MERVILLE PARK HOMEOWNERS ASSOCIATION, INC., PETITIONER, VS. HON. FRANCISCO X. VELEZ AND EDGARDO M. SALANDANAN, RESPONDENTS.

Merville Park Homeowners Association versus Velez

The Case

This is a petition for certiorari filed by the Merville Park Homeowners Association against Judge Francisco Velez and Edgardo Salandanan. The Association asks the Supreme Court to annul two orders of the trial court: one lifting the writ of preliminary mandatory injunction that had placed the Association in control of the subdivision's waterworks system, and another directing the sheriff to restore possession of that system to Salandanan. The case matters because it fixes the narrow grounds for a preliminary mandatory injunction, the writ that commands a party to do something or to surrender property while the main case is still pending, and it teaches that such a writ cannot be used to take disputed property from one party and hand it to another.

Procedural History

The Association sued Salandanan before the Regional Trial Court of Makati, seeking rescission of the amended lease contract and of the amended compromise agreement, and praying for a writ of preliminary mandatory injunction. Judge Ricardo Francisco granted the writ and ordered Salandanan to turn over the operation and control of the waterworks system to the Association. After Salandanan filed his answer with counterclaim and third-party complaint, the case was re-raffled to Judge Benigno Puno, who lifted the writ. The case was re-raffled again, this time to Judge Manuel Yuzon, who reinstated the writ upon the Association's motion and its filing of a surety bond. Before Salandanan's motion for reconsideration could be resolved, the case was re-raffled a third time, to Judge Francisco Velez. Judge Velez lifted and set aside the writ, and later ordered the deputy sheriff to return and restore possession of the waterworks system to Salandanan. The Association then came to the Supreme Court on a petition for certiorari. The Court issued a temporary restraining order, later gave due course to the petition, and required the parties to file memoranda.

Facts

The Association, a non-stock, non-profit corporation, became owner of the pipelines and waterworks system of Merville Park Subdivision in Parañaque by virtue of a deed of donation executed in its favor in February 1977. In December 1978, through its then president, it entered into a contract of lease with Salandanan covering the waterworks system, to insure efficient water service within the subdivision. The lease required Salandanan to construct additional wells, to put Wells Numbered Four and Five into full operational condition, and to rehabilitate Wells Numbered One, Two, and Three. It allowed him to increase water rates annually, but only to the extent of ten percent of the preceding year's rates, and the rates could be charged only upon completion of Well Number Five.

The lease was later amended to provide a period of ten years commencing from its signing in July 1981, and the parties agreed to a water rate increase that was approved by the National Water Resources Council. The amended contract also required each homeowner to pay a deposit of 300 pesos, to be used to pay Salandanan's overdue electric bill with Meralco and thereafter credited against future water bills. When Salandanan again asked for an increase, the Association at first resisted and even filed a case, but in 1982 the parties reached a compromise. The Association consented to the increase, conditioned on Salandanan's completion of Well Number Two, and the compromise was later amended to provide a new water rate schedule effective July 1984, similarly conditioned.

In July 1985, the Association commenced its action for rescission. It alleged that in 1984, for failure of Salandanan to pay electric bills amounting to 1,035,000 pesos, Meralco had cut off the power supply of his rented water pumps, causing a severe water shortage within the subdivision and endangering the lives and health of the residents. It also alleged that he had neglected to drill and complete new wells and to repair broken pumps, and that there was an immediate need for a writ of preliminary mandatory injunction so that it could take possession and control of the waterworks system.

Issues

• Whether or not a writ of preliminary mandatory injunction is a proper remedy to take property, the possession of which is disputed, out of the possession and control of one party and deliver it to the other.
• Whether or not respondent Judge Velez acted with grave abuse of discretion, or without or in excess of jurisdiction, in lifting the writ and in ordering Salandanan restored to possession of the waterworks system.

Applicable Provisions

The decision does not quote a statutory text; it states the governing rule on preliminary mandatory injunction, which bears directly on both issues:

A preliminary mandatory injunction is not a proper remedy to take property, possession of which is being disputed, out of the possession and control of one party and to deliver the same to the other party.

