ADVENT vs. YOUNG FACTS: 1.

Advent filed for corporate rehabilitation with RTC of Makati, the court issued an order which states that "the enforcement of all claims whether such enforcement is by court action or otherwise, against Advent, its guarantors and sureties not solidarily liable with it, is stayed"; 2. Young filed a petition for rehabilitation, claiming that several employee benefits allegedly due him as Advent's former president and chief executive officer; 3. Rehabilitation court approved the rehab plan, included in the inventory of Advent's assets was the s ubject car which is in the possession of Young; 4. Young refused to return the car (benz e230), hence the replevin case; 5. Advent posted a 3M replevin bond, throungh Strong hold Insurance Company Inc.,TC issued a writ of replevin hence Young turned over the car; 6. Young filed an answer, stating that as a former employee of Advent, he had the option to purchase the subject car and to offset the value of the car with the proceeds of his retirement pay and stock option plan; 7. TC ordered the dismissal of the replevin case for Advent's failure to execute and dismissed Young's counterclaim for lack of jurisdiction; 8. Young filed M for partial recon of the dismissal order with respect of his counterclaim and filed an omnibus motiom that Advent return the car and pay him 1.2M in damages for improper and irregular seizure; 9. TC denied both motion; 10. CA ruled in favor of Young, the writ of seizure issued as an incident of the main action (for replevin) became functus officio and should have been recalled or lifted. ISSUE: 1. WON, CA committed an error in directing the return of the car to Young. 2. WON, CA erred in ordering the TC to set a hearing for the determination of damages against the replevin. HELD: Partly meritorious 1. No Upon the dismissal of the replevin case for failure to prosecute, the writ of seizure became functus officio and should have been lifted. there was no adjudication on the merits, which means that there were no determination of the issue of who has the better right of possession to the car.

In the replevin case, Young cannot demand that Advent pay him money because such payment, even if valid, has been "stayed" by order of the rehabilitation court. However in the same case, Young can raise Advent's car plan, coupled with his retirement pay and stock option plan, as giving him a better right of possession of the car. 2. Yes Sec 10, Rule 60 of the ROC, provides that in replevin cases, the damages to be awarded upon the bond "shall be claimed, ascertained and granted" in accordance with Sec.20, Rule 57, which allows the application to be filed at any time before the judgment becomes executory. It should be filed in the same case that is the main action and with the court having jurisdiction over the case at the time of the application. In this case, there was no application for damages against Stronghold resulting from the issuance of the writ of seizure before the finality of the dismissal of the complaint for failure to prosecute. It appears that Young filed his omnibus motion claiming damages against Stronghold after the dismissal order issued by TC had attained finality. Thus, Young is barred from claiming damages against the replevin bond. With this the CA erred in ordering the trial court to set a hearing for the determination of damages against the replevin bond.