G.R. No. L-15972; May 31, 1963
CONCEPCION ASETRE MOTOOMULL, petitioner, vs. HON. ABUNDIO Z. ARRIETA, Judge of the Court of First Instance of Oriental Misamis, and PILAR ASETRE GARCIA, respondents.

FACTS

The case originated from an action to quiet title filed by respondent Pilar Asetre Garcia and her sister Beatriz Asetre against their siblings, petitioner Concepcion Asetre Motoomull and Fortunato Asetre. The plaintiffs claimed ownership of a 114-hectare coconut land via a donation from their father, Pedro Asetre, alleging the defendants illegally took possession after his death. The defendants countered that the property was purchased for Concepcion using her funds in 1919 and formally transferred to her in 1935, and she had been in continuous possession. Beatriz later withdrew her claim, asserting the land belonged exclusively to Concepcion. The trial court initially dismissed the complaint for the plaintiffs’ non-appearance, but this order was later set aside. Respondent Garcia subsequently filed petitions for receivership, alleging the property was in danger: its area had diminished, a portion was occupied by a third party with petitioner’s consent, and petitioner had mortgaged parts of the land to the Philippine National Bank (PNB) for substantial loans, risking foreclosure.

ISSUE

Whether the respondent Judge acted with grave abuse of discretion or in excess of jurisdiction in ordering the property placed under receivership and in denying petitioner’s motion to lift the receivership upon filing a bond.

RULING

The Supreme Court held that the respondent Judge did not commit grave abuse of discretion. The legal logic is anchored on Section 1(b), Rule 61 of the Rules of Court, which permits receivership when the applicant has an interest in the property and it is in danger of being lost, removed, or materially injured. The Court found sound reasons on record justifying the appointment. The property, originally declared in the name of the deceased father, was only transferred to petitioner’s name in 1957. Crucially, petitioner had mortgaged the land to secure loans from the PNB, which had become due and unpaid, creating a clear danger of foreclosure and loss of the property itself. The Court distinguished the case from Lacson v. Hodges, cited by petitioner, where a bond sufficed because the obligation was a fixed debt and the property (a building) was only at risk of deterioration, not loss. Here, a bond was deemed inadequate to guard against the ultimate danger of the land being lost through foreclosure. The wide discretion granted to trial courts in appointing receivers was not exercised arbitrarily, as the factual circumstances presented a substantial risk to the preservation of the litigated property pending the final outcome of the case. The denial of the motion to lift receivership upon bond was likewise a proper exercise of discretion.