EMILIANO ACUÑA and NIEVES B. ACUÑA, petitioners, vs.

THE HONORABLE HERMOGENES CALUAG, Judge of the Court of First Instance of Rizal, Branch IV; GUILLERMO
ROMERO; and REYNALDO T. SANTOS, respondents.

Facts:

Petitioner Emilio Acuna and his wife, Nieves Acuna, executed in favor of Reynaldo Santos a real estate mortgage
over two parcels of land. Respondent Santos filed a complaint for foreclosure of the mortgage. The trial court issued
a writ of execution in favor of the plaintiff. The properties mortgaged were sold to Santos, and an order was issued
for the issuance of a writ of possession.

Respondent and Petitioners submitted an agreement and petition to settle but defendants have failed to comply
with the terms of the agreement. Thus another writ of possession was issued. Petitioner filed a motion to quash the
writ on the ground that it was null and void for the reason that the judgment sought to be enforced by said order
and alias writ of possession has been satisfied and/or novated by the Agreement. That the alias writ of possession
issued has no longer any force and effect since its life had already lapsed after the expiration of sixty (60) days.

Respondent Judge issued an order for the issuance of an alias writ of possession to enforce the decision in the case
and appointed Guillermo Romero as receiver of the properties involved over the opposition of the petitioners.

Issue:

Whether or Not the court orders were issued without jurisdiction which respondent Judge had lost by reason of the
perfection of the appeal?

Ruling:

No, We agree with counsel for the respondents that, although the perfection of an appeal deprives the trial court of
jurisdiction over the case, nevertheless, under the law, said court retains jurisdiction as regards the preservation of
the property under litigation and involved in the appeal, including necessarily the authority to appoint a receiver
who has the power to take and keep possession of the property in controversy. (Rule 61, Section 1 (d) and Section 7;
Velasco & Co. vs. Go Chuico, 28 Phil., 39; Jocson vs. Presbitero et al., 97 Phil., 6). According to respondents' answer
to the petition, petitioners did not contest the legality and propriety of the appointment of the receiver; they did
not even file a motion for reconsideration of the appointment. Consequently, it is now rather late to raise the
question of the propriety and legality of the order of the court appointing said receiver. According to the same
answer, petitioners herein are insolvent: the building and improvements involved in the appeal in danger of being
destroyed or impaired; and petitioners have failed to pay the rents at the rate of P500 a month from August, 1953,
up to the date of the answer, June 26, 1956, amounting to about P15,000, for which the receiver was appointed on
October 28, 1955.

Petitioners insinuate in their petition that the order for the delivery of the property to the receiver "touches a
matter litigated by the appeal, i.e., the physical possession of the petitioners". That is not correct. The question
litigated in the appeal is whether the petitioners or respondent Santos has a better right to possession. The
appointment of the receiver with order to deliver possession to him does not touch upon, much less decide that
question. It merely means that pending appeal, and to preserve the property and keep the rents, the trial court
through its officer, the receiver, would take possession.

The orders of respondent Judge on petitioner's to deliver possession of the property to the receiver are therefore
valid and it was petitioners' duty to obey the same. In view of the foregoing, the petition for certiorari is hereby
denied, with costs.
CENTRAL SAWMILLS, INC., plaintiff-appellee,
vs.
ALTO SURETY & INSURANCE CO., ET AL., defendants,
a for defendant-appellant.

BARREDO, J.:

This appeal from the order of the Court of First Instance of Manila dated October 4, 1960 in its Civil Case No.
27374, entitled Central Sawmills, Inc. vs. Alto Surety & Insurance Co., et al., ordering the appointment of a
receiver of the properties of defendant-appellant Alto Surety & Insurance Company as well as from the order of
October 25, 1960 denying the motion for reconsideration thereof was certified to this Court by the Court of Appeals
in a resolution, the pertinent portions of which read thus:

The undisputed evidence presented during the hearing on the petition for receivership is summarized by the
court a quo, as follows:

That a decision was rendered in the above-entitled case in favor of plaintiff and against the defendants, jointly and
solidarily, one of which is the defendant Alto Surety & Insurance Co., Inc. (Exhibit A-Receivership); that a writ of
execution (Exhibit B-Receivership was issued to enforce said judgment; that said writ of execution was returned
by the Sheriff of Manila unsatisfied (Exhibit C- Receivership); that on August 4, 1958, the Insurance Commissioner
wrote a letter addressed to Alto Surety & Insurance Co., Inc. (Exhibit E-Receivership), the last portion of which is
quoted as follows:

Financial Condition — The examination disclosed that the Alto Surety & Insurance Co., Inc., had, as of December
31, 1957, total admitted assets of P715,689.29, as against total liabilities of P645,096.94 and capital paid-up of
P259,700.00 which was impaired in the amount of P189,097.65, The company's net worth amounted to
P70,602.35 as of December 31, 1957. Compliance with our letter of July 18, 1958, regarding the covering of said
impairment is reiterated.

Your failure to comply with all the foregoing requirements within the time limit set forth in this letter will compel us
to suspend or revoke the certificates of authority to do insurance business issued in favor of the company, as well
as all other certificates granted to the company's officers, general agents, and/or to recommend the prosecution of
its officers.

that on May 16, 1960, the Insurance Commissioner addressed another letter marked exhibit G-Receivership, the
last portion of which is also quoted as follows:

6. Financial Condition as of September 30, 1959. — The examination disclosed that the Alto Surety & Insurance
Company Inc., had, as of September 30, 1959, total admitted assets of P161,121.84 as against total liabilities of
P649,130.88 and total net worth or capital deficiency of P488,009.04. The capital stock paid-up of P59,700.00
was impaired to the extent of P747,709.04, which is equal to the paid-up capital of P259,700.00 and capital
deficiency of P488,009.04.

