1. MILACABOVERDETANTANO v. DOMINALDA ESPINACABOVERDE, GR No.

203585,
2013-07-29
Facts:
Petitioners Mila Caboverde Tantano (Mila) and Roseller Caboverde (Roseller) are children
of respondent Dorninalda Espina-Caboverde (Dominalda) and siblings of other respondents
in this case, namely: Eve Caboverde-Yu (Eve), Fe Caboverde-Labrador (Fe), and
Josephine E. Caboverde
(Josephine).
Petitioners and their siblings, Ferdinand, Jeanny and Laluna, are the registered owners and
in possession of certain parcels of land... identified as Lots 2, 3 and 4... having purchased
them from their... parents, Maximo and Dominalda Caboverde.
The present controversy started when on March 7, 2005, respondents Eve and Fe filed a
complaint before the RTC... where they prayed for the annulment of the Deed of Sale
purportedly transferring Lots 2, 3 and 4 from their parents Maximo and
Dominalda in favor of petitioners Mila and Roseller and their other siblings, Jeanny, Laluna
and Ferdinand.
During the pendency of Civil Case
Maximo died.
On May 30, 2007, Eve and Fe filed an Amended Complaint with Maximo substituted by his
eight (8) children and his wife Dominalda.
The Amended Complaint... added... eight (8) more real properties of the Caboverde estate
in the original list.
As encouraged by the RTC, the parties executed a Partial Settlement Agreement (PSA)
where they fixed the sharing of the uncontroverted properties among themselves... the
adverted additional eight (8) parcels of land including their respective products and...
improvements.
The parties submitted the PSA to the court on or about March 10, 2008 for approval.[2]
Before the RTC could act on the PSA, Dominalda, who, despite being impleaded in the
case as defendant, filed a Motion to Intervene separately in the case. Mainly, she claimed
that the verified Answer which she filed with her co-defendants contained several material
averments... which were not representative of the true events and facts of the case. This
document, she added, was never explained to her or even read to her when it was
presented to her for her signature.
On May 12, 2008, Dominalda filed a Motion for Leave to Admit Amended Answer, attaching
her Amended Answer where she contradicted the contents of the aforesaid verified Answer
by declaring that there never was a sale of the three (3) contested parcels of land in favor of
Ferdinand, Mila, Laluna, Jeanny and Roseller and that she and her husband never received
any consideration from them. She made it clear that they intended to divide all their
properties equally among all their children without favor. In sum, Dominalda prayed that the
reliefs... asked for in the Amended Complaint be granted with the modification that her
conjugal share and share as intestate heir of Maximo over the contested properties be
recognized.
The RTC would later issue a Resolution granting the Motion to Admit Amended Answer.
On May 13, 2008, the court approved the PSA, leaving three (3) contested properties, Lots
2, 3, and 4, for further proceedings in the main case.
Fearing that the contested properties would be squandered, Dominalda filed with the
RTC on July 15, 2008 a Verified Urgent Petition/Application to place the controverted
Lots 2, 3 and 4 under receivership. Mainly, she claimed that while she had a legal interest
in the... controverted properties and their produce, she could not enjoy them, since the
income derived was solely appropriated by petitioner Mila in connivance with her selected
kin. She alleged that she immediately needs her legal share in the income of these
properties for her daily... sustenance and medical expenses.
On August 27, 2009, the court heard the Application for Receivership and persuaded the
parties to discuss among themselves and agree on how to address the immediate needs of
their mother.
On October 9, 2009, petitioners and their siblings filed a Manifestation formally expressing
their concurrence to the proposal for receivership on the condition, inter alia, that Mila be
appointed the receiver, and that, after getting the 2/10 share of Dominalda from the...
income of the three (3) parcels of land, the remainder shall be divided only by and among
Mila, Roseller, Ferdinand, Laluna and Jeanny. The court, however, expressed its aversion
to a party to the action acting as receiver and accordingly asked the parties to nominate
neutral... persons.
On February 8, 2010, the trial court issued a Resolution granting Dominalda's application
for receivership over Lot Nos. 2, 3 and 4.
Petitioners thereafter moved for reconsideration raising the arguments that the concerns
raised by Dominalda in her Application for Receivership are not grounds for placing the
properties in the hands of a receiver and that she failed to prove her claim that the income
she has... been receiving is insufficient to support her medication and medical needs. By
Resolution[11] of July 19, 2010, the trial court denied the motion for reconsideration
Undaunted, petitioners filed an Urgent Precautionary Motion to Stay Assumption of
Receivers dated August 9, 2010
The RTC... denied it via a Resolution dated October 7, 2011
It should be stated at this juncture that after filing their Urgent Precautionary Motion to Stay
Assumption of Receivers but before the RTC could rule on it, petitioners filed a petition for
certiorari with the CA dated September 29, 2010 seeking to declare null and void the
February 8, 2010 Resolution of the RTC granting the Application for Receivership and its
July 19, 2010 Resolution denying the motion for reconsideration filed by petitioners and
appointing the receivers nominated by respondents. The petition was anchored on two
grounds, namely:
(1) non-compliance with the substantial requirements under Section 2, Rule 59 of the 1997
Rules of Civil Procedure because the trial court appointed a receiver without requiring the
applicant to file a bond; and (2) lack of factual or legal basis to place the properties under...
receivership because the applicant presented support and medication as grounds in her
application which are not valid grounds for receivership under the rules.
On June 25, 2012, the CA rendered the assailed Decision denying the petition
Issues:
(1)  Whether or not the CA committed grave abuse of discretion in sustaining the
appointment of a receiver despite clear showing that the reasons advanced by the applicant
are not any of those enumerated by the rules; and
(2) Whether or not the CA committed grave abuse of discretion in upholding the Resolution
