G.R. No. 126731 & G.R. No. 128623; July 11, 2002
ESTEBAN YAU, petitioner, vs. THE MANILA BANKING CORPORATION, respondent. ( G.R. No. 126731 ) / THE MANILA BANKING CORPORATION, petitioner, vs. ESTEBAN YAU, et al., respondents. (G.R. No. 128623)

FACTS

Esteban Yau, a judgment creditor of Ricardo Silverio, Sr., levied upon and purchased Silverio’s proprietary share in Manila Golf Club at a public auction on December 29, 1992. However, prior writs of preliminary attachment over the same share had been issued in favor of The Manila Banking Corporation (Manilabank) by two Makati RTC branches in separate collection suits against Silverio. Yau moved to intervene in one of these Makati cases (Civil Case No. 90-271, Branch 64), which was granted. Simultaneously, Yau requested Manila Golf to issue a new certificate in his name, subject to the existing attachments. Upon Manila Golf’s refusal, Yau secured an order from the RTC of Cebu City (which rendered his judgment) directing the club to issue the certificate.
Manilabank challenged both the intervention order and the Cebu RTC’s directive via separate petitions for certiorari before the Court of Appeals. The CA nullified the Cebu RTC’s order for interfering with the jurisdiction of the Makati RTC, which had prior custody (custodia legis) of the attached property. However, the CA upheld Yau’s right to intervene in the Makati case. Both parties elevated the decisions to the Supreme Court via these consolidated petitions.

ISSUE

The core issues are: (1) Whether the RTC Cebu City acted without jurisdiction or with grave abuse of discretion in ordering the issuance of a new certificate to Yau; and (2) Whether the CA correctly upheld Yau’s right to intervene in the Makati case where the property was under attachment.

RULING

The Supreme Court denied both petitions and affirmed the CA’s decisions. On the first issue, the Court ruled that the Cebu RTC’s order was a nullity for violating the principle of judicial stability or non-interference. The Silverio share was under the custodia legis of the Makati RTC (Branch 64) by virtue of the prior writ of preliminary attachment. A court with property in its custody has exclusive jurisdiction over it, and no coordinate court may interfere with that custody. While Yau correctly purchased the share subject to the attachment lien, the act of directing the issuance of a new certificate was an improper exercise of authority over property under another court’s control. The proper remedy was to seek relief from the Makati court itself.
On the second issue, the Court held that the CA correctly sustained Yau’s intervention. Under the Rules, a person with a legal interest in property in the custody of the court may be allowed to intervene. Yau, as the purchaser of the attached share at the execution sale, possessed a direct legal interest in the proceedings that would determine the validity and priority of claims over that very property. His interest was not merely contingent or inchoate. The Court found that his intervention in the Makati case was the appropriate forum to assert his rights and have the competing claims adjudicated, and it would not unduly delay the main case. Thus, the Makati RTC did not commit grave abuse of discretion in granting his motion to intervene.