FIRST
DIVISION
TAN TI
[ALIAS TAN
TICO],
Plaintiff-Appellee,
G.
R.
No. 8228
January
16, 1914
-versus-
JAUN
ALVEAR, AS
SHERIFF, ET AL.,
Defendants-Appellants.
__________________________________
TIU UCO
[ALIAS TION
OCCO],
Plaintiff-Appellee,
G.
R.
No. 8229
January
16, 1914
-versus-
JUAN
ALVEAR, AS
SHERIFF, ET AL.,
Defendants-Appellants.
_________________________________
TIU TIAO,
ET AL.,
Plaintiffs-Appellees,
G.
R.
No. 8230
January
16, 1914
-versus-
JUAN
ALVEAR, AS
SHERIFF, ET AL.,
Defendants-Appellants.
D
E C I S I
O N
TRENT,
J :
Damages for wrongful attachment.
Three cases were, by agreement of counsel, tried together in the Court
below. Damages were awarded in each case and all were appealed by the
defendants.
They will be considered together.
Tan Ti, Tiu Uco, and
Tiu Tiao et al., the respective plaintiffs, each owned a retail store
in
Dagupan. The Court of First Instance of Manila issued execution on the
effects of one Lim Kok Tiu, and ordered notices of garnishment to be
served
on each of the above named present plaintiffs. These notices were
forwarded
to the sheriff of Pangasinan. It appears that the sheriff himself was
not
in his office when the notices were received and they were attended to
by his deputy, Lopez. Lopez delivered the notices to another deputy
sheriff,
Zulueta, for service. Zulueta, instead of merely serving the notices,
informed
each of the present plaintiffs that unless they submitted their
respective
bonds in the sum of P15,000, he would close their stores. The
respective
owners asked for time to go to Manila to secure bondsmen, which was
granted
to them. On arriving at Manila, they consulted their lawyers who
informed
them that the sheriff had no right to close their stores upon
garnishment
process, and told them to return to Dagupan and to inform the sheriff
and
his deputies, with the further admonition that such action would render
the latter liable for damages. The three plaintiffs returned to Dagupan
and notified deputies Lopez and Zulueta accordingly, but the latter
went
ahead and closed the stores on November 13, 1911, placing guards at
each
one. The owners thereupon returned to Manila for further consultation
with
their lawyers. Their attorneys consulted with attorney for the
plaintiff
in the case from which the garnishment process had issued, and the
latter
sent a telegram to the sheriff on November 14th, instructing him not to
close the stores but to proceed in accordance with Section 431 of the
Code
of Civil Procedure. At the same time, he wrote a letter to the sheriff
containing the same instructions.
Notwithstanding the
fact that the contents of the notices which the sheriff's deputies had
served on the owners of these stores clearly showed that they were not
writs of attachment, and the further instructions from the counsel for
the plaintiff in that civil case to the same effect, the deputy
sheriffs
refused to raise by the attachment. The owners of the stores thereupon
filed the complaints in the present civil actions on November 17, 1911,
after notification to the deputy sheriff that such was their intention.
On November 21, 1911, the attachments were raised and the plaintiffs
were
allowed to resume business.
The lower court awarded
damages to the plaintiff Tan Ti as follows:
For loss of profits
on the sale of goods during the time thestore
was closed P90.00
Impairment of credit
500.00
Counsel's fee 500.00
Rent 22.50
Wages of employees
67.50
Loss of profits from
sales of cigarettes 7.50
Two trips to Manila
40.00
__________________
Total 1,227.50
================
The loss of profits on
cigarette sales was fixed by stipulation of the parties. The two items
of rent for the building and wages of employees, being the pro rata
parts of the plaintiff's monthly expresses for these
services,
should
be allowed. It is urged that a one of plaintiff's two trips to Manila
was
made before the wrongful attachment of his property, this item should
be
cut in half. The first trips, however, was the direct result of
defendant's
representations to the plaintiff in their official capacity. We are of
the opinion that the defendants would have been liable for this expense
even if they had followed the instructions which they received from
Manila
as the result of plaintiff's first trip to Manila. They had no right to
make such representations to the plaintiff on the strength of the
notices
which they were called upon to serve, and such representations were the
direct and proximate cause which induced plaintiff to make the trip.