In view of the precarious financial condition of the company, it is required that the stockholders of the Alto Surety
& Insurance Co., Inc., put up within fifteen (15) days from receipt of this letter, the amount of P747,709.04 in order
to cover the impairment or deficit of an equal amount, and to comply immediately with all the other requirements
mentioned in the foregoing.

Receipt of your advice within the fifteen-day period given you for complying with the requirement stated above, will
be appreciated.

In granting the petition for receivership, the court a quo said:

Firstly, plaintiff has offered the provisions of Section 1, Rule 61 of the Rules of Court, more particularly paragraph
(d) thereof. In support of its claim, plaintiff has cited the case of Philippine Trust Co. vs. Francisco Santamaria 53
Phil. 463, wherein the Supreme Court ordered the appointment of a receiver of all the properties and assets of a
judgment debtor in aid of execution of judgment rendered against it. The action against the judgement debtor in
the said case was for the recovery of a sum of money. law phi1. nêt

Secondly plaintiff has cited the provisions of Section 2, Rule 61 of the Rule of court, quoted as follows:
SEC. 2. Creditor or stockholder may apply for receiver for corporation. — When a corporation has been dissolved,
or is insolvent or is in imminent danger or insolvency, or has forfeited its corporate rights, a receiver may be
appointed on the complaint of a creditor, stockholder, or member of the corporation.

In relation to this provision of law, Exhibits E-Receivership and G-Receivership tend to show that defendant Alto
Surety & Insurance Co., Inc., is in imminent danger of insolvency. As a matter of fact, no less than the Insurance
Commissioner of the Philippines has manifested in his letter dated May 16, 1960 and marked as Exhibit
G-Receivership that the defendant corporation and is in a precarious financial condition.

Thirdly, plaintiff has cited the provision of Section Rule 39 of the Rules of Court, quoted as follows:

SEC. 39. Appointment and bond of receiver. — The judge may, by order, appoint the sheriff, or other proper officer
or person, receiver of the property of the judgment debtor; and he may also, by order, forbid a transfer or other
disposition of, or any interference with, the property of the judgment debtor not exempt from execution. If a bonded
officer be appointed receiver, he and his sureties shall be liable on his official bond as such receiver, but if another
person be appointed he shall give a bond as receiver as in other cases.

It must be remembered that plaintiff filed the present petition for receivership in view of the return of the Sheriff of
Manila (Exhibit C-Receivership) to the effect that the writ of execution marked Exhibit B-Receivership could not be
satisfied for the reasons stated therein.

It is not disputed by the appellant company that though in the years 1955 and 1956 it was in a position to pay
installments, or September 1, 1958 and thereafter, it was no longer in a position to mark any payments
whatsoever.

In view of all the above, the issue raised in this appeal is purely a question of law; this appeal is therefore beyond
the competence of this Court.

ACCORDINGLY, let this case be certified, as it is hereby certified, under the provisions of the Judiciary Act of
1948, as amended, to the Honorable Supreme Court for proper disposition.

Accordingly, the only issue for resolution by this Court in this appeal is whether or not, in an action for the
collection of a debt, where there is already a final and executory judgment, the Court has the authority to appoint
a receiver of the properties of the judgment debtor which are not involved in the action, in aid of the execution of
said judgement.

This issue is not new. Almost on all fours with the present case is that of Philippine Trust Co. vs.
Santamaria, 1decided way back on September 4, 1929. There it was held:

This is a petition for mandamus in which the petitioner alleges that it is plaintiff in civil cases Nos. 6720 and 6721
pending in the Court of First Instance of Iloilo. That on October 19, 1927, that court in those actions rendered the
following judgments:

CIVIL CASE NO. 6720

Wherefore, judgment is rendered in so far as it refers to said case No. 6720, in favor of the Philippine Trust Co.
and against the defendant F. M. Yaptico & Co., Ltd., for the sum of P25,000.00, with interest thereon at the rate of
9 per cent per annum from March 6, 1924, until paid, and with legal interest of 6 per cent per annum on the
accumulated interest from the filing of the complaint to the date of the judgment, together with the costs of the
action.

