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[No. 6305. September 26, 1911.]COMPAIA GENERAL DE TABACOS DE
FILIPINAS, plaintiff and appellee, vs. ROMANA GAUZON and JUAN D.
POMAR, defendants. JUAN D. POMAR, receiver and appellant.
1.RECEIVERS; POWERS, DUTIES, AND RESPONSIBILITIES.A receiver is
generally defined to be an indifferent person between the parties
litigant, appointed by the court and on behalf of all the parties,
and not of the plaintiff or defendant only, to receive and hold the
thing or property in litigation, pending the suit, to receive the
rents, issues, or profits of the land or thing in question, to hold
possession and control of the property which is the subject-matter
of the litigation and to dispose of it in such manner as may be
directed by the court. He is the arm and hand of the court,
a262
262PHILIPPINE REPORTS ANNOTATEDCompaa General de Tabacos vs.
Gauzon and Pomar.part of the machinery of the court, by which the
rights of the parties are protected. He is required not only to
preserve the property, but to protect the rights of all the parties
interested.2.ID.; LIMITED AUTHORITY TO INCUR EXPENSE WITHOUT
EXPRESS PERMISSION OF THE COURT.Generally a receiver has no
authority to incur any expense in the administration of his
receivership, without express permission of the court, except it be
absolutely necessary to preserve the property, and then only when,
under special circumstances, he can not secure such authority from
the court. He should administer the estate as economically as
possible, to the end that the interests of all the parties shall be
conserved.3.ID.; COMPENSATION.The amount of compensation of a
receiver is fixed by the sound discretion of the court. The court,
in fixing the compensation of the receiver, should take into
consideration the general efficiency of the receiver in his
administration of the property under his control.APPEAL from a
judgment of the Court of First Instance of Occidental Negros.
McCabe, J.The facts are stated in the opinion of the court.M.
Fernandez Yamson, for appellant.A. P. Seva, for appellee.JOHNSON,
J.:
The present appeal is made by the defendant Juan D. Pomar, as
receiver, against the order of the Hon. Albert E. McCabe, judge of
the Province of Occidental Negros, disallowing certain items in the
final account of the said receiver.It appears from the record that
the defendant, Romana Gauzon, on the 10th day of September, 1904,
executed and delivered to the plaintiff (Compaa General de Tabacos
de Filipinas) a mortgage upon an hacienda known as "San Jose," in
the municipality of San Carlos, in the Province of Occidental
Negros. The said defendant (Romana Gauzon) having failed to pay the
said mortgage, the plaintiff (Compaia General de Tabacos de
Filipinas), on the 22nd day of September, 1905, commenced an action
for the foreclosure of said mortgage, and asked, in addition to the
foreclosure of the mortgage, that a receiver be appointed to take
charge263
VOL. 20, SEPTEMBER 26, 1911.263Compaa General de Tabacos vs.
Gauzon and Pomar.of the property in question, pending the said
action. On the same day (22nd of September, 1905) the Hon. Vicente
Jocson, after hearing the petition filed in said cause, appointed
the said defendant, Juan D. Pomar, an employee of the plaintiff,
receiver of the property involved in said foreclosure proceedings.
Said foreclosure proceedings continued to a termination. The result
of said proceedings may be found in two decisions of this court,
the cases of La Compaa General de Tabacos de Filipinas vs. Ganson
(13 Phil. Rep., 472) and La Compaa General de Tabacos de Filipinas
vs. Ganson (13 Phil. Rep., 481). The facts relating to the
foreclosure proceedings and the judgment therein are not important
in the present cause, further than to show the history of the
transactions of the receiver, the defendant, Juan D. Pomar.After
the termination of the receivership, the court required of the
receiver (Juan D. Pomar) a report and an accounting of his
operations as receiver. It appears from the record that the lower
court had a good deal of trouble in securing a final report. The
receiver apparently acted as though his only responsibility was to
the plaintiff (Compaa General de Tabacos de Filipinas) ; however,
finally the lower court secured what appears to be a final
accounting by the receiver, upon the 9th or 10th day of August,
1909. The report of the receiver contained many items. After a
careful consideration of the various items of the account of the
receiver, Judge McCabe allowed the f following items of said
account1. Care of cane before cutting
......................................................................................P1,522.302.
Cutting and grinding, according to report of commissioners
....................................8,5653. Fuel
.........................................................................................................................150.004.
Expenses in Iloilo, according to receiver's Exhibit B
................................................2,591.205. Storage
.....................................................................................................................428.286.
Insurance
..................................................................................................................428.287.
Selling commission
...................................................................................................648.128.
Judgment for plaintiff in cause No. 249
....................................................................9,187.809.
Receiver's pay
..........................................................................................................._1,000.00
Total
...................................................................................................................24,522.04264
264PHILIPPINE REPORTS ANNOTATEDCompaa General de Tabacos vs.
Gauzon and Pomar.and ordered the receiver, Juan D. Pomar, to pay
into court on or about the first Tuesday of November, 1909, the sum
of P7,883.76, a balance which he ought to have had in his
possession. From the order allowing said items only the defendant
appealed to this court and made the following assignments of
error:"I. The court erred in reducing to P8,565.97 the P22,-944.73
spent by the receiver for cutting, hauling, and manufacture of
8,005.58 piculs of sugar, for packing, transportation and storage
thereof, and insurance and selling commission thereon."II. The
court erred in not allowing the item of P147.86 paid out by the
receiver as interest on money borrowed to cover the first expenses
of his receivership.
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"III. The court erred in not approving the disbursement made by
the receiver of the P3,001.94 delivered to the aparceros as their
share of the crop."IV. The court erred in reducing to P1,000 the
P4,860.87 which the receiver claimed as compensation f or his
services."V. The court erred in holding that the order appointing
the receiver does not extend his powers beyond those prescribed in
section 175 of Act No. 190."With reference to the first assignment
of error, it will be noted that the receiver presented an account
for cutting, grinding, etc., of the sugar cane upon the hacienda,
over which he had control as receiver, amounting to P22,944.73.
Judge McCabe refused to allow that amount for the cutting and
grinding, etc., of said sugar cane, upon the ground that it was an
unreasonable charge. The parties in the lower court agreed to the
appointment of three commissioners f or the purpose of ascertaining
the reasonable cost of cutting, grinding, etc., of the sugar cane
upon the said hacienda. The commissioners were duly appointed, the
plaintiff selecting one, the defendant another and the court
selecting the third. In due time and after due deliberation, the
commissioners reported that the reasonable cost f or cutting,
'grinding, etc., of the said sugar cane per pico was P1.07. There
were 8,005.58 picos of sugar cane, which calculated at the265
VOL. 20, SEPTEMBER 26, 1911.265Compaa General de Tabacos vs.
Gauzon and Pomar.rate of P1.07 per pico for cutting, grinding,
etc., would amount to P8,565.97, which amount the lower court
allowed the receiver. The commissioners appointed by the lower
court were men who had had experience in the cutting and grinding
of sugar cane. It was the duty of the receiver to harvest the sugar
cane at the least possible cost to the owners of the crop. There is
much proof in the record to indicate that the receiver did not
harvest the crop of sugar cane as expeditiously as he should have
done. There is no proof in the record which shows that the amount
estimated by the said commissioners f or the cutting, grinding,
etc., of the sugar cane in question, was not a reasonable amount
for that expense. We find nothing in the record which justifies us
in modifying the decision of the lower court with reference to this
first assignment of error.With reference to the second assignment
of error, it appears that the receiver attempted to charge P147.86,
as interest on money borrowed by him during his administration as
receiver. There is no proof in the record that the receiver was
authorized to borrow money for the purpose of carrying on his work
as receiver of said hacienda; neither is there any proof in the
record which shows that it was necessary for him to borrow money to
properly conserve the interests of the owners and creditors
interested in the administration of the hacienda. The lower court
correctly said, "a receiver has no authority to borrow money unless
the same is expressly given by the court." We would be inclined,
however, to allow this amount (P147.86) had the necessity been
fully demonstrated for borrowing the money. In the absence of
authority expressly given and especially in the absence of proof of
the absolute necessity for incurring this item of expense, we
refuse to modify the conclusions of the lower court with respect to
this item.With reference to the third assignment of error above
noted, the receiver included in his account the item of P3,001.94,
being the amount, according to' this statement, of money and
effects delivered to "los aparceros de la hacienda" during his
administration. It is a well known266
266PHILIPPINE REPORTS ANNOTATEDCompaa General de Tabacos vs.
Gauzon and Pomar.custom among sugar growers in the Philippine
Islands, that the aparceros plant and cultivate sugar cane at their
own expense, receiving one-half of the sugar produced and
delivering the other half to the owner of the land. It is also a
well known custom that the owners of the land from time to time
advance money and effects to the aparceros, deducting the value of
the same from the value of the sugar after the same is harvested.
In the present case it appears that the receiver delivered one-half
of the sugar to the aparceros without deducting the amount of money
and effects advanced to them. If he, in fact, advanced to the
aparceros the said sum (P3,001.94) he should have deducted it from
the amount due said aparceros, and not have attempted to collect
the same from the amount due the owner of the hacienda, prejudicing
the owner of the hacienda thereby. Here again the receiver exceeded
his authority. Nevertheless we would be inclined to allow this
amount (P3,001.94) if it were a just charge against the
administration of the hacienda. But, as was said above, it is not a
just charge against the owner of the hacienda. This amount should
have been collected from the aparceros. Judge McCabe committed no
error in disallowing this item in the account of the receiver.With
reference to the fourth assignment of error above noted, it will be
seen that the receiver included in his account the sum of P4,860.87
as compensation for his administration as receiver. The lower court
disallowed that amount but did allow him. the sum of P1,000 as his
just compensation as receiver. The lower court, in the appointment
of the receiver, did not fix any sum for his compensation; neither
is it customary for courts in appointing receivers to fix their
compensation in advance. Their compensation is a matter which is
always left to the sound discretion of the court, to be allowed
from time to time. The receiver attempted to recover as his
compensation 15 per cent of the value of the sugar. The lower court
found that the amount of P4,860.87 was an unreasonable amount to be
allowed as compensation for the services of the re-267
VOL. 20, SEPTEMBER 26, 1911.267Compaa General de Tabacos vs.
