FACTS:

Respondents filed a case for replevin to recover possession of a second-hand Isuzu Wagon that they purchased for P75,000. The vehicle was registered in their names and was issued a Motor Vehicle Clearance Certificate (MVCC) by the Philippine National Police (PNP)-Traffic Management Group (TMG), stating that it was not in the list of wanted/stolen vehicles. Two years later, respondents' driver was apprehended by the petitioners, who alleged that the Official Receipt (OR) and Certificate of Registration (CR) of the vehicle were spurious. The vehicle was impounded and petitioners refused to release it, claiming that the chassis and engine numbers were tampered. Respondents then filed a complaint for replevin, seeking the return of the vehicle or payment of its actual value. The trial court found in favor of the respondents, ordering petitioners to pay the actual value of the vehicle, interest, attorney's fees, moral damages, and costs. Petitioners appealed to the Court of Appeals (CA), but their appeal was denied. The CA upheld the ownership of the respondents, ruled that the seizure and impounding of the vehicle were unlawful, and found the petitioners liable for damages.

ISSUES:

1. Whether the Court of Appeals committed reversible error in directing the return of the actual value of the seized vehicle to respondents.

2. Whether the Court of Appeals erred in ordering the payment of moral damages.

3. Whether or not the respondents have proven their ownership of the subject vehicle.

4. Whether or not the impounding of the subject vehicle was lawful.

5. Whether or not the petitioners can be held liable for the unauthorized impounding of the subject vehicle.

6. Whether or not the award of attorney's fees is justified.

7. Whether or not the Court of Appeals erred in affirming the award of attorney's fees in favor of the respondents.

8. Whether or not the appearance of the award of attorney's fees in the dispositive portion of the decision without stating the reason for the award in the body of the decision is allowed.

RULING:

1. The petition fails. The factual findings of the trial court as affirmed by the Court of Appeals are generally binding and conclusive on the parties and are not reviewable by the Court, unless there are exceptional circumstances. The ownership of the subject vehicle by the respondents has been clearly established with sufficient and competent evidence. Therefore, there is no reason to disturb the factual findings.

2. The respondents have proven their ownership of the subject vehicle by presenting their Certificate of Registration (CR) and Official Receipt (OR) which create a strong presumption of ownership. The burden of proof to rebut this presumption lies with the petitioners, but they have failed to provide competent proof to do so.

3. The impounding of the subject vehicle was deemed unlawful due to the lack of immediacy from when it was allegedly stolen until it was impounded, as well as the absence of probable cause to justify its seizure without a warrant. The petitioners' actions disregarded the respondents' constitutionally protected rights against unreasonable searches and seizures.

4. The petitioners can be held personally liable for the unauthorized impounding of the subject vehicle as they acted beyond the scope of their authority and without any valid ground or legal justification. Their misrepresentation of the whereabouts of the subject vehicle was indicative of bad faith or malice.

5. The award of attorney's fees is not justified as the lower court failed to state its basis for such award.

6. The Court of Appeals did not err in affirming the award of attorney's fees in favor of the respondents.

7. The appearance of the award of attorney's fees in the dispositive portion of the decision without stating the reason for the award in the body of the decision is not allowed.

PRINCIPLES:

• In a replevin suit, the claimant must show that he is either the owner or clearly entitled to the possession of the object sought to be recovered, and that the defendant wrongfully detains it.

• Replevin is a possessory action that determines the right of possession and can be both a principal remedy and a provisional relief.

• To be entitled to replevin, the plaintiff must show a clear title to the object sought for interim possession.

• The impounding of a subject vehicle can only be justified if there is a legal basis, such as the Anti-Carnapping Act of 1972.

• The ownership and identity of a motor vehicle can be ascertained through the Certificate of Registration (CR) issued by the Land Transportation Office (LTO).

• The Certificate of Registration (CR) of a motor vehicle creates a strong presumption of ownership, which can only be rebutted by competent proof.

• Actions of public officials performed in connection with their official duties can make them personally accountable when they act ultra vires or with bad faith.

• Tortious acts or crimes committed by government officials while discharging official functions are not covered by sovereign immunity.

• The impounding of a vehicle without a valid ground or legal justification and without due regard to the owner's constitutional rights against unreasonable searches and seizures is deemed unlawful.

• Attorney's fees must be justified and stated in the decision's body to be considered valid.

• The Court of Appeals can affirm an award of attorney's fees if it finds no error in the lower court's decision.

• The reason for the award of attorney's fees should be stated in the body of the decision and not only in the dispositive portion.