December 1960 - Philippine Supreme Court Decisions/Resolutions
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G.R. No. L-16521 December 31, 1960 - PORFIRIO DIAZ v. EMIGDIO NIETES
110 Phil 606:
110 Phil 606:
SECOND DIVISION
[G.R. No. L-16521. December 31, 1960.]
PORFIRIO DIAZ and JUANITO ELECHICON, Petitioners, v. HON. EMIGDIO NIETES and DANIEL EVANGELISTA, Respondents.
G. D. Demaisip, for Petitioners.
Luis U. Go and D. Tupas for Respondents.
SYLLABUS
1. RECEIVERSHIP; APPOINTMENT OF RECEIVER BEFORE FINAL ADJUDICATION OF THE RIGHTS OF THE PARTIES GRANTED ONLY IN EXTREME CASES. — Where the effect of the appointment of a receiver is to take real estate out of the possession of the defendants before the final adjudication of the rights of the parties, the appointment should be made only in extreme cases and on a clear showing of necessity therefor in order to save the plaintiff from grave and irremediable loss or damage (Mendoza v. Arellano, 36 Phil., 59; De la Cruz v. Guinto, 79 Phil., 304; 45 Off. Gaz., [3] 1309; Calo and San Jose v. Roldan, 76 Phil., 455; Municipality of Camiling v. De Aquino, 103 Phil., 128; 54 Off. Gaz., [16] 4716; De los Reyes v. Bayona, 107 Phil., 449; 60 off Gaz., [36] 5529).
2. ID.; POWER TO APPOINT RECEIVER EXERCISED WITH EXTREME CAUTION. — The power to appoint a receiver is a delicate one and it should be exercised with extreme caution and only when the circumstances so demand, either because there is imminent danger that the property sought to be placed in the hands of a receiver be lost or because they run the risk of being impaired, endeavoring to avoid that the injury thereby caused be greater than the one sought to be averted. For this reason, before the remedy is granted, the consequences or effects thereof should be considered in order to avoid causing irreparable injury to others who are entitled to as much consideration as those seeking it. (Velasco & Co. v. Gochico & Co., 28 Phil., 39; Claudio, Et. Al. v. Zandueta, 64 Phil., 312; Calo v. Roldan, 76 Phil., 454).
2. ID.; POWER TO APPOINT RECEIVER EXERCISED WITH EXTREME CAUTION. — The power to appoint a receiver is a delicate one and it should be exercised with extreme caution and only when the circumstances so demand, either because there is imminent danger that the property sought to be placed in the hands of a receiver be lost or because they run the risk of being impaired, endeavoring to avoid that the injury thereby caused be greater than the one sought to be averted. For this reason, before the remedy is granted, the consequences or effects thereof should be considered in order to avoid causing irreparable injury to others who are entitled to as much consideration as those seeking it. (Velasco & Co. v. Gochico & Co., 28 Phil., 39; Claudio, Et. Al. v. Zandueta, 64 Phil., 312; Calo v. Roldan, 76 Phil., 454).
D E C I S I O N
REYES, J. B. L., J.:
This is a petition for certiorari with a prayer for a writ of preliminary injunction to annul the order of the Court of First Instance of Iloilo in its Civil Case No. 5313 appointing a receiver of the property in litigation and of the products thereof.
Civil Case No. 5313 is an action filed by Daniel Evangelista on October 7, 1959 against Porfirio Diaz and Juanito Elechicon for the recovery of the possession of a portion of 12 hectares out of Lot No. 4651 of the Dumangas, Iloilo, Cadastre. The amended complaint alleges that plaintiff is the owner of the aforesaid lot, the same having been adjudicated to him in the project of partition in Special Proceedings No. 815 of the same Court, which partition the probate court has already approved and under which the adjudicatees have already received their respective shares; that defendants are in the possession of the property in question under an unlawful claim of ownership; that defendants have heeded none of the demands made by plaintiff for them to vacate the premises; that said property is first-class riceland, with a net yearly produce of 200 bultos of rice equivalent to P3,000; that the produce of said land for the crop year 1959-60 is about to be harvested; and that the appointment of a receiver is necessary, and the most convenient and peaceable means to preserve, administer, and dispose of the property in question and its 1959-60 harvest.