Gauzon and Pomar.ceiver in the present case. The court found that
the receiver might have done all the work which he did do in the
course of his administration as receiver in one hundred days. The
Code of Procedure in Civil Actions allows administrators of estates
of deceased persons the sum of P4 a day for the time actually
employed in the administration of the estate. The lower court, f
ollowing this provision of the law, believing the present case to
be somewhat analogous, allowed the receiver P4 a day for his
services. The lower court also allowed an additional amount, the
basis of which does not clearly appear in the record, making the
total compensation of the receiver the sum of P1,000. Against that
order the owner of the hacienda did not appeal. Considering the
negligent manner in which the receiver administered the hacienda,
as appears from the record, as well as his negligence in complying
with the various orders of the court with reference to rendering
accounts, etc., we are of the opinion that the sum of P1,000 is, in
fact, more than a just compensation for his services. In view,
however, of the fact that the owner of the hacienda did not appeal
from the order of the court allowing said sum (P1,000) we approve
the finding of the lower court.With reference to the fifth
assignment of error above noted, the appellant seems to believe
that section 175 of the Code of Procedure in Civil Actions gave him
full power to administer the property placed under his control as
receiver as he might deem wise and necessary, without any
intervention on the part of the court or of the interested parties.
The appellant evidently
-
overlooked the phrase of said article which says: "The receiver
shall have, under the control of the court in which the action is
pending, power, etc." The judge of the lower court in his decision
goes into detail at length and cites authorities extensively, for
the purpose of showing the general duties, powers and
.responsibilities of receivers, evidently for the purpose of
instructing receivers in his district. The receiver is generally
defined to be "an indifferent person between the parties litigant,
appointed by the court and on behalf of all the parties,268
268PHILIPPINE REPORTS ANNOTATEDCompaa General de Tabacos vs.
Gauzon and Pomar.and not of the plaintiff or defendant only, to
receive and hold the thing or property in litigation, pending the
suit (Booth vs. Clark, 17 How. (U. S.), 322, 331), to receive the
rents, issues or profits of the land or thing in question (Booth
vs. Clark, supra), to receive the rents or other income, to hold
possession and control of the property which is the subject matter
of the litigation, and to dispose of the same or deliver it to such
person or persons as may be directed by the court. (Wiswall vs.
Kunz, 173 111., 110.)" The reports of the decisions of the courts
are filled with decisions supporting the above doctrine. The
receiver is said to be the arm and hand of the courta part of the
machinery of the court, by which the rights of parties are
protected. He is required not only to preserve the property, but to
protect the rights of all of the parties interested. If he is not
versed in the law, he should secure legal advice, with the
permission of the court and in case of doubt should advise with the
court and receive direction.After a full consideration of the above
assignments of error, in connection with the facts contained in the
record, we find no reason for changing or modifying the decision of
the lower court, and the same is hereby affirmed, with
costs.Torres, Mapa, and Moreland, JJ., concur.CARSON, J.,
concurring:
I concur. I think it proper, however, to add that the
observation of the lower court, quoted with approval in the opinion
of this court, that "a receiver has no authority to borrow money
unless the same is expressly given by the court," while undoubtedly
true, as a general proposition, must not be understood as
absolutely prohibiting the borrowing of money by a receiver and its
repayment with interest as a lawful and necessary expense incurred
by the receiver in the performance of his duty, where it is
impracticable or impossible to secure the prior approbation of the
transaction by the court.As a rule, consent of court should first
be obtained; but269
VOL. 20, SEPTEMBER 27, 1911.269Rallos vs. Yangco.as clearly
indicated in the majority opinion, where the necessity for
incurring the expense actually exists, and is fully and clearly
established, the transaction will be ratified and approved when all
the facts are shown to the court. The receiver and the lender take
the risk that the transaction may not be ratified by the court, on
the ground that in the opinion of the court there was no necessity
therefor; and without the approval of the court previously obtained
or the ratification and approval obtained when the matter is
finally reported, the property in the hands of the receiver is not
and can not be bound for the repayment of the indebtedness.If it
were shown in the case at bar that to save a growing crop from
destruction, or to harvest it at the proper time, it became
necessary to borrow money to pay laborers or the like, and that
under all the circumstances it was impracticable to secure the
previous consent of the court to the transaction, it will not be
doubted that on a proper showing the court would ratify and affirm
the transaction, and that this subsequent ratification would bind
the property in the hands of the receiver for the repayment of the
money borrowed, together with interest and the expenses necessarily
incurred in and about the making of the loan.Judgment
affirmed._______________ [Compaa General de Tabacos vs. Gauzon and
Pomar., 20 Phil. 261(1911)]
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[No. 25729. November 24, 1926]THE BELGIAN CATHOLIC MISSIONARIES,
INC., plaintiff and appellee, vs. MAGALLANES PRESS, INC., ET AL.,
defendants. JOSE MARIA MEMIJE, appellant.
1.CHATTEL MORTGAGE; DEPOSIT OF PROPERTY.The trial court did not
commit an error in authorizing the plaintiff corporation to take
possession of the personal property in litigation upon the filing
of a bond sufficient to secure the conservation or value of the
same, such act not constituting a delivery of the personal
property, as the appellant contends, but only a deposit of the
property in litigation applied for by said plaintiff corporation
which became a receiver by authority of the court, it being the
party most interested in the conservation and care of said
property.2.lD.; INCREASE OF SECURITY.The increase of a mortgage
security becomes a new mortgage where the original mortgage does
not contain any stipulation in regard to the increase of the
mortgage credit, and, even if it does, said increase would take
effect only from the date of the increase. A mortgage which
contains a stipulation in regard to future increases of credit will
take effect from the date the same are made and not from the date
of the original. mortgage.3.ID.; SECURITY OF FUTURE DEBT.Where the
statute provides that the parties to a chattel mortgage must take
oath that the debt is a just debt, honestly due and owing from the
mortgagor to the mortgagee, it is obvious that a valid mortgage
cannot be made to secure a future debt.APPEAL from a judgment of
the Court of First Instance of Manila. Diaz, J.The facts are stated
in the opinion of the court.648
648PHILIPPINE REPORTS ANNOTATEDBelgian Catholic Missionaries vs.
Magallanes PressAntonio M. Opisso, Romualdez Hermanos and Luciano
de la Rosa for appellant.Cavanna, Aboitiz & Agan for
appellee.VILLA-REAL, J.:
This is an appeal taken by Jose Maria Memije from a judgment of
the Court of First Instance of Manila the dispositive part of which
is as follows:"For all the foregoing, the court is of the opinion
that the plaintiff has a right to the relief prayed for in its
complaint. Wherefore, judgment is rendered declaring that Exhibits
C and D, that is, the mortgage deeds in question in this
proceeding, in so far as they prejudice the rights of the
plaintiff, are null and void; that the preliminary injunction
issued in this case against the defendant Jose Ma. Memije is final
and absolute; and that the plaintiff recover the amount of the fire
insurance policies of the defendant 'Magallanes Press, Inc.,'
which, or the representatives of which, is hereby ordered to
endorse said insurance policies to the plaintiff, with the costs of
the proceeding against the defendants, with the exception of J. P.
Heilbronn Co., Inc. It is so ordered."In support of his appeal, the
appellant assigns the following supposed errors as committed by the
lower court in its judgment, to wit: (1) The court erred in
overruling the demurrer filed by this defendant to the complaint in
this action; (2) the trial court erred in giving the plaintiff
corporation possession of the property mortgaged to this appellant
without following the necessary proceedings or complying with the
provisions of the law; (3) the trial court erred in issuing the
writ of preliminary injunction against the appellant and E. E.
Elser, restraining the former from receiving from the latter, or
the latter from delivering to the former, the amount of the
insurance policies covering the property mortgaged to the
appellant, which was damaged by the fire that occurred in the
establishment of the Magallanes Press, Inc.; (4) the trial649
VOL. 49, NOVEMBER 24, 1926649Belgian Catholic Missionaries vs.
Magallanes Presscourt erred in giving to the unnecessary
intervention of the Magallanes Press, Inc., in the execution of the
deed Exhibit C an interpretation which is neither based upon law
nor upon the contract; (5) the trial court erred in ordering the
suspension of the foreclosure of the appellant's mortgage on the
property of the Magallanes Press, Inc.; (6) the trial court erred,
under the facts proven in this case, in applying article 1297 of
the Civil Code; (7) the trial court erred in finding in its
decision that the defendant Jose Ma. Memije should not have
executed the documents Exhibits C and D without taking into account
the rights of the plaintiff corporation, The Belgian Catholic
Missionaries, Inc.; (8) the trial court erred in declaring Exhibits
C and D null and void in so far as they prejudice the rights of the
plaintiff, over whose credit that of the herein appellant is
preferential; in declaring the writ of preliminary injunction
issued against the defendant Jose Ma. Memije final and absolute; in
giving judgment for the plaintiff to recover the amount of the fire
insurance policies of the defendant the Magallanes Press, Inc.; and
(9) the trial court erred in not making any pronouncement as to the
counterclaim and cross-complaint of the defendant Jose Ma. Memije
in this action, nor taking the same into consideration and
rendering judgment thereon in favor of said defendant.The oral
evidence has not been forwarded to this court so that we are
compelled to base our opinion exclusively upon the documentary
evidence and the facts found and stated by the trial court in its
judgment. It appears that on December 1, 1921, the MagallanesPress,
through its manager H. Camea, executed a promissory note in favor
of J. P. Heilbronn & Co., Inc., for the sum of P3,472.92, with
interest at 10 per cent per annum, payable at the rate of P250 a
month, plus the interest earned on the unpaid balance, until the
whole amount of the indebtedness shall have been paid, the first
payment to be made on January 1, 1922, with the condition that
upon650
650PHILIPPINE REPORTS ANNOTATEDBelgian Catholic Missionaries vs.