CIVIL CASE NO. 6721

Wherefore, judgment is rendered against F. M. Yaptico & Co., Ltd., jointly with the Visayan General Supply Co.,
Inc., for the sum of P50,000.00 with interest thereon at the rate of 9 per cent per annum from February 11, 1924,
until paid, and with legal interest from the filing of the complaint to the date of the judgment. And judgment is
rendered against the defendant F. M. Yaptico & Co., Ltd., for per cent per annum from March 5, 1924, plus the
legal interest of 6 per cent per annum on the accummulated interest from the date of filing of the complaint to that
of the judgment, together with costs of this action.
It is alleged that on such judgments there is now due and owing from the defendant to the petitioner about
P110,000.00. That on November 25, 1927, the plaintiff asked the court to issue and execution pending the
defendant's appeal to this court, which request was denied on December 5, 1927. That an appeal was taken to
this court which affirmed the judgments on October 25, 1928. That on November 23, 1928, plaintiff again asked
the lower court to issue an execution on the judgments, and that execution was issued on December 14, 1928.
That the sheriff made return that no property of defendant F.M. Yaptico & Co., Ltd., could not pay them. That on
January 18, 1929, the petitioner asked the lower court to appoint a receiver of the property of F. M. Yaptico & Co.,
Ltd. That on March 6, 1929, the court denied that petition. That on April 24, 1929, the petitioner prayed the court
for an order to require the manager of F. M. Yaptico & Co., Ltd., to appear and answer interrogatories as to the
assets of F.M. Yaptico & Co., Ltd. That on June 13, 1929, F. M. Yaptico & Co., Ltd., asked the court to suspend the
execution of the judgments for a period of four months, which request was opposed by the petitioner on the ground
that the court was without jurisdiction, and it again renewed its motion for the court to appoint a receiver. That the
manager appear in court on June 29, 1929, from which it appeared that the property of the defendant was being
disposed of to the damage of the petitioner; that F. M. Yaptico & Co., Ltd., had rendered the petitioner a false and
misleading statement of its assets and liabilities; and that after an examination of the manager and as a result of
the disclosures made by him, petitioner again prayed for the appointment if a receiver. That on June 30, 1929, the
court denied the application, and "suspended execution of the said judgments for a period of four months from and
after the 30th day of June, 1929, to give the respondent F. M. Yaptico & Co., Ltd., more time to pay said
judgments." That on July 12, 1929, the court again affirmed its order of June thirtieth, and on July 15, 1929, denied
the motion for reconsideration.

xxx xxx xxx

We are clearly of the opinion that the lower court exceeded its jurisdiction in suspending the execution for the
period of four months from June 30, 1929. We are also of the opinion that upon the facts shown in this record, it
was the duty of the court to appoint a receiver for the F. M Yaptico & Co., Ltd., to protect and preserve its property
and assets for the use and benefit of its creditors and, in particular, this petitioner, under the provisions of section
483 of the Code of Civil Procedure. The very fact that the judgments in question were rendered on October 19,
1927, and that no part of them has yet been paid, and that F. M. Yaptico & Co., Ltd., has so far been able to defeat
the petitioner in the collection of its judgments, in a very strong and cogent reason why a receiver should be
appointed.

It is the order of the court that a writ of mandamus be forthwith issued as prayed for in the petition, and that the
lower court at once appoint a receiver of all the property and assets of F. M. Yaptico & Co., Ltd., and that petitioner
have judgments for costs. So ordered.

With this precedent, it is obvious that the order of receivership appealed from should be affirmed.

Only one point of procedure need be clarified now. In its petition for the appointment of a receiver,
plaintiff-appellee relied expressly only on the provisions of Section 1(d) of Rule 61 (Rules of 1940) which provided
as follows:

SECTION 1. When and by whom receiver appointed. — One or more receiver of the property, real or personal,
which is subject of the action, may be appointed by the judge of the Court of First Instance in which the action is
pending, or by a Justice of the Court of Appeals or of the Supreme Court, in the following cases:

xxx xxx xxx

(d) After judgment, to preserve the property during the tendency of an appeal or to dispose of it according to the
judgement, or to aid execution when the execution has been returned unsatisfied or the judgment debtor refuses
to apply his property in satisfaction of the judgment, or otherwise to carry the judgement into effect;

This specific citation naturally gave defendant-appellant cause to oppose the petition on the ground that underline
provision thus cited, the receivership contemplated is only that "of the property, real or personal, which is the
subject of the action." It was only in its memorandum, which is not included in the record on appeal but mentioned
only in the opposition to the motion for reconsideration of the order granting the receivership (p. 50, Record on
Appeal), that plaintiff-appellant must have referred the court a quo to other provisions of the Rules, particularly,
Section 2 of Rule 61 and Section 39 of Rule 39. Thus, as may be seen from the above-quoted portions of its order
of receivership, the said court, made reference to all the three provisions which it said were "offered" or cited by
the plaintiff-appellee, namely: Section 1 (d), Rule 61, Section 2, Rule 61 and Section 39, Rule 39. Seemingly, the
court a quo was uncertain as to which particular one of these provisions was the proper basis of authority because
it simply ruled that "after considering the evidence and the argument adduced by the parties in relation to plaintiff's
petition for receivership and further considering the outstanding obligations of defendant corporation, the Court is
of the opinion that plaintiff's motion for receivership is well-taken and made no commitment as to which rule or
provision it was relying upon for its action.

It will be noted that in that case of Philippine Trust Co. vs. Santamaria, above-referred to, this Court cited Section
483 of the Code of Civil Procedure (Act 190) in holding that "it was the duty of the court to appoint a receiver for the
F.M. Yaptico & Co., Ltd. to protect and preserve its property and assets for the use and benefit of its creditors and,
in particular, this petitioner." The section cited reads thus:

SEC. 483. Judge may Appoint Receiver and Prohibit Transfers, and so forth. — The judge may, by order, appoint
the governor, or his deputy of the proper province, or other suitable person, a receiver of the property of the
judgment debtor, and he may also, by order, forbid a transfer or other disposition of, or any interference with, the
property of the judgment debtor not exempt by law.

