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[ GR No. 44831, Oct 08, 1936 ]



63 Phil. 539

[ G. R. No. 44831, October 08, 1936 ]




The herein petitioners, who  are at the  same time the plaintiffs in civil case No. 44053 of the Court of First Instance of Manila, entitled  "Chua Ke and Cu Peng, plaintiffs, vs. Benito Gaerlan  (alias Tiu Siong Bio) and Tan Ay  (alias Ong Bi), defendants," obtained in the course of said case the  order of September 16, 1933, requiring the respondent Benito Gaerlan,  as defendant therein, to transfer as soon as possible the  sum of P25,000, which  constituted a  part of the assets  of "Benito Gaerlan  & Co."  of which he was the manager, and which he had sent to  China, from the Bank of Amoy, where he had deposited it,  to any local bank, in order to be at the disposal of the court (Exhibits H and I).

Upon observing that  the  respondent did not take the necessary steps to comply with said order of September 16, 1933  (Exhibit I), notwithstanding the lapse of time from that date up to  October 5th of said year, the petitioners, on October 6th of said year, filed a motion in the case in question praying that the respondent be compelled to comply therewith under pain of contempt of court.  The lower court, considering the reasons given by the respondent and without warning him, granted him an additional period of one month to comply with the order in question  (Exhibits J, K and  L),  said period to be  counted from the 14th of said  month and  year.

Thinking later that he would not be able  to make the transfer of the P25,000 from the Bank of Amoy to Manila within the additional period granted him for the reason that to negotiate said transfer  he would have to  go to China, which, he claims,  was not possible because it would be  tantamount  to abandoning  his  case,  the respondent asked for permission to  give a bond of  P25,000 to secure the presentation of  the  sum in question  by him in due time  (Exhibit M).  In  its  order of November 15,  1933, the lower court, with the consent of the petitioners, permitted the respondent to file the bond offered, but on the condition that the attorney for the petitioners should first examine the terms and conditions thereof before it is approved (Exhibit N).  The bond which the respondent filed shortly afterwards, by virtue of said order, especially contained the following condition:
"*  *   *   under the  condition that  when so required by the Court of  First Instance of Manila, or any court of competent jurisdiction, we shall account  to the partnership, Benito Gaerlan & Co., or to its duly authorized representative the said sum of twenty-five thousand pesos (P25,000), Philippine  currency,  solely  to the extent  of whatever rights, interests and participation the plaintiffs may have therein up to the said sum of P25,000."
As nine months had elapsed from the time the respondent had  filed  his  bond of P25,000, and  more  than  one year from the time he received the order to place the P25,000 in question at the disposal of the court, without his doing anything in compliance therewith, the petitioners, on August 29,1934, asked among other things that the respondent be given a peremptory period to  deliver said sum to the receiver in civil case No. 44053, and to file another bond to secure payment by him  also of  the  accrued interest thereon from December 31, 1930, until  fully paid  (Exhibit O).  The lower court, after hearing the parties and considering their reasons stated in their pleadings (Exhibits P and Q), ordered the respondent to deliver to the receiver on or  before  November 30,  1934,  or immediately  after presenting his evidence to the referee, the  said  sum of P25,000 with all the accrued interest thereon from the time it was deposited in the Bank of Amoy (Exhibits R and V). Instead of taking advantage of the new opportunity granted him  by the lower court to comply with the order requiring him  to bring  the said sum of  P25,000 to the Philippines, the respondent,  on July 29,  1935, filed a motion praying for the reduction of the bond of  P25,000 filed by him to P9,000 only, alleging  that the participation  of  the petitioners in the P25,000 in  question did not and could not exceed 36 per cent thereof on  the ground that the capital contributed  by him to the partnership was P64,000, and therefore his participation  in the assets of said partnership was  more than  P50,000,  or more  than double  P25,000. After hearing the parties, the  lower court,  in an  order of October 22,  1935, decided  to grant the petition of the respondent  by  reducing his former  bond of P25,000 to P10,000 only,  giving him a period of ten days to file said new reduced  bond.  As the  petitioners' motion  for the reconsideration of this order failed, because the lower court denied it in an order of November 19, 1935 (Exhibit A-11), they filed this petition for certiorari,  alleging that the respondent judge  acted in  excess  of his jurisdiction and abused his discretion.

The respondents, in  their answer, maintain  that the lower  court  in so proceeding, acted absolutely within its jurisdiction  without having committed  any abuse of discretion,  because  equity and justice so demanded.

Before discussing the  question  so raised, it is advisable to know in order to better solve  it, some of the facts not disputed by  the  parties and those appearing from  their pleadings and the documents attached thereto, which are as follows:
In a deed executed by  the petitioners and the respondent Benito Gaerlan on April 1, 1930,  the  three formed a general partnership under  the  name Benito Gaerlan & Co., with a capital of P100,000, Philippine currency, to engage in the purchase  and sale  of  flour, sugar, and Philippine and European groceries, establishing  it on Nueva Street, in the City of Manila.   Of the  partnership capital agreed upon, P64,000 would belong to the respondent Benito Gaerlan, P29,000 to  the  petitioner  Chua Ke, and P7,000  to the petitioner Cu Peng, the  three binding themselves  to contribute said three sums to the partnership in order  to cover their respective quotas.  They  agreed  that the respondent Benito Gaerlan should take charge of the management, direction and administration of the partnership; that the partnership  should last five years to be counted from March 1, 1930, unless they agreed to dissolve it prior  to said period;  that the profits, after deducting the expenses, should be divided into 13  equal parts, 3 belonging to the manager and the other 10  to the three of them in proportion to the  capital contributed by each; that the losses should be assumed proportionately by all of them, and that the profits and losses should be balanced annually in  order to enter  them in the  books of the partnership.