Magallanes Pressthe failure to pay any monthly installment of the
interest earned on the unpaid balance, the whole amount of the
indebtedness shall become due, and the maker shall pay the payee an
additional sum equivalent to 15 per cent of the total balance, for
attorney's fee and expenses of collection, forfeiting all right of
exemption.On the same date, December 1, 1921, the said Magallanes
Press, through its manager H. Camea, also executed a promissory
note in f avor of J. P. Heilbronn & Co., Inc., for the sum of
P10,715.77, with interest at 12 per cent per annum, payable at the
rate of P500 a month, together with the interest earned on the
unpaid balance, until the whole amount of the indebtedness shall
have been paid, the first payment to be made on January 1, 1922,
with the condition that upon the failure to pay any monthly
installment or the interest earned on the unpaid balance, the whole
amount of the indebtedness shall become due, and the maker shall
pay
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the payee an additional sum equal to 15 per cent of the total
balance for attorney's fee and expenses of collection, forfeiting
all right of exemption.To secure the payment of said promissory
notes which amounted to a total of P14,188.69, H. Camea, as general
manager of the Magallanes Press, executed a chattel mortgage on all
the printing machinery and its accessories, belonging to the said
Magallanes Press, in favor of J. P. Heilbronn & Co,, Inc.On
June 19, 1922, the Magallanes Press Co., Inc., successor to the
Magallanes Press, with all the latter's rights and obligations,
through its duly authorized president, E. F. Clemente, executed a
chattel mortgage on the same printing machinery and its accessories
in favor of the Belgian Catholic Missionaries Co., Inc., which the
Magallanes Press had mortgaged to J. P. Heilbronn & Co., Inc.,
to secure the payment of a loan of P30,500, with interest at 12 per
cent per annum, which the said Magallanes Press & Co., Inc.,
had obtained from the Belgian Catholic Missionaries Co.,651
VOL. 49, NOVEMBER 24, 1926651Belgian Catholic Missionaries vs.
Magallanes PressInc., the duration of the mortgage loan being one
year from the execution of the mortgage deed.In December, 1922 the
appellant Jose Ma. Memije made a loan in the sum of P2,000 to E. F.
Clemente which was paid on account of the indebtedness of the
Magallanes Press to J. P. Heilbronn & Co., Inc., together with
the sum of P1,641 which A. F. Mendoza owed said E. F. Clemente.On
the occasion of the issuance of the writ of attachment in civil
cause No. 23818 of the Court of First Instance of Manila, entitled
Jose Ma. Cavanna vs. The Magallanes Press Co., Inc., the defendant
Jose Ma. Memije, on February 21, 1923, filed an intervention in
said case.All the promissory notes executed by the Magallanes Press
in favor of J. P. Heilbronn & Co., Inc., having been overdue
for non-payment of the installments, as well as the respective
chattel mortgage, the said J. P. Heilbronn & Co., Inc.,
transferred all its mortgage credit against the Magallanes Press to
Jose Ma. Memije in consideration of the sum of P8,280.90, the
balance of said mortgage credit.On March 14, 1923, Enrique
Clemente, as manager of the Magallanes Press Co., Inc., executed a
deed in favor of Jose Ma. Memije by virtue of which the chattel
mortgage which was given by the Magallanes Press in favor of J. P.
Heilbronn & Co., Inc., and transferred by the latter to Jose
Ma. Memije, was made to cover an additional loan of P5,895.79,
which included the sum of P2,000 which said Jose Ma. Memije had
advanced said Enrique Clemente in December, 1922.On April 21, 1923,
a fire occurred in the building where the printing machinery, its
accessories and other personal property of the Magallanes Press
Co., Inc., were located and which were covered by said chattel
mortgages. Said property was insured, and the insurance policies
covering it were endorsed to J. P. Heilbronn & Co., Inc., upon
the execution of the chattel mortgage thereon in favor of the
latter. When J. P. Heilbronn & Co., Inc., transferred652
652PHILIPPINE REPORTS ANNOTATEDBelgian Catholic Missionaries vs.
Magallanes Pressits mortgage credit to Jose Ma. Memije it, in turn,
endorsed said insurance policies to him. The insurance companies
were disposed to pay the respective insurance policies, which
amounted to P7,686.45, but due to the issuance of the
above-mentioned writ of preliminary injunction, payment could not
be made.Due to the filing of the complaint in the present case on
May 9, 1923, and the issuance of the writ of preliminary injunction
on May 10th of the same year, Jose Ma. Memije was unable to collect
the amount of the insurance policies, and when he was summoned
under the complaint on May 14, 1923, he made demand on the
Magallanes Press Co., Inc., for the payment of his mortgage credit
and on the same date the manager of said corporation, E. F.
Clemente, permitted the secretary of the said corporation to place
the property covered by the mortgage into the hands of the said
Jose Ma. Memije in order that the same might be sold, but the sale
could not be consummated due to the issuance of the said writ of
preliminary injunction.The first question raised by the defendant
and appellant has reference to the overruling of the demurrer filed
by him to the complaint.One of the grounds of said demurrer was
that the complaint in this case did not allege facts sufficient to
constitute a cause of action against the said def endant, in that,
notwithstanding the fact that the said complaint was instituted to
annul the document of transfer of the mortgage credit Exhibit C, it
was not alleged in the said complaint that the defendant Jose Ma.
Memije had any intention to defraud the interests of the plaintiff
corporation, which was absolutely impossible due to the nature of
the "transaction and the preferential character of the mortgage
credit of J. P. Heilbronn & Co., Inc.As to this paragraph of
the complaint, the plaintiff company having known of the existence
of a chattel mortgage in favor of J. P. Heilbronn & Co., Inc.,
the latter, either as653
VOL. 49, NOVEMBER 24, 1926653Belgian Catholic Missionaries vs.
Magallanes Pressthe first or as the second mortgagee, had a perfect
right to transfer its mortgage credit, without the knowledge or
consent of any other mortgagee, inasmuch as whoever acquired it,
would have exactly the same status as the transferor with the same
rights and obligations. The fact, therefore, that the Magallanes
Press Co., Inc., had consented to the transfer of the mortgage
credit of J. P. Heilbronn & Co., Inc., to Jose Ma. Memije, does
not constitute a fraud that can vitiate the said transfer, inasmuch
as the order of preference of the existing mortgages has not been
altered, and its allegation does not constitute a cause of action
to annul the said transfer.In regard to the allegation contained in
the ninth paragraph of the complaint, it is very clear that the
increase made by Jose Ma. Memije in the mortgage credit acquired by
him from J. P. Heilbronn & Co., Inc., and the extension made by
the Magallanes Press, Inc., of the mortgage to said additional
credit without the knowledge or consent of the plaintiff company,
as second mortgagee, prejudices the credit of the latter, inasmuch
as the security for the payment of said credit was reduced as to
it, and, therefore, constitutes a fraud that vitiates the contract
of extension of the mortgage evidenced by the deed Exhibit D,
rendering it void.The facts alleged in paragraph 9 of the complaint
are sufficient to constitute a cause of action of nullity, and the
lower court did not err in overruling the demurrer filed by the
defendant Jose Ma. Memije.In regard to the second assignment of
error, it appears that the defendant Jose Ma. Memije having
attempted to foreclose the mortgage, by which the mortgage credit
acquired by him from J. P. Heilbronn & Co., Inc., was secured,
in order to recover not only
-
the original credit but also the increase, the Belgian Catholic
Missionaries Co., Inc., filed a complaint, with a petition for a
writ of preliminary injunction against the sheriff, in whose hands
the fore-654
654PHILIPPINE REPORTS ANNOTATEDBelgian Catholic Missionaries vs.
Magallanes Pressclosure of the mortgage was placed. The writ of
preliminary injunction having been issued, upon the filing of a
bond in the sum of P15,000, and there being no person more
interested in the conservation and custody of the property covered
by the mortgage than said plaintiff company, being the largest
creditor, it applied and obtained from the court the possession of
the same.Contrary to the contention of the appellant, this case is
not one of replevin but simply a proceeding instituted by the
plaintiff for the deposit of the property in litigation, upon the
filing of a bond, said plaintiff acting as a receiver by authority
of the court, being the person most interested in the conservation
and care of the same (sec. 174, Act No. 190; 11 C. J., 726).The
lower court, therefore, did not err in authorizing the plaintiff
company to take possession of the personal property in litigation
upon the filing of a bond sufficient to secure the conservation or
value thereof.The third assignment of error raises the question as
to the preference of right between the plaintiff company and the
defendant over the mortgaged property and the amount of the
insurance policies covering a part thereof which was destroyed by
fire.As we have seen in the statement of the pertinent facts
necessary for the clear and accurate solution of the questions of
law involved in the present appeal, the firm of J. P. Heilbronn
& Co., Inc., had a mortgage credit against the Magallanes Press
for the sum of P14,186.69, secured by a first chattel mortgage. The
plaintiff company, the Belgian Catholic Missionaries Co., Inc.,
also had a mortgage credit for the amount of P30,500, secured by a
second mortgage on the same personal property. After this second
mortgage had been executed, the payment of the mortgage credit of
J. P. Heilbronn & Co., Inc., became due, which credit had been
reduced to the sum of P8,280.90 through partial pay-655
VOL. 49, NOVEMBER 24, 1926655Belgian Catholic Missionaries vs.
