the court to have been unlawful or without cause; there is no
finding of fact that plaintiff was not entitled to the attachment prayed
for.
There is another reason why the bondsman, appellant in this case, can not be
held responsible for costs sought to be enforced by execution of the bond. These
costs represent the expenses that the defendant himself had incurred to enforce
his counterclaim, which was dismissed. They were not costs sustained by the
defendant by reason of the attachment within the meaning of Section 4
of Rule 59, above-quoted. The phrase “by reason of the attachment” in this
section applies to the costa as well as to the damages. This construction is
supported by the punctuation. There is also no justification for making the
bondsman on plaintiff’s attachment responsible for the costs that may be awarded
defendant, because such costs did not arise by reason of the attachment
obtained by plaintiff’s bond. When a surety on the attachment bond executes
the bond therefor, he does not guarantee that the plaintiff’s cause of action is
meritorious and covenant that he will be responsible for all the costs adjudged
against his principal in case the action fails. It is unreasonable to extend the
responsibility that the bondsman has assumed to any and all costs arising in the
proceedings, especially those not arising from the attachment secured by this
bond.
“Liability on the bond is contractual in nature, and is ordinarily restricted
to the obligations expressly assumed therein.“Liability on an attachment bond is created by, and rests on, ita
stipulations. The obligor has a right to stand on the very terms of his
contract, and his liability will not be extended beyond the fair import of the
words used; his liability is one not to be extended by implication, and it will
not be inferred that he has agreed to do more than that which is fairly
expressed in the bond; * * *.” (7 CJS 342)
His liability should be limited to those which arise by virtue or in
connection with the attachment, and no more.
In connecton with the motion to dismiss the appeal, we note from the record
that a similar one was presented to the Court of Appeals beore the briefs were
filed and the jurisdiction of this Court of the case became apparent, and said
court denied the same.
This denial is binding on us as it was made while the Court of Appeals still
had jurisdiction of the case and the latter was pending therein.
For the foregoing considerations, the order of execution against the
appellant Plaridel Surety & Insurance Company for the payment of the costs,
subject of the appeal, is hereby reversed. With costs of the appeal against
defendant-appellee Morton Meads.
Pablo, Acting C. J., Bengzon, Montemayor, Reyes, A., Bautista Angelo,
Concepcion and Reyes, J. B. L., JJ., concur.
Order reversed.