JIMMY T. GO, PETITIONER, VS. THE CLERK OF COURT AND EX-OFFICIO PROVINCIAL SHERIFF OF NEGROS OCCIDENTAL, ILDEFONSO M. VILLANUEVA, JR., AND SHERIFF DIOSCORO F. CAPONPON, JR. AND M…

Jimmy Go versus the Clerk of Court and Ex-Officio Provincial Sheriff of Negros Occidental

The Case

This is a petition for review on certiorari brought by Jimmy Go against the Clerk of Court and Ex-Officio Provincial Sheriff of Negros Occidental, Sheriff Ildefonso Villanueva, Junior, Sheriff Dioscoro Caponpon, Junior, and Multi-Luck Corporation. Go sought to stop, through an injunction issued by the Regional Trial Court of Pasig City, the public auction of a house and lot and a club share levied by the sheriffs of Negros Occidental in execution of a final judgment of the Regional Trial Court of Bacolod City in a collection suit. The case matters because it fixes the boundary between co-equal courts: one court may not, by injunction, interfere with the execution of a final judgment rendered by another court of concurrent jurisdiction, and a person claiming to co-own the attached property must assert that claim in the court that rendered the judgment, not in a separate injunction suit elsewhere.

Procedural History

Multi-Luck Corporation sued Alberto Looyuko, as sole proprietor of Noah's Ark Merchandising, for collection of a sum of money before the Regional Trial Court of Bacolod City. On motion for judgment on the pleadings, the Bacolod court rendered judgment ordering Looyuko and Noah's Ark Merchandising to pay the value of three dishonored checks. No appeal was taken, and the decision became final and executory. On motion, the Bacolod court issued a writ of execution over a house and lot registered in Looyuko's name and over one club share registered in the name of Noah's Ark Merchandising, and scheduled the auction sales.

Jimmy Go then filed a complaint for injunction with a prayer for a temporary restraining order and a writ of preliminary injunction before the Regional Trial Court of Pasig City, Branch 266, claiming to be a business partner and co-owner of the properties. The Pasig court issued a temporary restraining order, then a writ of preliminary injunction enjoining the sheriffs from holding the public auction, and denied Multi-Luck's motion to dismiss. Multi-Luck elevated the matter to the Court of Appeals by petition for certiorari and prohibition. The Court of Appeals reversed the Pasig court, holding that it had gravely abused its discretion in interfering with a co-equal court and in granting relief despite the absence of a clear legal right. Go's motion for reconsideration was denied, and he came to the Supreme Court by petition for review on certiorari.

Facts

Multi-Luck Corporation held three dishonored United Coconut Planters Bank checks with an aggregate value of 8,985,440 pesos, issued by Looyuko and Noah's Ark Merchandising to Mamertha General Merchandising and indorsed to Multi-Luck, which claimed to be a holder in due course. When Looyuko failed to pay, Multi-Luck sued for collection in Bacolod. Judgment was rendered on the pleadings in January 2000, no appeal was filed, and the decision became final and executory.

To satisfy the judgment, the Bacolod court issued a writ of execution against a house and lot covered by a transfer certificate of title in Looyuko's name and one share in the Negros Occidental Golf and Country Club, Incorporated, in the name of Noah's Ark Merchandising. Auction sales were set in November 2000. Days before the scheduled sales, Go filed his injunction complaint in Pasig, asserting that he co-owned the properties of Looyuko and Noah's Ark Merchandising under agreements said to establish a partnership, and that the auction would deprive him of his share without due process because he was never impleaded in the Bacolod case.

Go relied on an agreement dated February 9, 1982, stating that while the business ventures were registered in the name of the first party, the second party was entitled to one half of the business, goodwill, profits, and real and personal properties, and on a later agreement of October 10, 1986, recognizing that the firms of the Noah's Ark group were registered in Looyuko's name only for purposes of expediency. The Court noted, however, that the authenticity and due execution of these documents were under litigation elsewhere, with Looyuko claiming his signatures were forged. It also noted that Noah's Ark Merchandising had operated for more than two decades as a registered single proprietorship in Looyuko's name, and that Go had annotated an adverse claim over the real property in June 1998, which under the Property Registration Decree was effective for only thirty days, and no action to confirm his claim appears to have been filed before the attachment.

Issues

• Whether or not the Regional Trial Court of Pasig City gravely abused its discretion in issuing a writ of preliminary injunction that restrained the sheriffs from executing the final judgment of the Regional Trial Court of Bacolod City.
• Whether or not Jimmy Go, as a claimed co-owner and stranger to the collection suit, was entitled to the injunctive writ under the requisites for preliminary injunction.
• Whether or not Go was estopped from claiming co-ownership of the attached properties, and whether or not he was improperly excluded from the collection suit.

Applicable Provisions

Section 3 of Rule 58 of the Rules of Court, on the grounds for a preliminary injunction, provides:

Section 3. Grounds for issuance of preliminary injunction. A preliminary injunction may be granted when it is established: (a) That the applicant is entitled to the relief demanded, and the whole or part of such relief consists in restraining the commission or continuance of the act or acts complained of, or in requiring the performance of an act or acts, either for a limited period or perpetually; (b) That the commission, continuance, or non-performance of the act or acts complained of during the litigation would probably work injustice to the applicant; or (c) That a party, court, agency or a person is doing, threatening, or is attempting to do, or is procuring or suffering to be done, some act or acts probably in violation of the rights of the applicant respecting the subject of the action or proceeding, and tending to render the judgment ineffectual.

This provision governs the case because it requires the applicant to show a clear and positive right calling for judicial protection, which the Court found Go did not possess.

Section 16 of Rule 39 of the Rules of Court, on proceedings where property is claimed by a third person, provides:

Section 16. Proceedings where property claimed by third person. If the property levied on is claimed by any person other than the judgment obligor 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 making the levy and a copy thereof upon the judgment obligee, the officer shall not be bound to keep the property, unless such judgment obligee, on demand of the officer, files a bond approved by the court to indemnify the third-party claimant in a sum not less than the value of the property levied on. In case of disagreement as to such value, the same shall be determined by the court issuing the writ of execution. No claim for damages for the taking or keeping of the property may be enforced against the bond unless the action therefor is filed within one hundred twenty days (120) days from the date of the filing of the bond. The officer shall not be liable for damages for the taking or keeping of the property, to any third-party claimant if such bond is filed. Nothing herein contained shall prevent such claimant or any third person from vindicating his claim to the property in a separate action, or prevent the judgment obligee from claiming damages in the same or a separate action against a third-party claimant who filed a frivolous or plainly spurious claim.

Go invoked this provision as a third-party claimant, but the Court held that his remedy lay in the court that issued the execution, not in an injunction suit before a co-equal court.

Ruling

On the first issue, the Court held that no court has the power to interfere by injunction with the judgments or orders of another court of concurrent jurisdiction having the power to grant the relief sought. This doctrine of non-interference rests on the principle that a judgment of a court of competent jurisdiction may not be opened, modified, or vacated by any court of concurrent jurisdiction. A case in which an execution order has been issued remains pending, so all proceedings on execution are still proceedings in the suit. The Bacolod court, having acquired jurisdiction and rendered judgment, retained jurisdiction to the exclusion of all coordinate courts over its judgment and over the conduct of its ministerial officers, the sheriffs. The Pasig injunction was therefore a clear act of interference.

The Court distinguished the case of Santos versus Bayhon, where an injunction was allowed against a writ of execution issued by a Labor Arbiter, because the Labor Arbiter had no jurisdiction to decide questions of ownership. Here, the Bacolod court had jurisdiction and competence to resolve the question of ownership had Go filed his claim there.

On the second issue, the Court held that a clear and positive right especially calling for judicial protection must be shown. Injunction will not issue to protect a contingent, abstract, or future right, or a right not in esse that may never arise. The requisites are a right in esse or a clear and unmistakable right to be protected, a violation of that right, and an urgent and permanent necessity for the writ to prevent serious damage. Go failed to establish these. The attached properties were registered solely in the names of Looyuko and Noah's Ark Merchandising. The agreements he relied on were of doubtful authenticity and under litigation elsewhere. Noah's Ark Merchandising had long operated as a registered single proprietorship, and third persons dealing with it, including Multi-Luck, could rely on that registration. At best, Go could file the proper action to enforce his rights against Looyuko in the purported partnership, but the injunction suit was not the proper forum.

On the third issue, the Court held that Go was estopped from disavowing the standing of Noah's Ark Merchandising as a registered single proprietorship. His annotation of an adverse claim was not notice that he was in fact a co-owner, only that he claimed to be one and intended to file the appropriate action; under the Property Registration Decree the claim was effective for only thirty days, and no confirming action appears to have been filed before the attachment. Looyuko and Noah's Ark Merchandising thus remained the sole owners when the Bacolod court ordered the sale. The Court also held that Multi-Luck properly did not implead Go, since only Looyuko was being made liable as single proprietor. Once a decision becomes final and executory, it is the ministerial duty of the judge to issue a writ of execution, except in certain cases not present here.

Doctrine

A court has no power to interfere by injunction with the judgment or orders of another court of concurrent jurisdiction that has the power to grant the relief sought. A judgment of a court of competent jurisdiction may not be opened, modified, or vacated by any court of concurrent jurisdiction. A case in which an execution order has been issued remains pending, so all incidents of execution, including questions of ownership of attached property raised by a third-party claimant, must be threshed out in the court that rendered the judgment.

Under Section 3 of Rule 58, a preliminary injunction requires a clear and positive right in esse, a violation of that right, and an urgent necessity for the writ to prevent serious damage. It will not issue to protect a contingent or doubtful right. A third-party claimant under Section 16 of Rule 39 must vindicate his claim before the court issuing the writ of execution, not before a co-equal court by injunction.

Disposition

The petition was denied, the decision and resolution of the Court of Appeals were affirmed, and costs were assessed against Jimmy Go.

Remember This

Memorize the line: a court has no jurisdiction to restrain execution proceedings in another court of concurrent jurisdiction, and a third-party claimant must bring his claim to the court that issued the writ. Examiners use this case on the doctrine of non-interference among co-equal courts and on the requisites of a preliminary injunction, especially the requirement of a clear and unmistakable right in esse.