Philippine Supreme Court Resolutions

G.R. No. 145817 (Urban Bank v. Magdaleno M. Peña); G.R. No. 145822 (Delfin C. Gonzalez, Jr., Benjamin L. De Leon, and Eric L. Lee v. Magdaleno M. Peña); G.R. No. 162562 (Magdaleno M. Peña v. Urban Bank, Inc., Teodoro Borlongan, Delfin C. Gonzalez, Jr., Benjamin L. de Leon, P. Siervo H. Dizon, Eric L. Lee, Ben T. Lim, Jr., Corazon Bejasa, and Arturo Manuel, Jr.). — Before this Court are two separate motions filed by respondent-petitioner Magdaleno M. Peña and intervenor Unimega Properties Holdings Corporation (Unimega) praying for the reconsideration of our Decision dated 19 October 2011, and a motion from petitioner-respondent Urban Bank, Inc., for the release, discharge and/or cancellation of the annotations of levy and sale on its properties.

In his Motion for Reconsideration (with Reiteration of Motion for Inhibition of Honorable Justice Sereno) dated 12 December 2011, respondent-petitioner Peña concurs with the findings of the Court on the existence of an attorney-client/agency relationship between him and Urban Bank, and his entitlement to just compensation for his services. He, however, moves for the reconsideration on the amount of compensation this Court awarded to him, the absence of solidary liability of the individual bank directors who are parties to the case, and the nullification of the execution pending appeal ordered by the trial court. Lastly, respondent-petitioner repeats his request for inhibition of Justice Maria Lourdes P.A. Sereno on the ground of her alleged bias and partiality because of her ponencia  in the assailed Decision.

Intervenor Unimega likewise moves for the reconsideration of the same questioned Decision insofar as it affects its interest as a purported bidder/buyer in good faith of the ten condominium units under the name of Urban Bank that were sold during the execution pending appeal.^[1] It argued that the period for Urban Bank to redeem these real properties had already lapsed when the Court issued the Resolution dated 13 November 2002. In addition, intervenor Unimega reasons that Urban Bank is already estopped from assailing the validity of the Certificate of Sale over the ten condominium units issued in favor of the former in the execution sale pending appeal.

On the other hand, petitioner-respondent Urban Bank moved for the release, discharge and/or cancellation of the annotations of levy and sale on its properties that were levied and sold on execution pending appeal, including but not limited to the 85 condominium certificates of title, various club shares, and other real properties.^[2]  Petitioner-respondent bank also prayed for the cancellation and release of its P40 Million supersedeas bond.

The Court finds that the two motions for reconsideration offered no substantial arguments that would merit a reversal of the assailed Decision. The arguments of respondent-petitioner Peña and intervenor Unimega have already been raised and have been sufficiently disposed of by the Court in its 19 October 2011 Decision.

Considering our disposition of the case, the Court, on the other hand, grants the motion of Urban Bank to release, discharge and/or cancel the annotations of levy and sale on its properties subject of the nullified execution pending appeal. As the Court already ruled, since "the Special Order and Writ of Execution was a result of the trial court's earlier award of PhP28,500,000, the nullification or complete reversal of the said award necessarily translates to the vacating as well of the processes arising therefrom, including all the proceedings for the execution pending appeal."^[3] Concomitantly, the lifting of the levy arising from the nullified execution pending appeal translates to the release as well of the P40 Million supersedeas bonds each issued by Urban Bank and the De Leon Group.^[4]  The purpose of a supersedeas bond is to stay discretionary execution granted by the lower court, while the case is being heard on appeal and conditioned on the final decision, being sustained in whole or in part.^[5] However, upon complete reversal by the appellate courts, such as in this case, the supersedeas bonds filed no longer hold any purpose since there is no condition to be fulfilled and must, therefore, be lifted accordingly.