For  failure of the  respondent as manager  of the partnership Benito Gaerlan & Co. to perform many of the duties incumbent upon him as such, and for having misapplied the funds of the partnership, as claimed by the petitioners, the latter instituted said civil case No. 44053, to ask for the dissolution thereof, after a liquidation of its assets. Incidentally, they asked for the appointment of a receiver to take charge of the partnership while in the process of liquidation, and the lower court appointed  one who performed said task at least until the month of  April, 1935, when he filed his final report in compliance with the order of March  30th  of  said year (Exhibits 6 and 7).  After having discovered  that Benito  Gaerlan  had  deposited P25,000 of the  partnership  funds as his in the Bank of Amoy, they also incidentally asked that Gaerlan be ordered to bring said money  to Manila and place  it at  the  disposal of the court.   The court so ordered but  it later permitted him, with the consent of the petitioners, to file the said P25,000 bond  to  secure  delivery by him  of said sum to the  partnership  Benito Gaerlan &  Co. or to  its duly authorized representative, when the court so require.  Said bond is precisely what the lower court reduced to P10,000 in the order which gave rise to this  certiorari proceeding.

It should be noted that when the question  relative to the reduction "of the bond was raised before the  lower court (October 22, 1935), the respondent judge had before him the data from the receiver's reports of March 30, 1933, and November, 1934, and the statements of Accountant and Auditor Galicano Tayag, who was appointed  by the petitioners themselves, Exhibit 2 and its annexa Exhibits 2-1 and  5 being copies thereof.   According  to  said  evidence, the respondent Benito Gaerlan's  assets in the  partnership, at least at that time, were greater than what the petitioners might expect as their share  after the liquidation.

Now, where could the respondent judge have exceeded his jurisdiction, or where could he have abused his discretion? It is well  settled in this jurisdiction  that  certiorari  lies to correct not only excesses of jurisdiction but also manifest abuses of discretion.   (De Castro and Morales vs. Justice of the Peace of Bocaue, 33 Phil., 595; Valdez vs. Querubm, 37 Phil, 774; Leung Ben vs. O'Brien, 38 Phil., 182; Larrobis vs. Wislizenus and Smith, Bell & Co., 42 Phil, 401; Westminster Bank vs. Torres and K. Nassoor, Inc., 57 Phil., 422.) 'There is no doubt that the respondent judge had jurisdiction and authority to accept the bond offered by the respondent Benito Gaerlan.  The giving of said bond was only an incident in the principal case submitted to it for decision, and said case is  among those clearly falling under the jurisdiction of  the  Courts of First Instance.  On the other hand, the petitioners  themselves consented to the giving of  said bond; also  carefully examined the terms  and conditions thereof  through their attorneys; and later induced the respondent judge to approve and accept it.   Therefore, if the respondent judge had jurisdiction to fix the amount of said bond  and to accept it, he unquestionably also  had jurisdiction to reduce it if there were justifiable motives therefor, which certainly   existed,  taking   into  consideration the above-stated reports of the receiver and the  statement of the accountant and auditor,  and the very terms of the bond  the amount of which was reduced.  It should not be forgotten that  the obligation secured  by  the said bond was not the exemption of the respondent Benito  Gaerlan from  every  action for contempt of court, but the  delivery by him  to Benito  Gaerlan & Co.  or to its  duly authorized representative of the sum of P25,000 "solely to the extent of whatever rights,  interests and participation the plain- tiffs may have  therein, up to the said sum of P25,000, as stated in said bond."
According to the data  which the respondent judge  had before him,  he  could properly use  the discretion permitted him by  the law to reduce or not to reduce the bond of the respondent Benito Gaerlan.   Even if he  had chosen not to reduce it, the obligation  of the sureties who subscribed it could  in no  way  be more than that of answering for the petitioners'  participation  in the P25,000.   Such and nothing more is simply the scope of the bond  in question, according to the very terms thereof.  If it were to appear that the liability of the respondent Benito Gaerlan is more than P10,000, the reduction of his  bond to said sum does not mean that he is exempted from paying the difference.

Perhaps although  this  is improbable,  taking  into consideration  the  facts  already of record the  respondent judge erred in reducing the bond of the respondent Benito Gaerlan to P10,000 only; but at  all events his  error is an error of judgment which cannot be corrected by certiorari, because, as  already  stated, remedies of  this kind only serve to correct  judicial  acts performed without  or  in excess of jurisdiction,  or with abuse of discretion, and never to correct errors.   (Gala vs. Cui and Rodriguez, 25 Phil., 522; Napa vs. Weissenhagen, 29 Phil., 180; Government of the Philippine Islands vs. Judge  of  First Instance of Iloilo and Bantillo,  34 Phil., 157; Bustos  vs. Moir and Fajardo, 35 Phil., 415.)

In view of  all the foregoing, it is held that the petition for certiorari is without merit, and it is  therefore denied with the costs to the petitioners.   So ordered.

Avanceña, C. J.,  Villa-Real, Abad Santos, Imperial, and Horrilleno, JJ., concur.