This section was under Chapter XX entitled "Proceedings Supplementary to the Execution". In other words, it was
part of the rules of proceeding governing aids to the execution of judgments. In the Rules of Court of 1940, the said
section had its counter-part in Section 39 of Rule 39 reading as follows:

SEC. 39. Appointment and bond of receiver. — The judge may, by order, appoint the sheriff, or other proper officer
or person, receiver of the property of the judgment debtor; and he may also, by order, forbid the transfer or other
disposition of, or any interference with, the property of the judgment debtor not exempt from execution. If a bonded
officer be appointed receiver, he and his sureties shall be liable on his official bond as such receiver but if another
person be appointed he shall give a bond as receiver as in other cases.2

Indeed, this is the provision applicable to the circumstances of the case at bar. Clearly, Section 1 (d) of Rule 61 3 is
not applicable here because, as contended by defendant-appellant, all the cases of receivers contemplated in
said section are only cases wherein the property or properties being placed under receivership are those involved
in the very litigation in which such receivership is ordered. This is evident from the opening paragraph of said
section which says that "one or more receivers of the property, real or personal, which is the subject of the action,
may be appointed ... in the following cases. [Emphasis Ours]. In other words, this qualifying clause, "the property,
real or personal, which is the subject of the action" applies to all the cases specified in the five paragraphs in said
Section 1, which are:

Section 1. — ....

(a) When a corporation has been dissolved, or is insolvent, or is in imminent danger of insolvency, or has forfeited
its corporate rights;

(b) When it appears from the complaint or answer, and such other proof as the judge may require, that the party
applying for the appointment of receiver has an interest in the property or fund which is in danger of being lost,
removed, or materially injured unless a receiver be appointed to guard and preserve it;

(c) When it appears in an action by the mortgagee for the foreclosure of a mortgage that the property is in danger
of being wasted or materially injured, and that its value is probably insufficient to discharge the mortgage debt, or
that the parties have so stipulated in the contract of mortgage;

(d) After judgment, to preserve the property during the pendency of an appeal or to dispose of it according to the
judgment, or to aid execution when the execution has been returned unsatisfied or the judgment debtor refuses to
apply his property in satisfaction of the judgment, or otherwise to carry the judgment into effect;

(e) Whenever in other cases it appears that the appointment of a receiver is the most convinient and feasible
means of preserving, administering, or disposing of the property in litigation.

And it is undisputed that in the case at bar, the properties being placed under receivership are not the subject of
the action.

Likewise, it is quite plain that Section 2 of Rule 61 4 is not also applicable to this case. This section refers to a
receivership, not as an aid to execution of a final judgment in an ordinary action, but as a consequence of the
dissolution of a corporation or its forfeiture of its corporate rights; and with respect to cases of insolvency or
imminent danger of insolvency of corporations, the receivership contemplated in this section must be in relation
exclusively to such insolvency or imminent danger thereof placed before the court in an appropriate principal
action, and again, not merely as an ordinary action.
In an event, it is necessary or superfluos to bring in Sections 1 and 2 of Rule 61, which, to say the least, are of
doubtful applicability, when Section 39 appears to be clearly and fittingly applicable. If at all, the other provisions of
Rule 61, may be resorted to only insofar as they prescribe the procedure and the bond related to the carrying out
of such receivership. There being no detailed rules under the authority of Section 6, Rule 124 (now Rule 135), the
pertinent provisions of Rule 61 may be adopted. Said section provides:

SEC. 6. Means to carry jurisdiction into effect. — When by law jurisdiction is conferred on a court or judicial officer,
all auxiliary writs, processes and other means necessary to carry it into effect may be employed by such court or
officer; and if the procedure to be followed in the exercise of such jurisdiction is not specifically pointed out by
these rules, any suitable process or mode of proceeding may be adopted which appears most conformable to the
spirit of said rules.5

WHEREFORE, with the above clarification that Section 39 of Rule 39 of the Rules of 1940, now Section 43 of Rule
39 of the current Rules, is the provision applicable to the receivership herein in question, the same being in aid for
money, the disputed orders of the court a quo dated October 4, 1960 and October 15, 1960 are hereby affirmed,
with costs against defendant-appellant, Alto Surety & Insurance Company, Inc.

Descallar v. Court of Appeals, G.R. No. 106473, [July 12, 1993]

PROVISIONAL REMEDIES; RECEIVERSHIP; DANGER TO PROPERTY OF BEING MATERIALLY INJURED OR LOST,

INDISPENSABLE IN APPOINTMENT OF RECEIVER. — Only when the property is in danger of being materially injured
or lost, as by the prospective foreclosure of a mortgage thereon for non-payment of the mortgage loans despite
the considerable income derived from the property, or if portions thereof are being occupied by third persons
claiming adverse title thereto, may the appointment of a receiver be justified.

FACTS:

Assailed in this petition for review on certiorari is the decision dated July 29, 1992 of the CA, affirming the orders
dated March 17, 1992 and April 27, 1992 of the trial court in a Civil Case, granting respondent's petition for
receivership and denying petitioner's motion for reconsideration thereof.

August 9, 1991 - respondent Camilo Borromeo, a realtor, filed against petitioner a civil complaint for the recovery
of three (3) parcels of land and the house built thereon in the possession of the petitioner and registered in her
name under Transfer Certificates of Title Nos. 24790, 24791 and 24792 of the Registry of Deeds for the City of
Mandaue.

