G.R. No. 91988 ; May 14, 1991
ALLIED LEASING & FINANCE CORPORATION, petitioner, vs. HONORABLE COURT OF APPEALS, HON. MILAGROS V. CAGUIOA, Judge, RTC-Pasig, Metro Manila, Branch 165, EMETERIO SIA and LUCIA SIA, respondents.

FACTS

Petitioner Allied Leasing filed a complaint for sum of money with a petition for a writ of replevin against respondent-spouses Sia for defaulting on lease agreements for printing equipment. The trial court granted the writ ex-parte upon petitioner’s posting of a P2,000,000 bond. The respondents, later claiming ownership of the equipment and alleging the contracts were chattel mortgages, moved to quash the writ. On January 30, 1989, the trial court quashed the writ, finding that the true nature of the transaction and ownership were in issue, creating a “dark cloud of doubt.” Petitioner’s motion for reconsideration was denied on July 14, 1989, received by petitioner on July 21, 1989.
Petitioner filed a petition for certiorari with the Court of Appeals on October 24, 1989, assailing the trial court’s orders. The appellate court dismissed the petition, first stating it was filed nine months after the January 30 order, and later, upon reconsideration, ruled it was filed 102 days after the July 14 order, constituting an unreasonable delay. Petitioner elevated the case to the Supreme Court.

ISSUE

Whether the Court of Appeals erred in dismissing the petition for certiorari for being filed beyond a reasonable period.

RULING

Yes. The Supreme Court reversed the Court of Appeals, ruling that the petition for certiorari was filed within a reasonable time. The appellate court erroneously computed the period from July 14, 1989 (the date of the denial order) instead of from July 21, 1989 (the date of petitioner’s receipt thereof). The correct period from July 21 to October 24, 1989, was “very much less than four months.”
More critically, the trial court committed a grave abuse of discretion in quashing the writ of replevin. A writ of replevin is a possessory action; the applicant need not hold legal title but need only be “entitled to possession” at the time of application, as per Section 2, Rule 60. The trial court’s basis for quashing the writ—the unresolved issue of ownership—was improper, as such a question is to be resolved in the main trial, not in the preliminary issuance of the writ. Furthermore, the trial court quashed the writ without requiring the respondents to post the mandatory counterbond prescribed by the Rules, a highly irregular act.
Given the trial court’s grave abuse and the lack of a specified period for filing certiorari under Rule 65, the variable “reasonable time” standard is applied to serve substantial justice. Disallowing the petition, filed in less than four months, would deprive the petitioner of a substantial right without remedy. Thus, the petition was timely filed.