The
expenses of both trips should be allowed, and this item of damages is
therefore
approved. Loss of profits from sales for the time the store was closed
was based upon the record of sales made by the plaintiff during the
months
of October, November, and December, 1911. The figures were follows:
October,
P1,517.54; November, P924.19; and December, P1,651.54. Upon these
figures,
reduction in gross sales was fixed at P600 and profits allowed at 15
per
cent, or P90. This seems to be a fair and reasonable method of arriving
at plaintiff's loss on this item and should be allowed.
We accept the statement
of counsel for the defendants to the effect that of the item of P500
for
attorney's fees, P200 were paid for services rendered in securing the
release
of the goods and P300 for prosecuting the present suit for damages.
That attorney's fees
in excess of the amount fixed by statute cannot be taxed as costs
against
the adverse party in any case is well settled. (Secs. 489 and 492, Code
Civ. Proc.; Mendiola vs. Villa, 15, Phil. Rep., 131; Orense vs.
Jaucian,
18 Phil. Rep., 553. Can such fees be allowed in this jurisdiction as an
element of damages?
The Decisions of the
State Courts in the American Union on this question are not uniform.
They
are irreconcilable, some holding that reasonable counsel fees incurred
in procuring the dissolution of injunctions, attachment, and in
recovering
property wrongfully seized in a proper element of damages, the amount
being
limited to fees paid for procuring the dissolution or recovery and not
for the general defense of the case or for prosecuting suits for
damages.
These holdings employ counsel to rid himself of an unjust restriction
which
his adversary has placed upon him. The courts which take the opposite
view
say that it is difficult to see upon what ground counsel fees incurred
by the adverse party should be charged up to the defeated party any
more
in attachment and injunction case than in other litigation’s upon
contracts
or for damages for torts. The litigation they say may be equally unjust
and oppressive in other cases as in cases of attachment, injunctions
and
replevin. It is true, however, they reason, that attachments and
injunction
are in some respects more summary and may entail damages airing out or
the seizure of defendant's property; but all of this is provided for by
the terms of the bond required to cove damages sustained. But counsel
fees
are as necessary in the one class of cases as in the other and are
neither
peculiar nor more erroneous in cases attachments and injunctions than
in
other cases.
The authorities on
either side of this question are eminent and there is no middle ground
upon which to stand. The authorities pro and con may be found collated
in the case notes of the following caws: Littleton vs. Burgess [16 L.
R.
A., N. S., 49); Lindeberg vs. Howard (8 Am. & Eng. Ann. Ca., 709,
injunction];
Plymouth Gold Mining Co. vs. U.S. Fidelity & Guaranty Co. [10 Am.
&
Eng. Ann. Cas., 951, attachment); Winkler vs. Roeder (8 Am. St. Rep.,
155,
attorneys' fees as element of damages].
In the United States
Supreme Court and in the Federal Courts such fees are not allowed. The
case first decided by the United States Supreme Curt upon this point
and
which has been steadfastly adhered to ever since is Oelrichs vs. Spain
[915 Wall., 211, 211]. In this case, the Court said:
"The point here in
question has never been expressly decided by this court, but it is
clearly
within the reasoning of the case last referred to, and we think is
substantially
determined by that adjudication. In debt, covenant and assumpsit
damages
are recovered, but counsel fees are never included. So in equity cases,
where there is no injunction bond, only the taxable costs are allowed
to
the complainants. The same rule is applied to the defendant, however
unjust
the litigation on the other side, and however large the expensa litis
to
which he may have been subjected. The parties in this respect are upon
a footing of equality. There is no fixed standard by which the
honorarium
can be measured. Some counsel demand much more than others. Some
clients
are willing to pay more than others. More counsel may be employed than
are necessary. When both client and counsel know that fees are to be
paid
by the other party there is danger of abuse. A reference to a master,
or
an issue to a jury, might be necessary to ascertain the proper amount,
and this grafted litigation might possibly be more animated and
protracted
than that in the original cause. it would be an office of some delicacy
on the part of the court to scale down the charges, as might sometimes
be necessary."
