G.R. No. L-16521, December 31, 1960
PORFIRIO DIAZ and JUANITO ELECHICON, petitioners, vs. HON. EMIGDIO NIETES and DANIEL EVANGELISTA, respondents.

FACTS

Respondent Daniel Evangelista filed a civil case (No. 5313) in the Court of First Instance of Iloilo against petitioners Porfirio Diaz and Juanito Elechicon to recover possession of a 12-hectare portion of Lot No. 4651. Evangelista alleged he was the owner of the lot, having been adjudicated the property in a project of partition approved by the probate court in Special Proceedings No. 815, and that the petitioners were in possession under an unlawful claim of ownership. He further alleged the land was first-class riceland with a harvest about to be reaped and moved for the appointment of a receiver to preserve and administer the property and its produce. Petitioners, in their answer, claimed they were not owners but lessees under a five-year lease contract executed on March 30, 1959, with Rosario Evangelista (plaintiff’s daughter), who was then the administratrix/agent of the property. They opposed the receivership, arguing the land was part of an estate still under probate jurisdiction (“in custodio legis”) and that the complaint’s allegations did not justify a receiver. The lower court, on November 14, 1959, issued an order appointing a receiver over the property and its products. Petitioners’ motion for reconsideration was denied, prompting them to file this petition for certiorari, arguing the order was issued with grave abuse of discretion and in excess of jurisdiction.

ISSUE

Whether the lower court committed a grave abuse of discretion in appointing a receiver over the property in litigation and its produce.

RULING

Yes. The Supreme Court set aside the lower court’s orders appointing the receiver. The Court found no sufficient cause to justify the receivership. While Evangelista had title to the land by virtue of the probate court’s partition, the petitioners were in material possession as lessees under a contract with Evangelista’s agent/daughter. Until that lease agreement was judicially declared void for lack of authority, petitioners were entitled to remain in possession unless powerful reasons existed to deprive them. No such reasons were present. There was no showing the property or harvest was in danger of being lost, that petitioners were committing waste, or that they were insolvent. The complaint did not even allege plaintiff’s interest in the specific crops. Petitioners occupied and planted the land in good faith as lessees and should be allowed to harvest the fruits of their labor (subject to paying the lessor’s share) until the parties’ rights to possession were finally adjudicated. The Court reiterated that appointing a receiver to take real estate out of a defendant’s possession before final adjudication should be done only in extreme cases upon a clear showing of necessity to prevent grave and irremediable loss. The power to appoint a receiver is delicate and must be exercised with extreme caution. The writ of preliminary injunction issued by the Supreme Court was made permanent. Costs were imposed on respondent Evangelista.