G.R. No. L-2894; August 30, 1949
BUCRA CORPORATION, petitioner, vs. HIGINO B. MACADAEG, Judge of First Instance of Manila, and ELIGIO GIRON, respondents.

FACTS

Petitioner Bucra Corporation was served as a garnishee in a civil case filed by respondent Eligio Giron against Antonio C. Salcedo. The respondent judge issued an order requiring Bucra Corporation to deposit P25,000 in court, which the petitioner claimed it owed to Salcedo prior to the garnishment. Bucra Corporation contested this order, asserting a legal claim to the funds and arguing that the court’s action deprived it of property without due process.

ISSUE

Whether the respondent judge acted in excess of jurisdiction by ordering the petitioner to deposit the garnished amount in court despite the petitioner’s claim of ownership or entitlement to the funds.

RULING

Yes. The Supreme Court granted the petition for certiorari and set aside the order. Under Section 41, Rule 39 of the Rules of Court, if a garnishee does not admit indebtedness or asserts a legal or equitable claim to the property or funds, the controversy must be resolved by a separate action. The order compelling deposit without adjudicating the petitioner’s claim constituted a deprivation of property without due process. The Court cited analogous provisions and precedents, including *Tee Bi and Co. v. Chartered Bank of India, Australia and China*, to emphasize that a garnishee’s liability must be determined judicially when contested. The respondent judge’s order was null and void for having been issued in excess of jurisdiction.

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