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CHANDRA O. CACHO v. JOAQUIN BONIFACIO

FACTS:

Spouses Joaquin and Teresita Bonifacio owned a commercial building and leased three stalls to Edira Food Corporation. The lease contracts provided for a total monthly rental of P17,000 for two years. After non-payment of rental arrearages, the Bonifacios filed a complaint for unlawful detainer against Edira. Meanwhile, petitioner Chandra Cacho and Edira executed new lease contracts and petitioner paid the unpaid rental arrearages. The MTC ruled in favor of the Bonifacios and ordered Edira to vacate the premises. Petitioner filed a complaint for annulment of the MTC decision and damages. The RTC dismissed the complaint insofar as it prayed for the annulment of the MTC decision but declared the execution of the writ void. The RTC also awarded damages to petitioner. Respondents appealed to the Court of Appeals.

ISSUES:

  1. Whether the Regional Trial Court erred in declaring the implementation of the writ of execution void.

  2. Whether the Regional Trial Court erred in awarding damages to the petitioner.

RULING:

  1. No, the Regional Trial Court did not err in declaring the implementation of the writ of execution void. The court found that the writ of execution was implemented against the petitioner in bad faith. It ruled that the implementation of the writ was in violation of due process as the petitioner was not given notice and opportunity to be heard before the levied properties were sold. Therefore, the court declared the implementation of the writ of execution void.

  2. No, the Regional Trial Court did not err in awarding damages to the petitioner. The court found that the respondents had the writ of execution implemented against the petitioner in bad faith and as a result, the petitioner suffered damages. The court ordered the respondents to pay the petitioner the unrealized profits, the value of the air-conditioners, moral damages, exemplary damages, and attorney's fees. However, the court dismissed the counterclaim for moral damages and attorney's fees filed by the respondents.

PRINCIPLES:

  • Due process of law requires that notice and opportunity to be heard be given to a party before their property can be levied and sold in execution.

  • Bad faith in the implementation of a writ of execution may result in the declaration of the implementation void and the award of damages to the affected party.