Magallanes Pressments, and the herein defendant-appellant Jose Ma,
Memije acquired said mortgage credit and increased it by P5,895.59,
of which increase P2,000 was a previous loan.There is no question
but that J. P. Heilbronn & Co., Inc., at the time of the
transfer of its mortgage rights to Jose Ma. Memije, had a
preferential right over that of the Belgian Catholic Missionaries
Co., Inc., for the remainder of the amount of the mortgage credit,
that is, P8,280.90. The plaintiff company had a preferential right
to the rest of the value of the mortgaged property after deducting
the remaining mortgage credit of J. P. Heilbronn & Co., Inc.The
increase of P5,895.59 made by the defendant Jose Ma. Memije in
favor of the Magallanes Press Co., Inc., and the extension of the
mortgage thereto, are not only subordinate to the mortgage credit
of the plaintiff company, being subsequent in time and in
registration, but said increase in the security is also void. The
increase of the mortgage security becomes a new mortgage in itself,
inasmuch as the, original mortgage did not contain any stipulation
in regard to the increase of the mortgage credit, and even if it
did, said increase would take effect only from the date of the
increase. A mortgage that contains a stipulation in regard to
future advances in the credit will take effect only from the date
the same are made and not from the date of the mortgage (11 C. J.,
448; 5 R. C. L., 420-421). In accordance with the provisions of
section 5 of Act No. 1508, known as the Chattle Mortgage Law, the
parties to the original deed swore that the same was mortgaged "to
secure the obligations specified therein and for no other purpose."
Neither the increase in question, nor the extension of the mortgage
to secure the payment of the same, is specified in the deed,
consequently said extension is void. "Where the statute provides
that the parties to a chattel mortgage must make oath that the debt
is a just debt, honestly due and -owing from the mortgagor to
the656
656PHILIPPINE REPORTS ANNOTATEDBelgian Catholic Missionaries vs.
Magallanes Pressmortgagee, it is obvious that a valid mortgage
cannot be made to secure a debt to be thereafter contracted." (11
C. J., 448.)Briefly, therefore, we have the following:(a) That Jose
Ma. Memije has a preferential right to the value of the chattels
mortgaged and the amount of the insurance policies up to the sum of
P8,280.90;(b) That the plaintiff corporation, the Belgian Catholic
Missionaries Co., Inc., has a right to the remainder of the value
of said chattels and the insurance policies up to the amount of
P30,500, after deducting the preferential credit of Jose Ma.
Memije;(c) That as to the increase of P5,895.59, the right of the
defendant Jose Ma. Memije is that of an ordinary creditor.In regard
to the damages claimed by the defendant in his counterclaim and
which is the subject-matter of his remaining assignments of error,
said defendant has a right to interest at 12 per cent on the
P8,280.90, the amount of the mortgage credit acquired by him from
J. P. Heilbronn & Co., Inc., from February 26, 1923, the date
of the acquisition until fully paid.For the foregoing reasons, the
judgment appealed from is revoked and it is ordered that another be
entered declaring all the mortgages overdue, and the mortgage
credit of Jose Ma. Memije preferential over that of the Belgian
Catholic Missionaries Co., Inc., up to the amount of P8,280.90,
with interest at the rate of 12 per cent per annum from February
26, 1923, until fully paid; the mortgage credit of the Belgian
Catholic Missionaries Co., Inc., for the sum of P30,500 with
interest at the rate of 12 per cent per annum, from June 19, 1922,
until fully paid, plus the sum of P3,000 for attorney's fees, over
the additional credit of Jose Ma. Memije for P5,895.59; and
ordering the foreclosure of the said mortgages by selling the
mortgaged property at public auction, to the proceeds of which
shall be added the amount of the insurance657
VOL. 49, DECEMBER 3, 1926657O'Brien vs. Del Rosario and Bank of
the Philippine Islandspolicies and the above-mentioned credits in
the order of preference above established, without special
pronouncement as to costs. So ordered.Avancea, C. J., Johnson,
Street, Ostrand, and Johns, JJ., concur.Judgment reversed. [Belgian
Catholic Missionaries vs. Magallanes Press, 49 Phil. 647(1926)]
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[No. 29295. October 22, 1928]J. M. PO PAUCO, plaintiff, vs.
DOLORES SIGENZA ET AL., defendants. WISE & Co., intervenor and
appellant.
1."SHERIFF;" RECEIVER.A sheriff, in a sense, is a judicial
officer of a general character, who is not appointed in any
particular judicial case; the sheriff is an officer who exercises
or may exercise his functions within the limits of his
jurisdiction. A receiver, on the other hand, is a special officer
appointed in connection with and in a particular case or action,
and whose duties are limited to his sphere, of action and do not
extend further than the case in which he is appointed.2.ID. ;
ID.While the funds in the hands of a sheriff may be within the
reach of processes coming from other judicial proceedings, such is
not the case with respect to those under the custody of a receiver.
Those who have any claim to property or sums in the possession of a
receiver, must appear in the same proceeding in which said receiver
discharges his duties, and there, by motion or petition, allege and
prove their claims.APPEAL from an order of the Court of First
Instance of Iloilo. Salas, J.The facts are stated in the opinion of
the court.Block, Johnston ,& Greenbaum for the intervenor.Roman
J. Lacson for receiver-appellee National Bank.242
242PHILIPPINE REPORTS ANNOTATEDPo Pauco vs. SigenzaROMUALDEZ,
J.:
In this case, J. M. Po Pauco obtained final judgment in his
favor against Dolores Sigenza and Mariano Aguilar for the sum of
P72,278.01, both parties agreeing to deduct therefrom the sum of
P13,007.46 which is the net value of the sugar cane belonging to
said def endants and attached by the plaintiff and manufactured by
the Philippine National Bank, the receiver of the said product. By
virtue of said judgment and agreement the court issued a writ of
execution for the remaining sum of P59,270.55 on November 19,
1926.In another civil case before the same court, No. 6416, Wise
& Co., Ltd., had on October 18, 1926 obtained judgment against
the herein plaintiff J. M. Po Pauco ic or the sum of P10,572.80
with legal interest thereon, execution of said judgment having been
ordered in those proceedings, which has not yet, even partially,
been paid.On October 23, 1927, Wise & Co., Ltd., intervened in
this case praying that the Philippine National Bank, the receiver
of the said sum of P13,007.46, be ordered to satisfy the judgment
in favor of the said petitioner Wise & Co., Ltd., against J. M.
Po Pauco, out of the sum deposited with it, Po Pauco's right and
interest in the judgment of this case now before us having been
preliminarily attached in civil case No. 6416, on August 6,
1926.Opposition was filed to said petition by the Philippine
National Bank alleging that said bank has a preferential right over
the surplus of the sale of the sugar delivered to it as receiver,
and also that the Hibila Trading Corpo-ration obtained judgment
against the said J. M. Po Pauco, in civil case No. 3197 of the
Court of First Instance of Occidental Negros, holding that the
rights of the Hibila Trading Corporation over the sugar harvest of
1923-1924 and 1924-1925 of the spouses Dolores Sigenza and Mariano
Aguilar in the San Agustin Estate, are preferential over those of
J. M. Po Pauco and, therefore, the latter is not243
VOL. 52, OCTOBER 22, 1928243Po Pauco vs. Sigenzaat all entitled
to any of the surplus remaining from the sale of said sugar; and
that said Hibila Trading Corporation is an interested party which
must be summoned before the motion of Wise & Co., Ltd., can be
heard, which corporation must institute an ordinary action to
establish whatever right it may have to the surplus of the sugar in
question.The Court of First Instance of Iloilo denied the motion of
Wise & Co., Ltd., granting it permission to institute an action
against the Philippine National Bank and the Hibila Trading
Corporation in order to determine which has the better right to the
net proceeds of the sale of said sugar.Wise & Co., Ltd.,
appeals from said ruling making several assignments of error.It
should not be forgotten that the sum mentioned is in the custody of
a receiver and not of a sheriff. The sheriff is a court officer of
a general character who is not appointed for a certain judicial
case; the sheriff is an officer who exercises or can exercise his
ic unctions within the limits of his jurisdiction. A receiver, on
the other hand, is a special officer, appointed in relation to and
within a certain case or action, and whose duties are limited to
his sphere of action, and do not extend further than the case in
which he was appointed.For this reason, while the funds in the
custody of a sheriff may be within the reach of processes coming
from other judicial proceedings, such is not the case with respect
to those under the custody of a depositary. From which it follows
that those who, as in the present case, have any claim to property
or sums in the possession of a receiver, must appear in the same
proceeding in which said receiver discharges his duties, and there,
by motion or petition,. allege and prove their claims.The order
appealed from is reversed and it is ordered that this proceeding be
remanded to the court of origin in order that, without the
necessity of commencing a new ac-244
244PHILIPPINE REPORTS ANNOTATEDZamboanga Transportation Co. vs.
Bachrach Motor Co.tion, the interested parties be given an
opportunity to set forth and prove their alleged preferential
rights over the sum in controversy.Without any special
pronouncement as to costs. So ordered.Johnson, Street, Malcolm,
Ostrand, and Villa-Real, JJ., concur.Order reversed, case remanded
for further proceedings.__________ [Po Pauco vs. Sigenza, 52 Phil.
241(1928)]
-
[No. L-2987. February 20, 1951]ERNEST BERG, plaintiff and
appellant, vs. VALENTIN TEUS, defendant and appellee.
