NORMANDY vs SAURA own account, particularly because it was a unilateral act on Saura's part improper.
particularly because it was a unilateral act on Saura's part improper. Moreover, he is now estopped from claiming any further
PETITIONERS: PILAR M. NORMANDY, in her own behalf and of others
similarly situated, as well as of the World War II Veterans Enterprises, Inc., &
LORENZO B. CAMINS, vs CALIXTO DUQUE, CLARO P. LIZARDO, FLORENCIO
SELGA, ALBERTO RAMOS, MANUEL BUENAFE & FILIPINAS MERCHANDISING
CORPORATION and JOSE COCHINGYAN, SR. and SUSANA COCHINGYAN
RESPONDENTS: RAMON E. SAURA,
DOCKET NO.: GR No. L-25407
DATE: August 29, 1969
PONENTE: Barredo, J.
TOPIC: Receivership
FACTS:
• Ramon E. Saura was appointed receiver of the WARVETS by the lower
court "generally to do and perform such acts respecting the property,
assets and transactions" of the organization "as the court may
authorize." Upon filing a bond in the sum of fifty thousand (P50,000.00)
pesos, he entered upon the discharge of his functions.
• During his term, appellant went to Japan by authority of the lower
court's order for the purpose of checking on the reported
undervaluation of goods shipped to the WARVETS and of preparing the
shipment of the goods which had not yet been committed. For expenses
incurred by him during this trip, which amounted to P9,431.48, he was
ordered reimbursed by the lower court
• Except for this reimbursed amount, for a continuous period of three (3)
years, he performed his duties as receiver without receiving any
compensation as such. Hence, he filed a motion in the lower court to fix
not only his compensation but also that of his co-receiver, Macario
Ofilada. In his motion, he prayed further for such amounts as attorney's
fees and stenographer's fees as the court may allow.
• Upon denial of the court, Saura resigned from his post as receiver and
praying that the lower court accept it and at the same time fix the
amount of his fees and compensation as receiver. He was discharged as
receiver and his compensation was fixed at P10,000.00.
• Subsequently, one Atty. Anacleto Magno, filed a motion to claim for the
payment of attorney's fees to him in the amount of P10,000.00 for his
alleged services as legal counsel for the appellant when he was still a
receiver.
• Appellant, himself, filed another motion for the payment and
cancellation of his receiver's bond and for the reimbursement to him of
the sum of P2,030.00 which he paid out of his personal funds as
premium for said bond from September 9, 1960 to September 9, 1964.
• Lower court disposed of both motions in one order by allowing
compensation to Atty. Magno in the reduced amount of P1,000.00 and
granting reimbursement to appellant in the whole sum prayed for by
him as premium on his bond. In excess, the matter should be for his
to get Magno as his lawyer in the receivership.
• Nevertheless, the Court is aware that Atty. Magno did in fact work for
Saura, for the former appeared in Court and signed pleadings for Saura
as receiver. Wherefore, in fairness to Atty. Magno, it is hereby ordered
that he be paid P1,000.00 from the funds under receivership. If he is
not satisfied with this amount, he can go after Saura.
• Barely two months after the issuance of the last-mentioned order, or on
November 18, 1964, appellant filed another motion for reimbursement,
this time for the amount he allegedly paid as compensation of a clerk
whom he employed when he was still a receiver.
• Lower court denied the motion of Saura because of it previously ordered
the payment of P10,000.00 as compensation for Saura for his services
as first receiver in this case. Therefore, whatever amount he now seeks
in addition thereto would be improper.
ISSUE: WON the Saura (receiver) is entitled to reimbursement of the salaries
paid by him to his clerk as receiver of the WARVETS
HELD: No.
• A receiver is a representative of the court appointed for the purpose of
preserving and conserving the property in litigation and prevent its
possible destruction or dissipation if it were left in the possession of any
of the parties. The receiver is not the representative of any of the parties
but of all of them to the end that their interests may be equally protected
with the least possible inconvenience and expense. It is inherent in the
office of a receiver not only that he should act at all times with the
diligence and prudence of a good father of a family but should also not
incur any obligation or expenditure without leave of the court and it is
the responsibility of the court to supervise the receiver and see to it that
he adheres to the above standard of his trust and limits the expenses of
the receivership to the minimum. For these reasons, it is generally the
receivership court that is in a better position to determine whether a
particular expenditure is reasonable and satisfied or not and its ruling
thereon may not be disturbed by this Court.
• It is true that in the case at bar, the motion in question of the receiver
was not opposed by any of the parties. It is to be observed, however,
that the records show that the court a quo had previously allowed or
approved reimbursements to the receiver of expenditures made by him
in connection with the performance of his duties, more particularly, for a
trip made to Japan and for the fees of a lawyer who had allegedly
assisted him, notwithstanding he is a lawyer himself. Besides, the court a
quo fixed the total compensation to the appellant receiver at P10,000.00
for his services as such and said amount, from all appearances, is
agreeable to everyone, including appellant.
• The receivership court's reasons for withholding approval of the
reimbursement in question are precisely because "whatever amount he
(the receiver) now seeks in addition thereto (P10,000) would be
amount as compensation for alleged clerical services employed by him as
such receiver without prior approval or authority of this Court." We find
these reasons to be cogent enough in the premises, specially because
appellant's alleged employment of a clerk was made without prior leave
of court. In these circumstances, it cannot be said that the court a quo
abused its discretion, much less gravely.
COMMODITIES STORAGE & ICE PLANT vs CA
PETITIONERS: COMMODITIES STORAGE & ICE PLANT CORPORATION,
SPOUSES VICTOR & JOHANNAH TRINIDAD
RESPONDENTS: COURT OF APPEALS, JUSTICE PEDRO A. RAMIREZ,
CHAIRMAN and FAR EAST BANK & TRUST COMPANY
DOCKET NO.: GR No. 125008
DATE: June 19, 1997
PONENTE: Puno, J.
TOPIC: Receivership
FACTS:
• Petitioner Sps. Trinidad obtained a loan of P31,000,000.00 from Far East
Bank & Trust Company to finance the purchase of the Sta. Maria Ice
Plant & Cold Storage in Sta. Maria, Bulacan. The loan was secured by a
mortgage over the ice plant and the land on which the ice plant stands.
Petitioner spouses failed to pay their loan. The bank extrajudicially
foreclosed the mortgage and the ice plant was sold by public bidding.
Respondent bank was the highest bidder. It registered the certificate of
sale on September 22, 1993 and later took possession of the property.
• Petitioner spouses filed Civil Case against respondent bank for
reformation of the loan agreement, annulment of the foreclosure sale
and damages. RTC dismissed for failure to pay the docket fees
• Petitioners filed again for damages, accounting and fixing of redemption
period. As a provisional remedy, petitioners filed an "Urgent Petition for
Receivership." They alleged that respondent bank took possession of
the ice plant forcibly and without notice to them; that their occupation
resulted in the destruction of petitioners' financial and accounting
records making it impossible for them to pay their employees and
creditors; the bank has failed to take care of the ice plant with due
diligence such that the plant has started emitting ammonia and other
toxic refrigerant chemicals into the atmosphere and was posing a
hazard to the health of the people in the community; the spouses'
attention had been called by several people in the barangay who
threatened to inform the Department of Environment and Natural
Resources should they fail to take action. Petitioners thus prayed for the
appointment of a receiver to save the ice plant, conduct its affairs and
safeguard its records during the pendency of the case.
RTC: granted the petition for receivership and appointed petitioners' nominee,
Ricardo Pesquera, as receiver, upon the filing and approval of the bond of
P2,000,000.00 which shall answer for all damages defendant may sustain by
reason of the receivership. Ricardo Pesquera is authorized to assume the
powers of a receiver as well as the obligation as provided for in Rule 59 of the
Rules of Court after taking his oath as such receiver.
1

CA: annulled the order for receivership and dismissed petitioners' complaint
for improper venue and lack of cause of action.
Petitioners claim that the appointment of a receiver is justified under Section
1 (b) of Rule 59. They argue that the ice plant which is the subject of the
action was in danger of being lost, removed and materially injured because of
the following "imminent perils":
"6.1 Danger to the lives, health and peace of mind of the inhabitants living
near the Sta. Maria Ice Plant;
6.2 Drastic action or sanctions that could be brought against the plaintiff by
affected third persons, including workers who have claims against the plaintiff
but could not be paid due to the numbing manner by which the defendant
took the Sta. Maria Ice Plant;
6.3 The rapid reduction of the Ice Plant into a scrap heap because of evident
incompetence, neglect and vandalism.
ISSUE: WON receivership is justified to constitute under Rule 59 of the Rules
of Court.
HELD: No. Receivership is unnecessary
• A receiver of real or personal property, which is the subject of the action,
may be appointed by the court when it appears from the pleadings or
such other proof as the judge may require, that the party applying for
such appointment has (1) an actual interest in it; and (2) that (a) such
property is in danger of being lost, removed or materially injured; or (b)
whenever it appears to be the most convenient and feasible means of
preserving or administering the property in litigation.
• A receiver is a person appointed by the court in behalf of all the parties
to the action for the purpose of preserving and conserving the property
in litigation and prevent its possible destruction or dissipation, if it were
left in the possession of any of the parties. The appointment of a
receiver is not a matter of absolute right. It depends upon the sound
discretion of the court and is based on facts and circumstances of each
particular case.
• A petition for receivership under Section 1 (b) of Rule 59 requires that
the property or fund which is the subject of the action must be in
danger of loss, removal or material injury which necessitates protection
or preservation. The guiding principle is the prevention of imminent
danger to the property. If an action by its nature, does not require such
protection or preservation, said remedy cannot be applied for and
granted.
• In the instant case, we do not find the necessity for the appointment of a
receiver. Petitioners have not sufficiently shown that the Sta. Maria Ice
Plant is in danger of disappearing or being wasted and reduced to a
"scrap heap." Neither have they proven that the property has been
materially injured which necessitates its protection and preservation. In
fact, at the hearing on respondent bank's motion to dismiss, respondent
bank, through counsel, manifested in open court that the leak in the ice
plant had already been remedied and that no other leakages had been
reported since and there was no imminent danger of another leakage.
Whatever danger there was to the community and the environment had
already been contained.
• The "drastic sanctions" that may be brought against petitioners due to
their inability to pay their employees and creditors as a result of "the
numbing manner by which [respondent bank] took the ice plant" does
not concern the ice plant itself. These claims are the personal liabilities
of petitioners themselves. They do not constitute "material injury" to the
ice plant.
ISSUE: WON the receiver appointed by the trial court is qualified under Rule
59.
• Moreover, the receiver appointed by the court appears to be a
representative of petitioners. Respondent bank alleges that it was not
aware that petitioners nominated one Mr. Pesquera as receiver. The
general rule is that neither party to a litigation should be appointed as
receiver without the consent of the other because a receiver should be
a person indifferent to the parties and should be impartial and
disinterested. The receiver is not the representative of any of the parties
but of all of them to the end that their interests may be equally
protected with the least possible inconvenience and expense.
• The power to appoint a receiver must be exercised with extreme caution.
There must be a clear showing of necessity therefor in order to save the
plaintiff from grave and irremediable loss or damage. It is 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, endeavouring to avoid
that the injury thereby caused be greater than the one sought to be
avoided.
• The Court of Appeals correctly found that the trial court gravely abused
its discretion in issuing the order for receivership. The respondent court,
however, went further and took cognizance of respondent bank's
motion to dismiss. And finding merit in the motion, it dismissed the
complaint.
GERONIMO DE LOS REYES, PETITIONER, VS. HON. FROILAN
BAYONA, ETC., ET AL., RESPONDENTS.
FACTS:
 This is a petition for certiorari with preliminary injunction filed by
Geronimo de los Reyes against respondent Hon. Bayona, as
Presiding Judge, Branch I, CFI of Manila, Maria B. Castro and
Arsenio Tenchavez, to annul the order of respondent Judge, dated
April 30, 1958, in Civil Case No. 3910, appointing Tenchavez
receiver of the property in question on the filing of a bond in the
sum of P50,000.
 Geronimo de los Reyes obtained a loan of P120,000 in Japanese
military war notes from Maria B. Castro with interest at the rate of
6% per year, said interest for the first two years to be paid in
advance.
 To guarantee the payment of the loan, Reyes executed in favor of
Castro a document purporting to be a deed of sale with right of
repurchase, over two parcels of land. On the same day, Castro as
vendee, allegedly leased the two parcels to Reyes for an annual
rental equivalent to the interest on the loan for a year.
 Claiming that the deed of sale with right to repurchase did not
express the true intention of the parties, but that it was merely a
mortgage to secure the payment of the loan, Reyes filed Civil Case
with the CFI of Manila against Castro and her husband, alleging in
his complaint that since December 1944 up to January 1945, he had
repeatedly tendered to Castro the payment of the principal of the
loan, but that she refused to accept it, at the same time consigning
in court in her favor the sum of P120,000, evidenced by an official
receipt issued by the Clerk of Court;
 Despite the pendency of said Civil Case, Castro executed an affidavit
of consolidation of ownership of the two parcels of land, as a result
of which, the Register of Deeds cancelled transfer certificates of title
Nos. 8254 and 8255 in his name and issued in lieu thereof, transfer
certificates of title Nos. 9.53 and 954 in Castro's name.
 Upon discovery of the consolidation of ownership made by Castro,
Reyes took steps toward the reconstitution of the records of the
Civil Case , whose original records presumably were destroyed
during the war, particularly the battle for the liberation of Manila,
but his efforts were frustrated by the denial by the trial court on the
ground that the period for reconstitution had already expired. So, as
already said, Reyes filed Civil Case No. 3910.
 In the meantime, on the theory that the two parcels in question had
really been sold to her by Reyes and that she had thereafter leased
the same to him and that he failed to pay the annual rentals
 Castro filed a complaint for unlawful detainer against.
 Justice of the Peace Court rendered judgment in favor of Castro.
Pending appeal of the unlawful detainer case in the CFI of Laguna
(Civil Case No. 9858), the said court over his objection issued a writ
of execution of the judgment of the Justice of the Peace Court.
 Failing to secure a reconsideration of the order of execution, Reyes
filed a petition for certiorari before this Tribunal to annul said order
of execution
 A decision in the said certiorari case, holding that the order of
execution was improvidently issued, inasmuch as more than five
years had elapsed since the judgment of the Justice of the Peace.
Court was rendered; that there was reason to believe that the deed
conveying the two parcels of land to Castro was one "of mortgage,
rather than of sale, and that furthermore, even assuming that it
were a sale, Castro not being the original owner and possessor of
the parcels but only a vendee a retro, the vendor, Reyes had the
right to continue in. his possession until the case between them was
finally determined.