In answer, defendants aver that they are not claiming the land in question as owners but as lessees thereof for a period of five years, in accordance with a contract of lease signed by them with the administratrix of said property, Rosario Evangelista (plaintiff’s daughter), on March 30, 1959; that said land pertains to Group 1 of the project of partition in Special Proceedings No. 815 and for that reason, the court did not have jurisdiction to appoint a receiver over the same in this case; and that the allegations of the complaint do not warrant the appointment of a receiver.
The opposition to the motion for receivership notwithstanding, the lower court, on November 14, 1959, issued an order placing the property in litigation and its produce under receivership. This order reads:jgc:chanrobles.com.ph
"It appearing that the verified complaint and from Annexes ‘A’, ‘A-1’, ‘A-2’, and ‘B’ that the plaintiff-petitioner for the appointment of Receiver and an interest in the property described in the complaint as owner thereof, the same being a part of his share in the partition of the intestate estate of his father (Special Proceedings No. 815 of the Court of First Instance of Iloilo) and, therefore, entitled to the products of the said property; and it being alleged that the said products are in emminent danger of being lost or removed unless a Receiver is appointed to take charge of and preserve the same, GERUNDIO DIASNES, of Dumangas, Iloilo, is hereby appointed as RECEIVER of the property in litigation as well as the products thereof, and upon putting up a bond of SIX THOUSAND PESOS (P6,000.00), approved by this Court, the said RECEIVER may qualify and assume his duties as such."cralaw virtua1aw library
Defendants moved for the reconsideration of the above order, claiming that the lot in question is in custodia legis in Special Proceedings No. 815 and can not, therefore, be the subject of a receivership in this case; that while it is true that said lot had been assigned to plaintiff in the project of partition in said proceedings, the probate court, in approving said partition, withheld the order of distribution and the closing of the estate "pending the submission by the administration and the heirs of the written conformity of the creditors, namely, the RFC and the PNB to such distribution and eventual assumption by the heirs of the liabilities of the estate" ; and finally, that it does not appear from the complaint that plaintiff has such interest in the property in litigation and its produce, and that such property is in danger of being lost, removed, or materially injured, as to justify the appointment of a receiver. This motion having been denied, defendants filed the present petition for certiorari reiterating substantially their arguments in their motion for reconsideration in the court below, and urging that the order appointing a receiver was issued in grave abuse of discretion and in excess of jurisdiction by the court a quo. Upon petitioners’ filing of a bond in the amount of P2,000.00, we issued a writ of preliminary injunction to restrain the lower court from enforcing the order complained of.
We see no sufficient cause or reason in the instant case to justify placing the land in question in receivership. While it does appear from the pleadings in the court below that title or ownership over said land is with plaintiff by virtue of the order of partition in Special Proceedings No. 815 adjudicating said property to him, it likewise appears, however, that petitioners are in the material possession thereof, not under any claim of title or ownership, but pursuant to a lease contract signed with them by plaintiff’s daughter, Rosario Evangelista, the former administratrix or agent of plaintiff over said property. In fact, plaintiff admitted in his answer to the present petition that he did "let his daughter manage the property" (par. 1 of Affirmative and Special Defenses, Answer, p. 2). Until therefore, the lease agreement signed between Rosario Evangelista, as agent of plaintiff, and defendants is judicially declared void for want of authority of the agent to execute the same, defendants are entitled to continue in the possession of the premises in question, unless powerful reasons exist for the lower court to deprive them of such possession and appoint a receiver over said property. These powerful reasons are wanting in this case. Indeed, there is even no showing here that the property in question and its pending harvest are in danger of being lost, or that defendants are committing acts of waste thereon, or that defendants are insolvent and can not repair any damage they cause to plaintiff’s rights. In truth, the complaint alleges no interest on the part of plaintiff in the crops subjected to receivership.