of the RTC and ruling that the receivership bond is not required prior to appointment despite
clear dictates of the rules.
Ruling:
The petition is impressed with merit.
Sec. 1(d), Rule 59 of the Rules of Court... states:
Section 1. Appointment of a receiver. Upon a verified application, one or more receivers of
the property subject of the action or proceeding may be appointed by the court where the
action is pending, or by the Court of Appeals or by the Supreme Court, or a member...
thereof, in the following cases:
(d) 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.
Indeed, Sec. 1(d) above is couched in general terms and broad in scope, encompassing
instances not covered by the other grounds enumerated under the said section.[16]
However, in granting applications for receivership on the basis of this section, courts... must
remain mindful of the basic principle that receivership may be granted only when the
circumstances so demand, either because the property sought to be placed in the
hands of a receiver is in danger of being lost or because they run the risk of being
impaired,[17] and that being a drastic and harsh remedy, receivership must be
granted only when there is a clear showing of necessity for it in order to save the
plaintiff from grave and immediate loss or damage.
Before appointing a receiver, courts should consider: (1) whether or not the injury resulting
from such appointment would probably be greater than the injury ensuing if the status quo is
left undisturbed; and (2) whether or not the appointment will imperil the interest of others...
whose rights deserve as much a consideration from the court as those of the person
requesting for receivership.[19]
Moreover, this Court has consistently ruled that where the effect of the appointment of a
receiver is to take real estate out of the possession of the defendant before the final
adjudication of the rights of the parties, the appointment should be made only in extreme...
cases.
We find that the grant of Dominalda's Application for Receivership has no leg to stand on for
reasons discussed below.
First, Dominalda's alleged need for income to defray her medical expenses and
support is not a valid justification for the appointment of a receiver. The approval of an
application for receivership merely on this ground is not only unwarranted but also an
arbitrary... exercise of discretion because financial need and like reasons are not found in
Sec. 1 of Rule 59 which prescribes specific grounds or reasons for granting receivership.
The RTC's insistence that the approval of the receivership is justified under Sec. 1(d) of
Rule 59, which... seems to be a catch-all provision, is far from convincing. To be clear, even
in cases falling under such provision, it is essential that there is a clear showing that there is
imminent danger that the properties sought to be placed under receivership will be lost,
wasted or... injured.
Second, there is no clear showing that the disputed properties are in danger of being
lost or materially impaired and that placing them under receivership is most convenient
and feasible means to preserve, administer or dispose of them.
Based on the allegations in her application, it appears that Dominalda sought receivership
mainly because she considers this the best remedy to ensure that she would receive her
share in the income of the disputed properties. Much emphasis has been placed on the fact
that she... needed this income for her medical expenses and daily sustenance. But it can be
gleaned from her application that, aside from her bare assertion that petitioner Mila solely
appropriated the fruits and rentals earned from the disputed properties in connivance with
some of her... siblings, Dominalda has not presented or alleged anything else to prove
that the disputed properties were in danger of being wasted or materially injured and
that the appointment of a receiver was the most convenient and feasible means to
preserve their integrity.
Third, placing the disputed properties under receivership is not necessary to save
Dominalda from grave and immediate loss or irremediable damage. Contrary to her
assertions, Dominalda is assured of receiving income under the PSA approved by the RTC
providing that she was... entitled to receive a share of one-half (1/2) of the net income
derived from the uncontroverted properties.
Finally, it must be noted that the defendants in Civil Case No. S-760 are the registered
owners of the disputed properties that were in their possession. In cases such as this, it is
settled jurisprudence that the appointment should be made only in extreme cases and on
a... clear showing of necessity in order to save the plaintiff from grave and irremediable loss
or damage.[22]
This Court has held that a receiver should not be appointed to deprive a party who is in
possession of the property in litigation, just as a writ of preliminary injunction should not be
issued to transfer property in litigation from the possession of one party to another where...
the legal title is in dispute and the party having possession asserts ownership in himself,
except in a very clear case of evident usurpation.
Furthermore, this Court has declared that the appointment of a receiver is not proper when
the rights of the parties, one of whom is in possession of the property, depend on the
determination of their respective claims to the title of such property[24]... unless such
property is in danger of being materially injured or lost, as by the prospective foreclosure of
a mortgage on it or its portions are being occupied by third persons claiming adverse title.
As regards the issue of whether or not the CA was correct in ruling that a bond was not
required prior to the appointment of the receivers in this case, We rule in the negative.
Sec. 2 of Rule 59 is very clear in that before issuing the order appointing a receiver the
court shall require the applicant to file a bond executed to the party against whom the
application is presented. The use of the word "shall"... denotes its mandatory nature; thus,
the consent of the other party, or as in this case, the consent of petitioners, is of no
moment. Hence, the filing of an applicant's bond is required at all times. On the other
hand, the requirement of a receiver's bond rests upon the... discretion of the court. Sec. 2 of
Rule 59 clearly states that the court may, in its discretion, at any time after the appointment,
require an additional bond as further security for such damages.