 As a result, the order of execution was set aside and the writ of
preliminary injunction issued was made permanent.
 As a result of the writ of execution issued by the CFI of Laguna in
Civil Case No. 9858, which as already stated was brought to this
Court on certiorari, Castro was placed in possession of the property
in question from March 16, 1955 to July 30, 1957
 Castro evidently giving up possession in favor of Reyes, only as a
result of our decision in G. R. No. L-8960.
 The dispositive part of said decision reads: judgment is hereby
rendered dismissing the case for lack of appellate jurisdiction over
the subject matter of the action and the plaintiff is ordered to return
to the defendant the possession of the two parcels of land
2
  Castro filed a petition for certiorari in the CA to set aside the above-
mentioned judgment.
 CA citing and reproducing our decision in G. R. No. L-8960,
aforementioned, on November 7, 1957, denied the petition for
certiorari
 According, to the present petition for certiorari, petitioner Reyes
"was notified of the hearing of the Urgent Petition for Receivership"
filed by Castro; that Reyes opposed the petition on October 28,
1957; and that respondent Judge Bayona issued an order denying
the petition for appointment of a receiver, thus:
ISSUE: WON the receivership should be held in abeyance
HELD: YES
This Court is of the opinion and so holds that the appointment of a receiver at
this time is inappropriate except until after the termination of the trial of this
case. The trial of this case has been set for several days in accordance with
the calendar, and this Court as well as the parties are bent in terminating this
case as soon as possible. In view of the foregoing, this Court is of the opinion
and so holds that the appointment of a receiver in this case should be held in
abeyance until after the decision of this Court shall have been rendered.
On May 7, 1958, Reyes was served a copy of the order of respondent Judge,
dated April 30, 1958, appointing respondent Arsenio Tenchavez receiver of the
properties in question. This order based on an ex-parte petition reiterating the
request for appointment of a receiver, which request had previously been
denied.
It should not be difficult to gather from our decision in G. R. No. L-8960 and
the decision of the Court of Appeals in CA-G.R. No. 19833-R that the courts, in
justice to the parties, particularly, Reyes, considered possession in him instead
of Castro as more reasonable and just. It is, therefore, to be expected that we
cannot look with favor on any judicial order or arrangement whereby this
possession of Reyes should be transferred to a receiver, because by so doing,
Castro would be obtaining indirectly what she could not obtain directly,
namely, deprive Reyes of the possession of the property until the controversy
between them is finally settled.
Petition for certiorari is hereby granted; the order of April 30, 1958 appointing
Arsenio Tenchavez receiver, is set aside and the writ of preliminary injunction
is made permanent. Respondent Maria B. Castro will pay the costs.
NATIONAL INVESTMENT v. BENJAMIN AQUINO
FACTS:
 2 separate petitions for certiorari and prohibition, with preliminary
injunction, seek to annul and set aside the orders of respondent
judge.
 Batjak (Basic Agricultural Traders Jointly Administered Kasamahan)
is a Filipino-American corporation organized under the laws of the
Philippines, primarily engaged in the manufacture of coconut oil and
copra cake for export.
 In 1965, Batjak's financial condition deteriorated to the point of
bankruptcy. As of that year, Batjak's indebtedness to some private
banks and to the PNB amounted to P11,915,000.00. As security for
the payment of its obligations and advances against shipments,
Batjak mortgaged 3 coco-processing oil mills to Manila Bank,
Republic Bank, and Philippine Commercial and Industrial Bank,
respectively.
 In need for additional operating capital to place the 3 coco-
processing mills at their optimum capacity and maximum efficiency
and to settle, pay or otherwise liquidate pending financial
obligations with the different private banks, Batjak applied to PNB
for additional financial assistance.
 On 5 October 1965, a Financial Agreement was submitted by PNB to
Batjak for acceptance. The terms and conditions of the Financial
Agreement were duly accepted by Batjak. Under said Agreement,
NIDC would, as it actually did, invest P6,722,500.00 in Batjak in the
form of preferred shares of stock convertible within five (5) years at
par into common stock, to pay for Batjak'sobligations to Republic
Bank, Manufacturers Bank and Trust Company and Philippine
Commercial & Industrial Bank, and the balance of the investment
was to be applied to Batjak's past due account of P 5 million with
the PNB.
 Upon receiving payment, RB, PCIB, and MBTC released in favor of
PNB the first and any mortgages they held on the properties
of Batjak.
 A Voting Trust Agreement was executed on 26 October 1965 in
favor of NIDC by the stockholders representing 60% of the
outstanding paid-up and subscribed shares of Batjak. This
agreement was for a period of five (5) years and, upon its
expiration, was to be subject to negotiation between the parties.
 In July 1967, forced by the insolvency of Batjak, PNB instituted
extrajudicial foreclosure proceedings against the oil mills of Batjak.
The properties were sold to PNB as the highest bidder.
 One year thereafter, or in September 1968, final Certificates of Sale
were issued. Subsequently, PNB transferred the ownership of the 2
oil mills to NIDC which, as aforestated, was a wholly-owned PNB
subsidiary.
 3 years thereafter, or on 31 August 1970, Batjak represented by
majority stockholders, through Atty. Amado Duran, legal counsel of
private respondent Batjak, wrote a letter to NIDC inquiring if the
latter was still interested in negotiating the renewal of the Voting
Trust Agreement.
 On 22 September 1970, legal counsel of Batjak wrote another letter
to NIDC informing the latter that Batjak would now safely assume
that NIDC was no longer interested in the renewal of said Voting
Trust Agreement and, in view thereof, requested for the turn-over
and transfer of all Batjak assets, properties, management and
operations. NIDC replied, confirming the fact that it had no intention
whatsoever to comply with the demands of Batjak. Batjak filed a
case to recover such assets, properties, management, and
operations.
 Respondent judge (Aquino) issued a restraining order prohibiting
petitioners from removing any record, books, commercial papers or
cash, and leasing, renting out, disposing of or otherwise transferring
any or all of the properties, machineries, raw materials and finished
products and/or by-products thereof now in the factory sites of the
3 modem coco-milling plants.
 On 24 April 1971, NIDC and PNB filed an opposition to the ex-parte
application for the issuance of a writ of preliminary prohibitory and
mandatory injunction and a motion to set aside restraining order.
Before the court could act on the said motion, private respondent
Batjak filed on 3 May 1971 a petition for receivership as alternative
to writ of preliminary prohibitory and mandatory injunction.[16] This
was opposed by PNB and NIDC.[17]
 On 8 May 1971, NIDC and PNB filed a motion to dismiss Batjak's
complaint.[18]
 On 16 August 1971, respondent judge issued the now assailed order
denying petitioners' motion to dismiss and appointing a set of three
(3) receivers.[19] NIDC moved for reconsideration of the aforesaid
order.[20]
 On 30 September 1971, respondent judge denied the motion for
reconsideration.[21]
ISSUE: WON appointment of receivership was proper
HELD: NO
On the appointment of receiver.
A receiver of real or personal property, which is the subject of the action, may
be appointed by the court when it appears from the pleadings that the party
applying for the appointment of receiver has an interest in said
property.[25] The right, interest, or claim in property, to entitle one to a
receiver over it, must be present and existing.
As borne out by the records of the case, PNB acquired ownership of 2 of the 3
oil mills by virtue of mortgage foreclosure sales. NIDC acquired ownership of
the third oil mill also under a mortgage foreclosure sale. Certificates of title
were issued to PNB and NIDC after the lapse of the one (1) year redemption
period. Subsequently, PNB transferred the ownership of the two (2) oil mills to
NIDC. There can be no doubt, therefore, that NIDC not only has possession
of, but also title to the three (3) oil mills formerly owned by Batjak. The
interest of Batjak over the three (3) oil mills ceased upon the issuance of the
certificates of title to PNB and NIDC confirming their ownership over the said
properties. More so, where Batjak does not impugn the validity of the
foreclosure proceedings. Neither Batjak nor its stockholders have instituted
any legal proceedings to annul the mortgage foreclosure sales
aforementioned.
Batjak premises its right to the possession of the three (3) oil mills on the
Voting Trust Agreement, claiming that under said agreement, NIDC was
constituted as trustee of the assets, management and operations of Batjak,
that due to the expiration of the Voting Trust Agreement, on 26 October 1970,
NIDC should turn over the assets of the three (3) oil mills to Batjak.
The relevant provisions of the Voting Trust Agreement, particularly paragraph
4 & No. 1 thereof, are hereby reproduced:
"NOW THEREFORE, the undersigned stockholders, in consideration of the
premises and of the mutual covenants and agreements herein contained and
to carry out the foregoing purposes in order to vest in the TRUSTEE the voting
rights of the shares of stock held by the undersigned in the CORPORATION as
hereinafter stated it is mutually agreed as follows:
"1. PERIOD OF DESIGNATION For a period of five (5) years from and after
3
date hereof, without power of revocation on the part of the SUBSCRIBERS,
the TRUSTEE designated in the manner herein provided is hereby made,
constituted and appointed as a VOTING TRUSTEE to act for and in the name
of the SUBSCRIBERS, it being understood, however, that this Voting Trust
Agreement shall, upon its expiration be subject to a re-negotiation between
the parties, as may be warranted by the balance and attending circumstance
of the loan investment of the TRUSTEE or otherwise in the CORPORATION.
"3. VOTING POWER OF TRUSTEE The TRUSTEE and its successors in trust, if
any, shall have the power and it shall be its duty to vote the shares of the
undersigned subject hereof and covered by this Agreement at all annual,
adjourned and special meetings of the CORPORATION on all questions,
motions, resolutions and matters including the election of directors and all
such matters on which the stockholders, by virtue of the by-laws of the
CORPORATION and of the existing legislations are entitled to vote, which may
be voted upon at any and all said meetings and shall also have the power to
execute and acknowledge any agreements or documents that may be
necessary in its opinion to express the consent or assent of all or any of the
stockholders of the CORPORATION with respect to any matter or thing to
which any consent or assent of the stockholders may be necessary, proper or
convenient."
From the foregoing provisions, it is clear that what was assigned to NIDC was
the power to vote the shares of stock of the stockholders of Batjak,
representing 60% of Batjak's outstanding shares, and who are the signatories
to the agreement. The power entrusted to NIDC also included the authority to
execute any agreement or document that may be necessary to express the
consent or assent to any matter, by the stockholders. Nowhere in the said
provisions or in any other part of the Voting Trust Agreement is mention made
of any transfer or assignment to NIDC of Batjak's assets, operations, and
management. NIDC was constituted as trustee only of the voting rights of
60% of the paid-up and outstanding shares of stock in Batjak. This is
confirmed by paragraph No. 9 of the same Voting Trust Agreement, thus:
"9. TERMINATION Upon termination of this Agreement as heretofore
provided, the certificates delivered to the TRUSTEE by virtue hereof shall be
returned and delivered to the undersigned stockholders as the absolute
owners thereof, upon surrender of their respective voting trust certificates,
and the duties of the TRUSTEE shall ceased and terminate."
Under the aforecited provision, what was to be returned by NIDC as trustee to
Batjak's stockholders, upon the termination of the agreement, are the
certificates of shares of stock belonging to Batjak's stockholders, not the
properties or assets of Batjak itself which were never delivered, in the first
place to NIDC, under the terms of said Voting Trust Agreement.
In any event, a voting trust transfers only voting or other rights pertaining to
the shares subject of the agreement, or control over the stock. The law on the
matter is Section 59, paragraph 1 of the Corporation Code (BP 68) which
provides:
"Sec. 59. Voting Trusts One or more stockholders of a stock corporation may
create a voting trust for the purpose of conferring upon a trustee or trusties
the right to vote and other rights pertaining to the shares for a period not
exceeding five (5) years at any one time; x x x"[26]
The acquisition by PNB-NIDC of the properties in question was not made or
effected under the capacity of a trustee but as a foreclosing creditor for the
purpose of recovering on a just and valid obligation of Batjak. were thereunder expressly assigned to Generoso Tupas, Jr. This project of
partition was approved by the probate court on July 16, 1956.
Moreover, the prevention of imminent danger to property is the guiding
principle that governs courts in the matter of appointing receivers. Under Sec. On February 18, 1957, however, a complaint for the recovery of the said two
1 (b), Rule 59 of the Rules of Court, it is necessary in granting the relief of parcels of land was filed by Lumampao against GenerosoTupas, Jr. and
receivership that the property or fund be in danger of loss, removal or Luis Tupas with the Court of First Instance of Iloilo (docketed as civil case
material injury. 4276), on the ground that the defendants therein, by use of force, threats,
stealth, strategy and intimidation, deprived him of the possession of the said
In the case at bar, Batjak in its petition for receivership, or in its amended properties and gathered all the products therefrom. The validity of the sale to
petition therefor, failed to present any evidence to establish the requisite him of these properties, which was brought in issue in the said case, was
condition that the property is in danger of being lost, removed or materially upheld by the court a quo on May 15, 1959.
injured unless a receiver is appointed to guard and preserve it.
This decision, in turn, was affirmed on appeal, by the Court of Appeals in CA-
WHEREFORE, the petitions are GRANTED. The orders of the respondent G.R. 26507-R onApril 2, 1964. The dispositive portion of the appellate court's
judge, dated 16 August 1971 and 30 September 1971, are decision reads as follows:
hereby ANNULLED and SET ASIDE. The respondent judge and/or his
"WHEREFORE, the judgment appealed from [declaring Lumampao the owner
successors are ordered to desist from hearing and/or conducting any further
of said parcels of real estate] is AFFIRMED, with the modification
proceedings in Civil Case No. 14452, except to dismiss the same. With costs
that Generoso Tupas, Jr. pay plaintiff P437.20 and that defendants pay
against private respondents.
plaintiff P4,000.00 for the bodega and sugar mill and P6,000.00 annually from
the crop year 1954-55 up to the delivery of the land to plaintiff. Costs against
SO ORDERED.
defendants."
The foregoing decision was appealed to this Court in L-23134, but in a minute
[ GR No. L-27631, Apr 30, 1971 ]
resolution dated December 15, 1964 we dismissed the appeal.
CIRILO D. DOLAR v. CARLOS L. SUNDIAM +
148 Phil. 630 Prior to the final adjudication on the aforementioned complaint of Lumampao,
however, Luis Tupas filed with the probate court, on February 9, 1960, a
CASTRO, J.: motion for authority to sell four (4) parcels of land of the testate estate for the
This is an original action for certiorari and prohibition to set aside an order of payment of taxes due to the Government in the amount of P1,701.68,
the Court of First Instance of Iloilo dated December 1, 1966, in Special attorney's fees and other obligations. The said motion included the two
Proceeding 472, granting the petition of the herein parcels of land previously sold to Lumampao. The motion was approved by
respondent Remigio Lumampao for the appointment of a receiver over two (2) the probate court on February 13, 1960 with
parcels of land subject of a motion, filed by the said respondent Lumampao, Judge Wenceslao Fernan presiding, subject to the condition that "before
to set aside the sale thereof made by the herein petitioner Luis Tupas, in his executing the sale, the price must first be referred [to] and approved by this
capacity as judicial administrator of the testate estate of one Generoso Tupas, Court."
Sr., in favor of his herein co-petitioner Cirilo Dolar.
For some unexplained reason, Luis Tupas did not take any action relative to
On June 25, 1948, one Generoso Tupas, Jr. filed a petition with the Court of the foregoing authority, for, on May 14, 1963, or more than three (3) years
First Instance of Iloilo (docketed as Special Proceeding 472) for the allowance later, another motion for authority to sell the same parcels of land mentioned
of his father's will and the appointment of an administrator for the deceased's in his motion of February 9, 1960 was filed by him with the probate court,
estate. The deceased was survived by his spouse, his again for the payment of municipal taxes in the same amount of P1,701.68
son Generoso Tupas, Jr., and his other children by a first marriage. and P10,000 for counsel's services. This motion, however, unlike the first
motion, bore the signed conformity of the heirs of the deceased,
After the probate of the will and the appointment of the deceased's widow
except Generoso Tupas, Jr. The said motion was approved on May 31, 1963
(later replaced by Luis Tupas) as judicial administrator of the testate
by the probate court, with Judge Jesus Rodriguez, presiding, subject to the
estate, Generoso Tupas, Jr., on December 5, 1953, sold to the herein
condition that the real properties mentioned therein shall be sold, as per
respondent Lumampao, for the price of P40,000, two (2) parcels of land
prayer of Luis Tupas, for not less than P15,000.
bequeathed to him by his father. On August 9, 1955, Lumampao, by virtue of
this purchase, asked the surrogate court to be allowed to intervene in the On June 4, 1963, Luis Tupas sold to his herein co-petitioner Cirilo Dolar for the
proceedings. The court granted his motion. price of P15,000 the four (4) parcels of land specified in his motion,
comprising an aggregate area of 143 hectares, more or less, inclusive of the
On July 9, 1956, a project of partition of the testate estate, comprising at least
92 hectares previously sold to Lumampao by Generoso Tupas, Jr. for
two hundred twenty-three (223) hectares, was submitted to the probate court
P40,000. It will be noted that at this time, the validity of the sale
for approval, by the herein petitioner Luis Tupas, as judicial administrator
to Lumampao was still pending adjudication in the Court of Appeals.
thereof. The two parcels of land of the testate estate previously sold
to Lumampao, with an area of ninety-two (92) hectares, more or less,
4
On January 24, 1964, the probate court, through Judge Imperial Reyes, who
temporarily took over the functions of the court a quo in the absence of its
presiding judge who was then in Manila, affixed his signature at the foot of
the deed of sale executed by Luis Tupas to his co-petitioner Cirilo Dolar,
indicating his conformity therewith.
On November 6, 1965, Lumampao, in his capacity as intervenor in the
settlement proceedings, filed with the surrogate court an amended motion to
set aside the order of the said court dated May 31, 1963 insofar as it
authorized the sale of the two (2) parcels of land conveyed to him
by Generoso Tupas, Jr. Among the grounds adduced by Lumampao in his
motion are (a) that the said parcels of land belong to him by virtue of a final
and executory decision of the Court of Appeals; (b) that contrary to section
7(b), Rule 89 (formerly Rule 90) of the New Rules of Court no notice was
given to him and to some of the heirs of the deceased of both motions of
Luis Tupas for authority to sell said properties; (c) that the probate court's
approvals of the said motions were all made without his knowledge; (d) that
the approval of the conveyance to Cirilo Dolar of the said parcels was made
without any corresponding motion therefor; and (e) that the testate estate
has other properties with which to pay its obligations.
On October 22, 1966, pending decision on his motion to set
aside, Lumampao filed with the probate court a petition for the appointment
of a receiver over the two parcels of land conveyed and adjudicated to him.
On December 1, 1966, the probate court, with Judge
Carlos Sundiam presiding, granted Lumampao's petition, and, on February 8,
1967, appointed the herein respondent Gregorio Lira receiver over the said
parcels of land.
On June 7, 1967, Tupas and Dolar filed with this Court the instant petition to
set aside the receivership order of the court a quo. On June 16, 1967, we
issued a writ of preliminary injunction against the herein respondents
Judge Sundiam, Lumampao and Lira.
The principal object of the ancillary relief a receivership is to secure and
preserve the property or thing in controversy pending litigation in order that,
as far as practicable, a judicial tribunal, in aid of its jurisdiction, may be able
to effectively bestow to the parties litigant the rights to which they are
entitled, or exact from them the obligations to which they are subject, under
the law. Ordinarily, therefore, this remedy will not lie where the property
involved is already in custody of law, such as that in the hands of an executor
or administrator. In these cases, the practical and equitable purposes to be
accomplished under a receivership are then virtually available.
The fact remains, however, that relief by way of receivership is essentially
equitable in nature, and consequently, must be controlled by, and
administered on, equitable principles, in the absence of statutory principles
specifically defining or laying out the dimension of its coverage, scope or
application. Thus, the Corpus Juris Secundum,[1] in a brief resume of the
decisions of several learned American tribunals, says:
"Ordinarily, a receiver cannot be put on property which is already in custody
of the law under process from another court of competent jurisdiction; and
there cannot be more than one receiver over the same property. ... A court of
equity has power to appoint a receiver of property which is already in the
hands of an executor or administrator, but such power should be exercised
with caution, and a receiver should not be appointed to take assets out of the
hands of legally appointed representatives except in cases of manifest danger
of loss or destruction of, or material injury to, assets. ...
"... Also, a receiver will be appointed when the executor or administrator has
been guilty of misconduct, waste, or misuse of assets, and there is real
danger of loss; and conversely, a receiver will not be appointed to take assets
from the custody of an executor or administrator unless there is manifest
danger of loss or destruction of, or material injury to, the assets and a
receivership is clearly necessary to protect and preserve the property."
In appreciating the foregoing principles, it must be borne in mind that, thus
far, we have proceeded upon the assumption that the estate upon which
receivership is prayed for is under the custody of law. Apparently, the two
parcels of land in dispute cannot be said to be within this category, judged
from the records of this case. The said two parcels of real estate were, by
virtue of a final and executoryjudgment, adjudicated in favor
of Lumampao. Consequently, they can no longer be said to form part of the
testate estate of the late Generoso Tupas, Sr. over which the probate court
can validly exercise jurisdiction in connection with the distribution and
liquidation of the said estate.
The probate court's order authorizing the sale of the said parcels of land was
issued and their subsequent sale to Cirilo Dolar was consummated prior to the
rendition of the judgment of the Court of Appeals upholding the validity of the
sale to Lumampao. Consequently, at the time of the sale of these two parcels
to Cirilo Dolar, the status of such parcels as belonging to the testate estate or
to Lumampao was then still fairly controversial. But the inevitable time-lag
that goes with the disposal of court cases cannot, in the present controversy,
alter the fact that the Court of Appeals' decision on the merits of the
controversy below was based upon the validity of the deed of sale of the said
parcels to Lumampao, and, thus, in law, said properties belonged to him even
before the authority to sell them was issued by the probate court to
Luis Tupas. Hence, although the appellate court's decision on the ownership
question came later, it nevertheless had merely the effect of erasing once and
for all any doubt or uncertainty about the real ownership of the said
parcels. Appellate courts, beset as they are by heaps of cases, cannot be
expected naturally to act on the hour on every litigation brought to them. A
court exercising original jurisdiction over a suit ought, by constant exposure to
this exacting job of unraveling what is true and just, to comprehend the
quantum of caution required for the avoidance of simple problems that may in
the future hamper the closure of a dispute before it. There appears, for
instance, no plausible reason why the sale of the two parcels in dispute was
authorized by the probate court considering that the testate estate was still
quite enormous, and considering further that the court a quo itself had, only a
short time before that, upheld the validity of their sale to Lumampao.
Moreover, it is essentially the duty of every person dealing at arms' length
with the administrator of an estate subject to settlement and liquidation to
inquire about the existence of claims against, or of persons having interests
in, the estate subject of probate and settlement proceedings, for such
proceedings are, by their nature and purpose, open notice to all and sundry
once put into motion. Every diligent person ought to know that such
proceedings require not just the collection, identification, division and
distribution of assets; they not infrequently involve matters more complicated
than these.
The foregoing opinion notwithstanding, we find it essential for the purpose of
disposing of the specific issue raised in the instant petition --- that the
respondent court has no jurisdiction to grant receivership over the said parcels
of land in dispute --- to allow the respondent court the benefit of the doubt,
that when it authorized Luis Tupas to sell the real properties in dispute and
approved their sale in favor of Cirilo Dolar, it was acting under an honestly
mistaken impression that the questioned properties still formed part of
the inventoriableestate of the late Generoso Tupas, Sr.
In our opinion, where, as in this case, a piece of property which originally is a
part of the estate of a deceased person is sold by an heir of the deceased
having a valid claim thereto, and said piece of property is, by mistake,
subsequently inventoried or considered part of the deceased's estate subject
to settlement, and, thereafter, with the authority and approval of the probate
court, is sold once more to another person, a receiver of the property so sold
may, during the pendency of a motion to set aside the second sale, be
appointed by the court when in its sound judgment the grant of such
temporary relief is reasonably necessary to secure and protect the rights of its
real owner against any danger of loss or material injury to him arising from
the use and enjoyment thereof by another who manifestly cannot acquire any
right of dominion thereon because the approving surrogate court had already
lost jurisdiction to authorize the further sale of such property to another
person.
Under the particular facts of the instant dispute, we find no compelling reason
for disturbing the respondent court's order granting the petition
of Lumampao for the appointment of a receiver over the parcels of land in
question.
ACCORDINGLY, the order of the court a quo dated December 1, 1966 is
hereby affirmed. The said court is, however, enjoined to act in consonance
with the tenor and intendment of this decision. No costs.
Concepcion, C.J., Reyes, J.B.L., Dizon, Makalintal, Zaldivar,
Fernando, Teehankee, Barredo, Villamor, and Makasiar, JJ., concur.
G.R. No. 111357. June 17, 1997]
TRADERS ROYAL BANK, petitioner, vs. INTERMEDIATE APPELLATE
COURT and HEIRS OF THE LATE JOSE C.
TAYENGCO, respondents.
RESOLUTION
ROMERO, J.:
The factual aspects of this case have already been resolved by this
Court in G.R. No. 63855,[1] wherein we ruled the deceased spouses Jose and
Salvacion Tayengco to be the lawful owners of the properties under
receivership, and G.R. No. 60076,[2] where we affirmed the validity of the
appointment of petitioner Traders Royal Bank (TRB) as receiver pendente lite.
In view of these rulings, the receivership proceeding was duly
terminated. Thus, TRB rendered its final accounting of the funds under
receivership wherein it retained the amount of P219,016.24 as its receiver's
5
fee, instead of turning over the entire fund to the Tayengcos. The Regional
Trial Court of Iloilo, Branch 5, in an order dated July 5, 1988, approved the
final accounting submitted by TRB, including the deduction of its fee from the
fund under receivership.
The Tayengcos assailed said order before the Court of
Appeals,[3] contending that TRB's compensation should have been charged
against the losing party and not from the funds under receivership.
In resolving this issue the Court of Appeals,[4] in its decision dated
February 12, 1993, ruled that TRB cannot deduct its fee from the funds under
its receivership since this must be shouldered by the losing party or equally
apportioned among the parties-litigants. Consequently, TRB was ordered to
return the P219,016.24 to the Tayengcos, and the losing parties, Cu Bie, et
al., were held solely liable for TRB's compensation.[5] TRB filed a motion for
reconsideration, but this was denied by the appellate court in its resolution
dated August 17, 1993.[6]
In this appeal, TRB raises the following errors allegedly committed by
the Court of Appeals:
1. The Hon. IAC (should be CA) erred when it rendered the judgment and
Resolution ordering the return by TRB of Receiver's Fee of P219,016.24 to the
heirs of Jose Tayengco, as it reversed the Decision ofthe Supreme Court in the
case of Jose Tayengco vs. Hon. Ilarde, TRB, et al., GR. No. 60076, which
ordered the Trial Court to "settle the account of the receiver, TRB" to
thereafter discharge the receiver and charged as cost against the losing party;
2. The Hon. IAC had no jurisdiction in CA-GR. 21423 and erred in knowingly
taking cognizance and rendering the judgment and resolution on the issue of
the payment of receiver's fee to TRB since the same subject matter was
already within the jurisdiction of the Supreme Court in GR. No. 60076;
3. The Hon. IAC erred when it rendered the judgment and Resolution which
reversed the final Supreme Court Decision in GR. No. 60076 on the payment
of the receiver's fee to TRB as it violated the Rule on
"Bar by Final Judgment".[7] (Underscoring supplied)
TRB's assignment of errors submits for resolution two vital issues: (1) Is
the Court of Appeals decision dated February 12, 1993 barred
by res judicata by virtue of our ruling in G.R. No. 60076 recognizing the
propriety of TRB's appointment as receiver? (2) Who is responsible for TRB's
receiver's fee?
With respect to the first assigned error, we are not persuaded.
The elements of res judicata are: (1) The previous judgment has
become final; (2) the prior judgment was rendered by a court having
jurisdiction over the matter and parties; (3) the first judgment was made on
the merits; and (4) there was substantial identity of parties, subject matter,
and cause of action, as between the prior andsubsequent actions.[8]
The difference between the two causes of action is unmistakable. In
G.R. No. 60076, the petition was for the annulment of the trial court's order
requiring Tayengco to render and submit an accounting of the rental of the
buildings and apartments, while C.A. G. R. CV No. 21423 was an appeal
questioning the order of the trial court authorizing the deduction by TRB of its
compensation from the receivership funds. There is clearly no identity of
causes of action here. Clearly, the last element of res judicata is absent in the
case at bar.
Procedural obstacles aside, we now answer the principal query posed in
the instant petition.
Nobody questions the right of TRB to receive compensation. Section 8,
Rule 59 of the Rules of Court, however, explicitly provides for the manner in
which it shall be paid for its services, to wit:
"SEC. 8. Termination of receivership; compensation of receiver.- Whenever
the court, of its own motion or on that of either party, shall determine that the
necessity for a receiver no longer exists, it shall, after due notice to all
interested parties and hearing, settle the accounts of the receiver, direct the
delivery of the funds and other property in his hands to the persons adjudged
entitled to receive them, and order the discharge of the receiver from further
duty as such. The
court shall allow the receiver such reasonable compensation as the circumstan
ces of the case
warrant, to be taxed as costs against the defeated party, orapportioned, as ju
stice requires." (Underscoring supplied)
It is, therefore, clear that when the services of a receiver who has been
properly appointed terminates, his compensation is to be charged against the
defeated party, or the prevailing litigant may be made to share the expense,
as justice requires. Consequently, the trial court's order approving TRB's
compensation to be charged solely against the funds under its receivership is
without legal justification; hence, it was correctly reversed by the Court of
Appeals.
IN VIEW OF THE FOREGOING, the decision appealed from is
AFFIRMED. Costs against petitioner.
SO ORDERED.
Yang vs Valdez
177 SCRA 141
August 31, 1989
FELICIANO, J.:
FACTS:
 The present Petition for Certiorari seeks to annul orders of
Judge Marcelino R. Valdez of RTC General Santos City, Branch 22.
 The assailed orders, respectively, had approved a replevin bond posted
by respondents, denied the counter-replevin bond filed by
Manuel Yaphockun, and rejected petitioner Thomas Yang's counter-
replevin bond.
 On 4 January 1985, respondent spouses Ricardo and
Milagros Morante brought an action against petitioner Thomas
Yang and Manuel Yaphockun, to recover possession of two (2) Isuzu
cargo trucks.
 In their complaint, the Morante spouses alleged that they had actual use
and possession of the two (2) cargo trucks, having acquired them during
the period from 1982 to 1984.
 The trucks were, however, registered in the name of petitioner Thomas
Yang who was the Treasurer in the Morante spouses' business of buying
and selling corn.
 The Morante spouses further alleged that they were deprived of
possession of the vehicles in the morning of 3 January 1985, when
petitioner Yang had the vehicles taken from where they were parked in
front of the Coca-Cola Plant in General Santos City, to the warehouse of
Manuel Yaphockun and there they were thereafter held.
 To obtain immediate possession of the Isuzu trucks, respondent spouses
applied for a writ of replevin and put up a replevin bond of P560,000.00
executed by respondent Milagros Morante and
Atty. Bayani Calonzo (counsel for respondent spouses).
 On 7 January 1985, the respondent judge issued an order of seizure to
take immediate possession and custody of the vehicles involved.
 On 10 January 1985, defendant Manuel Yaphockun filed a motion
seeking repossession of the cargo trucks, and posted a replevin counter-
bond of P560,000.00 executed by himself and one Narciso Mirabueno.
 The respondent spouses reacted by amending their complaint on 13
January 1985 by excluding Manuel Yaphockun as party-defendant. The
following day, i.e., 14 January 1985, the respondents submitted an
opposition to Yaphockun's counter-bond, contending that since
Manuel Yaphockun was merely a nominal defendant, he had no standing
to demand the return of the cargo trucks.
 By an order dated 18 January 1985, the respondent judge disapproved
the counter-bond filed by Manuel Yaphockun, since the latter had been
dropped as party-defendant and accordingly no longer had any
personality to litigate in the replevin suit.
 The trial court also ordered the immediate release and delivery of the
cargo trucks to respondent spouses.
 It is contended by petitioner that that replevin bond was merely an
undertaking of the bondsmen Milagros Morante and Atty. Calonzo to pay
the sum of P560,000.00, that no tangible security, such as"cash,
property or surety", was placed thereby at the disposal and custody of
the court. It is argued, secondly, that the replevin bond was defective
considering that it had been filed by only one of the two (2) private
respondents and that the bondsmen thereon had failed by its terms to
undertake to return the cargo trucks to petitioner should he (the
petitioner) be adjudged lawful owner thereof.
ISSUE: WON judge had committed a grave abuse of discretion amounting to
lack or excess of jurisdiction in approving the replevin bond of respondent
spouses.
HELD: We are not persuaded by petitioner's arguments.
A bond that is required to be given by law is commonly understood to refer to
an obligation or undertaking in writing that is sufficiently secured.[2] It is not
indispensably necessary, however, that the obligation of the bond be secured
or supported by cash or personal property or real property or the obligation of
a surety other than the person giving the bond. Most generally understood, a
"bond" is an obligation reduced to writing binding the obligor to pay a sum of
money to the obligee under specified conditions.[3] At common law, a bond
was merely a written obligation under seal.[4] A bond is often, as a
6
commercial matter, secured by a mortgage on real property; the mortgagee
may be the obligee, although the mortgagee may also be a third party surety
whose personal credit is added to that of the principal obligor under the bond.
The sufficiency of a bond is a matter that is addressed to the sound discretion
of the court which must approve the bond. In the case at bar,
the replevin bond given by the respondent Morante spouses was properly
secured by the sureties themselves who declared their solvency and capacity
to answer for the undertaking assumed, through an Affidavit of Justification
which read as follows:
"We, MILAGROS MORANTE and BAYANI L. CALONZO, both of legal age,
Filipinos, married and residents of Maltana, Tampakan, South Cotabato, and
General Santos City, respectively, after having been duly sworn to in
accordance with law do hereby depose and say:
1. That each of them is a resident house-holder or free-holder within the
Philippines;
2. That each of them is worth the amount specified in the undertaking
assumed by them in the above bond over and above all debts, obligations and
property exempt from execution.
IN WITNESS WHEREOF, we have hereunto set our hands, this 4th day of
January, 1985, at General Santos City, Philippines."
The above sworn declaration of solvency which was submitted to the judge
together with the bond, in effect secured the replevin bond. We note also
that the sureties or bondsmen under the bond included not only
Milagros Morante who was party-plaintiff below, but also a third person,
Atty. Bayani L. Calonzo who was not a party-litigant. Petitioner Yang never
put in issue the financial capability of these two (2) sureties. It follows that
the approval of the replevin bond by respondent judge, before whom it was
presented and who was in a better position than this Court to appreciate the
financial standing of the sureties, can scarely be questioned as a grave abuse
of discretion.
The other objections to the replevin bond are equally lacking in merit. The
fact that the other respondent, Ricardo Morante, did not act as surety on the
same bond as his wife did, does not affect the validity or the sufficiency of
that bond. It would appear to the benefit of petitioner that
Atty. Bayani L. Calonzo signed up as the other or second surety or bondsman
on that bond, since petitioner thereby acquired a right of recourse not only
against the respondent spouses but also against a third person, not a party to
the replevin suit. Further, the failure of the replevin bond to state expressly
that it was "conditioned for the return of the property to the defendant, if the
return thereof be adjudged,"[5] is not fatal to the validity of
the replevin bond. The replevin bond put up by
Milagros Morante and BayaniL. Calonzo stated that it was given "under the
condition that [they] will pay all the costs, which may be adjudged to
the said defendants and all damages which said defendants may sustain by
reason of the order of replevin, if the court shall finally adjudge that the
plaintiffs were not entitled thereto."[6] We believe that the condition of the
bond given in this case substantially complied with the requirement of Section
2, Rule 60. Moreover, the provisions of Rule 60, Section 2 of the Revised
Rules of Court under which the replevin bond was given may be regarded as
having become part of the bond and as having been imported thereunto. All
the particular conditions prescribed in Section 2, Rule 60, although not written
in the bond in printer's ink, will be read into the bond in determining the
scope and content of the liability of the sureties or bondsmen under that
bond.[7]
The provisional remedy of replevin is in the nature of
a possessory action and the applicant who seeks immediate
possession of the property involved need not be holder of the legal
title to the property. It suffices, if at the time he applies for a writ
of replevin, he is, in the words of Section 2, Rule 60, "entitled to the
possession thereof."
A person in actual or constructive possession of the goods sought to
be replevied, should of course be made a party-defendant. At the same time,
however, the respondent spouses, as complainants in the suit for replevin,
were entitled, for their own convenience and at their own peril, to exclude or
strike out the name of a party previously impleaded from the complaint. In
excludingManuel Yaphockun as party-defendant from the complaint, the
respondent spouses were well within their rights; no leave of court was
needed, no responsive pleading having been previously filed.[8]
A defendant in a replevin suit may demand return of possession of the
property replevied by filing a redelivery bond within the periods specified in
Sections 5 and 6 of Rule 60, which provide:
"Sec. 5. Return of property. - If the defendant objects to the sufficiency of
the plaintiff's bond, or of the surety or sureties thereon, he cannot require the
return of the property as in this section provided; but if he does not so
object, he may, at any time before the delivery of the property to the plaintiff,
require the return thereof, by filing with the clerk or judge of the court a
bond executed to the plaintiff, in double the value of the property stated in
the plaintiff's affidavit, for the delivery of the property to the plaintiff, if such
delivery be adjudged, and for the payment of such sum to him as may be
recovered against the defendant, and by serving a copy of such bond on the
plaintiff or his attorney;
Sec. 6. Disposition of property by officer. - If within five (5) days after the
taking of the property by the officer, the defendant does not object to the
sufficiency of the bond, or of the surety or sureties thereon, or require the
return of the property as provided in the last preceding section; or if the
defendant so objects and the plaintiff's first or new bond is approved; or if the
defendant so requires, and his bond is objected to and found insufficient and
does not forthwith file an approved bond, the property shall be delivered to
the plaintiff. If for any reason the property is not delivered to the plaintiff, the
officer must return it to the defendant." (Underscoring supplied)
Under Section 5, petitioner may "at any time before the delivery of the
property to the plaintiff" require the return of the property; in Section 6, he
may do so, "within five (5) days after the taking of the property by the
officer". Both these periods are mandatory in character.[9] Thus, a lower court
which approves a counter-bond filed beyond the statutory periods, acts in
excess of its jurisdiction. In the instant case, the cargo trucks were taken into
custody by the Sheriff on 7 January 1985. Petitioner Yang's counter-
replevin bond was filed on 25 January 1985. The matter was treated at
length in the trial court's order of 28 February 1985:
It is a truism that the primary purpose of summons is to acquire jurisdiction
over the person of the parties, and jurisdiction can be acquired by the
voluntary submission of the defendant to the jurisdiction of the Court. Hence,
after defendant had been duly represented by counsel even at the inception of
the service of summons and a copy of the order of replevin on January 7,
1985, defendant Thomas Yang had already been duly served, especially so,
when counsel manifested in their comment to the opposition filed by plaintiffs
that Manuel Yap has been duly authorized to represent Thomas Yang. From
then on defendant should have been on guard as to the provision of Section
6, Rule 60 of the Rules of Court - re- the five (5) days period within which to
file the counter-replevin for the approval of the court, counted from the actual
taking of the property by the officer or the sheriff on January 7, 1985. It is
honestly believed that the five day period spoken of by the Rule begins from
the taking of the property by the sheriff and not from the service of summons
to the defendant, for even if summons was already duly served to the
defendant but the property has not yet been taken by the sheriff, the
provision above cited does not apply. Hence, it is clear that
the prescriptive period for filing a counter-replevin bond must be counted from
the actual taking of the property by the sheriff, subject of the replevin bond
and in this particular case on January 7, 1985. True indeed, that defendant
Manuel Yap filed the counter-replevin bond on January 10, 1985, which was
denied by this court, that was three (3) days after the property was taken on
January 7, 1985 but when the said defendant was dropped from the complaint
on January 14, 1985, defendant Thomas Yang should have immediately filed
the proper counter-replevin bond after Manuel Yap has been dropped from
the complaint on January 14, 1985 considering that the counter-replevin bond
filed on January 10, 1985 by Manuel Yap has become obsolete on this date,
January 14, 1985. The service of summons to Thomas Yang on January 25,
1985, has become an academic formality because on January 21, 1985,
counsel has already filed a motion for extension of time of fifteen (15) days
within which to file their responsive pleading counted from January 31, 1985,
for the original period of fifteen (15) days for filing the corresponding answer
lapsed on January 31, 1985, which this court readily granted. Hence,
irrespective of the order of this court dated January 18, 1985, denying the
counter-replevin bond filed, defendant Thomas Yang should and must have
filed his counter-replevin bond within two (2) days from service of the
amended complaint, the same must have been filed on January 18, 1985, to
conform with liberal interpretation of the rules and not on January 25,
1985, for then the counter-replevin bond had been filed beyond the period
provided by the Rules. The decisional principle on the filing of counter-
replevin bond to entitle the defendant to the redelivery or retaining possession
of the property, is compliance with all the conditions precedent pursuant to
the rules, and failure to comply therewith entitles plaintiff to possession, and
the initial steps in obtaining redelivery must be taken within the time limit
provided thereto. x x x"[10](Underscoring supplied)
We agree with the conclusion of respondent judge that petitioner's right to file
a counterbond had already prescribed.
We consider, accordingly, that respondent judge did not commit any grave
abuse of discretion amounting to lack or excess of jurisdiction in issuing the
orders here assailed.
7
FILINVEST CREDIT CORPORATION, PETITIONER, VS. HON. COURT conduct to the end that law may approach its supreme ideal, which is the on foreclosure, it must bring a civil action either to recover such possession as
OF APPEALS AND SPOUSES EDILBERTO AND MARCIANA TADIAMAN, sway and dominance of justice." a preliminary step to the sale or to obtain judicial foreclosure. Pertinent
RESPONDENTS.  Petitioner Filinvest Credit Corporation (hereinafter Filinvest) appealed portions of Bachrach read as follows:
G.R. No. 115902, September 27, 1995 that portion of the judgment on the counterclaim to the Court of
DAVIDE, JR., J.: Appeals.The plaintiff-appellant argues that it had the right to seize the Where, however, debtor refuses to yield up the property, the creditor must
truck from the moment that the defendants-appellees defaulted in the institute an action, either to effect a judicial foreclosure directly, or to secure
payment of the monthly installments, and to institute an action for possession as a preliminary to the sale contemplated in the provision above
FACTS:
replevin preliminary to effecting a foreclosure of the property mortgaged quoted. He cannot lawfully take the property by force against the will of the
 Defendants-appellees, spouses Edilberto and Marciana Tadiaman,
extrajudicially. debtor. Upon this point the American authorities are even more harmonious
residents of Cabanatuan City, purchased a 10-wheeler Isuzu cargo truck
 The plaintiff-appellant misses the point entirely. In the first place, it has than they are upon the point that the creditor is entitled to possession. As
from Jordan Enterprises, Inc., in Quezon City, in installments.
not been held liable for filing an action for replevin in order to recover was said many years ago by the writer of this opinion in a monographic article
 Said spouses executed a promissory note for P196,680.00 payable in 24
possession of the truck prior to its foreclosure, but for the manner in contributed to an encyclopedic legal treatise, "if possession cannot be
monthly installments in favor of Jordan Enterprises, Inc., and a Chattel
which it carried out the seizure of the vehicle. In the second place, peaceably obtained the mortgagee must bring an action." (Trust Deeds and
Mortgage over the motor vehicle purchased to secure the payment of the
plaintiff-appellant was held liable for hiding the truck and making it Power of Sale Mortgages, 28 Am. & Eng. Encyc. of Law, 2d ed., 783.) In the
promissory note.
difficult for the defendants-appellees to recover the same. In the third Article of Chattel Mortgages, in Corpus Juris, we find the following statement
 Jordan Enterprises, Inc. assigned its rights and interests over the said
place, there is unrebutted evidence that the truck was "cannibalized" of the law on the same point: "The only restriction on the mode by which the
instruments to Filinvest Finance and Leasing Corporation, which in turn
while in the custody of the plaintiff-appellant. mortgagee shall secure possession of the mortgaged property after breach of
assigned them to plaintiff-appellant Filinvest Credit Corporation.
condition is that he must act in an orderly manner and without creating a
ISSUE: WON FILINVEST is liable for damages due to the manner it carried breach of the peace, subjecting himself to an action to trespass." (11 C.J.,
 Subsequently, the spouses Tadiaman defaulted in the payment of the
out the seizure of the vehicle. 560; see also 5 R.C.L., 462.)
installments due on the promissory note, and plaintiff-appellant filed an
action for replevin and damages against them with the court below.
HELD: Yes. As to the sole issue defined above, the Court of Appeals correctly The reason why the law does not allow the creditor to possess himself of the
 Upon motion of the plaintiff-appellant, a writ of replevin was issued, and
ruled that Filinvest is liable for damages not because it commenced an action mortgaged property with violence and against the will of the debtor is to be
the truck was seized in the province of Isabela, by persons who
for replevin to recover possession of the truck prior to its foreclosure, but found in the fact that the creditor's right of possession is conditioned upon the
represented themselves to be special sheriffs of the court, but who
because of the manner it carried out the seizure of the vehicle. Sections 3 and fact of default, and the existence of this fact may naturally be the subject of
turned out to be employees of the plaintiff-appellant.
4, Rule 60 of the Rules of Court are very clear and direct as to the procedure controversy. The debtor, for instance, may claim in good faith, and rightly or
 The truck was brought by such persons all the way back to Metro Manila.
for the seizure of property under a writ of replevin, thus: wrongly, that the debt is paid, or that for some other reason the alleged
 Thereafter, defendant spouses filed a counterbond, and the lower court
default is nonexistent. His possession in this situation is as fully entitled to
ordered the return of the truck.
Sec. 3. Order. Upon the filing of such affidavit and bond with the protection as that of any other person, and in the language of article 446 of
 This was not immediately implemented because the defendant spouses
clerk or judge of the court in which the action is pending, the judge the Civil Code he must be respected therein. To allow the creditor to seize the
were met with delaying tactics of the plaintiff-appellant, and when they
of such court shall issue an order describing the personal property property against the will of the debtor would make the former to a certain
finally recovered the truck, they found the same to be "cannibalized".
alleged to be wrongfully detained, and requiring the sheriff or other extent both judge and executioner in his own cause -- a thing which is
 After trial, the trial court rendered a decision the dispositive portion of
proper officer of the court forthwith to take such property into his inadmissible in the absence of unequivocal agreement in the contract itself or
which reads as follows:
custody. express provision to that effect in the statute.
WHEREFORE, judgment is hereby rendered on the main action, in favor
of plaintiff and against defendants, ordering the latter, jointly and
Sec. 4. Duty of the officer. Upon receiving such order the officer It will be observed that the law places the responsibility of conducting the sale
severally, to pay the plaintiff the following sums:
must serve a copy thereof on the defendant together with a copy of upon "a public officer;" and it might be supposed that an officer, such as the
the application, affidavit and bond, and must forthwith take the sheriff, can seize the property where the creditor could not. This suggestion
(a) The sum of P88,333.32 which is the balance of the promissory note
property, if it be in the possession of the defendant or his agent, and is, we think, without force, as it is manifest that the sheriff or other officer
as of September 26, 1982, with interest thereon at 14% per annum from
retain it in his custody. ... (emphasis supplied) proceeding under the authority of the language already quoted from section
said date.
14 of the Chattel Mortgage Law, becomes pro hac vice the mere agent of the
In the instant case, it was not the sheriff or any other proper officer of the creditor. There is nothing in this provision which creates a specific duty on
(b) The sum equivalent to 25% of the amount sued upon, as and for
trial court who implemented the writ of replevin. Because it was aware that no the part of the officer to seize the mortgaged property; and no intention on
attorney's fees, that is P88,333.32 plus the stipulated interest; and
other person can implement the writ, Filinvest asked the trial court to appoint the part of the law-making body to impose such a duty can be implied. The
a special sheriff. Yet, it used its own employees who misrepresented conclusion is clear that for the recovery of possession, where the right is
(c) The costs of suit.
themselves as deputy sheriffs to seize the truck without having been disputed, the creditor must proceed along the usual channels by action in
 On the Counterclaim: Plaintiff not having successfully rebutted the
authorized by the court to do so. Filinvest justified its seizure by citing a court. Whether the sheriff, upon being indemnified by the creditor, could
defendants' evidence respecting damages caused to them by virtue of
statement in Bachrach Motor Co. vs. Summers,[9] to wit, "the only restriction safely proceed to take the property from the debtor, is a point upon which we
the illegal seizure of the property, and hiding the truck in some other
on the mode by which the mortgagee shall secure possession of the express no opinion. . . .
place not their garage, feigning knowledge that the same had been
mortgaged property after breach of condition is that he must act in an orderly
recorded in their incoming ledger books, the "cannibalizing" done while
manner and without creating a breach of the peace, subjecting himself to an But whatever conclusion may be drawn in the premises with respect to the
the truck was in the custody of plaintiff's garage, the frustrations which
action for trespass." true nature of a chattel mortgage, the result must in this case be the same;
the defendants had to undergo for two weeks before the truck was
for whether the mortgagee becomes the real owner of the mortgaged
finally placed in the hands of Sheriff Dizon, all point to the liability of
This justification is misplaced and misleading for Bachrach itself had ruled that property as some suppose or acquires only certain rights therein, it is none
plaintiff for its failure intentionally or otherwise "to observe certain norms
if a mortgagee cannot obtain possession of a mortgaged property for its sale the less clear that he has after default the right of possession; though it
that spring from the fountain of good conscience and guide human
8
cannot be admitted that he may take the law into his own hands and wrest ALIBSAR ADOMA, complainant, vs. ROMEO GATCHECO, Sheriff III,  The Court agrees with the findings of the investigating Judge and the
the property violently from the possession of the mortgagor. Neither can he and EUGENIO TAGUBA, Process Server, of Branches 1 and 2, OCA that respondents received the amount of P2,000.00 and that they
do through the medium of a public officer that which he cannot directly do respectively, of the Municipal Trial Court in Cities of Santiago demanded the payment of an additional P6,000.00 from complainant.
himself. The consequence is that in such case the creditor must either resort City, respondents. The testimony of complainant before the investigating Judge is worthy of
to a civil action to recover possession as a preliminary to a sale, or preferably [A.M. No. P-05-1942. January 17, 2005] belief because the same was not only candid and direct but also
he may bring an action to obtain a judicial foreclosure in conformity, so far as YNARES-SANTIAGO, J.: corroborated by two witnesses who attested to the veracity of
practicable, with the provisions of the Chattel Mortgage Law.[10] complainants accusations. The writ of replevin has been implemented
FACTS: and the vehicle is now in complainants possession.
Replevin is, of course, the appropriate action to recover possession
 The instant administrative complaint filed against respondents for ISSUE: WON there is misconduct on the part of the Sheriff and Process
preliminary to the extrajudicial foreclosure of a chattel mortgage.
violation of Republic Act No. 3019 (Anti-Graft and Corrupt Practices Act) server in the manner of execution of the writ of replevin. Yes
Filinvest did in fact institute such an action and obtained a writ of
and conduct unbecoming a court employee, arose from the execution of
replevin. And, by filing it, Filinvest admitted that it cannot acquire
a writ of replevin in Adoma v. Spouses Edmundo Andres and Luzviminda HELD: Under Section 9, Rule 141 of the Rules of Court, the procedure
possession of the mortgaged vehicle in an orderly or peaceful
Andres for recovery of possession of motor vehicle with prayer for the for the execution of writs and other processes are: first, the sheriff must make
manner. Accordingly, it should have left the enforcement of the writ
issuance of a writ of replevin before Branch 1 of the Municipal Trial Court an estimate of the expenses to be incurred by him; second, he must obtain
in accordance with Rule 60 of the Rules of Court which it had
in Cities (MTCC) of Santiago City, presided by Judge Ruben Plata. court approval for such estimated expenses; third, the approved estimated
voluntarily invoked.
expenses shall be deposited by the interested party with the Clerk of Court
 Complainant Alibsar Adoma claimed that on August 16, 2003 a writ of and ex-oficio sheriff; fourth, the Clerk of Court shall disburse the amount to
Parenthetically, it must be observed that the trial court erred in replevin[1] for the recovery of an L-300 van was issued in his favor. the executing sheriff; and fifth, the executing sheriff shall liquidate his
holding that the action for replevin was "not in order as [Filinvest] is
expenses within the same period for rendering a return on the writ. Any
not the owner of the property (Sec. 2 par. (a) Rule 60)."[11] It is not  On the same day, respondent sheriff Romeo Gatcheco implemented the
amount received by the sheriff in excess of the lawful fees allowed by the
only the owner who can institute a replevin suit. A person "entitled writ. He was accompanied by respondent Eugenio Taguba, a process
Rules of Court is an unlawful exaction which renders him liable for grave
to the possession" of the property also can, as provided in the same server of Branch 2 of MTCC, Santiago City, who volunteered to assist
misconduct and gross dishonesty.[7]
paragraph cited by the trial court, which reads: respondent sheriff.
In the instant case, respondent sheriff totally disregarded the aforecited
SEC. 2. Affidavit and bond. Upon applying for such order the  After the two respondents seized the vehicle, they demanded payment of
procedure. He failed to make and submit estimate of the sheriffs expenses.
plaintiff must show ... P8,000.00, allegedly promised by complainant but the latter was able to
The amounts received and demanded by him are therefore unauthorized fees.
give only P1,000.00 and another P1,000.00 the following day.[2]
His acts of accepting and soliciting said monetary considerations make him
 The writ of replevin stated that the vehicle will be delivered to liable not only for conduct unbecoming a court employee but also for grave
That the plaintiff is the owner of the property claimed, misconduct and dishonesty.
complainant after 5 days from the implementation thereof.
(a) particularly describing it, or is entitled to the possession
thereof;... (Italics supplied)  With the vehicle still undelivered on the 7th day, complainant threatened As correctly found by the OCA, respondent sheriff deliberately failed to
to file an administrative case against respondent sheriff. place complainant in possession of the vehicle after five days from the
Upon the default by the mortgagor in his obligations, Filinvest, as a implementation of the writ because the latter failed to give the whole amount
mortgagee, had the right to the possession of the property  Finally, on August 29, 2003, the latter was forced to release the vehicle he promised. Since the adverse party did not object to the complainants bond
mortgaged preparatory to its sale in a public auction.[12] However, to complainant. nor posted a redelivery bond to recover possession of the vehicle taken under
for employing subterfuge in seizing the truck by misrepresenting its the writ of replevin, respondent sheriff is under obligation to deliver the van to
employees as deputy sheriffs and then hiding and cannibalizing it,  Respondents, however, continued to demand P6,000.00, hence complainant. However, it took respondent sheriff 13 days before he released
Filinvest committed bad faith in violation of Article 19 of the Civil complainant filed the instant administrative case.[3] the vehicle to complainant, a clear violation of Section 6, Rule 60 of the 1997
Code which provides: Revised Rules of Civil Procedure which provides
 Respondents, on the other hand, denied soliciting and receiving any
amount from the complainant. Respondent sheriff admitted, however,
Every person must, in the exercise of his rights and in the
that complainant promised to give him P10,000.00 if the vehicle will be SEC. 6. Disposition of property by sheriff.If within five (5) days after the
performance of his duties, act with justice, give everyone his due,
sold.[4] taking of the property by the sheriff, the adverse party does not object to the
and observe honesty and good faith.
sufficiency of the bond, or of the surety or sureties thereon; or if the adverse
 In her investigation report, Judge Madrid found the testimony of party so objects and the court affirms its approval of the applicants bond or
Decision is AFFIRMED, subject to the modifications abovestated (a) Actual complainant which was corroborated by two witnesses, to be more approves a new bond, or if the adverse party requires the return of the
damages in the reduced amount of P33,222.00; (b) Moral damages in the credible. property but his bond is objected to and found insufficient and he does not
amount of P50,000.00; and
forthwith file an approved bond, the property shall be delivered to the
(c) Exemplary damages in the amount of P20,000.00.  Upon receipt of the report of Judge Madrid, the Court referred the case
applicant. If for any reason the property is not delivered to the applicant, the
------------------------------------------------------------------------------- to the Office of the Court Administrator (OCA) for evaluation, report and
sheriff must return it to the adverse party. (6a)
recommendation.[6]

 It recommended that respondent sheriff be fined in the amount of In Apuyan, Jr. v. Sta Isabel,[8] citing Alvarez, Jr. v. Martin,[9] a sheriff
P5,000.00 for conduct unbecoming a court employee and that was similarly found guilty of grave misconduct, dishonesty and conduct
respondent Taguba be reprimanded for trying to abet the misconduct of grossly prejudicial to the best interest of the service for receiving and soliciting
a fellow employee of another court.

9
money from the complainant and for deliberately ignoring the rules for the
implementation of a writ of attachment, thus
Furthermore, respondents act of demanding money and receiving P1,500.00
from the complainant for the lunch and merienda of the policemen who will
accompany him in executing the decision of the Court is a clear violation of
section 9, Rule 141. The Rules require the sheriff to estimate his expenses in
the execution of the decision. The prevailing party will then deposit the said
amount to the Clerk of Court who will disburse the amount to the sheriff,
subject to liquidation. Any unspent amount will have to be returned to the
prevailing party. In this case, no estimate of sheriffs expenses was submitted
to the court by respondent. In fact, the money which respondent deputy
sheriff had demanded and received from complainant was not among those
prescribed and authorized by the Rules of Court. This Court has ruled that any
amount received by the sheriff in excess of the lawful fees allowed by the
Rules of Court is an unlawful exaction and renders him liable for grave
misconduct and gross dishonesty.