Upon the other hand, defendants occupied and planted the land in question in good faith as lessees, and it is only just and equitable that they be allowed to continue in their possession and harvest the fruits of their labor (subject to their obligation to pay their lessor his due share in the harvest) until the respective rights of the parties in this case to the possession of the land in question are finally resolved and adjudicated. This Court has repeatedly ruled that where the effect of the appointment of a receiver is to take real estate out of the possession of the defendants before the final adjudication of the rights of the parties, the appointment should be made only in extreme cases and on a clear showing of necessity therefor in order to save the plaintiff from grave and irremediable loss or damage (Mendoza v. Arellano, 36 Phil. 59; De la Cruz v. Guinto, 79 Phil., 304; 45 Off. Gaz., [3] 1309; Calo and San Jose v. Roldan, 76 Phil., 455; Municipality of Camiling v. De Aquino, 103 Phil., 128; 54 Off. Gaz., [16] 4716; De los Reyes v. Bayona, 107 Phil., 449; 60 Off. Gaz., [36] 8659).
Moreover, the trial court seems to have overlooked that, as has often been held, "the power to appoint a receiver is a delicate one; that said power should be exercised with extreme caution and only when the circumstances so demand, either because there is emminent danger that the property sought to be placed in the hands of a receiver be lost or because they run the risk of being impaired, endeavoring to avoid that the injury thereby caused be greater than the one sought to be averted. For this reason, before the remedy is granted, the consequences or effects thereof should be considered or, at least, estimated in order to avoid causing irreparable injustice or injury to others who are entitled to as much consideration as those seeking it." (Velasco & Co. v. Gochico & Co., 23 Phil., 39; Claudio, Et. Al. v. Zandueta, 64 Phil., 812; Calo v. Roldan, 76 Phil., 454).
Wherefore, the orders of November 14, 1959 and December 10, 1959 are set aside, and the writ of preliminary injunction issued by this Court on February 3, 1960 is made permanent. Costs against respondent Daniel Evangelista.
Bengzon, Padilla, Bautista Angelo, Concepción, Barrera, Gutiérrez David, Paredes and Dizon, JJ., concur.
Civil Case No. 5313 is an action filed by Daniel Evangelista on October 7, 1959 against Porfirio Diaz and Juanito Elechicon for the recovery of the possession of a portion of 12 hectares out of Lot No. 4651 of the Dumangas, Iloilo, Cadastre. The amended complaint alleges that plaintiff is the owner of the aforesaid lot, the same having been adjudicated to him in the project of partition in Special Proceedings No. 815 of the same Court, which partition the probate court has already approved and under which the adjudicatees have already received their respective shares; that defendants are in the possession of the property in question under an unlawful claim of ownership; that defendants have heeded none of the demands made by plaintiff for them to vacate the premises; that said property is first-class riceland, with a net yearly produce of 200 bultos of rice equivalent to P3,000; that the produce of said land for the crop year 1959-60 is about to be harvested; and that the appointment of a receiver is necessary, and the most convenient and peaceable means to preserve, administer, and dispose of the property in question and its 1959-60 harvest.
In answer, defendants aver that they are not claiming the land in question as owners but as lessees thereof for a period of five years, in accordance with a contract of lease signed by them with the administratrix of said property, Rosario Evangelista (plaintiff’s daughter), on March 30, 1959; that said land pertains to Group 1 of the project of partition in Special Proceedings No. 815 and for that reason, the court did not have jurisdiction to appoint a receiver over the same in this case; and that the allegations of the complaint do not warrant the appointment of a receiver.
The opposition to the motion for receivership notwithstanding, the lower court, on November 14, 1959, issued an order placing the property in litigation and its produce under receivership. This order reads:jgc:chanrobles.com.ph
"It appearing that the verified complaint and from Annexes ‘A’, ‘A-1’, ‘A-2’, and ‘B’ that the plaintiff-petitioner for the appointment of Receiver and an interest in the property described in the complaint as owner thereof, the same being a part of his share in the partition of the intestate estate of his father (Special Proceedings No. 815 of the Court of First Instance of Iloilo) and, therefore, entitled to the products of the said property; and it being alleged that the said products are in emminent danger of being lost or removed unless a Receiver is appointed to take charge of and preserve the same, GERUNDIO DIASNES, of Dumangas, Iloilo, is hereby appointed as RECEIVER of the property in litigation as well as the products thereof, and upon putting up a bond of SIX THOUSAND PESOS (P6,000.00), approved by this Court, the said RECEIVER may qualify and assume his duties as such."cralaw virtua1aw library
Defendants moved for the reconsideration of the above order, claiming that the lot in question is in custodia legis in Special Proceedings No. 815 and can not, therefore, be the subject of a receivership in this case; that while it is true that said lot had been assigned to plaintiff in the project of partition in said proceedings, the probate court, in approving said partition, withheld the order of distribution and the closing of the estate "pending the submission by the administration and the heirs of the written conformity of the creditors, namely, the RFC and the PNB to such distribution and eventual assumption by the heirs of the liabilities of the estate" ; and finally, that it does not appear from the complaint that plaintiff has such interest in the property in litigation and its produce, and that such property is in danger of being lost, removed, or materially injured, as to justify the appointment of a receiver. This motion having been denied, defendants filed the present petition for certiorari reiterating substantially their arguments in their motion for reconsideration in the court below, and urging that the order appointing a receiver was issued in grave abuse of discretion and in excess of jurisdiction by the court a quo. Upon petitioners’ filing of a bond in the amount of P2,000.00, we issued a writ of preliminary injunction to restrain the lower court from enforcing the order complained of.