2. Republic of the Philippines

SUPREME COURT
Manila

EN BANC

G.R. No. L-43482             July 28, 1937

SERAFIN SANSON, plaintiff-appellant,
vs.
ISABEL ARANETA, ALFREDO SANSON, and EVA SANSON, defendants-appellees.

William E. Greenbaum for appellant.

Ganzon and Orozo and Araneta, Zaragoza and Araneta for appellees.

DIAZ, J.:

The plaintiff brought this action on August 23, 1932, for the rescission of the agreement of partition entered into by
him and the defendant on June 10, 1927, to terminate the testamentary proceedings of the deceased Roque Sanson,
civil case No. 1055 of the Court of first Instance of Iloilo.

The plaintiff and the defendant Alfredo Sanson and Eva Sanson, the latter married to Antonio Yusay, are brother and
sister, all of them being children of the deceased Roque Sanson and the defendant Isabel Araneta.

After due hearing, the court decided the case in favor of the plaintiff, ordering, as a consequence thereof, the
rescission of the agreement of portion in question by reason of lesion exceeding the fourth part suffered by him. This
decision was later affirmed by this court to which the case had been brought, on appeal taken therefrom by the
defendant (G. R. No. 39697).1

In the decision, the defendant Isabel Araneta was ordered among other things, to file within thirty days a complete
inventory of all the real and personal properties, furniture, jewelry, credits and actions left by the deceased Roque
Sanson, together with the respective value thereof and to present within said period a project of partition of said
properties among the heirs. Inasmuch as the defendant had failed to present the inventory of property and the project
of partition required of her, the ones presented by her on December 3, 1934, not having been satisfactory to the
plaintiff, the latter, on January 3, 1935, asked for the appointment of a receiver to take charge of the custody
and administration of the properties in question, which was granted by the court on the 21st of said months and
year. Sabas Gustilo, the plaintiff's father-in-law was appointed. After the receiver had entered upon the performance
of his duties, he encountered many difficulties in discharging them due to the defendants' refusal to turn over
to him the properties which formed part of the estate left by the deceased Roque Sanson. On February 12,
1935, the court, upon motion of the plaintiff, ordered the defendants to turn over the properties in question to the
receiver within the period of four days. Inasmuch as the defendants did not comply with this order, the defendant
Isabel Araneta having confined herself to presenting, on the 14th of said month and year, an amended but incomplete
inventory of the properties left by the deceased Roque Sanson, the receiver, Sabas Gustilo, on February 18, 1935,
petitioned that they be required to appear before the court to show cause, if any, why they should not be punished for
contempt of court, for disobedience of an order thereof. Before his petition could be acted upon, the receiver filed
another on February 27, 1935, praying the court this time to expressly order the appearance of the defendant Alfredo
Sanson to show cause, if any, why he should not be declared guilty of contempt of court, for having ordered his
tenants and farms not to turn over to him the fruits of the lands in their possession. The court, acting upon the
receiver's last petition, ordered the defendant Alfredo Sanson to appear before it on March 4, 1935, to be heard in
connection therewith. However, before the day set for said defendant's appearance arrived that is on February 28,
1935, the court issued another order appointing the provincial sheriff of Iloilo as judicial receiver in
substitution of Sabas Gustilo in view of the difficulties which the latter was encountering in the discharge of
his duties as such receiver. Sabas Gustilo asked for the reconsideration of this last order but the court, instead of
directly deciding his motion, one way or another issued the order of March 15, 1935, (a) denying said motion for
reconsideration; (b) considering the incident relative to the appointment of a receiver as terminated; (c)
approving the amended inventory filed by the defendant Isabel Araneta on February 14, 1935, and (d) ordering the
parties to submit on April 1, 1935, the names of persons qualified for appointment as commissioners to proceed with
the partition of the properties stated in the inventory. The plaintiff appealed from both this last order and that of
February 28, 1935, appointing the provincial sheriff of Iloilo as judicial receiver in lieu of Sabas Gustilo, attributing to
the lower court the seven alleged errors assigned by him in his brief.

The plaintiff contends by means of the first two errors assigned by him, that the lower court erred in appointing the
provincial sheriff of Iloilo as judicial receiver in lieu of Sabas Gustilo, and in setting aside without any hearing the
appointment of said Sabas Gustilo.