Borromeo alleged in his complaint that he purchased the property on July 11, 1991 from Wilhelm Jambrich, an
Austrian national and former lover of the petitioner for many years until he deserted her in 1991 for the favors of
another woman.

Based on the deed of sale which the Austrian made in his favor, Borromeo filed an action to recover the ownership
and possession of the house and lots from Descallar and asked for the issuance of new transfer certificates of title in
his name.

Descallar’s answer to the Complaint: alleged that the property belongs to her as the registered owner thereof; that
Borromeo's vendor, Wilhelm Jambrich, is an Austrian, hence, not qualified to acquire or own real property in the
Philippines. He has no title, right or interest whatsoever in the property which he may transfer to Borromeo. prcd

March 5, 1992 - Borromeo asked the trial court to appoint a receiver for the property during the pendency of the
case.
Despite the petitioner's opposition, Judge Mercedes Golo-Dadole granted the application for receivership and
appointed her clerk of court as receiver with a bond of P250,000.00.

Petitioner filed a motion for reconsideration but it was denied. So Petitioner sought relief in the CA by a petition for
certiorari but it was also dismissed by the CA. Petitioner then appealed the Appellate Court's decision to the SC by a
petition for certiorari under Rule 45 of the Rules of Court.

ISSUE:

Whether the trial court gravely abused its discretion in appointing a receiver for real property registered in the
name of the petitioner in order to transfer its possession from the petitioner to the court-appointed receiver? YES!

HELD:

The SC is amazed that the trial court and the Court of Appeals appear to have given no importance to the fact that
the petitioner herein, besides being the actual possessor of the disputed property, is also the registered owner
thereof, as evidenced by TCTs Nos. 24790, 24791, and 24792 issued in her name by the Register of Deeds of
Mandaue City on December 3, 1987. Her title and possession cannot be defeated by mere verbal allegations that
although she appears in the deed of sale as vendee of the property, it was her Austrian lover, Jambrich, who paid
the price of the sale of the property. Her Torrens certificates of title are indefeasible or incontrovertible.

Even if it were true that an impecunious former waitress, like Descallar, did not have the means to purchase the
property, and that it was her Austrian lover who provided her with the money to pay for it, that circumstance did
not make her any less the owner, since the sale was made to her, not to the open-handed alien who was, and still is,
disqualified under our laws to own real property in this country. The deed of sale was duly registered in the
Registry of Deeds and new titles were issued in her name. The source of the purchase money is immaterial for
there is no allegation, nor proof, that she bought the property as trustee or dummy for the monied Austrian, and
not for her own benefit and enjoyment.

***There is no law which declares null and void a sale where the vendee to whom the title of the thing sold is
transferred or conveyed, paid the price with money obtained from a third person. If that were so, a bank would be
the owner of whatever is purchased with funds borrowed from it by the vendee. The holding of the trial court and
the Court of Appeals that Jambrich, notwithstanding his legal incapacity to acquire real property in the Philippines, is
the owner of the house and lot which his erstwhile mistress, Antonietta, purchased with money she obtained from
him, is a legal heresy.

In view of the above circumstances, The Court found that, the order of receivership is tainted with grave abuse of
discretion. The appointment of a receiver is not proper where the rights of the parties (one of whom is in possession
of the property), are still to be determined by the trial court.

"Relief by way of receivership is equitable in nature, and a court of equity will not ordinarily
appoint a receiver where the rights of the parties depend on the determination of adverse claims
of legal title to real property and one party is in possession." (Calo, et al. vs. Roldan, 76 Phil. 445).

Only when the property is in danger of being materially injured or lost, as by the prospective foreclosure of a
mortgage thereon for non-payment of the mortgage loans despite the considerable income derived from the
property, or if portions thereof are being occupied by third persons claiming adverse title thereto, may the
appointment of a receiver be justified (Motoomul vs. Arrieta, 8 SCRA 172). LLphil
In this case, there is no showing that grave or irremediable damage may result to respondent Borromeo unless a
receiver is appointed. The property in question is real property, hence, it is neither perishable or consummable.
Even though it is mortgaged to a third person, there is no evidence that payment of the mortgage obligation is being
neglected. In any event, the private respondent's rights and interests, may be adequately protected during the
pendency of the case by causing his adverse claim to be annotated on the petitioner's certificates of title.

Another flaw in the order of receivership is that the person whom the trial judge appointed as receiver is her own
clerk of court. This practice has been frowned upon by this Court.The respondent judge committed grave abuse of
discretion in connection with the appointment of a receiver .We hold that the respondent judge has acted in excess
of his jurisdiction when he issued the order above adverted to. That order, in effect, made the clerk of court a sort
of a receiver charged with the duty of receiving the proceeds of sale and the harvest of every year during the
pendency of the case with the disadvantage that the clerk of court has not filed any bond to guarantee the faithful
discharge of his duties as depositary; and considering that in actions involving title to real property, the
appointment of a receiver cannot be entertained because its effect would be to take the property out of the
possession of the defendant, except in extreme cases when there is clear proof of its necessity to save the plaintiff
from grave and irremediable loss or damage, it is evident that the action of the respondent judge is unwarranted
and unfair to the defendants.

During the pendency of this appeal, Judge Dadole rendered a decision in Civil Case No. MAN-1148 upholding
Borromeo's claim to Descallar's property, annulling the latter's TCTs Nos. 24790, 24791 and 24792 and ordering the
Register of Deeds of Mandaue City to issue new ones in the name of Borromeo. This circumstance does not
retroactively validate the receivership until the decision (presumably now pending appeal) shall have attained
finality.