The Court also states the conditions under which such a writ may issue while the main case is pending:

It may issue pendente lite only in cases of extreme urgency, where the right to the possession, during the pendency of the main case, of the property involved is very clear; where considerations of relative inconvenience bear strongly in favor of the complainant seeking the possession pendente lite; where there was wilful and unlawful invasion of plaintiff's rights, over his protest and remonstrance, the injury being a continuing one; where the effect of the preliminary mandatory injunction is to re-establish and maintain a pre-existing and continuing relationship between the parties, recently and arbitrarily interrupted by the defendant, rather than to establish a new relationship during the pendency of the principal case.

These conditions define the burden the Association had to discharge, and its failure to meet them is the heart of the ruling.

Ruling

On the first issue, the Court held that a preliminary mandatory injunction is not a proper remedy to take disputed property from one party and deliver it to another. It may issue only in cases of extreme urgency, where the right to possession during the pendency of the main case is very clear, where relative inconvenience strongly favors the complainant, where there was a wilful and unlawful invasion of the plaintiff's rights over his protest, the injury being continuing, or where the writ would re-establish and maintain a pre-existing relationship recently and arbitrarily interrupted by the defendant. It is for the party requesting the writ to demonstrate clearly the presence of one or more of these grounds.

On the second issue, the Court found no grave abuse of discretion on the part of respondent Judge. Under the amended lease, Salandanan is entitled to possess and manage the waterworks system for ten years beginning March 1981, unless the contract is judicially rescinded, and the rescission case remained pending. The Association failed to show an extraordinary situation imposing irreparable injury. It alleged the 1984 power cutoff and water shortage, but made no showing that the condition remained subsisting three years later, when the assailed orders were rendered and when the petition was filed. There was no showing that the shortage had not been remedied, or that a clear and present danger of a similar default persisted. On the contrary, the Metropolitan Waterworks and Sewerage System had commenced servicing the subdivision before the assailed orders, reducing the probability of a recurrence. The Court concluded that the continued possession by Salandanan did not create a continuing, clear, and imminent danger that the subdivision would lack adequate potable water.

Because relations between the parties had been strained by their controversies and litigation, however, the Court required Salandanan to post a cash deposit or a surety bond of 100,000 pesos, conditioned on the continued and adequate supply of potable water and faithful compliance with his obligations, in addition to any performance bond required under existing contracts. The trial court was also recognized to have full authority to issue further orders to protect the residents from disruption of water service during the pendency of the rescission case.

Doctrine

A preliminary mandatory injunction is not a proper remedy to take property, the possession of which is disputed, out of the possession and control of one party and deliver it to the other. It may issue pendente lite only in cases of extreme urgency, where the right to possession during the pendency of the main case is very clear, where relative inconvenience strongly favors the complainant, where there was a wilful and unlawful invasion of the plaintiff's rights over his protest, the injury being continuing, or where the writ would re-establish and maintain a pre-existing relationship recently and arbitrarily interrupted by the defendant. The burden is on the party requesting the writ to demonstrate clearly the presence of one or more of these grounds. A party who invokes the writ must show that the danger it seeks to avert is continuing, clear, and imminent at the time the writ is sought, not merely that it existed years before.

Disposition

The petition for certiorari was dismissed for lack of merit, and Salandanan was required to post a cash deposit or a surety bond of 100,000 pesos within a non-extendible period of ten days from notice, to indemnify the members of the Association for any damages or inconvenience from his failure to provide a continuous and adequate supply of potable water and to comply faithfully with his obligations.

Remember This

The line worth memorizing is that a preliminary mandatory injunction cannot be used to take disputed property from one party and deliver it to another; it issues only in extreme urgency, upon a very clear right to possession. Examiners like to use this case on provisional remedies, particularly on when a preliminary mandatory injunction may issue and on the burden of showing a continuing, clear, and imminent danger.