Since the enunciation of
this doctrine, the Supreme Court of the United States has had occasion
to reverse several decisions of State Courts where attorneys' fees for
services in dissolving writs of injunction and attachment were allowed,
the writs having issued out of Federal courts and actions for damages
brought
in the State Courts. [Tullock vs. Mulavane, 184 U.S., 497, reversing 61
kan., 650; 46 L. ed., 657; Mo. etc. E. Co. vs. Elliott, 184 U.S. 530;
46
L. ed., 673, reversing 154 No., 300].
The case at bar is
one of replevin. In this country the damages must be determined and
assessed
in the principal action. Two actions, one of replevin and the other for
damages, cannot be maintained. This makes the apportionment of
attorneys'
fee exceedingly difficult and in the absence of an agreement
practically
impossible. In those jurisdictions where attorneys' fees are allowed as
an element of damages two actions as a rule are required.
After an examination
of all the available authorities we have concluded that sound public
policy
demands that counsel fees in suits of the character of the one under
consideration
should not be regarded as a proper element of damages, even where they
are capable of being apportioned so as to show the amount incurred for
the release of the goods as separate and distinct from the other
services
necessary in the prosecution of the suit for damages. it is not sound
public
policy to place a penalty on the right to litigate. To compel the
defeated
party to pay the fees of counsel for his successful opponent would
throw
wide the door of temptation to the opposing party an his counsel to
swell
the fees to undue proportions, and to apportion them arbitrary between
those pertaining property to one branch of the case from the other.
This Court has already
placed itself on record as favoring the view taken by those courts
which
hold that attorneys' fees are not a proper element of damages. In
Ortiga
Bros. & Co. vs. Enage and Yap Tico [18 Phil. Rep., 345], a wrongful
attachment on the pier belonging to plaintiffs had issued at the
request
of Yap Tico. Ortiga Bros. sued out an injunction preventing the
attempted
sale of the pier by the sheriff and the matter was then held in statu
quo
pending judgment of the court as to the right of the sheriff to attach
and sell the property. Judgment in the lower court was in favor of the
plaintiffs and damages were awarded in the amount of P600 which proved
to consist entirely of the fees of plaintiff's attorney. This Court
expressly
disallowed the same, awarding the plaintiffs only the usual statutory
costs.
As the item of P500
for impairment of plaintiff's credit: Plaintiff testified that he was
conducting
a credit business with wholesale houses in Manila, and that when his
stock
of goods was seized by the sheriff he so informed these houses, who
thereupon
stopped his credit; that on being restored to possession of his goods
he
so advised them. Although he states that by stoppage of his credit he
was
unable to secure merchandise for Christmas sales, it appears from his
books,
as stated above, that he sold P1,651.54 during the month of December,
which
was as much as, if not more, than he had sold during the same month of
the previous year. The wrongfulness of the seizure was so apparent that
a satisfactory explanation of the same could easily have been given to
the wholesale houses with which he was doing business, and it
apparently
had no effect on his sales for the month of December. As We have
allowed
him the profits on P600 for sales which he was prevented from making
during
the month of November, it appears that the damage from interruption to
his business has been fully compensated. so that, without touching upon
the vexatious question of whether damages to credit might be allowed in
a proper case, we are of the opinion that such damages in this case, if
any, were so infinitesimal and speculative, that they cannot be allowed.
Our Decision in the
Tan Ti case disposes of the questions raised in the other two cases.
All
the items allowed in those cases being of a similar character and
having
been computed in the same manner as those in the first case, should be
allowed, with the exception of the amounts allowed as attorneys' fees
and
for impairment of credit. In both cases these items are disallowed.
For the foregoing
reasons,
the judgments appealed from reduced to P227.50; in Tiu Uco's case, to
P460.50;
and in the judgments appealed from are affirmed. Without costs in this
instance.
Arellano, C.J.,
Carson and Araullo, JJ., concur.
Moreland, J.,
concurs in the result. |