SC Ruling:

 finding grave abuse of discretion in the order of receivership which the respondent Court of Appeals affirmed in
its decision
 the petition for certiorari is hereby GRANTED
 the decision of the appellate court, as well as the order dated March 17, 1992 of the RTC of Mandaue City in
the Civil Case are hereby ANNULLED and SET ASIDE.

COMMODITIES STORAGE & ICE PLANT CORPORATION vs. COURT OF APPEALS

G.R. No. 125008. June 19, 1997

PUNO, J.:

FACTS:

Petitioner spouses Victor and Johannah Trinidad obtained a loan of P31,000,000.00 from respondent 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 and later took possession of
the property.
 Petitioner spouses filed Civil Case No. 956-M-93 against respondent bank before the Regional Trial Court,
Malolos, Bulacan for reformation of the loan agreement, annulment of the foreclosure sale and damages. The trial
court dismissed the complaint for petitioners' failure to pay the docket fees. The dismissal was without prejudice to
refiling of the complaint.

On October 28, 1994, petitioners filed Civil Case No. 94-72076 against respondent bank before the Regional
Trial Court, Branch 9, Manila for damages, accounting and fixing of redemption period. As a provisional remedy,
petitioners filed on November 16, 1994 an "Urgent Petition for Receivership." 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. Instead of an answer, respondent bank filed on November 25, 1994 a "Motion to Dismiss and Opposition
to Plaintiff's Petition for Receivership." It alleged that the complaint states no cause of action and that venue had
been improperly laid. It also alleged that petitioners failed to pay the proper docket fees and violated the rule on
forum-shopping.

In an order dated December 13, 1994, the trial court granted the petition for receivership and appointed
petitioners' nominee, Ricardo Pesquera, as receiver. Respondent bank assailed this order before the Court of
Appeals on a petition for certiorari. On January 11, 1996, the Court of Appeals annulled the order for receivership
and dismissed petitioners' complaint for improper venue and lack of cause of action.

ISSUE: WON Receivership is proper.

RULING:

Section 1 of Rule 59 of the Revised Rules of Court provides that:

"Sec. 1. When and by whom receiver appointed.-- One or more receivers of the property, real or personal, which is
the subject of the action, may be appointed by the judge of the Court of First Instance in which the action is
pending, or by a Justice of the Court of Appeals or of the Supreme Court, in the following cases:

(a) When the corporation has been dissolved, or is insolvent, or is in imminent danger of insolvency, or has forfeited
its corporate rights;
(b) When it appears from the complaint or answer, and such other proof as the judge may require, that the party
applying for the appointment of receiver has an interest in the property or fund which is the subject of the action,
and that such property or fund is in danger of being lost, removed or materially injured unless a receiver be
appointed to guard and preserve it;

(c) When it appears in an action by the mortgagee for the foreclosure of a mortgage that the property is in danger of
being wasted or materially injured, and that its value is probably insufficient to discharge the mortgage debt, or that
the parties have so stipulated in the contract of mortgage;

(d) After judgment, to preserve the property during the pendency of the appeal, or to dispose of it according to the
judgment, or to aid execution when the execution has been returned unsatisfied or the judgment debtor refuses to
apply his property in satisfaction of the judgment, or otherwise carry the judgment into effect;

(e) Whenever in other cases it appears that the appointment of a receiver is the most convenient and feasible
means of preserving, administering, or disposing of the property in litigation."

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.[9]

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.[10] 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.

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."
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.[15] 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.[16] This statement has not been disputed by petitioners.

At the time the trial court issued the order for receivership of the property, the problem had been remedied 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.

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.

PACIFIC MERCHANDISING CORPORATION, vs. CONSOLACION INSURANCE & SURETY CO., INC.,

Facts:

An action for collection of sum of money was filed by Pacific Merchandising Corporation (plaintiff-appellee) against
Consolacion Insurance & Surety Co., Inc., (defendant- appellee) who in turn filed a third-party complaint against
Gregorio V. Pajarillo (third-party defendant-appellant).

The TC rendered judgment in favor of the plaintiff and against the defendant, ordering the latter to pay the former
and condemning third defendant to pay third-party plaintiff for whatever sums or amounts the latter paid the
plaintiff on account of this judgment.
 The third-party defendant Gregorio V. Pajarillo appealed said decision. The parties, through their respective
counsel, submitted the following Stipulation of Facts:

1. A Writ of Execution was issued by the LC in the case Pacific Merchandising Corporation vs. Leo Enterprises, Inc.,;

2. That by virtue of the aforesaid Writ of Execution, the Sheriff of Manila levied and attached the following:

A. Second Hand AUTOMATICKET Machine;and

B. Cinema Projectors

Said items were advertised for sale.

3. That Atty. Greg V. Pajarillo was appointed as Receiver in the case of Gregorio V. Pajarillo vs. Leo Enterprises, Inc.;

4. That the sale at public auction of the aforementioned items was postponed and was later cancelled due to the
representation of Atty. Greg V. Pajarillo as Receiver of Paris Theatre operated by Leo Enterprises, Inc.