By means of the 3d, 4th, 5th and 6th assignment of error, the plaintiff contends that the lower court erred (1) In
approving the amended inventory presented by the defendant Isabel Araneta on February 14, 1935, without taking
into account: (a) that property exclusively belonging to the deceased Roque Sanson has been stated therein as
conjugal partnership property of said deceased and the defendant; (b) that several parcels of land subject to partition,
being conjugal partnership property of said spouses, have been omitted therefrom; (c) that the jewelry referred to in
Exhibit M and N has likewise been omitted therefrom; and (d) that the inventory in question fails to state not only the
proceeds of the sale of lands belonging to the conjugal partnership of the deceased and the defendant Isabel
Araneta, which were sold by the latter and her codefendants, but also the fruits of the lands actually in the possession
of the three; (2) in failing to order the defendant Isabel Araneta to again amend the inventory presented by her on
February 14, 1935, for the purpose of including therein all other properties of the deceased Roque Sanson, subject to
partition; and (3) in failing to order the defendants to bring to collation a part of the properties turned over to them as
inheritance.

By means of the 7th error, the plaintiff contends that the court erred in failing to order the sale at public auction of all
the properties left by the deceased Roque Sanson to facilitate the partition thereof among the heirs, notwithstanding
the fact that it had been so agreed upon by all the interested parties.

The first two errors attributed to the court are unfounded Under sections 173 and 174 of the Code of Civil Procedure,
the appointment of a receiver lies within the sound discretion of the court, it not being a matter of strict right
to ask for and obtain it, nor an imperative duty to grant it when it is sought (Sanson vs. Barrios, 63 Phil, 198).
It follows from the foregoing that the judge who has made the appointment may very well set aside, as was done by
the respondent judge, when in his opinion it is not justified by the facts and circumstances of the case. The
respondent judge, in acting as he did, was undoubtedly guided by the consideration that the properties sought to be
placed in the hands of a receiver were already in the possession of the defendants and the plaintiff himself; that it
would be of no benefit to them to place the properties, in the hands of a receiver inasmuch as in case of lesion, there
is the remedy of collation provided for by the Civil Code; that the greater part of said properties consists in real estate
which cannot be easily lost; and that the parties could very well protect their respective rights by merely recording in
the registry of deed of notice of lis pendens, in accordance with the provisions of section 401 of the Code of Civil
Procedure.
As to the 3d, 4th, 5th and 6th errors. The record shows that the respondent judge really erred in approving the
amended inventory presented by the defendant Isabel Araneta on February 14, 1935, because he failed to take into
consideration: (1) That said defendant stated therein that the land appearing in the record as lot No. 1525 is conjugal
property belonging to her and the deceased Roque Sanson, when it is very clear, according to Exhibit F. No. 1, that it
exclusively belongs to the deceased Roque Sanson, so much so that it is stated in the original certificate of title No,
2538, covering it, that it belongs to Roque Sanson, married to Isabel Araneta: (2) that lots Nos. 3, 4, 5, 6, 7, 13, 14,
21, 25, 26, 30, 32, 36 and 38 of plan II-12490, more particularly described in original certificate of title No. 28970
issued in the name of Isabel Araneta and her children Alfredo Sanson, Serafin Sanson and Eva Sanson, who are the
same parties litigant, have not been stated in said inventory; since, although it is alleged in Exhibit F, page 10, that
said original certificate of title was later cancelled and substituted by transfer certificate of title No. 8044 issued in the
name of Isabel Araneta and Eva Sanson, by order of the court it does not mean that the plaintiff and the defendant
Alfredo Sanson have lost their right to participate in said properties, it being admitted by the litigants that they
constitute part of the conjugal partnership property of the defendant Isabel Araneta and of the deceased Roque
Sanson. Furthermore, the alleged transfer of the lots in question made by the defendant Isabel Araneta in favor of
Eugenio Badilla, is neither evidenced by any document nor authorized by the court, and it appears from Exhibit F that
a notice of lis pendens affecting them was recorded in the registry of deed from the beginning; (3) that lots Nos. 22,
23 and 27 described in original certificate of title No. 28970 and in transfer certificate of title No. 8044 have been
stated in the inventory as properties subject to partition, when it appears from Exhibit E that they had been sold for
the sum of P30,000 to Delfin Mahinay on December 16, 1933, and it does not conclusively appear that such sale has
been rescinded for failure of Mahinay to pay the stipulated price. Said price, which must be in the possession of the
defendant Isabel Araneta, must at least be stated in the inventory to be distributed among the litigants; (4) that lot No.
461, described in transfer certificate of title No. 8157, has been stated in the inventory as sold to Herminio Maravilla
for the sum of P12,000 and therefore not subject to partition, when such transfer was declared fictitious and null and
void by the lower court in a judgment rendered in this same case on March 3, 1933, and in a judgment rendered by
this court in case G. R. No. 39697. Said land should be included in the inventory: (5)that the lands referred to in tax
declarations Nos. 3849, 3850 and 3851 (Exhibits A, B and C), have not been stated in the inventory, since the only
mention made of them therein is that they are in the possession of Alfredo Sanson, having been allotted to him in the
partition, but this is no reason for not including them because, as the agreement of partition by virtue of which Alfredo
Sanson took possession said properties was rescinded, they should necessarily be included in the inventory so that
they may be taken into account when the partition is carried out; (6) that neither have the lands referred to in tax
declarations Nos. 3434, 3740 and 3743 been stated in the inventory, the only mention made therein of the land
referred to in the first declaration being that it was stated in the original inventory presented on December 3, 1934,
which cannot now be taken into consideration because it was substituted by the amended one of February 14, 1935;
(7) that the sum of P3,000 representing the selling price of the two parcel of land described in Exhibit U, has not been
stated in the inventory as assets subject to partition; (8) that neither have the 17 parcel of land situated in the
municipality of Banate of the provincial of Iloilo, valued at P9,000, which constitute part of the conjugal partnership
property of the deceased Roque Sanson and the defendant Isabel Araneta, been stated in the inventory, the only
mention made thereof in said inventory being that they were sold by the defendant Isabel Araneta to one Victoriano
Arroyo for the sum of P4,500 on May 21, 1924; and while it is true that said sale was made, it has not been
authorized by the court and is therefore null and void; (9) that neither has proceeds of the sale of several parcels of
land sold by the defendant Isabel Araneta to Evaristo Cuenca, amounting to P6.000 been stated in the inventory,
which amount should be included in the inventory because it forms part of the asset subject to portion; (10) that
neither have the various sums amounting to P12,500 admitted by the defendant Isabel Araneta to have been
collected by her from Domingo Arcosa as rents of certain lands belonging to the deceased Roque Sanson (t. s. n.
pages 341, 342), been stated in the inventory; and (11) that neither have the income and fruits of the lands which are
in the possession of the parties litigant by virtue of the rescinded agreement of partition, been stated in the inventory.
At least the products and fruits of said properties, received by each of the parties from the time they were notified of
the judgment rescinding their agreement of portion, should be stated in the inventory for purposes of the collation
which will be made in due time, it being clear that those derived prior thereto should not be included therein, because
fruits received by possessors in good faith become their own until their good faith ceases (article 451, in connection
with article 433 of the Civil Code), and the parties were, theretofore possessors in good faith.