We see no sufficient cause or reason in the instant case to justify placing the land in question in receivership. While it does appear from the pleadings in the court below that title or ownership over said land is with plaintiff by virtue of the order of partition in Special Proceedings No. 815 adjudicating said property to him, it likewise appears, however, that petitioners are in the material possession thereof, not under any claim of title or ownership, but pursuant to a lease contract signed with them by plaintiff’s daughter, Rosario Evangelista, the former administratrix or agent of plaintiff over said property. In fact, plaintiff admitted in his answer to the present petition that he did "let his daughter manage the property" (par. 1 of Affirmative and Special Defenses, Answer, p. 2). Until therefore, the lease agreement signed between Rosario Evangelista, as agent of plaintiff, and defendants is judicially declared void for want of authority of the agent to execute the same, defendants are entitled to continue in the possession of the premises in question, unless powerful reasons exist for the lower court to deprive them of such possession and appoint a receiver over said property. These powerful reasons are wanting in this case. Indeed, there is even no showing here that the property in question and its pending harvest are in danger of being lost, or that defendants are committing acts of waste thereon, or that defendants are insolvent and can not repair any damage they cause to plaintiff’s rights. In truth, the complaint alleges no interest on the part of plaintiff in the crops subjected to receivership.
Upon the other hand, defendants occupied and planted the land in question in good faith as lessees, and it is only just and equitable that they be allowed to continue in their possession and harvest the fruits of their labor (subject to their obligation to pay their lessor his due share in the harvest) until the respective rights of the parties in this case to the possession of the land in question are finally resolved and adjudicated. This Court has repeatedly ruled that where the effect of the appointment of a receiver is to take real estate out of the possession of the defendants before the final adjudication of the rights of the parties, the appointment should be made only in extreme cases and on a clear showing of necessity therefor in order to save the plaintiff from grave and irremediable loss or damage (Mendoza v. Arellano, 36 Phil. 59; De la Cruz v. Guinto, 79 Phil., 304; 45 Off. Gaz., [3] 1309; Calo and San Jose v. Roldan, 76 Phil., 455; Municipality of Camiling v. De Aquino, 103 Phil., 128; 54 Off. Gaz., [16] 4716; De los Reyes v. Bayona, 107 Phil., 449; 60 Off. Gaz., [36] 8659).
Moreover, the trial court seems to have overlooked that, as has often been held, "the power to appoint a receiver is a delicate one; that said power should be exercised with extreme caution and only when the circumstances so demand, either because there is emminent danger that the property sought to be placed in the hands of a receiver be lost or because they run the risk of being impaired, endeavoring to avoid that the injury thereby caused be greater than the one sought to be averted. For this reason, before the remedy is granted, the consequences or effects thereof should be considered or, at least, estimated in order to avoid causing irreparable injustice or injury to others who are entitled to as much consideration as those seeking it." (Velasco & Co. v. Gochico & Co., 23 Phil., 39; Claudio, Et. Al. v. Zandueta, 64 Phil., 812; Calo v. Roldan, 76 Phil., 454).
Wherefore, the orders of November 14, 1959 and December 10, 1959 are set aside, and the writ of preliminary injunction issued by this Court on February 3, 1960 is made permanent. Costs against respondent Daniel Evangelista.
Bengzon, Padilla, Bautista Angelo, Concepción, Barrera, Gutiérrez David, Paredes and Dizon, JJ., concur.
