LAURO P. LEVISTE, PETITIONER VS. EUSEBIO F. RAMOS, JUDGE OF THE EIGHT JUDICIAL DISTRICT, IN HIS CAPACITY AS PRESIDING JUDGE OF THE COURT OF FIRST INSTANCE OF ORIENTAL MINDORO, T…

Leviste versus Ramos

The Case

This is Leviste versus Ramos, a special civil action for certiorari and mandamus decided by the Supreme Court in November 1960. Lauro Leviste sued the occupants of a large parcel of land in Naujan, Oriental Mindoro, to recover possession and to be declared owner of the crops, plants, trees, and buildings they had put there. Within that suit he asked the trial court to place the property in the hands of a receiver. The trial court refused, and he came to the Supreme Court to compel it. The case matters because it fixes the standard for the provisional remedy of receivership: it is a matter of sound judicial discretion, exercised sparingly, and never used to disturb a possession that the court has yet to adjudicate.

Procedural History

Leviste filed a verified complaint in the Court of First Instance of Oriental Mindoro, praying among other things for the appointment of a receiver over the crops, plants, and improvements on the land. The respondents answered with a counterclaim. The trial court, through Judge Eusebio Ramos, denied the motion for appointment of a receiver, and later denied the motion for reconsideration. Leviste then filed a petition in the Supreme Court under Rule 67 for writs of certiorari and mandamus, asking that the order be annulled and that the trial court be compelled to appoint a receiver. The Supreme Court treated the petition as an original action and decided it directly.

Facts

Leviste held original certificate of title over a parcel of land in barrio Ina-rawan, Naujan, Oriental Mindoro, containing about 132 hectares, issued in his name upon a patent. He alleged that sometime in 1955 the respondents entered the land without his authority and against the objection of his overseer, and cultivated it. In his complaint he sought to recover possession, to be declared owner of the crops, plants, trees, and buildings the respondents had sown or erected in bad faith, and to collect actual damages for unharvested crops, moral damages, and litigation expenses.

The respondents answered that since 1951 they had been in actual possession and occupation of the land, when it was still virgin forest, and that believing it to be of the public domain they made clearings for cultivation without molestation from anyone. They set up a counterclaim for moral damages, attorney's fees, and litigation expenses.

Leviste moved for the appointment of a receiver over the crops, plants, and improvements. The trial court denied the motion, and denied reconsideration. Hence the petition in the Supreme Court.

Issues

• Whether or not the trial court gravely abused its discretion in denying the petition for appointment of a receiver.
• Whether or not mandamus lies to compel the trial court to appoint a receiver over the property in litigation.

Applicable Provisions

Section 1 of Rule 61, paragraphs (b) and (e), on when a receiver may be appointed, provides:

When it appears from the complaint or answer, and such other proof as the judge may require, that the party applying for the appointment of receiver has an interest in the property or fund which is the subject of the action, and that such property or fund is in danger of being lost, removed, or materially injured unless a receiver be appointed to guard and preserve it.

This is the ground Leviste invoked, and it requires both an interest in the property and a showing of danger to it.

The same Section 1 further provides:

Whenever in other cases it appears that the appointment of a receiver is the most convenient and feasible means of preserving, administering, or disposing of the property in litigation.

This catch-all ground confirms that receivership is an extraordinary remedy of preservation, not of possession.

Ruling

On the first issue, the Court held that the appointment of a receiver largely lies in the discretion of the court to which application is made, and should be made only when there is no other means by which the rights of the petitioner could be protected. Just as a writ of preliminary injunction should not issue to put a party in possession of the property in litigation and deprive another who is in possession, except in a very clear case of evident usurpation, so also a receiver should not be appointed to deprive a party who is in possession of the property in litigation. The Court noted that in an action for ejectment where there is no claim on the crops, a receiver cannot be appointed to take charge of the crops; conversely, where the fruits of the land are claimed, a receiver thereof may be appointed, but such power should be sparingly used.

Applying these rules, the Court found it difficult to conceive how the trial court could be held to have gravely abused its discretion. The good faith or bad faith of the respondents was yet to be determined. Until the case was fully decided, the status of the parties in relation to the crops, plants, trees, and buildings should not be disturbed.

On the second issue, since there was no grave abuse of discretion, there was no basis for certiorari, and no ministerial duty whose performance mandamus could compel. The writs prayed for were denied.

Doctrine

A Bar candidate should retain these rules. First, the appointment of a receiver is addressed to the sound discretion of the court, and should be made only when there is no other means by which the rights of the applicant can be protected. Second, a receiver should not be appointed to deprive a party who is in possession of the property in litigation, just as a preliminary injunction should not be used to put a party in possession except in a very clear case of evident usurpation. Third, where the fruits of the land are claimed, a receiver thereof may be appointed, but the power should be sparingly used. Fourth, where the good faith or bad faith of the possessor is yet to be determined, the status of the parties as to the crops and improvements should not be disturbed until the case is decided. These rules tie directly to Section 1 of Rule 61, which requires an interest in the property and a danger of loss, removal, or material injury before a receiver may be appointed.

Disposition

The Supreme Court denied the writs prayed for, with costs against Leviste, leaving the trial court's denial of the receivership undisturbed.

Remember This

A receiver is appointed to preserve, not to seize possession; the remedy lies in the sound discretion of the court and is used sparingly. Examiners use this case to test the limits of receivership and preliminary injunction against a party in possession whose good faith is still in issue.