5. That the third-party defendant Pajarillo approached Consolacion Insurance (third-party plaintiff) and applied for
a surety bond in the amount of P5,000.00 to be rated in favor of the abovenamed plaintiff in order to guarantee to
said plaintiff the payment of obligations in its favor by the Leo Enterprises, Inc.;

6. That the bond applied for was in fact executed in favor of the pIaintiff with third-party defendant Pajarillo as
principal and Consolacion Insurance (third-party plaintiff) as surety in the context of the allegations of the preceding
paragraph and a copy of the said bond is attached a ANNEX 'A' to the third party complaint;

7. That to protect third party plaintiff against damage and injury, the third party defendant Pajarillo executed in
favor of the former an INDEMNITY AGREEMENT,

8. That the plaintiff received from Greg V. Pajarillo the sum of P2,000.00 leaving a balance of P2,562.88 still unpaid
aside from interest at the rate of 1% per month and atto lnen s f cluiaient to 25% of tht amount due as provided for
in said undertaking (ANNEX 'C' to tlie complaint);

9. That on July 1, 1963, a decision was rendered tne court of First Instance of Manila in Civil case No. 50201, copy of'
which is attached its ANNEX 'A' to Answer to Third Party Complaint, by virtue of which Greg V. Pajarillo, as said
Received stololcl making payments to plaintiff;

10. That the said decision in Civl Case No. 50201 dated July 1, 1963 was appealed lix defendant Leo Enterprises, Inc.
to the court of Appeals and that the records kere eleattd to the aid ApiIiat court on August 27, 1963;

11. That on October 9, 1963, plaintiff's counsel demanded from the said principal, Greg V. Paiarillo, the payment of
the installments corresponding to the months of May, June, July, August and September, 1963, which remain
unpaid in spite of said demand, copy of said letter being, attached as ANNEX 'E' to the complaint;

12. That the defendant was duly notified of the demand made on the principal, Greg V. Pajarillo and in spite of said
notice the defendant has failed and refused to pay the unpaid obligation;

13. That on December 19, 1963, plaintiff's counsel demanded from the defendant the payment of the unpaid
obligation of the principal, Greg V. Pajarillo but refused and failed to pay the same in spite of said demand;

14. That when reminded by third-party plaintiff regarding his obligations in favor of the plaintiff, the third-party
defendant, Greg V. Pajarillo replied that he no longer was bound to pay because he had ceased to be the receiver of
Paris Theatre operated by Leo Enterprises, Inc. by virtue of the decision of the Court in Civil Case No. 50201 cited
above, and for this reason, third- party plaintiff refused to pay the demand of the plaintiff 2
On the basis of the foregoing Stipulation of Facts, Said court affirmed the LC’s decision.

The trial court predicated its judgment on the following considerations:

(1) Since the unpaid claim represents the cost of certain materials used in the construction of the Paris Theatre, the
possession of which reverted to Gregorio V. Pajarillo as owner of said property by virtue of the judgment in Civil
Case No. 50201, "it is only simple justice that Pajarillo should pay for the said claim. otherwise he would be
enriching himself by having the said building without paying plaintiff for the cost of certain materials that went into
its construction";

(2) "under Section 7 of Rule 61 of the former Rules of Court, one of the powers of a receiver i8 to pay outstanding
debts, and since the said plaintiff's claim has been outstanding since August 27, 1962, if not before, Pajarillo should
have paid the same long before the alleged termination of the receivership on July 1, 1963";

(3) the procedure outlined in Section 8 of the Rule, namely, that whenever the court "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," has not been followed;
and

(4) when Gregorio V. Pajarillo undertook to pay the amount owed to plaintiff (Annex "C") and executed the surety
bond (Annex "D") in favor of plaintiff, he 4 6 stepped into the shoes" of the dr Leo Enterprises, Inc., .4 and the
properties of the said debtor having all subsequently passed on to Pajarillo, there is no reason, legal or otherwise,
for relieving defendants of their said undertaking."

The court a quo likewise declared that (1) "the receivership was not terminated by virtue of the appeal interposed
by Leo Enterprises, Inc., one of the defendants in Civil Case No. 50201, because a decision which is appealed cannot
be the subject of execution";

(2) "granting arguendo that the decision is final and executory, the said decision cannot bind nor can it be enforced
against the plaintiff in the present case because it is not a party in Civil Case No. 50201"; and

(3) "when Atty. Pajarillo assumed the obligation of Leo Enterprises, Inc., as a Receiver, there was a subrogation of
the party liable and, therefore, the plaintiff cannot enforce the judgment in Civil Case No. 49691 against Leo
Enterprises, Inc."

From the foregoing judgment, third-party defendant Gregorio V. Pajarillo appealed to the CA. The aforesaid
Appellate Court, in turn certified the same to this Court on the ground that there is no question of fact involved, but
only one of law.

ISSUE:

Whether or not third party defendant-appellant Gregorio V. Pajarillo is liable to plaintiff for the unpaid amount
claimed.

HELD:

Upon the resolution of this issue will in turn depend the liability of defendant-third-party plaintiff Consolacion
Insurance & surety Co., Inc. under the Surety Bond, on the basis of which it was ordered by the court a quo to pay
the amount involved to plaintiff-appellee.