The plaintiff contends that the jewelry referred to in Exhibit M, N, O, P, and R should have been and should even now
also be included in the inventory. This court has reviewed the evidence relative to this question and is of the opinion
that the explanations given by the defendant Isabel Araneta are entirely satisfactory. Between the plaintiff's averment
and that of said defendant, this court chooses to believe the latter's because her explanation are convincing. Many of
the jewels in question, as those indicated by Nos. 1, 4, 9, 10, 14, 15, 16, 17 and 18 in Exhibit, 21, 22, 23, 25, 26, 28,
30, 31, 32, 34, 36 and 38 in Exhibit N, the necklace and the rings described in Exhibit O, the crown, the necklace and
the bracelets described in Exhibit P, and the jewels described in Exhibit R, do not belong to her. Others as, those
indicated by Nos. 3, 7, 11, 12, 13 and 19 in Exhibit M, 20 27 and 37 in Exhibit N, the bracelet described in Exhibit O,
and the bird-shaped necklace, the bracelet without diamonds and the bracelet with a diamond cluster described in
Exhibit P, exclusively belong to her. The rest, some of which have already been distributed among the heirs,
belonging to her conjugal partnership (Nos. 2, 5, 6 and 8 of Exhibit M, 24, 29, 33 and 35 of Exhibit N, and the three
solitaire rings and the ring with a diamond cluster described in Exhibit P).

With respect to the last error attributed to the lower courts it should be said that, taking into consideration the
circumstance to be stated hereinafter, the agreement entered into by the parties, allegedly approved by said court on
February 25, 1935, to sell all the properties left by the deceased Roque Sanson at public auction for the purpose of
distributing the proceeds thereof among themselves, is not of the nature of a compromise having a binding force
under the provisions of the Civil Code (article 1809 et seq. of the Civil Code). The lower court, in issuing the appealed
order of March 15, 1935, failed to order the sale of said properties, as agreed upon by the parties, for the purpose of
facilitating the distribution thereof, which proves that the court revoked the approval thereof given by it on February
25th of said year. On the other hand, the partition of the properties left by the deceased Roque Sanson may be made
without necessity of selling them at public auction; and to so sell them would be to openly disregard the orders of the
deceased contained in his probated will.

In view of all the foregoing, the order appealed from is modified by affirming it in so far as it appointments of the
receivers Sabas Gustilo and the provincial sheriff of Iloilo, and reversing it in so far as it approves the amended
inventory of February 14, 1935, presented by the defendant Isabel Araneta; and said defendant is ordered to present,
within the period of thirty days, a new inventory of all the properties left by the deceased, whether or not they be in
her possession or in that of the other litigants, stating therein the respondent values thereof and their income and
fruits from the time each and every one of said litigants, including the defendant herself, was notified of the judgment
rescinding said agreement of partition. Said properties are those stated in the aforesaid amended inventory of
February 14, 1935, which were not the subject matter of an opposition upheld by the court, plus those omitted
therefrom which are no other than the ones expressly enumerated in this decision. It is ordered, furthermore that as
soon as the required inventory is presented, and unless said defendant and the other litigants present a project of
partition satisfactory to everybody, the lower court should proceed with the appointment of partition commissioners, in
accordance with the provisions relative thereto contained in Act No. 190; and when said partition takes place, the
necessary collations and compensations should be made in order that it may be the most equitable and just possible,
in conformity with the provisions of the will of the deceased Roque Sanson. Let the costs be taxed against the
appellees. So ordered.

Villa-Real, Abad Santos, Imperial, Laurel and Concepcion, JJ., concur.

RESOLUTION

September 8, 1937

DIAZ, J.:

The defendants and appellees have filed in two separate pleadings a motion for reconsideration of the decision
rendered in this case, alleging: (1) That there is no evidence of record to the effect that Delfin Mahinay has paid to the
defendant and appellee Isabel Araneta the sum of P30,000 for parcels 22, 23 and 27 described in original certificate
of title No. 28970 and in transfer certificate of title No. 8044; (2) that neither is there evidence in support of the court's
conclusion that the parcels of land described in tax declarations Nos. 3849, 3850, 3851, 3740 and 3743 were not
included in the amended inventory presented by the defendant-appellee Isabel Araneta; (3) that neither is there
evidence in support of the court's finding that Isabel Araneta did not sell the 17 parcels of land situated in the
municipality of Banate, Province of Iloilo, to Victorians Arroyo, for the sum of P4,500, and that at all events, what
should be done is to order the inclusion of the P4,500 in the inventory to form part of the assets subject to partition;
(4) that while the new partition ordered by the court not carried out the heirs are entitled to continue in the possession
of the lands turned over to them and, consequently to receive the fruits thereof, invoking therefor the provision of
article 1077 of the Civil Code; and (5) that the court should order the deduction of the sum of P19,463, advanced by
the defendant and appellee Isabel Araneta while she was administratrix of the testate estate of the deceased Roque
Sanson, from the various sums which ought to be included in the inventory to be prepared by virtue of the decision
rendered in the case.

1. The first allegation of the defendants is contradicted by Exhibit E, which is a certified copy of a notarial
certificate the validity of which has never been questioned. Said document shows that on December 16,
1933, the defendants and appellees Isabel Araneta and Eva Sanson, and the latter's husband named
Antonio Yusay, sold parcel 22, 23 and 27 described in plan II-12490 and in transfer certificate of title No.
8044, to Delfin Mahinay for the sum of P30,000 which they admitted to have received as follows: P21,112.40
 upon the execution of said document, and the assumption by said Delfin Mahinay of the obligation to pay to
the Philippine National Bank a certain loan in the sum of P8,887.60, for which said properties were
mortgaged. Consequently, the contention that this court should not have declared that the price thereof had
been paid because, according to Isabel Araneta's testimony, she received only about P4,000 from Mahinay
(t. s. n., page 303), is unfounded. Isabel Araneta as one of the makers of the notarial deed of transfer could
not and cannot impugn it except under the circumstances prescribed in section 285 of Act No. 190, which
are certainly not those which were present herein (Weidman vs. Macasero, G. R. No. 24505, December 28,
1925, not reported). The fact that, subsequent to the promulgation of the decision of this court, Alfredo
Sanson agreed with the purchaser Mahinay to rescind the contract of sale Exhibit E, according to Annex I of
the motion for reconsideration, cannot alter said decision, much less set aside said contract. Neither can
Annex I nor the document and promissory notes attached to said motion for reconsideration as Annex B, C,
D, E, F, G and H be taken into consideration, because neither are they new evidence which may be
admitted with the formalities required by law, nor have they been previously admitted as such, nor is the first
one (Annex 1) subscribed by all the parties who executed the deed of sale sought to be affected thereby,
that is Exhibit E. They apparently have all the earmarks of having been intentionally prepared solely to
support the motion for reconsideration. It was well settled in the decision that the sum of P30,000, and not
parcels 22, 23 and 27, should have been and should be stated in the inventory to be subject to partition.

2. As to the second proposition of the defendant and appellees, it should be stated that, with the exception
of their allegations contained on pages 20 and 21 of their brief to the effect that the lands described in tax
declarations Nos. 3434, 3740 and 3743 have been consolidated to form the parcel described in tax
declaration No. 3844, there is nothing of record to prove such fact. What the evidence clearly shows is that
said lands and those described in tax declarations Nos. 3849, 3850 and 3851 belonged to the conjugal
partnership of the deceased Roque Sanson and Isabel Araneta. Such being the fact, there is no doubt that
they should be included in the new inventory to be presented in accordance with the decision, inasmuch as
the contract by virtue of which Alfredo Sanson took possession thereof has been rescinded.

