G.R. No. 206563 , October 14, 2020.
UEM Mara Philippines Corporation (Now Known as Cavitex Infrastructure Corporation), Petitioner, vs. Alejandro Ng Wee, Respondent.

FACTS

Alejandro Ng Wee filed a Complaint for sum of money against UEM Mara Philippines Corporation (UEM MARA) and several other defendants, seeking to hold them jointly and severally liable for P210,595,991.62. Ng Wee alleged that his funds, placed with Westmont Investment Corporation (Wincorp) based on promises of high yield and no risk, were loaned to Power Merge Corporation, a company he discovered had no capacity to repay. The complaint included an application for a writ of preliminary attachment. On November 6, 2000, the Regional Trial Court (RTC) granted the application. Pursuant to the writ, a Notice of Garnishment dated November 7, 2000, was served on the Philippine Reclamation Authority (PRA) to garnish “the proportionate share of [UEM MARA] in the Project Income of the Tollway Project.” In a letter dated November 13, 2000, the PRA advised the sheriff that as of November 7, 2000, there was no income allocated for UEM MARA that could be garnished because the net revenue had not yet been distributed. Ng Wee also attached a house and lot owned by co-defendant Luis Juan L. Virata.
Subsequent motions to dismiss and discharge the writ were denied by the trial court, and these denials were upheld by the Court of Appeals and the Supreme Court. In 2010, Virata and UEM MARA filed an Urgent Motion to Discharge Writ of Attachment, offering to post a counter-bond. The RTC granted the motion only as to Virata’s property, not UEM MARA’s share in the tollway income. Both parties filed motions for reconsideration. The RTC set a hearing to determine the property’s value and issued a subpoena to the PRA General Manager. In a July 20, 2010 letter, the PRA reiterated its non-compliance with the garnishment, noting advice from the Office of the Government Corporate Counsel that the garnishment could not be effected as the contract was with UEM-MARA, not another named entity, and that no income was allocable to Virata or UEM MARA for garnishment. Ng Wee argued the subpoena was relevant to determine if income had been approved for distribution after November 2000.
The RTC eventually quashed the subpoena and lifted the writ of preliminary attachment on the ground that the PRA’s letter showed the garnished property did not exist. Ng Wee filed a petition for certiorari with the Court of Appeals (CA). The CA granted the petition, reinstating the writ of attachment on UEM MARA’s share in the tollway project income, ruling that the PRA’s letter did not conclusively prove the property’s non-existence and that the trial court gravely abused its discretion. UEM MARA filed a motion for reconsideration, which the CA denied.

ISSUE

Whether the Court of Appeals erred in reinstating the writ of preliminary attachment on UEM MARA’s share in the income of the Manila-Cavite Tollway Project.

RULING

The Supreme Court granted the petition, reversing and setting aside the CA’s Decision and Resolution. The writ of preliminary attachment was deemed lifted.
The Court held that a writ of preliminary attachment is a provisional remedy issued at the commencement of an action or during its pendency to secure the satisfaction of any judgment that may be recovered. The grounds for discharging a writ of attachment are provided under Section 13, Rule 57 of the Rules of Court. One ground is that the property attached is exempt from preliminary attachment. More fundamentally, an attachment is proper only when the defendant has property within the Philippines not exempt from execution. The Court emphasized that the writ can only be issued and sustained if the defendant has attachable interest in the property. If the defendant has no such interest, the writ must be discharged.
Applying these principles, the Court found that the PRA’s letters (dated November 13, 2000, and July 20, 2010) constituted prima facie evidence that UEM MARA had no attachable interest in any distributable income from the tollway project as of the time of garnishment. The PRA clearly stated there was “no income which can be allocated for [UEM MARA] which can be garnished since the net revenue between the parties has not yet been distributed” and that the distribution required approval by the Joint Venture Project Committee, which had not been given. The Court ruled that future or contingent income is not subject to garnishment. The alleged property right was inchoate and not yet existing, thus not attachable. Therefore, the trial court correctly lifted the writ, as the garnished property was exempt from attachment. The CA erred in reversing this finding.
Furthermore, the Court noted that the main case for sum of money against UEM MARA and Virata had already been finally adjudicated by the Supreme Court in Virata, et al. v. Ng Wee, where they were absolved from liability. Consequently, the provisional remedy of attachment, which is ancillary to the main action, ceased to exist not only due to the final adjudication but also because it lost its basis in view of the absolution from liability of the party against whom it was directed.