1.MORATORIUM; APPOINTMENT OF RECEIVER DOES NOT FALL UNDER THE
MORATORIUM LAW.Where the complaint for the foreclosure of real and
chattel mortgages also prays for the appointment of a receiver, a
motion to dismiss on the ground of the Moratorium Law should not be
sustained. The alleged violations of the conditions of the mortgage
contract, if true, make it necessary, if not imperative, for the
protection of the interest of the plaintiff, that the mortgaged
properties be placed in the custody of the court. The fact that the
appointment of a receiver, as the defendant emphasizes, is an
ancillary remedy is precisely one powerful reason why the case
should not be dismissed; dismissal of the main action would
eliminate the only basis for the appointment of a receiver and thus
completely bar the door to any relief from mischiefs.APPEAL from an
order of the Court of First Instance of Ilocos Sur. Ortega, J.The
facts are stated in the opinion of the Court.Alva J. Hill for
appellant.J. Prez Cardenas for appellee.TUASON, J.:
This appeal is from an order of the Court of First Instance of
Ilocos Sur dismissing the above-entitled action by reason of
Executive Order No. 25, as amended by Executive Order No. 32, on
moratorium.Ernest Berg brought the action against Valentin Teus to
foreclose a real estate and chattel mortgage executed in November,
1944, to secure six promissory notes of the aggregate value of
P80,000 and payable on demand two years after declaration of
armistice between the United States and Japan. An amended or
supplementary complaint was later admitted against the defendant's
objection. The complaints recited that by stipulations of the
parties, the mortgagor had undertaken, among other things, to
insure and pay the taxes on the mortgaged properties;174
174PHILIPPINE REPORTS ANNOTATEDBerg vs. Teusnot to alienate,
sell, lease, encumber or in any manner dispose thereof; and to keep
and maintain the said properties in good order and repair; but
that, it was alleged, he (defendant) had failed lo keep taxes fully
paid; had made material alterations on the premises, and had sold
and conveyed them to Central Azucarera del Norte. It was further
alleged that the mortgagor had agreed that should he fail to
perform any of his obligations as stipulated, "the mortgage shall
be deemed to be automatically foreclosed and the mortgagee may
forthwith proceed to foreclose this mortgage either
extrajudicially, even after the death of the mortgagor, in
pursuance of the provisions of Act No. 3135, as amended;" and on
the basis of this agreement it was prayed that the mortgage be
declared automatically foreclosed and the plaintiff entitled to
immediate possession of the properties in question. In a separate
motion Berg's attorney also asked for the appointment of a
receiver.Counsel for the defendant having moved for the dismissal
of the complaint on the grounds that plaintiff's cause of action
had not accrued by reason of the executive orders hereinbefore
cited, and having opposed the motion for receivership, Judge Zoilo
Hilario entered an order holding that as to the collection of the
six notes the suit had been prematurely brought, but setting the
cause for trial on the merits because, according to His Honor, the
reasons alleged in the motion to dismiss were not "indubitable"
with reference to the appointment of a receiver sought by the
plaintiff. As we understand this order, its result was that the
moratorium ought not to interfere with the plaintiff's motion for
appointment of receiver.However that may be, the plaintiff
subsequently filed a "complete complaint" in which the original
complaint and the amended or supplementary complaint were
consolidated. This "complete complaint", which was admitted without
objection, apparently was supposed to have restored the case to its
original status. Consequently the attorney for175
VOL. 88, FEBRUARY 20, 1961175Berg vs. Teusthe defendant filed a
new motion to dismiss; and Judge Luis Ortega, who had replaced
Judge Hilario, ignoring the latter's order entered the order now on
appeal by which the entire action was quashed on the theory
advanced in the motion to dismiss. The new order was silent on both
the application for receivership and the prayer that the plaintiff
be adjudged authorized by the terms of the mortgage to foreclose it
extrajudicially and seize the properties.Judge Ortega opined that
Executive Orders Nos. 25 and 32 were still in force unaffected by
Republic Act No. 342 as to debts contracted during the Japanese
occupation. Plaintiff contended that those executive orders had
passed out of existence by the disappearance of the emergency
contemplated thereby, and the contention is reiterated in this
instance. But from the view we take of the case, decision on this
question can be deferred. For the purpose of the present decision,
we will assume that Executive Orders Nos. 25 and 32 are still in
full force and effect. This we do to pave the way for and hasten
action on the petition to put the premises and chattels involved in
the hands of a receiver, petition which appears of urgent
character. The constitutionality of Executive Orders Nos. 25 and 32
and Republic Act No. 342 and allied issues can wait. These issues
are delicate and would require prolonged study and deliberation.
Besides, there is a pending bill in Congress repealing those
executive orders and law.In Medina vs. Santos (78 Phil., 464; 44
Off. Gaz., [No. 10] 3811), it was held that an action for the
recovery of a truck with prayer for payment of its value in case
the truck was not returned, could proceed notwithstanding the
moratorium law. The court observed that the indemnity sought was a
subsidiary liability and would not come into being unless and until
decision was rendered against the defendant for such payment.In
Moya vs. Barton (79 Phil., 14; 45 Off. Gaz., [No. 1] 237), the
court said that when the cause of action was in176
176PHILIPPINE REPORTS ANNOTATEDBerg vs. Teuspart covered by the
moratorium and in part not, it was not unjust to render judgment
for the payment of the entire obligation with the understanding
that execution with respect to the amounts that had fallen due
before March 10, 1945, would be stayed.In the case of Alejo vs.
Gomez (83 Phil., 969), the court ruled that suit for unlawful
detainer and rents in arrears was not affected by the moratorium,
the recovery of the unpaid rentals, it was said, being accessory to
the main action.And, lastly, in Realty Investments, Inc. et al. vs.
Villanueva et al., (84 Phil., 842; 47 Off. Gaz., 1844), the court,
citing the above-mentioned cases decided that the court should go
ahead with the trial of the action on the merits without prejudice
to the right of
-
the defendant to arrest the execution should one for payment of
money be issued. In that case the plaintiff, which had sold to the
defendant a piece of land on installment basis, was demanding
payment of the installments still unpaid, (installments which the
defendant claimed to have fully settled with the Japanese alien
property custodian) or, in default, restoration of the ownership
and possession of the property. In revoking the lower court's order
of dismissal, we pointed out that the De Venecia vs. General, (78
Phil., 780; 44 Off. Gaz., 4912), and Ma-ao Sugar Central Co., Inc.
vs. Barrios, (79 Phil., 666; 45 Off. Gaz., 2444), were
distinguishable from Moya vs. Barton, Medina vs. Santos, and Alejo
vs. Gomez, in that the suits in the first two named cases had for
their sole object the enforcement of a monetary obligation.The case
at bar falls within the relaxed rule of this court's later
decisions. The alleged violations of the conditions of the mortgage
contract, if true, make it necessary if not imperative, for the
protection of the interest of the plaintiff, that the mortgaged
properties be placed in the custody of the court. The fact that the
appointment of a177
VOL. 88, FEBRUARY 20, 1951177Berg vs. Teusreceiver, as the
defendant emphasizes, is an ancillary remedy is precisely one
powerful reason why the case should not be dismissed. Because
receivership is an auxiliary remedy dismissal of the main action
would eliminate the only basis for the appointment of receiver and
thus completely bar the door to any relief from mischiefs.Under the
circumstances of the case, the least that should have been done, if
that were feasible as a matter of procedure, was to adopt the steps
which Judge Hilario had proposed to do. Judge Hilario evidently saw
the grave injustice to the plaintiff and the irreparable injury to
which his rights would be exposed if an indefinite suspension of
the entire proceeding were decreed.In suspending the right of
creditor to enforce his right the President and Congress had no
idea of depriving him of all means of preventing the destruction or
alienation of the security for the debt, destruction which would
virtually write off, in some cases, the whole credit. If that were
the intention, it is doubtful if the orders and the law invoked
could stand the test of constitutionality.The order appealed from
will therefore be reversed and the case remanded to the court below
f or f urther proceeding according to the tenor of this decision.
We leave the way open to the defendant to ask for the arrest or
stay of execution in the event of an adverse monetary judgment, and
for the plaintiff to impugn anew, if necessary, the
constitutionality of Executive Orders Nos. 25 and 32 and Republic
Act No. 342 and/or their being still in force. Costs of this appeal
will be charged against the appellee.Moran, C. J., Pars, Feria,
Pablo, Bengzon, Padilla, Montemayor, Reyes, Jugo and Bautista
Angelo, JJ., concur.Order reversed, and case remanded for further
proceedings. [Berg vs. Teus, 88 Phil. 173(1951)]
-
G.R. No. 155408. February 13, 2008.*JULIO A. VIVARES and MILA G.
IGNALING, petitioners, vs. ENGR. JOSE J. REYES, respondent.