Finally, the procedure for execution of a final judgment is the same as that in
carrying out a writ of preliminary attachment, as set forth in Rule 141 of the
Rules of Court
Clearly, in this case, respondent not only utterly failed to live up to the high
ethical standards required of a sheriff, but also, he totally ignored Section 9,
Rule 141 of the Rules of Court. Respondent failed to demonstrate that he
followed the procedure laid down by Rule 141.
With respect to respondent Taguba, we find the sanction of reprimand
too light a penalty for his transgression. Although it was not him who
deliberately delayed the delivery of the vehicle to force complainant to yield to
the sheriffs demand, and that complainant did not point to him as the one
who received the amount of P2,000.00, respondent Taguba assisted
respondent sheriff in soliciting money from complainant. Note that respondent
Taguba is a process server of another branch of the MTCC of Santiago City
but he volunteered to aid respondent sheriff in the implementation of the writ.
At the grassroots of our judicial machinery, sheriffs are indispensably in
close contact with the litigants, hence, their conduct should be geared
towards maintaining the prestige and integrity of the court, for the image of a
court of justice is necessarily mirrored in the conduct, official or otherwise, of
the men and women who work thereat, from the judge to the least and
lowest of its personnel; hence, it becomes the imperative sacred duty of each
and everyone in the court to maintain its good name and standing as a temple
of justice.[13]
WHEREFORE, in view of all the foregoing, respondent Romeo
Gatcheco, Sheriff III, Municipal Trial Court in Cities, Branch 1, Santiago City is
found GUILTY of Grave Misconduct, Dishonesty and Conduct Grossly
Prejudicial to the Best Interest of the Service and is SUSPENDED for one (1)
year, without pay. Respondent Eugenio Taguba, Process Server, Municipal
Trial Court in Cities, Branch 2, Santiago City is found GUILTY of Conduct
Prejudicial to the Best Interest of the Service and is SUSPENDED for six (6)
months without pay.
Respondents are warned that a repetition of the same or any other act
of infraction in the future shall be dealt with most severely. SO ORDERED.
PAAT V CA
FACTS:
 On May 19, 1989, the truck of VICTORIA DE GUZMAN was seized by the
DENR because the driver of the truck was not able to produce the
required documents for the forest products.
 Petitioner JOVITO LAYUGAN, the Community Environment and Natural
Resources Officer (CENRO), issued an order of confiscation of the truck
and gave the owner 15 days to submit an explanation. Owner was not
able to submit an explanation and the order of the CENRO was enforced.
 The issue was brought to the secretary of DENR. Pending the case, the
owner filed a suit for Replevin vs. LAYUGAN.
 LAYUGAN filed a Motion to Dismiss on the ground that the owner failed
to exhaust administrative remedies.
o Petitioners aver that the trial court could not legally entertain
the suit for replevin because the truck was under
administrative seizure proceedings pursuant to Section 68-A of
P.D. 705, as amended by E.O. 277. Private respondents, on
the other hand, would seek to avoid the operation of this
principle asserting that the instant case falls within the
exception of the doctrine upon the justification that (1) due
process was violated because they were not given the chance
to be heard, and (2) the seizure and forfeiture was unlawful on
the grounds: (a) that the Secretary of DENR and his
representatives have no authority to confiscate and forfeit
conveyances utilized in transporting illegal forest products, and
(b) that the truck as admitted by petitioners was not used in
the commission of the crime.
 RTC: ruled in favour of the owner.
 CA: affirmed the decision of the RTC
ISSUE: WON the trial has jurisdiction over the case
HELD:
 No. This Court in a long line of cases has consistently held that before a
party is allowed to seek the intervention of the court, it is a pre-condition
that he should have availed of all the means of administrative processes
afforded him. Hence, if a remedy within the administrative machinery can
still be resorted to by giving the administrative officer concerned every
opportunity to decide on a matter that comes within his jurisdiction then
such remedy should be exhausted first before courts judicial power can
be sought. The premature invocation of courts intervention is fatal to
ones cause of action.
 To sustain the claim of private respondents would in effect bring the
instant controversy beyond the pale of the principle of exhaustion of
administrative remedies and fall within the ambit of excepted cases
heretofore stated. However, considering the circumstances prevailing in
this case, we can not but rule out these assertions of private respondents
to be without merit. First, they argued that there was violation of due
process because they did not receive the May 23, 1989 order of
confiscation of petitioner Layugan. This contention has no leg to stand
on. Due process does not necessarily mean or require a hearing, but
simply an opportunity or right to be heard.[28] One may be heard , not
solely by verbal presentation but also, and perhaps many times more
creditably and practicable than oral argument, through pleadings.[29] In
administrative proceedings moreover, technical rules of procedure and
evidence are not strictly applied; administrative process cannot be fully
equated with due process in its strict judicial sense.[30] Indeed,
deprivation of due process cannot be successfully invoked where a party
was given the chance to be heard on his motion for reconsideration,[31]
as in the instant case, when private respondents were undisputedly given
the opportunity to present their side when they filed a letter of
reconsideration dated June 28, 1989 which was, however, denied in an
order of July 12, 1989 of Executive Director Baggayan.
 From the foregoing disquisition, it is clear that a suit for replevin can not
be sustained against the petitioners for the subject truck taken and
retained by them for administrative forfeiture proceedings in pursuant to
Section 68-A of the P. D. 705, as amended. Dismissal of the replevin suit
for lack of cause of action in view of the private respondents failure to
exhaust administrative remedies should have been the proper course of
action by the lower court instead of assuming jurisdiction over the case
and consequently issuing the writ ordering the return of the truck.
Exhaustion of the remedies in the administrative forum, being a condition
precedent prior to ones recourse to the courts and more importantly,
being an element of private respondents right of action, is too significant
to be waylaid by the lower court.
 It is worth stressing at this point, that a suit for replevin is founded solely
on the claim that the defendant wrongfully withholds the property sought
to be recovered. It lies to recover possession of personal chattels that
are unlawfully detained.[39] To detain is defined as to mean to hold or
keep in custody,[40] and it has been held that there is tortuous taking
whenever there is an unlawful meddling with the property, or an exercise
or claim of dominion over it, without any pretense of authority or right;
this, without manual seizing of the property is sufficient.[41] Under the
Rules of Court, it is indispensable in replevin proceedings, that the
plaintiff must show by his own affidavit that he is entitled to the
possession of property, that the property is wrongfully detained by the
defendant, alleging the cause of detention, that the same has not been
taken for tax assessment, or seized under execution, or attachment, or if
so seized, that it is exempt from such seizure, and the actual value of the
property.[42] Private respondents miserably failed to convince this Court
that a wrongful detention of the subject truck obtains in the instant case.
It should be noted that the truck was seized by the petitioners because it
was transporting forest products with out the required permit of the
DENR in manifest contravention of Section 68 of P.D. 705 as amended by
E.O 277. Section 68-A of P.D. 705, as amended, unquestionably warrants
the confiscation as well as the disposition by the Secretary of DENR or
his duly authorized representatives of the conveyances used in violating
the provision of forestry laws. Evidently, the continued possession or
detention of the truck by the petitioners for administrative forfeiture
proceeding is legally permissible, hence , no wrongful detention exists in
the case at bar.
10
 Moreover, the suit for replevin is never intended as a procedural tool to
question the orders of confiscation and forfeiture issued by the DENR in
pursuance to the authority given under P.D.705, as amended. Section 8
of the said law is explicit that actions taken by the Director of the Bureau
of Forest Development concerning the enforcement of the provisions of
the said law are subject to review by the Secretary of DENR and that
courts may not review the decisions of the Secretary except through a
special civil action for certiorari or prohibition.
CITIBANK V CA
FACTS:
 In consideration for a loan with Citibank, N.A. (formerly First National
City Bank), private respondent Douglas Anama executed a promissory
note to pay the plaintiff bank the sum of P418,000.00 in sixty (60) equal
successive monthly installments.
 To secure payment of the loan, Anama also constituted a Chattel
Mortgage in favor of petitioner, on various machineries and equipment.
 However, for failure and refusal of the private respondent to pay the
monthly installments despite repeated demands, petitioner filed a verified
complaint against Anama in the Manila CFI for the collection of his
unpaid balance, for the delivery and possession of the chattels covered
preparatory to the foreclosure.
 Anama submitted his Answer with Counterclaim, denying the material
averments of the complaint, and averring, inter alia that the remedy of
replevin was improper and the writ of seizure should be vacated.
 RTC: upon proof of default f the private respondent in the payment of
the said loan, issued an Order of Replevin. Despite the issuance of the
said order however, actual delivery of possession did not take place
because of negotiations for an amicable settlement.
o A pre-trial conference was held and the petitioner then took
over private respondent’s business as receiver.
o Settlement failed – RTC tried the case on its merits.
 Petitioner presented a Motion for the Issuance of an Alias Writ of Seizure,
ordering the sheriff to seize and dispose of the properties involved.
o Private respondent opposed the motion claiming, among
others:
 (1) that Citibank’s P400,000 replevin bond to answer
for damages was grossly inadequate;
 (2) that he was never in default to justify the
seizure;
 (3) that his supposed obligations with Citibank were
fully secured and his mortgaged properties are more
than sufficient to secure payment thereof
 RTC: issued an Order granting the Motion for Alias Writ of Seizure.
o Private respondent’s MR was denied.
o As a consequence, the sheriff seized subject properties,
dismantled and removed them from the premises where they
were installed, delivered them to petitioner’s possession and
advertised them for sale at public auction.
 Private respondent filed with the CA a Petition for Certiorari and
Prohibition with Injunction.
 CA: granted the petition, holding that the provisions of the Rules of
Court on Replevin and Receivership have not been complied with, in that
(1) there was no Affidavit of Merit accompanying the Complaint for
Replevin; (2) the bond posted by Citibank was insufficient; and (3) there
was non-compliance with the requirement of a receiver’s bond and oath
of office.
ISSUE:
1. WON CA erred in finding that the issuance of writ of replevin was
improper
2. WON CA erred in finding that the complaint did not comply with the
requirements of an affidavit of merit
3. WON CA erred in finding that the bond posted by petitioner is
insufficient
4. WON CA erred in finding that petitioner did not comply with Section
5, Rule 59
HELD:
1. No.
A judgment is on the merits when it determines the rights and liabilities
of the parties on the basis of the disclosed facts, irrespective of formal,
technical or dilatory objections, and it is not necessary that there should
have been a trial.[9] The assailed decision of the Court of Appeals did
not make any adjudication on the rights and liabilities between Citibank
and Douglas Anama. There was no finding yet of the fact of default. The
decision only ruled on the propriety of the issuance of the writ of seizure
by the trial court. As worded by the respondent court itself, the main
issues to be resolved are whether there was lack or excess of jurisdiction,
or grave abuse of discretion, in the issuance of the orders in question,
and there is no appeal nor any plain, speedy, and adequate remedy in
the ordinary course of law.[10]
In resolving the issue posed by the petition, the Court of Appeals limited
its disposition to a determination of whether or not the assailed order of
seizure was issued in accordance with law, that is, whether the
provisions of the Rules of Court on delivery of personal property or
replevin as a provisional remedy were followed. The Court of Appeals
relied on Rule 60 of the Rules of Court, which prescribes the procedure
for the recovery of possession of personal property, which Rule,
provides:
Sec. 2. Affidavit and Bond. - Upon applying or such order the plaintiff
must show by his own affidavit or that of some other person who
personally knows the facts:
(a) That the plaintiff is the owner of the property claimed particularly
describing it, or is entitled to the possession thereof;
(b) That the property is wrongfully detained by the defendant, alleging
the cause of detention thereof according to his best of knowledge,
information and belief;
(c) That it has not been taken for a tax assessment or fine pursuant to
law, or seized under an execution, or an attachment against the property
of the plaintiff, or is so seized, that is exempt from such seizure; and
(d) The actual value of the property.
The plaintiff must also give a bond, executed to the defendant in double
of the value of the property as stated in the affidavit aforementioned, for
the return of the property to the defendant of such sum as he may
recover from the plaintiff in the action.
The Court of Appeals did not pass upon the issue of who, as between
Douglas Anama and Citibank, is entitled to the possession of subject
machineries, as asserted by the latter. When it ordered the restoration of
the said machineries to Douglas Anama (now the private respondent), it
merely brought the parties to a status quo, by restoring the defendant to
the possession of his properties, since there was a finding that the
issuance of the writ was not in accordance with the specific rules of the
Rules of Court.
2. Yes.
While petitioner is correct insofar as it contends that substantial
compliance with the affidavit requirement may be permissible pursuant
to Section 2, Rule 60 of the ROC, petitioner’s complaint does notallege all
the facts that should be set forth in an affidavit of merit.
The Court held that the absence of an affidavit of merit is not fatal where
the petition itself, which is under oath, recites the following facts
constitutive of the grounds for the petition: (1) that plaintiff owns the
property particularly describing the same, or that he is entitled to its
possession; (2) wrongful detention by defendant of said property; (3)
that the property is not taken by virtue of a tax assessment or fine
pursuant to law or seized under execution or attachment or, if it is so
seized, that it is exempt from such seizure; and the (4) the actual value
of the property.
Although the complaint alleges that petitioner is entitled to the
possession of subject properties by virtue of the chattel mortgage
executed by the private respondent, upon the latter’s default on its
obligation, and the defendant’s alleged “wrongful detention” of the same,
the said complaint does not state that subject properties were not taken
by virtue of a tax assessment or fine imposed pursuant to law or seized
under execution or attachment or, if they were so seized, that they are
exempt from such seizure. Then too, petitioner stated the value of
subject properties at a “probable value of P200,000.00, more or less”.
Although respondent’s defense of lack of affidavit of merit is meritorious,
procedurally, such a defense is unfortunately no longer available for
failure to plead the same in the Answer as required by the omnibus
motion rule.
3. Yes.
The Rules of Court requires the plaintiff to “give a bond, executed to the
defendant in double the value of the property as stated in the affidavit x
x x .” Since the valuation made by the petitioner has been disputed by
the respondent, the lower court should have determined first the actual
11
 value of the properties. It was thus an error for the said court to approve
the bond, which was based merely on the probable value of the
properties. A replevin bond is intended to answer for damages and to
indemnify the defendant against any loss that he may suffer by reason of
its being compelled to surrender the possession of the disputed property
pending trial of the action.
