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G.R. No. L-9126 March 31, 1915
NEMESIO MONTEVERDE vs. NAKATA -->

EN BANC

G.R. No. L-9126 March 31, 1915

NEMESIO MONTEVERDE, Plaintiff-Appellant, vs. NAKATA (Japanese), Defendant-Appellee.

Chicote and Miranda for appellant.
James F. Yeager for appellee.

CARSON, J.:

Upon an appeal from a judgment of a justice of the peace to the Court of First Instance of Davao it appeared that the justice of the peace had taken jurisdiction of an action, in which plaintiff sought to cancel a mortgage, to compel the mortgagee to receive the alleged amount of the loan secured by the mortgage, and to return the land which it was alleged was in his possession. It further appeared that the justice of the peace had rendered judgment in favor of the plaintiff in accordance with the prayer of his complaint, and that he had appointed a receiver for the land pending proceedings on appeal to the Court of First Instance.chanroblesvirtualawlibrary chanrobles virtual law library

On motion of the defendant, the judge of the Court of First Instance dismissed the action of the plaintiff on the ground that he had failed to prosecute the action on appeal by filing a new complaint, as required by section 78 of the Code of Civil Procedure as amended by Acts No. 1627 and No. 2111.chanroblesvirtualawlibrary chanrobles virtual law library

Before doing so, however, he entertained a motion of defendant, who prayed that the receiver be discharged and damages allowed for the unlawful detention of the land in the hands of the receiver. Upon this motion, some testimony was taken, and thereafter an order was entered discharging the receiver and allowing damages in favor of the defendant and against the plaintiff, the receiver and the sureties on the receiver's bond, in the sum of P500. The record is before us on plaintiff's appeal from this order.chanroblesvirtualawlibrary chanrobles virtual law library

Counsel for appellant do not question the validity of the order discharging the receiver, but they insist that the trial judge erred in entertaining and deciding in these proceedings the motion of defendant praying for damages alleged to have resulted from the appointment of the receiver.chanroblesvirtualawlibrary chanrobles virtual law library

Counsel contend that since the Court of First Instance acquired no original jurisdiction in the premises, its powers were limited to the dismissal of the action in the exercise of its appellate jurisdiction.chanroblesvirtualawlibrary chanrobles virtual law library

It is true that it has not infrequently been said that the power of the Courts of First Instance, in the exercise of their appellate jurisdiction, is limited to the dismissal of the action or of the appeal (as the case may be), when it appears that the inferior court was without jurisdiction or that plaintiff has failed to prosecute the action on appeal. But this must be understood merely as a statement of a limitation upon the power of these courts in the adjudication of the issues raised by the pleadings and the final disposition of the action on appeal. Pending the final dispositon of the case on appeal, Courts of First Instance must, in the very nature of things, be held to have all the powers necessary for the proper control of the proceedings which are set forth in detail in section 11 of the Code of Civil Procedure; and furthermore to have jurisdiction to grant or deny in proper cases those special remedies, such as preliminary injunctions and the appointment or removal of receivers, which, under the code, as ancillary to all actions and proceedings pending in those courts.chanroblesvirtualawlibrary chanrobles virtual law library

We conclude that the court below had jurisdiction, while the appellate proceedings were still pending before it, to discharge the receiver appointed by the justice of the peace upon the motion of the defendant and a showing that the receiver had been appointed improvidently, or without lawful authority.chanroblesvirtualawlibrary chanrobles virtual law library

The most superficial examination of the record clearly discloses that all the proceedings had in the court of the justice of the peace were void for want of jurisdiction, and that the appointment of the receiver pending the proceedings on appeal was wholly without authority of law. We conclude that there was no error in the action of the judge of the Court of First Instance in discharging the receiver who had taken possession of the property, and whose possession of the property pending the final disposition of the appeal was a manifest wrong which defendant had a perfect right to have remedied upon motion, at any stage of the proceedings.chanroblesvirtualawlibrary chanrobles virtual law library

The only questions which remain have to do with the amount of the damages allowed because of the unlawful seizure of the property by the receiver; and the jurisdiction of the Court of First Instance to assess the damages in the course of the proceedings then pending before it.chanroblesvirtualawlibrary chanrobles virtual law library

In the case of Yap Unki vs. Chua Jamco (14 Phil. Rep., 602), we held in reliance upon section 177 of the Code of Civil Procedure that: "Damages for the procurement of the appointment of a receiver without sufficient cause are to be ascertained and decreed in the action wherein the receiver is appointed, and final judgment having been rendered in that action, the question of damages on this ground is res adjudicata."chanrobles virtual law library

We are of the opinion that in case appealed to a Court of First Instance from a court of a justice of the peace, wherein a receiver has been imprudently or unlawfully appointed and has thereafter been removed by the Court of First Instance, the appropriate time and place for the adjudication of any question of damages resulting from the improper appointment of the receiver is in the course of the appellate proceedings in that court. With the interested parties before the court, all questions arising out of the unlawful appointment of the receiver, including the question of damages, can there and then be threshed out without undue inconvenience or unnecessary expense. And however this may be, we are of opinion and so hold, that the adjudication of the damages in this manner is in accord with the expenses provision of section 177 of the Code of Civil Procedure.chanroblesvirtualawlibrary chanrobles virtual law library

As to the contentions of appellant with reference to the amount of damages allowed, we must confess that the evidence of record upon which the trial judge based his findings is not wholly satisfactory. But there is evidence in the record which, if accepted as true, is sufficient to sustain his judgment, and there is no sufficient evidence to the contrary to justify us in disturbing the conclusions of the trial judge in this regard.chanroblesvirtualawlibrary chanrobles virtual law library

The judgment entered in the court below should therefore be affirmed, with the costs of this instance against the appellant. So ordered.

Arellano, C.J., Moreland and Trent, JJ., concur.

Separate Opinions

TORRES, J,. dissenting: chanrobles virtual law library

I think that the proceedings in both instances should be annulled and set aside, reserving to the parties their respective rights.