THE Supreme Court (SC) has denied Cebu Gov. Gwendolyn Garcia’s appeal to block an order requiring her to pay US$2.8 million (approximately P156.6 million) in debt to a foreign bank, citing her use of “dilatory petitions.”
Garcia’s camp has not yet received the decision and has urged the public not to be swayed by what it calls “incomplete, misleading and malicious news reports” aimed at tarnishing her image.
The court stated that Garcia failed to present any facts justifying the quashal of the alias writ of execution, noting that she did not identify any specific error in the amount determined by the trial court.
The decision, penned by Associate Justice Antonio Kho Jr., emphasized that Garcia merely objected to the “staggering amount” without contesting the calculations of legal and accumulated interest.
In a 12-page decision issued in 2012 yet but only made public on Tuesday, Sept. 10, 2024, the SC ordered Garcia to pay Hongkong Shanghai Banking Corp. (HSBC) $700,000 in damages, plus interest and legal costs.
On Feb. 22, 2018, HSBC filed an urgent ex-parte motion for the issuance of an alias writ of execution, as Garcia had not yet paid her judgment debt. The following day, on Feb. 23, the Regional Trial Court (RTC) granted HSBC’s motion and issued an alias writ of execution (Alias Writ) directing the sheriff to collect from Garcia the amount of US$2,825,636.79, including legal and accumulated interest and the costs of the suit.
On June 13, 2018, Garcia filed an urgent request to cancel the execution order, arguing that it violated her due process rights because HSBC’s request was not scheduled for a hearing.
On Sept. 17, 2018, the RTC issued an order rejecting Garcia’s request due to lack of merit. Garcia filed a request for reconsideration, but it was rejected in an order dated Jan. 3, 2019. Still undeterred, Garcia filed a petition for review under Rule 65 of the Rules of Court with the Court of Appeals.
In 1996, Garcia borrowed US$900,000 to purchase a cargo barge from Sam Trading for her business, GGC Enterprises. HSBC sued her after she failed to repay the loan.
The Irrevocable Documentary Credit obligated HSBC to pay Sam Trading the purchase price of US$900,000 in five separate installments of US$180,000. To secure the payment of the credit, Garcia executed (with the consent of her then husband) a real estate mortgage covering two parcels of land, a trust receipt dated Oct. 15, 1997 over the barge and a general surety agreement relating to goods in favor of HSBC.
However, Garcia and GGC failed to pay or reimburse HSBC for the payments that the latter made to Sam Trading.
The RTC had previously ruled in favor of HSBC, ordering Garcia and her former husband to pay substantial damages.
“Intolerance”
The court’s ruling underscored its intolerance for attempts to delay the enforcement of final judgments, stating that allowing endless appeals against enforcement orders would undermine the judicial system.
“Thus, to allow controversies to go on indefinitely by allowing petitions for certiorari against writs or alias writs of execution is against public policy. It will not only clog the courts’ dockets, but it will also impair the stability of our judicial system. Appealing an order which is known to be unappealable, such as an alias writ of execution, abuses court processes and hinders the dispensation of justice. It has been more than 10 years since this Court’s Minute Resolution dated Aug. 22, 2012 in G.R. 177734 became final and executory. The Court notes that because of Garcia’s dilatory petitions, the five-year effectivity period of the Alias Writ of Execution dated Feb. 23, 2018 has already lapsed,” the decision reads.
In response, Garcia’s legal counsel claimed that there is no imminent threat of enforcement against her, arguing that the SC’s decision should have included details about the legal reasoning and that the order should have been served to her company, GGC Enterprises, rather than to her personally.
In the decision, Garcia claims that because the order wasn’t served to her company’s official address, she didn’t know the exact amount she owed and couldn’t offer to settle the debt. She asserts that the rules for serving legal documents must be followed strictly.
HSBC served the request for the enforcement order to Garcia’s former lawyer, not to her, which deprived her of the opportunity to argue against it.
Garcia also contends that the request to enforce the judgment was a legal matter that should have required a hearing before the court granted it. She argues that a court order issued without a hearing is not valid and cannot be acted upon. She states that she was denied due process because she could not participate in determining the final amount she owed, including interest.
Conversely, HSBC maintains that the enforcement orders did not require detailed legal reasoning and that Garcia’s appeal is merely an attempt to delay payment.
HSBC points out that the SC’s decision in its favor became final a long time ago. It says that Garcia’s appeal is just an attempt to delay the bank from getting its money.
The bank asserts that the order was served correctly and that Garcia, as the owner of a sole proprietorship, is personally liable for the business’s debts.
HSBC also highlighted that Garcia’s lawyer was given an opportunity to contest the enforcement order but did not do so, indicating no violation of her rights. / CDF
SC orders Guv Gwen to pay debt