A receiver is not an agent or representative of any party to the action. He is an officer of the court exercising his
functions in the interest of neither plaintiff nor defendant, but for the common benefit of all the parties in
interest. He performs his duties "subject to the control of the Court," and every question involved in the
receivership may be determined by the court taking cognizance of the receivership proceedings.
Thus, "a receiver, strictly speaking, has no right or power to make any contract binding the property or fund in his
custody or to pay out funds in his hands without the authority or approval of the court as explained by Justice
Moran, speaking for The custody of the receiver is the custody of the court. His acts and possession are the acts and
possession of the court, and his contracts and liabilities are, in contemplation of law, the contracts and liabilities of
the court. As a necessary consequence, receiver is subject to the control and supervision of the court at every
step in his management of the property or funds placed in his hands. He cannot operate independently of the court,
and cannot enter into any contract without its approval.

In the case at bar, appellant Pajarillo does not dispute the fact that he never secured the court's approval of either
the agreement of March 11, 1963, with Pacific Merchandising Corporation or of his Indemnity Agreement with the
Consolacion Insurance & Surety Co., Inc. on March 14, 1963, in consideration of the performance bond submitted by
the latter to Pacific Merchandising Corporation to guarantee the payment of the obligation. As the person to whom
the possession of the theater and its equipment was awarded by the court in Civil Case No. 50201, it was certainly
to his personal profit and advantage that the sale at public auction of the equipment of the theater was prevented
by his execution of the aforesaid agreement and submission of the aforementioned bond.

In order to bind the property or fund in his hands as receiver, he should have applied for and obtained from the
court authority to enter into the aforesaid contract. Unauthorized contracts of a receiver do not bind the court in
charge of receivership. They are the receiver's own contracts and are not recognized by the courts as contracts of
the receivership.Consequently, the aforesaid agreement and undertaking entered into by appellant Pajarillo not
having been approved or authorized by the receivership court should, therefore, be considered as his personal
undertaking or obligation. Certainly, if such agreements were known by the receivership court, it would not have
terminated the receivership without due notice to the judgment creditor as required by Section 8 of Rule 59 of the
Rules of Court. This must be assumed because of the legal presumption that official duty has been regularly
performed.

Indeed, if it were true that he entered into the agreement and undertaking as a receiver, he should have, as such
receiver, submitted to the court an account of the status of the properties in his hands including the outstanding
obligations of the receivership. Had he done so, it is reasonable to assume that the judgment creditor would have
opposed the termination of the receivership, unless its claim was paid. Having failed to perform his duty, to the
prejudice of the creditor, appellant should not be permitted to take advantage of his own wrong. The judgment
creditor having been induced to enter into the aforesaid agreement by appellant Pajarillo it was the duty of the
latter to comply with his end of the bargain.

He not only failed to perform his undertaking, but now attempts to evade completely his liability. Under such
circumstances, appellant is not entitled to equitable relief. No ground for equitable relief can be found in a case
where a party has not only failed to perform the conditions upon which he alone obtained the execution of the
contract, but where it is clear that he never, at any time, intended to perform them.

Alcantara vs Abbas G.R. No. L-14890

Facts:

In March, 1957, Alcantara sued Bacaron partly to foreclose the chattel mortgage executed by the latter on a
caterpillar tractor with its accessories.

To a clause in the mortgage contract, the Davao court designated Alcantara as receiver of the tractor; and
he duly qualified as such. Thereafter, with the court's approval, he leased the machine to Serapio Sablada. Upon the
expiration of the lease, and after Sablada's failure to return the machine, said court at the instance of Alcantara,1
declared Sablada to be in contempt of court and fined him in the amount of P100.00 on October 6, 1958.

Alleging that Alcantara had neglected his duties as receiver, because he did not get the tractor, Bacaron
petitioned the court to relieve such receiver, and to appoint him (Bacaron) as the receiver instead.
 The respondent dent judge of the Davao court, in an order dated December 10, 1958, relieved Alcantara
and appointed Bacaron as receiver of the tractor, without bond, with authority to receive the sum of P2,000.00 in
Alcantara's hands as rentals of the tractor, and to the end the same for repairs if necessary.

His motion to reconsider having been denied, Alcantara filed with this Court the instant special civil action.
And his request a preliminary injunction was issued to restrain enforcement of His Honor's aforesaid order of
December 10, 1958.

Issue:

WON alcantara was properly relieved as a receiver

Held:

It is not clear what steps the court had in mind when it declared that "plaintiff-receiver failed to take steps
to take possession of the tractor leased to Sablada". It could have meant that Alcantara failed to take the tractor
directly from the hands of Sablada from the place where it was, without resorting to official help. If the court meant
as it must have meant that Alcantara failed to exhaust judicial remedies to compel Sablada to comply with the order
to place the tractor at the "junction" previously mentioned, then it fell into error, because Alcantara had in effect,
suggested that Sablada be held in "continuous contempt", imprisoned until he placed the tractor at the "junction";
and the court instead of acting accordingly under Rule 64, sec. 74 held Alcantara to be negligent, and removed him.

In this connection, it should be observed that in his aforesaid pleading of November 26, 1958, Alcantara
even asked for permission to sue Sablada for replevin.

If it was error to remove Alcantara, a clearer error occurred when Bacaron — the defendant — was
appointed, as receiver without bond, over the objection of Alcantara — the plaintiff. The general rule is that neither
to a litigation should be appointed receiver without the other's consent because "a receiver ought to be an
indifferent person between the parties" and "should be impartial and disinterested" . Note that Bacaron was the
defendant, and his personal interest would conflict with his duties to the court and the plaintiff. