ROBERTO TING AND DOLORES TING, PETITIONERS, VS. HON. AUGUSTO E. VILLARIN, FELICIANO GERVACIO, FERDINAND J. GUERRERO, AND CONSOLIDATED BANK & TRUST COMPANY, RESPONDENTS.

On September 17, 1981,
private respondent Consolidated Bank and Trust Company (hereinafter
“Consolidated Bank”) filed a complaint^[1]
for a sum of money with prayer for a writ of preliminary attachment against Perlon Textile Mills and its directors.

Roberto Ting, a director, was impleaded
with his wife Dolores Lim Ting.  The
complaint recites that the wife was impleaded as a
party defendant in order to bind their conjugal partnership of gains which
allegedly benefitted from the transactions subject of
the complaint.  The spouses Ting are the
present petitioners.

Consolidated Bank actually sued on two (2) causes of action.  The first was targetted
at recovering on several promissory notes the amount of P2,972,955.51,
allegedly obtained for the defendant corporation by its duly authorized
officers Lu Cheng Peng, Teng
See, and Roberto Ting.  These officers
allegedly signed the promissory notes in their personal and official capacities
thereby binding themselves jointly and severally to Consolidated Bank for the
payment of the promissory notes.

The second cause of action dwells on several violations of trust
receipt agreements which the defendant corporation executed in favor of
Consolidated Bank.  The defendant
corporation’s faithful compliance with the trust receipt agreements appears to
have been secured by the continuing guaranty of defendants Liu Suy Lin, Angelo Leonar, and Lu
Cheng Peng.

In support of the application for preliminary attachment,
Consolidated Bank averred the ground of “fraud in contracting an obligation”
thus –

16.  Defendants are guilty of
fraud in contracting their obligations more specifically illustrated by their
violation of the trust receipt agreement which is a ground defined under Sec.
1, Rule 57 of the Rules of Court for the issuance of a writ of preliminary
attachment.^[2]

On September 23, 1981,
acting on the application for a writ of attachment by Consolidated Bank, the
respondent judge issued the orders under question, to wit:

xxx                  xxx                 xxx

We, therefore, command you [Deputy Sheriffs Feliciano Gervacio and Ferdinand J. Guerrero] that you attach the
estate, real and personal, of the said defendants Perlon
Textile Mills, Inc., Lu Cheng Peng and Spouse; Teng See @ Teng Tik Hua and Spouse; Spouses
Roberto Ting and Dolores Lim Ting; Angelo Leonor and
Spouse, Liu Suy Lin and Spouse, and Yap Chi and
Spouse, within your province to the value of said demands, and costs of suit,
and that you keep safely the same according to the Rules of Court, unless the
defendant – gives security to pay such judgment as may be recovered in this
action in the manner provided for by the Rules of Court; and that you return
immediately this order after executing the same with a full statement of your
proceedings and a complete inventory of the properties attached.^[3]

On March 3, 1982,
acting on the petitioners’ Motion to Quash Attachment, the respondent judge
issued a second order, to wit:

xxx                  xxx                 xxx

 Acting on defendants Roberto
and Dolores Ting’s motion to quash attachment and plaintiffs’ opposition
thereto, it appearing from plaintiffs’ allegations that the alleged fraud was
effected through the collective action of the defendants, the court finds the
motion to be without sufficient merit.^[4]

xxx                  xxx                 xxx

On July 19, 1982,
acting on the petitioners’ motion for reconsideration, the respondent judge
issued the last disputed order the dispositive
portion of which states:

xxx                  xxx                 xxx

WHEREFORE, under the circumstances, and finding no sufficient
justification for the reconsideration of the order of March 3, 1982, the motion for reconsideration is
hereby DENIED.^[5]

xxx                  xxx                 xxx

The petitioners came to this Court via a petition for certiorari.  They are questioning the writ of preliminary
attachment principally on the ground that the application therefor
hinges on “fraud in contracting” the trust receipt agreements under the
second cause of action.  On the other
hand, the petitioners are impleaded in the complaint
merely under the first cause of action.

Moreover, the petitioners challenge the writ of preliminary attachment
issued because, in effect, it pierced the veil of corporate fiction.  The petitioners explain that the corporation
alone should be held liable for the violation of the trust receipt agreements.

Finally, the petitioners ask that the writ of preliminary
attachment be struck down by this Court because it authorized an attachment
over the petitioners’ conjugal partnership property.

We agree with the petitioners.

The complaint did not provide for a sufficient basis for the
issuance of a writ of preliminary attachment. 
It is not enough for the complaint to ritualistically cite, as here,
that the defendants are “guilty of fraud in contracting an
obligation”.  An order of attachment
cannot be issued on a general averment, such as one ceremoniously quoting from
a pertinent rule.^[6]
The need for a recitation of factual circumstances that support the application
becomes more compelling here considering that the ground relied upon is
“fraud in contracting an obligation”. 
The complaint utterly failed to even give a hint about what constituted
the fraud and how it was perpetrated. 
Fraud cannot be presumed.^[7]

The respondent judge thus failed in his duty to ensure that,
before issuing the writ of preliminary attachment, all the requisites of the
law have been complied with.  He acted in
excess of his jurisdiction and the writ he so issued is thus null and void.^[8]

What is more, the respondent judge plainly ignored that, as
correctly pointed out by the petitioners, the application for preliminary
attachment rests on “fraud in contracting” the trust receipt
agreements.  The complaint itself, save
for the unwarranted sweeping reference to “defendants”, alleged that
only Consolidated Bank, as principals, and Liu Suy
Lin, Angelo Leonar, and Lu Cheng Peng,
as guarantors, were privy to the trust receipt agreements under the second
cause of action.  Petitioner Roberto
Ting’s involvement is limited only to the promissory notes under the first
cause of action.  The complaint thus
relevantly alleges –

FIRST CAUSE OF ACTION

7.  On March 15, 1979,
defendant corporation, through its duly authorized officers Lu Cheng Peng, Tang See and Roberto Ting obtained from plaintiff
loan accomodations in the amount of P2,972,955.51 and
as evidence thereof, the aforementioned defendants in their personal and
official capacities executed promissory notes undertaking therein jointly and
severally with the corporation to pay plaintiff the above-mentioned amount with
interest  x x x.

SECOND CAUSE OF ACTION

8.  On different occasions in
1978-1979, defendants applied to plaintiff for the opening of numerous letters
of credit to finance its purchase of goods from various suppliers.

xxx                  xxx                 xxx

ALLEGATIONS
COMMON TO ALL

CAUSES OF ACTION

12. In order to secure the credit accomodations
obtained and all those that the defendant Perlon
Textile Mills, Inc. may thereafter obtain from plaintiff, defendants Liu Suy Lin, Angelo Leonar and Lu
Cheng Peng executed a continuing guaranty x x x.^[9]

The sweeping nature of the attachment order probably stemmed from
the respondent judge’s failure to detect that the two (2) causes of action had
been misproperly joined.  Joinder of causes
of action is, among others, subject to the rules on joinder
of parties.^[10]
And the rule on joinder of parties is enunciated in
Sec. 6, Rule 3, Revised Rules of Court, thus –

Sec. 6.  Permissive joinder of parties. 
– All persons x x x
against whom any right to relief in respect to or arising out of the same
transaction or series of transactions is alleged to exist, whether jointly,
severally, or in the alternative, may, except as otherwise provided in these
rules x x x be joined as
defendants in one complaint, where any question of law or fact common to all
such x x x defendants may
arise in the action x x x.

Here, the two causes of action arose from different
transactions.  There was no “series
of transactions” to speak of.  But
above all, the complaint can conceivably affect adversely petitioner Roberto
Ting under the first cause of action only but not in the second cause of action.^[11]

That the attachment ordered by the respondent judge called for
the sheriffs to “attach the estate, real and personal of x x x Spouses Roberto Ting and
Dolores Lim Ting” (Order of September 23, 1981) likewise gives cause for
this Court to strike it down for being null and void.  The attached property of the spouses Ting are
conjugal, the same cannot be validly brought under the painful process of
attachment because:

(a) First, the wife Dolores was impleaded
merely because of the fact that she is the spouse of Roberto;

(b) Second, the conjugal partnership cannot possibly be benefitted (again, here, Consolidated Bank’s allegation
that the act of the husband redounded to the benefit of the conjugal
partnership is mere “book form”) when the husband binds himself, as
guarantor, because this act does not conserve or augment conjugal funds but
instead threatens to dissipate them^[12]
by unnecessary and unwarranted risks to the partnership’s financial
stability.  When the husband assumes the
obligation of a guarantor, the presumption that he acts, as administrator, for
the benefit of the conjugal partnership, is lost.

WHEREFORE, the petition is hereby GRANTED.  The questioned Orders, dated September 23, 1981, March 3, 1982, and July 19, 1982, of the respondent
judge, and the levy on attachment made by the deputy sheriffs against the
parcel of land covered by TCT No. T-7232 and registered in the names of the
petitioners, are declared NULL AND VOID. 
Costs against the private respondent.

SO ORDERED.

Melencio-­Herrera, (Chairman), Paras, and Regalado, JJ., concur.

Padilla, J., No part in the
deliberations.

^[1] Rollo, 15-22.

^[2] Rollo, 20.

^[3] Rollo, 23.

^[4] Rollo, 33.

^[5] Rollo, 45.

^[6] Dy v. Enage, No. L-35351, March 17, 1976, 70 SCRA 96.

^[7] Filinvest Credit Corp. vs. Relova,
No. 50378, September 30, 1982,
117 SCRA 420.

^[8]
Salas vs. AdiI, No. L-46089, May 14, 1979,
90 SCRA 121.

^[9] Rollo, 16, 17, 19.

^[10]
Sec. 5, Rule 2, Revised Rules of Court.

^[11] Gacula v. Martinez,
et al., L-3038, January 31, 1951,
88 Phil. 142.

^[12]
Luzon Surety Co., Inc. v. De Garcia, G.R. No. 25659, October 31, 1969,
30 SCRA 111.