G.R. No. L-70640 June 29, 1988
INVESTORS’ FINANCE CORPORATION, Doing Business Under The Name And Style “FNCB FINANCE,” petitioner-appellant, vs. ROMEO EBARLE, HON. JOSE L. CASTIGADOR, Presiding Judge, RTC, Br. XXII, Pagadian City, The Deputy Provincial Sheriff of Zamboanga Del Sur, and the INTERMEDIATE APPELLATE COURT, respondents-appellees.

FACTS

Petitioner Investors’ Finance Corporation, as assignee of a chattel mortgage over a car, filed a verified Complaint for Replevin with Damages (Civil Case No. 8782) in the Regional Trial Court (RTC) of Misamis Oriental against the original mortgagors, Flaviano Fucoy Jr. and Jose Mariano Tan, for non-payment of installments. The complaint contained a specific prayer for a writ of replevin to seize the car for foreclosure but did not include an alternative prayer for a sum of money. The court issued the writ, but the car was found in the possession of private respondent Romeo Ebarle in Pagadian City over a year later. After a deputized military officer seized the vehicle pursuant to the writ, it was temporarily returned to Ebarle following an agreement to settle the debt, which later fell through.
Subsequently, Ebarle filed a separate action for Damages and Discharge of Chattel Mortgage with Preliminary Injunction (Civil Case No. 2312) against the petitioner and the special deputy sheriff in the RTC of Pagadian City. He alleged humiliation from the seizure and sought damages and the mortgage’s discharge. The petitioner moved to dismiss this Pagadian case, asserting the pendency of the prior replevin suit in Misamis Oriental and arguing that any claim for damages arising from the seizure should be pursued as a counterclaim in that original case.

ISSUE

Whether the Regional Trial Court of Pagadian City erred in not dismissing Civil Case No. 2312 on the ground of litis pendentia, given the prior pending replevin action (Civil Case No. 8782) in the Regional Trial Court of Misamis Oriental.

RULING

Yes, the Pagadian court erred. The Supreme Court reversed the Intermediate Appellate Court and ordered the dismissal of Civil Case No. 2312. The doctrine of litis pendentia requires the concurrence of three elements: identity of parties, identity of rights asserted and relief prayed for, and identity with respect to the two preceding particulars such that any judgment in one case would amount to res judicata in the other. These elements were present. The parties in both suits were substantially identical, as Ebarle, being in possession of the mortgaged vehicle, was a real party in interest in the replevin action. The rights asserted and reliefs arose from the same cause: the enforcement of the chattel mortgage and the subsequent seizure of the car. Ebarle’s claim for damages due to the allegedly wrongful seizure is a compulsory counterclaim that must be set up in the replevin case, not in an independent suit. Filing the separate action in Pagadian constituted forum-shopping, an unethical act aimed at securing a favorable ruling from a potentially sympathetic court, given Ebarle’s local influence. The proper remedy for Ebarle was to seek damages within the original replevin case in Misamis Oriental, where a replevin bond had already been filed to answer for such eventualities.