PORFIRIO DIAZ AND JUANITO ELECHICON, PETITIONERS VS. HON. EMIGDIO NIETES AND DANIEL EVANGELISTA, RESPONDENTS.

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;

“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.”

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 laijd 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 fsuits 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 vs. Arellano, 36 Phil.
59; De la Cruz vs. Guinto, 79 Phil., 304; 45 Off. Gaz., [3] 1309; Calo
and San Jose vs. Roldan, 76 Phil., 455; Municipality of Camiling
vs. De Aquino, 103 Phil., 128; 54 Off. Gaz., [16] 4716; De los Reyes
vs. 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 emmment 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 L to others who are
entitled to as much consideration as those seeking it”. (Velasco & Co.
vs. Gochico & Co., 23 Phil., 39; Claudio, et al. vs.
Zandueta, 64 Phil., 812; Calo vs. 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, Concepcion, Barrera, Gutierrez David,
Paredes, and Dizon, JJ., concur.

Writ granted.