G.R. Nos. 162814-17 August 25, 2005
JOSE F. MANACOP, HARISH C. RAMNANI, CHANDRU P. PESSUMAL and MAUREEN M. RAMNANI, Petitioners, vs. EQUITABLE PCIBANK, LAVINE LOUNGEWEAR MANUFACTURING INC., PHILIPPINE FIRE AND MARINE INSURANCE CORPORATION and FIRST LEPANTO-TAISHO INSURANCE CORPORATION, Respondents.

FACTS

Lavine Loungewear Manufacturing, Inc. insured its properties with several insurance companies. The policies contained a “loss payable” clause in favor of Equitable Banking Corporation. A fire occurred, and claims were filed. Lavine, through its newly appointed president Chandru Ramnani, filed a petition for injunction to prevent the insurers from paying the proceeds directly to the bank, requesting instead that payment be made to Lavine who would then settle the bank’s interest. Certain insurers had already paid the bank directly.
A group of individuals, including the petitioners Jose Manacop and Harish Ramnani, moved to intervene in the case, claiming to be Lavine’s legitimate directors and asserting that Harish was the authorized representative. They sought to have the remaining insurance proceeds delivered to them. The trial court granted their motion to intervene. Subsequently, the petitioners filed a motion for the trial court to issue an order directing the insurance companies to deposit the proceeds with the court.

ISSUE

Whether the trial court’s order directing the insurance companies to deposit the insurance proceeds with the court is a final order appealable via a petition for review under Rule 45, or an interlocutory order only reviewable by certiorari under Rule 65.

RULING

The Supreme Court ruled that the assailed order is interlocutory and not appealable. An order is final if it disposes of the subject matter in its entirety or terminates a particular proceeding or action, leaving nothing more for the court to do but to enforce the judgment. In contrast, an interlocutory order does not dispose of the case but merely settles incidental matters during the pendency of the litigation.
The trial court’s order requiring the deposit of the insurance proceeds was merely a provisional measure. It did not adjudicate the rights and liabilities of the parties concerning the ownership of the funds. The core issues—such as who between Lavine (through its competing officer factions) and Equitable Bank is entitled to the proceeds, and the exact amount of Lavine’s outstanding loan obligation—remained unresolved and required a full trial on the merits. The order was issued to safeguard the subject of the litigation pending final judgment, ensuring the funds would be available for eventual disbursement to the rightful claimant. Since it did not determine the merits of the case, it was interlocutory. The proper remedy for an aggrieved party from such an interlocutory order is a petition for certiorari under Rule 65, not an appeal under Rule 45. Consequently, the petitioners’ appeal was dismissed for being the wrong remedy.