3. The third proposition is untenable. If the 17 parcels in question were not sold, it is just that they be
included in the new inventory in order to form part of Roque Sanson's hereditary estate subject to partition.
The alleged proceeds of their sale (P4,500) should not be stated in the inventory in lieu thereof, because
said amount is less by one-half than the value given by the same defendant Isabel Araneta in the inventory
submitted by her to the court while she was administratrix of the testate estate of Roque Sanso, and
because to do so would be equivalent to sanctioning an act which could not have been approved by the
court.

4. With respect to the fourth proposition, it should be stated that, as the agreement of partition under
consideration was declared rescinded by this court, the parties were bound to return the properties which
were the subject matter of the partition, with all their fruits and income or the equivalent thereof in money
(article 1295, Civil Code), in conformity with the provisions of articles 451, and 430 to 436 of said Code, from
the date of the rescission.

5. As to the last proposition, this court holds that the matter referred to therein is a question that must be
submitted to the consideration of the lower court, which will be the one to determine how and to what extent
the set-offs will have to be made when it orders the partition of the properties subject thereto.

For all the foregoing consideration, this court decides to deny as it hereby denies the defendant's motion for
reconsideration. So ordered.

Villa-Real, Abad Santos, Imperial, Laurel and Concepcion, JJ., concur.

Footnotes

Samson vs. Araneta, 60 Phil., 27.

1
 3. Republic of the Philippines
SUPREME COURT
Manila

EN BANC

G.R. No. L-18359             March 26, 1965

CALIXTO DUQUE, FLORENCIO SELGA, ALBERTO RAMOS, MANUEL BUENAFE, CLARO LIZARDO and the
Spouses SUSANA and JOSE COCHINGYAN, SR., petitioners,
vs.
THE COURT OF FIRST INSTANCE OF MANILA, Branch I, LORENZO B. CAMINS and RAMON
SAURA, respondents.

-----------------------------

G.R. No. L-23754             March 26, 1965

PILAR NORMANDY and LORENZO B. CAMINS in their own behalf and others similarly situated and for and in
behalf of World War II Veterans Enterprises, Inc., petitioners,
vs.
HON. FRANCISCO ARCA, Judge of the Court of First Instance of Manila, CALIXTO DUQUE, CLARO B.
LIZARDO, FLORENCIO SELGA, ALBERTO RAMOS, MANUEL BUENAFE, JOSE and SUSANA COCHINGYAN,
JOSEPH COCHINGYAN, JR. and MACARIO OFILADA as Second Receiver for the World War II Enterprises,
Inc., respondents.

G.R. No. L-18359:

Jose W. Diokno and Norberto J. Quisumbing for petitioners Spouses Susana and Jose Cochingyan, Sr.
Cipriano P. Primicias and Rene A. Diokno for respondent Lorenzo B. Camins.
Cipriano Primicias, Jr. for respondent Ramon Saura.

G.R. No. L-23754:

Ceferino de los Santos and Rene A. Diokno for petitioners.
Leandro Sevilla and Ramon C. Aquino for respondents Jose and Susana Cochingyan.
Lino M. Patajo for respondents Calixto Duque, et al.

REYES, J.B.L., J.:

In the first case, petitioners Calixto Duque, et al., have sought a review by certiorari of the refusal of the respondent
Court of First Instance of Manila to suspend Ramon Saura as receiver in its Civil Case No. 34998.

Lorenzo Camins seeks, in G.R. No. L-23754, a writ of certiorari against certain orders of the Court of First Instance of
Manila (issued in the same Civil Case No. 34998) appointing Macario Ofilada, Clerk of the Court of First
Instance, the permanent receiver of World War Veterans Enterprises, Inc., and refusing to appoint the
Philippine Veterans Bank as such receiver.

Said Case No. 34998, entitled "Pilar Normandy, Lorenzo Camins, et al., vs. Calixto Duque, et al.", and "Jose and
Susana Cochingyan, Intervenors", was a derivative suit filed by minority stockholders of the World War Veterans
Enterprises, Inc., seeking to annul and set aside certain agreements entered into by the directors of the corporation
and Jose and Susana Cochingyan.
By order of September 6, 1960, the Court of First Instance of Manila had, upon motion, appointed one Ramon E.
Saura as receiver of the properties of the corporation. On January 31, 1961, defendants and intervenors filed
charges against the receiver Saura and sought his suspension, praying further that a co-receiver be appointed. This
motion was denied; whereupon, the movants, Calixto Duque, et al., resorted to the Supreme Court, alleging grave
abuse of discretion amounting to excess of jurisdiction (G.R. No. L-18359). On April 29, 1961, this Supreme Court
issued a resolution giving the petition due course, and stated therein —

Without in any way prejudging the question involved in the motion for the removal of the receiver still
pending in the respondent court, it is also the opinion of this Court that, for the proper protection of the rights
of petitioners, a second receiver should be appointed. Therefore, Macario Ofilada, Clerk of the Court of First
Instance of Manila, is hereby appointed second receiver and may qualify as such upon filing and approval of
a bond equal in the amount to the one filed by receiver Ramon Saura. However, inasmuch as said Clerk of
Court has considerable official duties to perform, his appointment hereby made is provisional and shall
stand only until such time as this Court appoints another in his stead.

This case became moot when on May 28, 1964 receiver Ramon E. Saura resigned, and his resignation was accepted
by the court below, which also fixed a fee of P10.,000.00 for his services. Thereupon, defendants and intervenors
asked that Macario Ofilada be made permanent receiver. Plaintiff Camins, on the other hand, opposed such
appointment and sought Ofilada's discharge on various grounds, primarily partiality to the other side. Camins
proposed that the Philippine Veterans Bank be appointed receiver instead of Ofilada.

On September 24, 1964, the respondent Judge, Hon. Francisco Arca, rejected the proposal to appoint the Bank as
receiver, stating —

2. Petitioner Lorenzo B. Camins through counsel filed on August 22, 1964 a petition for the substitution of
the first receiver, the discharge of the second receiver, and the appointment of the Philippine Veterans Bank
as receiver in place of the First Receiver, Ramon E. Saura, since discharged.

The Court does not consider well taken the reasons alleged by Camins in his petition and the Court believes
that only one receiver is sufficient and will entail less expense. Consequently, the motion to appoint a
substitute receiver in lieu of Saura is hereby denied and, inasmuch as the Court sees no valid and
sufficient reason to discharge Macario M. Ofilada as receiver, the motion to remove him is hereby
likewise denied.

Two days, later, by order dated September 2, the court below granted the motion to appoint Macario Ofilada
permanent receiver upon filing of a bond of P10,000.00.

Failing to obtain a reconsideration, plaintiffs Camins and Normandy (the latter died during the pendency of the
proceedings) resorted to this Court for a writ of certiorari, asking that, for the reasons set forth in the, petition, the
orders of September 24 and 26, 1964 a annulled; that the Philippine Veterans Bank be appointed sole receiver; and
that the lower court be ordered to discharge Macario Ofilada as receiver.

A due regard for the facts appearing of record convinces us that the petition should be denied. The appointment and
discharge of receivers are matters primarily addressed to, and resting largely on, the discretion of the trial
court, not being a matter of strict right, and a reviewing court will not interfere with the exercise of such
discretion unless convinced that the same has been abused (Sanson vs. Araneta, 64 Phil. 549; Lama vs.
Apacible, 79 Phil. 68; De la Cruz vs. Guinto, 79 Phil. 304; Valiente vs. Court of First Instance of Tarlac, 80 Phil. 415;
Tecson vs. Macadaeg, 88 Phil. 605; Medel vs. De Aquino, 92 Phil. 895). This is all the more true of the trial court's
choice between candidates for receivership proposed by the contending parties, who have been fully heard in the
matter.

The petitioner stresses that in 1961 this Court, in Case G.R. No. L-18359, has taken cognizance of the fact that as a
Clerk of Court Mr. Ofilada had considerable official duties to perform, and, for that reason, appointed him only as
temporary receiver. Such action does not preclude a more accurate appraisal by the trial court three years later,
whether or not the official duties of Mr. Ofilada, as the Clerk of that same court, impaired his efficient discharge of the
functions of a receiver, taking into account his actuations as temporary receiver from 1961 to 1964; and we see no
evidence that in concluding that Mr. Ofilada could well perform the work of a permanent receiver, despite his official
duties, the lower court's decision was so arbitrary and capricious a determination as to warrant intervention of the
appellate court.
The orders complained of import also a rejection of the charges of incompetence and partiality levelled at receiver
Ofilada. It does not appear, however, that such action of the court was arbitrary, since the charges were fully
discussed by the parties and considered by the Court. Assuming, for the sake of argument, that the conclusion made
by the court below was erroneous, that per se does not render its appraisal of the facts adduced before it any grave
abuse of discretion that would warrant the grant of a writ of certiorari (Abad Santos vs. Province of Tarlac, 67 Phil.
480; Tan vs. People, 88 Phil. 609).1äwphï1.ñët

With regard to the impending retirement of Mr. Ofilada in March 1965, his nomination as judge of the Court of First
Instance, and the nomination by respondents of former General Dionisio Ojeda, brought to light during the hearing of
this case, as well as the propriety of appointing a neutral party as a receiver, it is not shown that these developments
were called to the lower court's attention. It is our opinion that the same should be first presented to the respondent
Judge to give him due opportunity to consider and weigh them, and then decide whether such factors would justify a
change of receiver.

WHEREFORE, the petition for a writ of certiorari in G.R. No. L-23754 is denied, with costs against petitioner Lorenzo
B. Camins.

The former receiver, Ramon E. Saura, having resigned and his resignation having been accepted, Case G.R. No. L-
18359 has become academic. The case is, therefore, dismissed, without costs.

Bengzon, C.J., Bautista Angelo, Concepcion, Barrera, Paredes, Dizon, Regala, Makalintal, Bengzon, J.P., and
Zaldivar, JJ., concur.