G.R. No. 82985; April 22, 1991
MERVILLE PARK HOMEOWNERS ASSOCIATION, INC., petitioner, vs. HON. FRANCISCO X. VELEZ and EDGARDO M. SALANDANAN, respondents.

FACTS

Petitioner Merville Park Homeowners Association, Inc. (MPHAI) owned the subdivision’s waterworks system. It leased this system to private respondent Edgardo Salandanan under a contract requiring him to construct and rehabilitate wells, with provisions for rate increases. Disputes arose, leading to a compromise agreement on new rates conditioned on Salandanan’s completion of a new well. In 1985, MPHAI filed a complaint for rescission of the lease and compromise agreement in the Regional Trial Court (RTC), alleging Salandanan’s failure to pay electric bills (causing a power cutoff and water shortage) and to complete required wells. It sought a writ of preliminary mandatory injunction to take possession of the water system.
The RTC initially granted the writ, ordering Salandanan to turn over the system. After case re-raffles, Judge Francisco X. Velez issued orders lifting the writ and directing the system’s return to Salandanan. MPHAI filed this Petition for Certiorari, arguing grave abuse of discretion.

ISSUE

Whether respondent Judge Velez committed grave abuse of discretion in lifting the writ of preliminary mandatory injunction and restoring possession of the waterworks system to Salandanan.

RULING

The Supreme Court dismissed the petition, finding no grave abuse of discretion. The legal logic is anchored on the extraordinary nature of a preliminary mandatory injunction. The Court emphasized that such a writ, which commands the performance of a specific act like delivering property, is not a proper remedy to transfer possession of disputed property from one party to another pendente lite. It may be issued only in cases of extreme urgency, where the applicant’s right is very clear and the need to prevent serious damage is paramount.
Here, the Court found the circumstances did not warrant such extreme relief. The right to possession was precisely the core issue in the pending rescission case. Granting the writ would have effectively decided the main case prematurely by transferring possession to MPHAI before a full trial on the merits of the rescission claim. Respondent Judge’s act of lifting the writ to maintain the status quo (Salandanan’s possession under the lease) pending litigation was thus a proper exercise of judicial discretion, not an arbitrary or capricious act. To safeguard the subdivision residents, however, the Court required Salandanan to post a P100,000 bond to ensure continuous water supply and compliance with his contractual obligations during the case’s pendency.