Remedial Law; Civil Law; Receivership; He who alleges fraud has
the burden to prove it.Petitioners miserably failed to adduce
clear, convincing, and hard evidence to show the alleged fraud in
the transfers and the antedating of said transfers. The fact that
the transfers were dated prior to the demise of Torcuato on May 12,
1992 does not necessarily mean the transfers were attended by
fraud. He who alleges fraud has the burden to prove it.Same; Same;
Same; Receivership is a harsh remedy to be granted only in extreme
situations.Receivership is a harsh remedy to be granted only in
extreme situations. As early as 1914, the Court already enunciated
the doctrinal pronouncement in Velasco & Co. v. Gochuico &
Co., 28 Phil. 39 (1914), that courts must use utmost circumspection
in allowing receivership, thus: The power to appoint a receiver is
a delicate one and should be exercised with extreme caution and
only under circumstances requiring summary relief or where the
court is satisfied that there is imminent danger of loss, lest the
injury thereby caused be far greater than the injury sought to be
averted. The court should consider the consequences to all of the
parties and the power should not be exercised when it is likely to
produce irreparable injustice or injury to private rights or the
facts demonstrate that the appointment will injure the interests of
others whose rights are entitled to as much consideration from the
court as those of the complainant.PETITION for review on certiorari
of a decision of the Court of Appeals.The facts are stated in the
opinion of the Court. Mutia, Trinidad & Romero Law Offices for
petitioners. The Law Firm of Hermosisima & Inso for
respondent._______________
* SECOND DIVISION.81
VOL. 545, FEBRUARY 13, 200881Vivares vs. ReyesVELASCO, JR.,
J.:
The CaseThe kernel dispute in this petition under Rule 45 is the
legality of the May 22, 2001 Resolution1 of the Camiguin Regional
Trial Court (RTC), Branch 28 in Civil Case No. 517, which placed
the estate of Severino Reyes under receivership. The Court of
Appeals (CA) saw it differently in CA-G.R. SP No. 67492its June 18,
2002 Decision2 recalled the RTC directive on the appointment of the
receiver, prompting Julio Vivares and Mila Ignaling to file the
petition at bar to convince the Court to reinstate the
receivership.The FactsSeverino Reyes was the father of respondent
Jose Reyes and Torcuato Reyes. Upon the death of Severino,
respondent and Torcuato came upon their inheritance consisting of
several properties. They had an oral partition of the properties
and separately appropriated to themselves said properties.On May
12, 1992, Torcuato died with a last will and testament executed on
January 3, 1992. In Reyes v. Court of Appeals,3 we affirmed the
November 29, 1995 CA Decision, admitting the will for
probate.Petitioner Vivares was the designated executor of Torcuatos
last will and testament, while petitioner Ignaling was declared a
lawful heir of Torcuato.Believing that Torcuato did not receive his
full share in the estate of Severino, petitioners instituted an
action for Partition and Recovery of Real Estate before the
Camiguin RTC, Branch 28 entitled Julio A. Vivares, as executor of
the estate of_______________
1 Rollo, pp. 94-95. Penned by Presiding Judge Noli T. Catli.2
Id., at pp. 19-29. Penned by Associate Justice Wenceslao I. Agniri,
Jr. and concurred in by Associate Justices B.A. Adefuin-De la Cruz
(Chairperson) and Regalado E. Maambong.3 G.R. No. 124099, October
30, 1997, 281 SCRA 277.82
82SUPREME COURT REPORTS ANNOTATEDVivares vs. ReyesTorcuato J.
Reyes and Mila R. Ignaling, as heir v. Engr. Jose J. Reyes and
docketed as Civil Case No. 517. With the approval of the trial
court, the parties agreed that properties from the estate of
Severino, which were already transferred in the names of respondent
and Torcuato prior to the latters death on May 12, 1992, shall be
excluded from litigation. In short, what was being contested were
the properties that were still in the name of Severino.On November
24, 1997, for the purpose of collating the common properties that
were disputed, the trial court directed the formation of a
three-man commission with due representation from both parties, and
the third member, appointed by the trial court, shall act as
chairperson. The disputed properties were then annotated with
notices of lis pendens upon the instance of petitioners.On March
15, 2000, petitioners filed a Motion to Place Properties in
Litigation under Receivership4 before the trial court alleging that
to their prejudice respondent had, without prior court approval and
without petitioners knowledge, sold to third parties and
transferred in his own name several common properties. Petitioners
also averred that respondent fraudulently antedated, prior to May
12, 1992, some conveyances and transfers to make it appear that
these were no longer part of the estate of Severino under
litigation. They further claimed that respondent was and is in
possession of the common properties in the estate of Severino, and
exclusively enjoying the fruits and income of said properties and
without rendering an accounting on them and turning over the share
pertaining to Torcuato. Thus, petitioners prayed to place the
entire disputed estate of Severino under receivership. They
nominated a certain Lope Salantin to be appointed as
receiver._______________
4 Rollo, pp. 32-39.83
VOL. 545, FEBRUARY 13, 200883
-
Vivares vs. ReyesOn March 23, 2000, respondent filed his
Opposition to Place the Estate of Severino Reyes under
Receivership,5 denying that he had fraudulently transferred any
property of the estate of Severino and asserting that any transfer
in his name of said properties was a result of the oral partition
between him and Torcuato that enabled the latter as well to
transfer several common properties in his own name.On May 24, 2000,
petitioners filed their Offer of Exhibits in support of their
motion for receivership. On the same date, the trial court issued
an Order6 granting petitioners motion and appointed Salantin as
receiver conditioned on the filing of a PhP 50,000 bond. Respondent
filed a motion for reconsideration, contending that the appointment
of a receiver was unduly precipitate considering that he was not
represented by counsel and thus was deprived of due process.On
August 4, 2000, the trial court allowed respondent to present his
evidence to contest petitioners grounds for the appointment of a
receiver, and the trial court set the reception of respondents
evidence for September 4, 2000. However, on August 24, 2000,
respondent filed a motion for postponement of the September 4, 2000
scheduled hearing on the ground that he was in the United States as
early as July 23, 2000 for medical examination. On September 5,
2000, the trial court denied respondents motion for postponement
and reinstated its May 24, 2000 Order.On September 19, 2000,
respondent filed a Manifestation with Motion to Discharge Receiver,
reiterating the circumstances which prevented him from attending
the September 4, 2000 hearing and praying for the discharge of the
receiver upon the filing of a counterbond in an amount to be fixed
by the court in accordance with Section 3, Rule 59 of the 1997
Revised Rules on Civil Procedure. On October 10, 2000,
peti-_______________
5 Id., at pp. 40-41.6 Id., at pp. 67-68. Penned by
Judge-Designate Antonio A. Orcullo.84
84SUPREME COURT REPORTS ANNOTATEDVivares vs. Reyestioners filed
their undated Opposition to Motion to Discharge
Receiver.Subsequently, respondent filed a Motion to Cancel Notice
of Lis Pendens which was annotated on Tax Declaration (TD) No. 112
covering Lot No. 33 allegedly belonging exclusively to him.
Respondent asserted in the motion that an adjacent property to Lot
No. 33, particularly a portion of Lot No. 35, which is owned by a
certain Elena Unchuan, was erroneously included in Lot No. 33 and,
consequently, was subjected to the notice of lis pendens.
Petitioners filed their Opposition to the Motion to Cancel Lis
Pendens.Consequently, on May 22, 2001, the trial court issued a
Resolution, denying respondents motions to discharge receiver and
cancel the notice of lis pendens in TD No. 112. Respondent
seasonably filed a partial motion for reconsideration of the May
22, 2001 Resolution, attaching copies of deeds of sale executed by
Torcuato covering several common properties of the estate of
Severino to prove that he and Torcuato had indeed made an oral
partition of the estate of their father, Severino, and thus
allowing him and Torcuato to convey their respective shares in the
estate of Severino to third persons.On October 19, 2001, the trial
court heard respondents motion for partial reconsideration, and on
the same date issued an Order denying the motion for partial
reconsideration on the ground that respondent failed to raise new
matters in the motion but merely reiterated the arguments raised in
previous pleadings.Aggrieved, respondent filed a Petition for
Certiorari before the CA, assailing the May 22, 2001 Resolution and
October 19, 2001 Order of the RTC.The Ruling of the Court of
AppealsOn June 18, 2002, the CA rendered the assailed Decision,
sustaining respondents position and granted relief, thus:85
VOL. 545, FEBRUARY 13, 200885Vivares vs. ReyesWHEREFORE,
premises considered, the Petition is hereby GRANTED. The Resolution
dated 22 May 2001 of the Regional Trial Court of Camiguin, Branch
28 in Civil Case No. 517 is hereby reversed and set aside. The
court-appointed receiver, Lope Salantin, is discharged upon the
posting by petitioner of a counterbond in the amount of
P100,000.00. The notice of lis pendens in Tax Declaration 112, in
so far as it covers the property of Elena Unchuan, is cancelled.
Let this case be remanded to the court a quo for further
proceedings.7In reversing the trial court, the CA reasoned that the
court a quo failed to observe the well-settled rule that allows the
grant of the harsh judicial remedy of receivership only in extreme
cases when there is an imperative necessity for it. The CA thus
held that it is proper that the appointed receiver be discharged on
the filing of a counterbond pursuant to Sec. 3, Rule 59 of the 1997
Revised Rules on Civil Procedure.Moreover, the CA ratiocinated that
respondent has adequately demonstrated that the appointment of the
receiver has no sufficient basis, and further held that the rights
of petitioners over the properties in litigation are doubly
protected through the notices of lis pendens annotated on the
titles of the subject properties. In fine, the appellate court
pointed out that the appointment of a receiver is a delicate one,
requiring the exercise of discretion, and not an absolute right of
a party but subject to the attendant facts of each case. The CA
found that the trial court abused its discretion in appointing the
receiver and in denying the cancellation of the notice of lis
pendens on TD No. 112, insofar as it pertains to the portion owned
by Unchuan.Aggrieved, petitioners in turn interposed a Motion for
Reconsideration that was denied through the assailed September 24,
2002 CA Resolution.Thus, this petition for review on certiorari is
before us, presenting the following issues for
consideration:_______________
7 Supra note 2, at p. 28.86
86SUPREME COURT REPORTS ANNOTATEDVivares vs. ReyesI
-
WHETHER OR NOT THE ANNOTATION OF A NOTICE OF LIS PENDENS
PRECLUDES THE APPOINTMENT OF A RECEIVER WHEN THERE IS A NEED TO
SAFEGUARD THE PROPERTIES IN LITIGATION.II
WHETHER OR NOT A DULY APPOINTED RECEIVER OF PROPERTIES IN
LITIGATION SHOULD BE DISCHARGED SIMPLY BECAUSE THE ADVERSE PARTY
OFFERS TO POST A COUNTERBOND.III
WHETHER OR NOT THE CANCELLATION OF A NOTICE OF LIS PENDENS
ANNOTATED ON TAX DECLARATION NO. 112 IS CONTRARY TO LAW.8The Courts
RulingThe petition must be denied. Being closely related, we
discuss the first and second issues together.Receivership not
justifiedWe sustain the CA ruling that the trial court acted
arbitrarily in granting the petition for appointment of a receiver
as there was no sufficient cause or reason to justify placing the
disputed properties under receivership.First, petitioners
asseverate that respondent alienated several common properties of
Severino without court approval and without their knowledge and
consent. The fraudulent transfers, they claim, were antedated prior
to May 12, 1992, the date of Torcuatos death, to make it appear
that these properties no longer form part of the assets of the
estate under litigation in Civil Case No. 517.Petitioners position
is bereft of any factual mooring._______________
8 Rollo, pp. 212-213.87
VOL. 545, FEBRUARY 13, 200887Vivares vs. ReyesPetitioners
miserably failed to adduce clear, convincing, and hard evidence to
show the alleged fraud in the transfers and the antedating of said
transfers. The fact that the transfers were dated prior to the
demise of Torcuato on May 12, 1992 does not necessarily mean the
transfers were attended by fraud. He who alleges fraud has the
burden to prove it.Moreover, respondent has adduced documentary
proof that Torcuato himself similarly conveyed several lots in the
estate of Severino based on the oral partition between the
siblings. To lend credence to the transfers executed by Torcuato
but distrust to those made by respondent would be highly
inequitable as correctly opined by the court a quo.Indeed,
receivership is a harsh remedy to be granted only in extreme
situations. As early as 1914, the Court already enunciated the
doctrinal pronouncement in Velasco & Co. v. Gochuico & Co.