The remedies provided under Section 5, Rule 60, are alternative
remedies. Conformably, a defendant in a replevin suit may demand the
return of possession of the property replevined by filing a redelivery bond
executed to the plaintiff in double the value of the property as stated in
the plaintiff’s affidavit within the period specified in Sections 5 and 6.
Alternatively, “the defendant may object to the sufficiency of the
plaintiff’s bond, or of the surety or sureties thereon;” but if he does so,
“he cannot require the return of the property” by posting a counter-bond
pursuant to Sections 5 and 6. The private respondent did not opt to
cause redelivery of the properties to him by filing a counter-bond
precisely because he objected to the sufficiency of the bond posted by
plaintiff. Therefore, he need not file a counter-bond or redelivery bond.
4. No.
CA found that the requirements of Section 5, Rule 59 on receivership
were not complied with by the petitioner, particularly the filing or posting
of a bond and the taking of an oath. However, the old Rules of Court
which was in effect at the time this case was still at trial stage, a bond
for the appointment of a receiver was not generally required of the
applicant, except when the application was made ex parte. CA was right
in finding a defect in such assumption of receivership in that the
requirement of taking an oath has not been complied with.
For erroneously issuing the alias writ of seizure without inquiring into the
sufficiency of the replevin bond and for allowing petitioner to assume
receivership without the requisite oath, the Court of Appeals aptly held
that the trial court acted with grave abuse of discretion in dealing with
the situation. Under the Revised Rules of Court, the property seized
under a writ of replevin is not to be delivered immediately to the plaintiff.
This is because a possessor has every right to be respected in its
possession and may not be deprived of it without due process. Petition
DISMISSED.
FERNANDEZ V ICB
FACTS:
 Petitioners purchased a Nissan Sentra Sedan through a financing scheme
of the private respondent, the International Corporate Bank, now Union
Bank of the Philippines, and the chattel mortgage was executed in favor
of the financing institution on November 10, 1993. Purchase price was
P492,000.00, minus the downpayment of P147,500.00, leaving the
amount of P344,[5]00.00 to be financed. The total amount to be paid for
48 monthly installments would amount to P553,944.00.
 Petitioner added that due to the respondent bank’s greedy desire to
unjustly enrich itself at the expense of the petitioners, the former filed an
unfounded complaint for a sum of money with replevin (Case No. 983-
96) before the Metropolitan Trial Court, Branch 44, Pasay City.
 Petitioners filed an Answer mentioning in the special and affirmative
defenses a Motion to Dismiss, for lack of jurisdiction, but this was denied
on February 10, 1997 and was received on February 20, 1997.
o A Motion for Reconsideration was then submitted on April 2,
1997.
o Denied.
 When the respondent bank filed its complaint with prayer for the
issuance of a Writ of Replevin on November 28, 1997, the monthly
installments were almost fully paid; [they] would have been fully paid on
November 26, 1997. Furthermore, the cars mileage at the time of illegal
seizure was only 28,464 kilometers. They could not have been
considered in default at the time the complaint was filed, considering
that: (a) they attempted many times to pay the bank their installments
for the months of August, September, October, 1996, and up to the time
of the filing of the case, they ha[d] not received any statement of
delinquency as mandated by R.A. No. 3165, otherwise known as the
Truth in Lending Act.
o Their petition for the outright dismissal of the complaint, as
well as the lifting of the Writ of Replevin was denied even if
the amount of P553,344.00 representing the value of the
chattel was beyond the jurisdiction of the court.
 CA: ruled that the Metropolitan Trial Court (MTC) of Pasay City had
jurisdiction over civil cases in which the amount of the demand did not
exceed P200,000 exclusive of interest, damages and attorneys fees. The
basic claim in the present case was P190,635.90; hence, the MTC had
jurisdiction.
ISSUE:
1. May the Writ of Replevin issued by the MTC of Pasay City be
enforced outside the city?
2. Did the MTC have jurisdiction over the Complaint?
3. Were petitioners entitled to the redelivery of the subject vehicle?
HELD:
1. Yes.
Under the Resolution of the Supreme Court en banc, dated January 11,
1983, providing for the interim rules and guidelines relative to the
implementation of BP 129, a writ of replevin like the one issued in the
present case may be served anywhere in the Philippines. Specifically, the
said Resolution states:
3. Writs and processes. ---
(a) Writs of certiorari, prohibition, mandamus, quo warranto, habeas
corpus and injunction issued by a regional trial court may be enforced in
any part of the region.
(b) All other processes, whether issued by a regional trial court or a
metropolitan trial court, municipal trial court or municipal circuit trial
court may be served anywhere in the Philippines, and, in the last three
cases, without a certification by the judge of the regional trial court.[10]
2.
Thus, the Writ of Replevin issued by Judge Paas, which obviously does
not fall under item a of the above-cited Rule, may be validly enforced
anywhere in the Philippines. Petitioners confused the jurisdiction of a
court to hear and decide a case on the one hand with, on the other, its
power to issue writs and processes pursuant to and in the exercise of
said jurisdiction. Applying the said Rule, Malaloan v. Court of Appeals[11]
reiterated the foregoing distinction between the jurisdiction of the trial
court and the administrative area in which it could enforce its orders and
processes pursuant to the jurisdiction conferred on it:
We feel that the foregoing provision is too clear to be further belabored
or enmeshed in unwarranted polemics. The rule enumerates the writs
and processes which, even if issued by a regional trial court, are
enforceable only within its judicial region. In contrast, it unqualifiedly
provides that all other writs and processes, regardless of which court
issued the same, shall be enforceable anywhere in the Philippines. No
legal provision, statutory or reglementary, expressly or impliedly provides
a jurisdictional or territorial limit [to] its area of enforceability. On the
contrary, the above-quoted provision of the interim Rules expressly
authorizes its enforcement anywhere in the country, since it is not among
the processes specified in paragraph (a) and there is no distinction or
exception made regarding the processes contemplated in paragraph (b).
Petitioners object to the filing of the Complaint in Pasay City, pointing out
that their residence is in Quezon City, while private respondents principal
place of business is in Makati. Again, we are not persuaded. Under the
Rules of Court before the 1997 amendments,[12] an objection to an
improper venue must be made before a responsive pleading is filed.
Otherwise, it will be deemed waived. In Diaz v. Adiong,[13] the Court
explained such requirement in this wise:
xxx. Indeed, the laying of venue is procedural rather than substantive,
relating as it does to jurisdiction of the court over the person rather than
the subject matter. Venue relates to trial and not to jurisdiction.
jj
Finally, Sec. 1 of Rule 16 provides that objections to improper venue
must be made in a motion to dismiss before any responsive pleading is
filed. Responsive pleadings are those which seek affirmative relief and
set up defenses. Consequently, having already submitted his person to
the jurisdiction of the trial court, petitioner may no longer object to the
venue which, although mandatory in the instant case, is nevertheless
waivable. As such, improper venue must be seasonably raised,
otherwise, it may be deemed waived.[14]
In the present case, petitioners objection to the venue of the case was
raised for the first time in the Answer itself. Not having been raised on
time, their objection is therefore deemed waived.
In any event, petitioners had agreed to a stipulation in the Promissory
Note that a suit arising from their transaction may be filed in the proper
court anywhere in Metro Manila, at the sole option of respondent
bank.[15] Necessarily, Pasay City is deemed included in the said
stipulation.
Yes.
12
 Petitioners argue that the value of the property seized is in excess of
P200,000 and thus outside the jurisdiction of the Metropolitan Trial
Court. This argument has no legal and factual basis. The fundamental
claim in the main action against petitioners, as shown in respondent
banks Complaint, is the collection of the sum of P190,635.90, an amount
that is clearly within the jurisdiction of the MTC. Although the value of
the vehicle seized pursuant to the Writ of Replevin may have exceeded
P200,000, that fact does not deprive the trial court of its jurisdiction over
the case. After all, the vehicle was merely the subject of a chattel
mortgage that had been used to secure petitioners loan. In any case,
private respondents are entitled only to the amount owed them. Under
Section 14 of the Chattel Mortgage Law, the proceeds of the sale of the
mortgaged property shall be used primarily to pay the costs of the sale,
the obligation that has been secured and other subsequent obligations;
and the balance will be turned over to the mortgagors, herein petitioners.
3. No.
Petitioners assail the MTCs refusal to release the seized vehicle despite a
Managers Check in the amount of P69,168 they issued for the redelivery
of the vehicle within five days from its seizure.
This argument is devoid of merit. As observed by the trial court,
petitioners failed to comply with the requisites for the redelivery of the
vehicle seized:
Under the Rules of Court, the defendant has a period of 5 days from
January 7, 1997 to post a re-delivery bond, in order to secure the return
of the subject vehicle and to post a counter bond double the amount of
the chattel. In this respect[,] defendants failed to exercise his right.[16]
Indeed, a careful perusal of the records shows that petitioners failed to
comply with the requirements prescribed by Rule 60 of the Rules of Court
in effect at the time:[17]
SEC. 5. Return of Property. --- If the defendant objects to the sufficiency
of the plaintiffs bond, or of the surety or sureties thereon, he cannot
require the return of the property as in this section provided; but if he
does not so object, he may, at any time before the delivery of the
property to the plaintiff, require the return thereof, by filing with the
clerk or judge of the court a bond executed to the plaintiff, in double the
value of the property as stated in the plaintiffs affidavit, for the delivery
of the property to the plaintiff, if such delivery be adjudged, and for the
payment of such sum to him as may be recovered against the defendant,
and by serving a copy of such bond on the plaintiff or his attorney.
SEC. 6. Disposition of property by officer. --- If within five (5) days after
the taking of the property by the officer, the defendant does not object
to the sufficiency of the bond, or of the surety or sureties thereon; or
require the return of the property as provided in the last preceding
section; or if the defendant so objects, and the plaintiffs first or new
bond is approved; or if the defendant so requires, and his bond is
objected to and found insufficient and he does not forthwith file an
approved bond, the property shall be delivered to the plaintiff. If for any
reason the property is not delivered to the plaintiff, the officer must
return it to the defendant.
In their Petition for Review, petitioners plainly admit that they issued a
check for only P69,168 for the purpose of covering the advance
payments plus the redelivery bond. Clearly, that amount was insufficient
to cover even just the required redelivery bond alone, which should be in
an amount double that of the chattel. Hence, the MTCs refusal to grant
petitioners Motion for redelivery was correct, and the Court of Appeals
did not err in upholding it.
REYES vs INES-LUCIANO
Petitioner: Manuel J.C Reyes
Respondent: Leonor Ines-Luciano
Citation: GR No. L-48219
Date of Promulgation: July 25, 1979
Ponente: Fernandez
FACTS:
 Private Respondent Celia Ilustre-Reyes: filed an MR asking that
the decision be modified by making the payment of the
support pendente lite of Four Thousand Pesos (P4,000.00) a month
retroact to June 1976, on the following grounds:
1. There is ample evidence that the businesses of the petitioner,
Manuel J. C. Reyes, can very easily bear the burden of
support;
2. The petition for support pendente lite is directed mainly on the
private respondent's share in the conjugal partnership;
3. Full support may be taken from the private respondent's share
of the conjugal properties;
4. The private respondent, Celia Ilustre-Reyes, has incurred
obligations during the three (3) year period that she was not
given any actual support and she also has to pay attorney's
fees;
5. The corporation, Development and Technology Consultants,
Inc., of which the petitioner is the controlling stockholder, in
addition to four (4) cars in its name, has acquired two (2)
new Opel Record sedan cars, each worth One Hundred Twenty
Thousand Pesos (P120,000.00), and the petitioner lives in an
expensive condominium and maintains business offices in
different buildings in Makati and Manila; and
6. Finally, on April 20, 1979, the petitioner and his three (3)
children went abroad on a two-month pleasure trip, while the
private respondent, Celia Ilustre-Reyes, lives in a difficult and
penurious situation, deeply in debt and caught in the web of
high prices and current inflation.
 Petitioner: also filed an MR of the decision on the grounds that:
1. trial court should be ordered to receive evidence on the issue of
whether or not the private respondent is entitled to
support pendente lite; and
2. assuming, arguendo, that the private respondent is entitled to
support pendente lite, the amount of Four Thousand Pesos
(P4,000.00) is not only excessive for the needs of private
respondent but beyond the means of the petitioner herein.
ISSUES:
1. W/N Private Respondent is entitled to a support pendente
lite in the amount of 4000?
2. W/N the support pendete lite in favor of the private
respondent retroact?
HELD:
1. YES.
The Court has gone over the different exhibits attached by the parties to their
respective motions. The Development and Technology Consultants, Inc. has
multi-million construction projects with gross receipts of several million pesos.
The petitioner cannot seriously complain that the amount of
support pendente lite he is ordered to pay will ruin him. He has not denied
the allegations of the private respondent that the Development and
Technology Consultants, Inc. has acquired two (2) new automobiles and that
the petitioner maintains expensive offices and resides in an expensive
condominium. It is not also denied that he and his three (3) children had
recently traveled abroad for two (2) months.
The support pendente lite in the amount of Four Thousand Pesos (P4,000.00)
is reasonable. Hence, the motion for reconsideration of the petitioner has no
merit.
2. YES
In resolving the motion for reconsideration of the private respondent,
Celia Ilustre-Reyes, the Court has taken into consideration the fact that in
view of the issuance of the restraining order by the Court of Appeals she had
not received any support at all until this Court issued a resolution allowing her
only One Thousand Pesos (P1,000.00) a month.
Obviously, during the period that she was not receiving any support she
incurred debts. She must also pay attorney's fees.
Considering that whatever support the private respondent, Celia Ilustre-Reyes,
might now be receiving will be deducted from her share of the conjugal
properties, the Court finds that under the equities and circumstances of the
case, the decision should be modified so as to make the
support pendente lite of Four Thousand Pesos (P4,000.00) a month retroact to
November 1, 1977.
WHEREFORE, the decision promulgated on February 28, 1979 is hereby
modified in the sense that the support pendente lite at the rate of Four
Thousand Pesos (P4,000.00) a month should commence from November 1,
1977.