The operational details with respect to the restitution or reparation for damages have been remanded to the Regional Trial Court of Makati City, to implement the restorative directives of the Court's 19 October 2011 Decision, including but not limited to the return of properties wrongfully executed, or the payment of the value of properties that can no longer be restored, and other incidental issues of execution. It is the trial court, and not this Court, which has better capacities to sift through these factual circumstances and execute the conditions imposed by the dispositive portion of our Decision,^[6] on the proper restitution and reparation for damages, if any, to which Urban Bank, and the individual petitioner bank directors or officers are entitled to.cralaw

WHEREFORE, the Court DENIES the Motion for Reconsideration (with Reiteration of Motion for Inhibition of Honorable Justice Sereno) dated 12 December 2011 of respondent-petitioner Magdaleno M. Peña and the Motion for Reconsideration dated 13 December 2011 of intervenor Unimega Properties Holdings Corporation.

On the other hand, the Court GRANTS the Motion to Discharge dated 31 January 2012 filed by petitioner-respondent Urban Bank, Inc. Pursuant to the 19 October 2011 Decision, all levied or garnished properties that have been sold to a third party purchaser at the public auction during the execution pending appeal, where title to the property has not been validly and timely transferred to the name of the third party, shall be returned to Urban Bank or respondent bank officers, subject to the third party's right to claim restitution for the purchase price paid at the execution sale against the judgment creditor. The identification of the levied or garnished properties of the bank and/or the individual directors or officers that will be released and the process of restitution are remanded to the Regional Trial Court of Makati City. The supersedeas bonds, each amounting to P40,000,000 separately filed by petitioner-respondent Urban Bank, Inc., and petitioners Delfin C. Gonzalez, Jr., Benjamin L. de Leon, and Eric L. Lee are hereby CANCELLED and RELEASED. (Brion, J., Acting Chairperson, Villarama, J., additional member vice Carpio, J., per Raffle dated 7 June 2010; Mendoza, J., additional member vice Reyes, J., per Raffle dated 17 October 2011; Bernabe, J., additional member vice Perez, J., per S.O. No. 1114)

Very truly yours, 

(Sgd.) TERESITA AQUINO TUAZON
Deputy Division Clerk of Court

Endnotes:

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^[1] Intervenor Unimega’s Motion for Reconsideration dated 13 December 2011.

^[2] Urban Bank's Motion to Discharge (1) Annotations of Levy and Sale; and (2) Supersedeas Bond dated 31 January 2012. 

^[3] Decision dated 19 October 2011. 

^[4] The De Leon Group refers to Delfin C. Gonzalez, Jr., Benjamin L. de Leon, and Eric L. Lee the petitioners in G.R. No. 145822. 

^[5] "Discretionary execution issued under the preceding section may be stayed upon approval by the proper court of a sufficient supersedeas bond filed by the party against whom it is directed, conditioned upon the performance of the judgment or order allowed to be executed in case it shall be finally sustained in whole or in part. The bond thus given may be proceeded against on motion with notice to the surety." (Rules of Court, Rule 39, Sec. 3) 

^[6] "a. Urban Bank, Teodoro Borlongan, Delfin C. Gonzalez, Jr., Benjamin L. de Leon, P. Siervo H. Dizon, Eric L. Lee, Ben Y. Lim, Jr., Corazon Bejasa, and Arturo Manuel, Jr., (respondent bank officers) shall be restored to full ownership and possession of all properties executed pending appeal; 

b. If the property levied or garnished has been sold on execution pending appeal and Atty. Magdaleno Peña is the winning bidder or purchaser, he must fully restore the property to Urban Bank or respondent bank officers, and if actual restitution of the property is impossible, then he shall pay the full value of the property at the time of its seizure, with interest;

c. If the property levied or garnished has been sold to a third party purchaser at the public auction, and title to the property has not been validly and timely transferred to the name of the third party, the ownership and possession of the property shall be returned to Urban Bank or respondent bank officers, subject to the third party's right to claim restitution for the purchase price paid at the execution sale against the judgment creditor;

d. If the purchaser at the public auction is a third party, and title to the property has already been validly and timely transferred to the name of that party, Atty. Peña must pay Urban Bank or respondent bank officers the amount realized from the sheriffs sale of that property, with interest from the time the property was seized." (Decision dated 19 October 2011)