Accordingly a writ of preliminary injunction was issued and DECORP was ordered

Accordingly a writ of preliminary injunction was

This preview shows page 6 - 7 out of 9 pages.

Paramount Insurance Corporation (Paramount). Accordingly, a writ of preliminary injunction was issued and DECORP was ordered to continue the supply of electric power. The RTC rendered judgment in favor of DECORP and likewise adjudged Paramount to pay. On appeal by Paramount, the CA affirmed the decision of the trial court. Before this Court, Paramount contends that the injunction bond was issued to guarantee “actual and material damages as may be sustained and duly proved by DECORP,” to the effect that it is liable to pay such actual and material damages only and no other damages. ISSUE: WON surety is released from liability where there was no hearing held to establish it’s liability on the injunction bond. Ruling: It is neither mandatory nor fatal that there should be a separate hearing in order that damages upon the bond can be claimed, ascertained and awarded. Rule 57, Section 20. Jurisprudential findings laid down the doctrine that a final adjudication that the applicant is not entitled to the injunction does not suffice to make the surety liable. It is necessary, in addition, that the surety be accorded due process, that is, that it be given an opportunity to be heard on the question of its solidary liability for damages arising from a wrongful injunction order. Withal, the fact that the matter of damages was among the issues tried during the hearings on the merits will not render unnecessary or superfluous a summary hearing to determine the extent of a suretys liability unless of course, the surety had been impleaded as a party, or otherwise earlier notified and given opportunity to be present and ventilate its side on the matter during the trial. The exception under the doctrinal ruling abovenoted is extant in the case at bar. What is necessary only is for the attaching party and his surety or sureties to be duly notified and given the opportunity to be heard. PARAMOUNT was present and represented by its counsel Atty. Nonito Q. Cordero as shown in the trial courts order. What t he law abhors is not the absence of previous notice but rather the absolute lack of opportunity to ventilate a partys side. In other words, petitioner cannot successfully invoke denial of due process where it was given the chance to be heard . It may not be amiss to point out that by the contract of suretyship, it is not for the obligee to see to it that the principal pays the debt or fulfills the contract, but for the surety to see to it that the principal pay or perform. The purpose of the injunction bond is to protect the defendant against loss or damage by reason of the injunction in case the court finally decides that the plaintiff was not entitled to it, and the bond is usually conditioned accordingly. Thus, the bondsmen are obligated to account to the defendant in the injunction suit for all damages, or costs and reasonable counsel’s fees, incurred or sustained by the latter in case it is determined that the injunction was wrongfully issued. The posting of a bond in connection with a preliminary
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  • Fall '16
  • Atty. Gil
  • Guaranty And Surety Digest, Credit Case Digest, Aval, Surety, Sureties, Surety bond

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