that courts must use utmost circumspection in allowing
receivership, thus:The power to appoint a receiver is a delicate
one and should be exercised with extreme caution and only under
circumstances requiring summary relief or where the court is
satisfied that there is imminent danger of loss, lest the injury
thereby caused be far greater than the injury sought to be averted.
The court should consider the consequences to all of the parties
and the power should not be exercised when it is likely to produce
irreparable injustice or injury to private rights or the facts
demonstrate that the appointment will injure the interests of
others whose rights are entitled to as much consideration from the
court as those of the complainant.9Petitioners cannot now impugn
the oral partition entered into by Torcuato and respondent and
hence cannot also assail the transfers made by respondent of the
lots which were subject of said agreement, considering that
Torcuato also sold properties based on said verbal arrangement.
Indeed, the parties agreed that the civil action does not encompass
the properties covered by the oral partition. In this factual
set-_______________
9 28 Phil. 39, 41 (1914).88
88SUPREME COURT REPORTS ANNOTATEDVivares vs. Reyesting,
petitioners cannot convince the Court that the alleged fraudulent
transfers of the lots made by respondent, which purportedly form
part of his share in Severinos estate based on the partition, can
provide a strong basis to grant the receivership.Second, petitioner
is willing to post a counterbond in the amount to be fixed by the
court based on Sec. 3, Rule 59 of the 1997 Rules of Civil
Procedure, which reads:Sec. 3. Denial of application or discharge
of receiver.The application may be denied, or the receiver
discharged, when the adverse party files a bond executed to the
applicant, in an amount to be fixed by the court, to the effect
that such party will pay the applicant all damages he may suffer by
reason of the acts, omissions, or other matter specified in the
application as ground for such appointment. The receiver may also
be discharged if it is shown that his appointment was obtained
without sufficient cause.Anchored on this rule, the trial court
should have dispensed with the services of the receiver, more so
considering that the alleged fraud put forward to justify the
receivership was not at all established.Petitioners advance the
issue that the receivership should not be recalled simply because
the adverse party offers to post a counterbond. At the outset, we
find that this issue was not raised before the CA and therefore
proscribed by the doctrine that an issue raised for the first time
on appeal and not timely raised in the proceedings in the lower
court is barred by estoppel.10 Even if we entertain the issue, the
contention is nevertheless devoid of merit. The assailed CA
decision supported the discharge of the receiver with several
reasons including the posting of the counterbond. While the CA made
a statement that the trial court should have discharged the
appointed receiver on the basis of the proposed counterbond, such
opinion does not jibe with the import of Sec. 3, Rule
59._______________
10 Philippine Banking Corporation v. Court of Appeals, G.R. No.
127469, January 15, 2004, 419 SCRA 487, 503-504.89
VOL. 545, FEBRUARY 13, 2008
-
89Vivares vs. ReyesThe rule states that the application may be
denied or the receiver discharged. In statutory construction, the
word may has always been construed as permissive. If the intent is
to make it mandatory or ministerial for the trial court to order
the recall of the receiver upon the offer to post a counterbond,
then the court should have used the word shall. Thus, the trial
court has to consider the posting of the counterbond in addition to
other reasons presented by the offeror why the receivership has to
be set aside.Third, since a notice of lis pendens has been
annotated on the titles of the disputed properties, the rights of
petitioners are amply safeguarded and preserved since there can be
no risk of losing the property or any part of it as a result of any
conveyance of the land or any encumbrance that may be made thereon
posterior to the filing of the notice of lis pendens.11 Once the
annotation is made, any subsequent conveyance of the lot by the
respondent would be subject to the outcome of the litigation since
the fact that the properties are under custodia legis is made known
to all and sundry by operation of law. Hence, there is no need for
a receiver to look after the disputed properties.On the issue of
lis pendens, petitioners argue that the mere fact that a notice of
lis pendens was annotated on the titles of the disputed properties
does not preclude the appointment of a receiver. It is true that
the notice alone will not preclude the transfer of the property
pendente lite, for the title to be issued to the transferee will
merely carry the annotation that the lot is under litigation.
Hence, the notice of lis pendens, by itself, may not be the most
convenient and feasible means of preserving or administering the
property in litigation. However, the situation is different in the
case at bar. A counterbond will also be posted by the respondent to
answer for all damages petitioners may suffer by reason of any
transfer of the_______________
11 Medelo v. Gorospe, No. L-41970, March 25, 1988, 159 SCRA 248,
254.90
90SUPREME COURT REPORTS ANNOTATEDVivares vs. Reyesdisputed
properties in the future. As a matter of fact, petitioners can also
ask for the issuance of an injunctive writ to foreclose any
transfer, mortgage, or encumbrance on the disputed properties.
These considerations, plus the finding that the appointment of the
receiver was without sufficient cause, have demonstrated the
vulnerability of petitioners postulation.Fourth, it is undisputed
that respondent has actual possession over some of the disputed
properties which are entitled to protection. Between the possessor
of a subject property and the party asserting contrary rights to
the properties, the for-mer is accorded better rights. In
litigation, except for exceptional and extreme cases, the possessor
ought not to be deprived of possession over subject property.
Article 539 of the New Civil Code provides that every possessor has
a right to be respected in his possession; and should he be
disturbed therein he shall be protected in or restored to said
possession by the means established by the laws and the Rules of
Court. In Descallar v. Court of Appeals, we ruled that the
appointment of a receiver is not proper where the rights of the
parties, one of whom is in possession of the property, are still to
be determined by the trial court.12In view of the foregoing
reasons, we uphold the CA ruling that the grant of the receivership
was without sufficient justification nor strong basis.Anent the
third issue that the cancellation of the notice of lis pendens on
TD No. 112 is irregular as Lot No. 33 is one of the disputed
properties in the partition case, petitioners position is
correct.The CA made a factual finding that the property of Unchuan
was erroneously included in Lot No. 33, one of the disputed
properties in Civil Case No. 517. It then ruled that the annotation
of lis pendens should be lifted.This ruling is bereft of factual
basis._______________
12 G.R. No. 106473, July 12, 1993, 224 SCRA 566, 569.91
VOL. 545, FEBRUARY 13, 200891Vivares vs. ReyesThe determination
whether the property of Unchuan is a part of Lot No. 33 and whether
that portion really belongs to Unchuan are matters to be determined
by the trial court. Consequently, the notice of lis pendens on TD
No. 112 stays until the final ruling on said issues is
made.WHEREFORE, the petition is PARTLY GRANTED. The June 18, 2002
CA Decision in CA-G.R. SP No. 67492 is AFFIRMED with MODIFICATION
insofar as it ordered the cancellation of the notice of lis pendens
in TD No. 112. As thus modified, the appealed CA Decision should
read as follows:WHEREFORE, premises considered, the Petition is
hereby PARTLY GRANTED. The Resolution dated 22 May 2001 of the
Regional Trial Court of Camiguin, Branch 28 in Civil Case No. 517
is hereby reversed and set aside. The court-appointed receiver,
Lope Salantin, is discharged upon the posting by petitioner of a
counter-bond in the amount of PhP 100,000. The notice of lis
pendens in TD No. 112, including the portion allegedly belonging to
Elena Unchuan, remains valid and effective. Let this case be
remanded to the court a quo for further proceedings in Civil Case
No. 517.No costs.SO ORDERED. Quisumbing (Chairperson), Carpio,
Carpio-Morales and Tinga, JJ., concur.Petition partly granted,
judgment affirmed with modification.Note.Before appointment of
receiver is granted, consequences thereof should be considered to
avoid causing irreparable injustice to others. (Talag vs. Court of
Appeals, 189 SCRA 802 [1990]) [Vivares vs. Reyes, 545 SCRA
80(2008)]
-
G.R. No. 174356.January 20, 2010.*EVELINA G. CHAVEZ and AIDA
CHAVEZ-DELES, petitioners, vs. COURT OF APPEALS and ATTY. FIDELA Y.
VARGAS, respondents.