13
LAM vs CHUA
Petitioner: Jose Lam
Respondent: Adriana Chua
Citation: GR No. L-131286
Date of Promulgation: March 18, 2004
Ponente: Austria-Martinez
FACTS:
 Adriana Chua: filed a Petition for Declaration of Nullity of marriage
against Jose Lam in RTC Pasay
 ALLEGATIONS IN THE PETITION:
1. she and Jose were married on January 13, 1984;
2. out of said marriage, they begot one son, John Paul Chua
Lam;
3. Jose was psychologically incapacitated to comply with the
essential marital obligations of marriage but said incapacity
was not then apparent;
4. such psychological incapacity of Jose became manifest only
after the celebration of the marriage when he frequently failed
to go home, indulged in womanizing and irresponsible
activities, such as, mismanaging the conjugal partnership of
gains;
5. in order to save what was left of the conjugal properties, she
was forced to agree with Jose on the dissolution of their
conjugal partnership of gains and the separation of present
and future properties;
6. said agreement was approved by the Regional Trial Court of
Makati City (Branch 149) in a Decision dated February 28,
1994;
7. they had long been separated in bed and board;
8. they have agreed that the custody of their child will be with
her, subject to visitation rights of Jose.
9. Adriana prayed that the marriage between her and Jose be
declared null and void but she failed to claim and pray for the
support of their child, John Paul.
 Jose Lam: did not filed his Answer
 Collusion  Trial
 Adriana was the lone witness. She testified that:
1. Her marriage with Jose was arranged by her parents in the
traditional Chinese way;
2. that her married life was abnormal because Jose very seldom came
home, never worked for a living and instead kept asking for money
from her to buy his sports cars;
3. that she was also the one spending for all the expenses of their
only child, John Paul.
 Formal Offer of Exhibits. No evidence was presented re: support
needed by John Paul
 June 23, 1994: Adriana filed an Urgent Motion to Re-Open on the
ground that she was able to secure additional new evidence which were
significant, material and indispensable
 RTC: re-open
- Admitted into evidence the Marriage Contract dated May 25, 1977
between Jose and one Celia Santiago, and another Marriage
Contract dated May 6, 1982 between Jose and one Evan Lock,[5]
showing that Jose had been married twice before he married
Adriana in 1984
 RTC Decision:
- marriage between Adriana and Jose is null and void
- Ordered Jose to give a monthly support of 20, 000 to his son
 Jose: MR, but only insofar as the decision awarded monthly support to
his son in the amount of P20,000.00. He argued that there was already a
provision for support of the child as embodied in the decision[9] dated
February 28, 1994 of the Makati RTC wherein he and Adriana agreed to
contribute P250,000.00 each to a common fund for the benefit of the
child
- MR denied ruling that the compromise agreement entered into by
the parties and approved by the Makati RTC before the marriage
was declared null and void ab initio by the Pasay RTC, is of no
moment and cannot limit and/or affect the support ordered by the
latter court.
 CA: affirmed
ISSUE/S:
1. W/N the compromise agreement between petitioner and
respondent where they bound themselves to contribute the
amount of two hundred fifty thousand pesos (p250,000.00)
to a common fund for the benefit of their child does not bar
the trial court in annulment case to again award support in
favor of the child.
2. W/N the amount of support granted by RTC Pasay in favor
of John Paul is just?
HELD:
1. NO
Thus, there is no merit to the claim of Jose that the compromise
agreement between him and Adriana, as approved by the Makati RTC and
embodied in its decision dated February 28, 1994 in the case for voluntary
dissolution of conjugal partnership of gains, is a bar to any further award of
support in favor of their child John Paul. The provision for a common fund for
the benefit of their child John Paul, as embodied in the compromise
agreement between herein parties which had been approved by the Makati
RTC, cannot be considered final and res judicata since any judgment for
support is always subject to modification, depending upon the needs of the
child and the capabilities of the parents to give support.
2. NO.
The Pasay RTC should have been aware that in determining the amount
of support to be awarded, such amount should be in proportion to the
resources or means of the giver and the necessities of the recipient, pursuant
to Articles 194, 201 and 202 of the Family Code, to wit:
Art. 194. Support comprises everything indispensable for sustenance,
dwelling, clothing, medical attendance, education and transportation,
in keeping with the financial capacity of the family.
The education of the person entitled to be supported referred to in
the preceding paragraph shall include his schooling or training for
some profession, trade or vocation, even beyond the age of
majority. Transportation shall include expenses in going to and from
school, or to and from place of work.
Art. 201. The amount of support, in the cases referred to in Articles
195[21] and 196,[22] shall be in proportion to the resources or means
of the giver and to the necessities of the recipient.
Art. 202. Support in the cases referred to in the preceding article
shall be reduced or increased proportionately, according to the
reduction or increase of the necessities of the recipient and the
resources or means of the person obliged to furnish the same.
It is incumbent upon the trial court to base its award of support on the
evidence presented before it. The evidence must prove the capacity or
resources of both parents who are jointly obliged to support their children as
provided for under Article 195 of the Family Code; and the monthly expenses
incurred for the sustenance, dwelling, clothing, medical attendance, education
and transportation of the child.
In this case, the only evidence presented by respondent Adriana
regarding her claim for support of the child is her testimony, which is quoted
below in verbatim:
Atty. Lorbes:
Q - After discovering that your husband had contracted two valid
marriages prior to your marriage, how do you feel about it?
A - I felt it is unfair to my life.
Q - Considering the bigamous marriage contract by your husband
with you, what do you want to request to the Honorable
Court?
A - I want to request the Court that the respondent be ordered to
support my little boy.
Court:
Q - How much support do you want?
A - P20,000.00 to P25,000.00
Q - Is there a prayer for support?
Atty. Lorbes:
A - None, Your Honor.
Court:
Get the original copy of the complaint, add and sign it for the
support of the boy.
A - Yes, Your Honor.[23]
Evidently, such testimony does not establish the amount needed by the
child nor the amount that the parents are reasonably able to give.
The matter of support is a question that may be raised and threshed out
before the Makati RTC as it was the court that approved the Compromise
Agreement, or before the Pasay RTC where the petition for declaration of
nullity or annulment of marriage is filed. In the interest of orderly
administration of justice, the Court deems it proper that the issue on support
should be resolved by the Pasay RTC where the claim for support of the child
was initiated by Adriana.
The trial courts action of merely ordering in open court during the July
6, 1994 hearing that a prayer for support be written and inserted in the
petition filed by respondent Adriana does not constitute proper amendment
and notice upon petitioner Jose. Consequently, herein petitioner Jose was
14
deprived of due process when the trial court proceeded to hear the case on a
motion to re-open and render judgment without giving Jose the requisite
notice and the opportunity to refute the new claim against him.
Verily, the manner by which the trial court arrived at the
amount of support awarded to John Paul was whimsical, arbitrary
and without any basis.
Such being the case, the Court has no other recourse but to reverse the
decision of the Court of Appeals and Pasay RTC insofar as the award of
support is concerned and order the remand of the case to Pasay RTC for
further proceedings as to the issue regarding support.
CALDERON vs ROXAS
Petitioner: Ma. Carminia C. Calderon, as rep. by Marycris Baldevia
Respondent: Jose Antonio Roxas, CA
Citation: GR No185595
Date of Promulgation: January 9, 2013
Ponente: Villarama
FACTS:
 Carminia and Jose: married on December 4, 1985
- 4 children
 Jan. 16, 1998: Petitioner filed an Amended Complaint for the
declaration of nullity of their marriage on the ground of psychological
incapacity
 May 19, 1998: trial court issued an Order granting petitioner’s
application for support pendent lite
- Accordingly, the defendant is hereby ordered to contribute to the
support of the above-named minors, (aside from 50% of their
school tuition fees which the defendant has agreed to defray, plus
expenses for books and other school supplies), the sum of
P42,292.50 per month, effective May 1, 1998, as his share in the
monthly support of the children, until further orders from this Court.
The first monthly contribution, i.e., for the month of May 1998, shall
be given by the defendant to the plaintiff within five (5) days from
receipt of a copy of this Order. The succeeding monthly
contributions of P42,292.50 shall be directly given by the defendant
to the plaintiff without need of any demand, within the first five (5)
days of each month beginning June 1998. All expenses for books
and other school supplies shall be shouldered by the plaintiff and
the defendant, share and share alike. Finally, it is understood that
any claim for support-in-arrears prior to May 1, 1998, may be taken
up later in the course of the proceedings proper.
 Said ORDER: subject of GR No. 139337 wherein it was declared that
“the proceedings and orders issued by the trial court in the application
for support pendente lite (and the main complaint for annulment of
marriage) in the re-filed case, that is, in Civil Case No. 97-0608 were not
rendered null and void by the omission of a statement in the certificate of
non-forum shopping regarding the prior filing and dismissal without
prejudice of Civil Case No. 97-0523 which involves the same parties.”
- Assailed orders for pendente lite: reinstated and trial court
resumed hearing the main case
 October 11, 2002: the trial court issued an Order dated October 11,
2002 directing private respondent to give support in the amount of
P42,292.50 per month starting April 1, 1999 pursuant to the May 19,
1998 Order.7
 February 11, 2003: Respondent filed a Motion to Reduce Support as
the amount fixed by the Court is higher that his P20,800.00 monthly
salary as city councilor.
- Granted on March 7, 2005
- Supported by evidence
 May 04, 2005: LC denied Petitioner’s Motion for Partial Consideration
 Trial Court (Civil Case No. 97-0608):
- marriage = null and void
- Ordering the respondent Jose Antonio Roxas to provide support to
the children in the amount of P30,000.00 a month, which support
shall be given directly to petitioner whenever the children are in her
custody, otherwise, if the children are in the provisional custody of
respondent, said amount of support shall be recorded properly as
the amounts are being spent. For that purpose the respondent shall
then render a periodic report to petitioner and to the Court to show
compliance and for monitoring. In addition, the respondent is
ordered to support the proper schooling of the children providing for
the payment of the tuition fees and other school fees and charges
including transportation expenses and allowances needed by the
children for their studies.
 Petitioner: Notice of Appeal from the Orders dated March 7, 2005 and
May 4, 2005.
- In her appeal brief, petitioner emphasized that she is not appealing
the Decision dated May 16, 2005 which had become final as no
appeal therefrom had been brought by the parties or the City
Prosecutor or the Solicitor General.
- Petitioner pointed out that her appeal is “from the RTC Order dated
March 7, 2005, issued prior to the rendition of the decision in the
main case”, as well as the May 4, 2005 Order denying her motion
for partial reconsideration.
- Dismissed by CA
ISSUE/S:
1. W/N the Orders dated March 7, 2005 and May 4, 2005 on
the matter of support pendent lite are interlocutory or
final?
HELD:
The assailed orders relative to the incident of support pendente lite and
support in arrears, as the term suggests, were issued pending the rendition of
the decision on the main action for declaration of nullity of marriage, and are
therefore interlocutory. They did not finally dispose of the case nor did they
consist of a final adjudication of the merits of petitioner’s claims as to the
ground of psychological incapacity and other incidents as child custody,
support and conjugal assets.
The Rules of Court provide for the provisional remedy of support pendente lite
which may be availed of at the commencement of the proper action or
proceeding, or at any time prior to the judgment or final order.
On March 4, 2003, this Court promulgated the Rule on Provisional Orders
which shall govern the issuance of provisional orders during the pendency of
cases for the declaration of nullity of marriage, annulment of voidable
marriage and legal separation. These include orders for spousal support, child
support, child custody, visitation rights, hold departure, protection and
administration of common property.
Petitioner contends that the CA failed to recognize that the interlocutory
aspect of the assailed orders pertains only to private respondent’s motion to
reduce support which was granted, and to her own motion to increase
support, which was denied. Petitioner points out that the ruling on support in
arrears which have remained unpaid, as well as her prayer for
reimbursement/payment under the May 19, 1998 Order and related orders
were in the nature of final orders assailable by ordinary appeal considering
that the orders referred to under Sections 1 and 4 of Rule 61 of the Rules of
Court can apply only prospectively. Thus, from the moment the accrued
amounts became due and demandable, the orders under which the amounts
were made payable by private respondent have ceased to be provisional and
have become final.
We disagree. The word interlocutory refers to something intervening between
the commencement and the end of the suit which decides some point or
matter but is not a final decision of the whole controversy.18 An interlocutory
order merely resolves incidental matters and leaves something more to be
done to resolve the merits of the case. In contrast, a judgment or order is
considered final if the order disposes of the action or proceeding completely,
or terminates a particular stage of the same action.19 Clearly, whether an
order or resolution is final or interlocutory is not dependent on compliance or
noncompliance by a party to its directive, as what petitioner suggests. It is
also important to emphasize the temporary or provisional nature of the
assailed orders.
Provisional remedies are writs and processes available during the pendency of
the action which may be resorted to by a litigant to preserve and protect
certain rights and interests therein pending rendition, and for purposes of the
ultimate effects, of a final judgment in the case.
They are provisional because they constitute temporary measures availed of
during the pendency of the action, and they are ancillary because they are
mere incidents in and are dependent upon the result of the main action.20
The subject orders on the matter of support pendente lite are but an incident
to the main action for declaration of nullity of marriage.
Moreover, private respondent’s obligation to give monthly support in the
amount fixed by the RTC in the assailed orders may be enforced by the court
itself, as what transpired in the early stage of the proceedings when the court
cited the private respondent in contempt of court and ordered him arrested
for his refusal/failure to comply with the order granting support pendente
lite.21 A few years later, private respondent filed a motion to reduce support
while petitioner filed her own motion to increase the same, and in addition
sought spousal support and support in arrears. This fact underscores the
provisional character of the order granting support pendente lite. Petitioner’s
theory that the assailed orders have ceased to be provisional due to the
arrearages incurred by private respondent is therefore untenable.
Under Section 1, Rule 41 of the 1997 Revised Rules of Civil Procedure, as
amended, appeal from interlocutory orders is not allowed. Said provision
reads:
15
 SECTION 1. Subject of appeal. - An appeal may be taken from a
judgment or final order that completely disposes of the case, or of a
particular matter therein when declared by these Rules to be
appealable. No appeal may be taken from:

XXXX

(c) An interlocutory order;

XXXX

In all the above instances where the judgment or final

order is not appealable, the aggrieved party may file an
appropriate special civil action under Rule 65. (Emphasis
supplied.)

The remedy against an interlocutory order not subject of an appeal is an

appropriate special civil action under Rule 65 provided that the interlocutory
order is rendered without or in excess of jurisdiction or with grave abuse of
discretion. Having chosen the wrong remedy in questioning the subject
interlocutory orders ofthe RTC, petitioner's appeal was correctly dismissed by
the CA.

WHEREFORE, the petition for review on certiorari is DENIED, for lack of

merit. The Decision dated September 9, 2008 and Resolution dated December
15, 2008 of the Court of Appeals in CA-G.R. CV No. 85384 are AFFIRMED.
With costs against the petitioner. SO ORDERED.

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