Remedial Law; Actions; Forum Shopping; By forum shopping, a
party initiates two or more actions in separate tribunals, grounded
on the same cause, trusting that one or the other tribunal would
favorably dispose of the matter; Elements of Forum Shopping.By
forum shopping, a party initiates two or more actions in separate
tribunals, grounded on the same cause, trusting that one or the
other tribunal would favorably dispose of the matter. The elements
of forum shopping are the same as in litis pendentia where the
final judgment in one case will amount to res judicata in the
other. The elements of forum shopping are: (1) identity of parties,
or at least such parties as would represent the same interest in
both actions; (2) identity of rights asserted and relief prayed
for, the relief being founded on the same facts; and (3) identity
of the two preceding particulars such that any judgment rendered in
the other action will, regardless of which party is successful,
amount to res judicata in the action under consideration.Same;
Same; Same; Receivership; Receivership is not an action; It is but
an auxiliary remedy, a mere incident of the suit to help achieve
its purpose; It cannot be said that the grant of receivership in
one case will amount to res judicata on the merits of the
other_______________
* SECOND DIVISION.400
400SUPREME COURT REPORTS ANNOTATEDChavez vs. Court of
Appealscases.The above cases are similar only in that they involved
the same parties and Fidela sought the placing of the properties
under receivership in all of them. But receivership is not an
action. It is but an auxiliary remedy, a mere incident of the suit
to help achieve its purpose. Consequently, it cannot be said that
the grant of receivership in one case will amount to res judicata
on the merits of the other cases. The grant or denial of this
provisional remedy will still depend on the need for it in the
particular action.Same; Same; Same; Same; A petition for
receivership under Section 1 (b), Rule 59 of the Rules of Civil
Procedure requires that the property or fund subject of the action
is in danger of being lost, removed, or materially injured,
necessitating its protection or preservation; If the action does
not require such protection or preservation, the remedy is not
receivership.In any event, we hold that the CA erred in granting
receivership over the property in dispute in this case. For one
thing, a petition for receivership under Section 1(b), Rule 59 of
the Rules of Civil Procedure requires that the property or fund
subject of the action is in danger of being lost, removed, or
materially injured, necessitating its protection or preservation.
Its object is the prevention of imminent danger to the property. If
the action does not require such protection or preservation, the
remedy is not receivership.PETITION for review on certiorari of the
resolutions of the Court of Appeals. The facts are stated in the
opinion of the Court. Jesus G. Chavez for petitioners.ABAD,J.:This
case is about the propriety of the Court of Appeals (CA), which
hears the case on appeal, placing the property in dispute under
receivership upon a claim that the defendant has been remiss in
making an accounting to the plaintiff of the fruits of such
property.401
VOL. 610, JANUARY 20, 2010401Chavez vs. Court of Appeals The
Facts and the CaseRespondent Fidela Y. Vargas owned a five-hectare
mixed coconut land and rice fields in Sorsogon. Petitioner Evelina
G. Chavez had been staying in a remote portion of the land with her
family, planting coconut seedlings on the land and supervising the
harvest of coconut and palay. Fidela and Evelina agreed to divide
the gross sales of all products from the land between themselves.
Since Fidela was busy with her law practice, Evelina undertook to
hold in trust for Fidela her half of the profits.But Fidela claimed
that Evelina had failed to remit her share of the profits and,
despite demand to turn over the administration of the property to
Fidela, had refused to do so. Consequently, Fidela filed a
complaint against Evelina and her daughter, Aida C. Deles, who was
assisting her mother, for recovery of possession, rent, and damages
with prayer for the immediate appointment of a receiver before the
Regional Trial Court (RTC) of Bulan, Sorsogon.1 In their answer,
Evelina and Aida claimed that the RTC did not have jurisdiction
over the subject matter of the case since it actually involved an
agrarian dispute.After hearing, the RTC dismissed the complaint for
lack of jurisdiction based on Fidelas admission that Evelina and
Aida were tenants who helped plant coconut seedlings on the land
and supervised the harvest of coconut and palay. As tenants, the
defendants also shared in the gross sales of the harvest. The court
threw out Fidelas claim that, since Evelina and her family received
the land already planted with fruit-bearing trees, they could not
be regarded as tenants. Cultivation, said the court, included the
tending and caring of the trees. The court also regarded as
relevant Fidelas pending application for a five-hectare retention
and Evelinas_______________
1 Branch 65.402
402SUPREME COURT REPORTS ANNOTATEDChavez vs. Court of
Appealspending protest relative to her three-hectare beneficiary
share.2Dissatisfied, Fidela appealed to the CA. She also filed with
that court a motion for the appointment of a receiver. On April 12,
2006 the CA granted the motion and ordained receivership of the
land, noting that there appeared to be a need to preserve the
property and its fruits in light of Fidelas allegation that Evelina
and Aida failed to account for her share of such
fruits.3Parenthetically, Fidela also filed three estafa cases with
the RTC of Olongapo City and a complaint for dispossession with the
Department of Agrarian Reform Adjudication Board (DARAB) against
Evelina and Aida. In all these cases, Fidela asked for the
immediate appointment of a receiver for the property.
-
The Issues PresentedPetitioners present the following
issues:1.Whether or not respondent Fidela is guilty of forum
shopping considering that she had earlier filed identical
applications for receivership over the subject properties in the
criminal cases she filed with the RTC of Olongapo City against
petitioners Evelina and Aida and in the administrative case that
she filed against them before the DARAB; and2.Whether or not the CA
erred in granting respondent Fidelas application for
receivership._______________
2 Rollo, pp. 59-64.3 Id., at pp. 13-15. Penned by Associate
Justice Hakim S. Abdulwahid, with Associate Justices Remedios A.
Salazar-Fernando and Estela M. Perlas-Bernabe concurring.403
VOL. 610, JANUARY 20, 2010403Chavez vs. Court of Appeals The
Courts RulingOne.By forum shopping, a party initiates two or more
actions in separate tribunals, grounded on the same cause, trusting
that one or the other tribunal would favorably dispose of the
matter.4 The elements of forum shopping are the same as in litis
pendentia where the final judgment in one case will amount to res
judicata in the other. The elements of forum shopping are: (1)
identity of parties, or at least such parties as would represent
the same interest in both actions; (2) identity of rights asserted
and relief prayed for, the relief being founded on the same facts;
and (3) identity of the two preceding particulars such that any
judgment rendered in the other action will, regardless of which
party is successful, amount to res judicata in the action under
consideration.5Here, however, the various suits Fidela initiated
against Evelina and Aida involved different causes of action and
sought different reliefs. The present civil action that she filed
with the RTC sought to recover possession of the property based on
Evelina and Aidas failure to account for its fruits. The estafa
cases she filed with the RTC accused the two of misappropriating
and converting her share in the harvests for their own benefit. Her
complaint for dispossession under Republic Act 8048 with the DARAB
sought to dispossess the two for allegedly cutting coconut trees
without the prior authority of Fidela or of the Philippine Coconut
Authority.The above cases are similar only in that they involved
the same parties and Fidela sought the placing of the properties
under receivership in all of them. But receivership is not an
action. It is but an auxiliary remedy, a mere incident of the suit
to help achieve its purpose. Consequently, it cannot be said that
the grant of receivership in one case will amount
to_______________
4 Philippine National Construction Corporation v. Dy, G.R. No.
156887, October 3, 2005, 472 SCRA 1, 6.5 Cruz v. Caraos, G.R. No.
138208, April 23, 2007, 521 SCRA 510, 522.404
404SUPREME COURT REPORTS ANNOTATEDChavez vs. Court of Appealsres
judicata on the merits of the other cases. The grant or denial of
this provisional remedy will still depend on the need for it in the
particular action.Two.In any event, we hold that the CA erred in
granting receivership over the property in dispute in this case.
For one thing, a petition for receivership under Section 1(b), Rule
59 of the Rules of Civil Procedure requires that the property or
fund subject of the action is in danger of being lost, removed, or
materially injured, necessitating its protection or preservation.
Its object is the prevention of imminent danger to the property. If
the action does not require such protection or preservation, the
remedy is not receivership.6Here Fidelas main gripe is that Evelina
and Aida deprived her of her share of the lands produce. She does
not claim that the land or its productive capacity would disappear
or be wasted if not entrusted to a receiver. Nor does Fidela claim
that the land has been materially injured, necessitating its
protection and preservation. Because receivership is a harsh remedy
that can be granted only in extreme situations,7 Fidela must prove
a clear right to its issuance. But she has not. Indeed, in none of
the other cases she filed against Evelina and Aida has that remedy
been granted her.8Besides, the RTC dismissed Fidelas action for
lack of jurisdiction over the case, holding that the issues it
raised properly belong to the DARAB. The case before the CA is but
an offshoot of that RTC case. Given that the RTC has found that it
had no jurisdiction over the case, it would seem more prudent for
the CA to first provisionally determine that the RTC had
jurisdiction before granting receivership which is but an incident
of the main action. [Chavez vs. Court of Appeals, 610 SCRA
399(2010)]
-
G.R. No. 106473. July 12, 1993.*ANTONIETTA O. DESCALLAR,
petitioner, vs. THE HON. COURT OF APPEALS and CAMILO F. BORROMEO,
respondents.
Remedial Law; Receivership; The appointment of a receiver is not
proper where the rights of the parties are still to be determined
by the trial court.In view of the above circumstances, we find the
order of receivership tainted with grave abuse of discretion. The
appointment of a receiver is not proper where the rights of the
parties (one of whom is in possession of the property), are still
to be determined by the trial court.Same; Same; Same; Only when the
property is in danger of being materially injured or lost may the
appointment of a receiver be justified.Only when the property is in
danger of being materially injured or lost, as by the prospective
foreclosure of a mortgage thereon for non-payment of the mortgage
loans despite the considerable income_______________
* FIRST DIVISION.567
VOL. 224, JULY 12, 1993567Descallar vs. Court of Appealsderived
from the property, or if portions thereof are being occupied by
third persons claiming adverse title thereto, may the appointment
of a receiver be justified.Same; Same; Same; The practice of
appointing as receiver the clerk of court of the trial judge is
frowned upon by the Court.Another flaw in the order of receivership
is that the person whom the trial judge appointed as receiver is
her own clerk of court. This practice has been frowned upon by this
Court.PETITION for review on certiorari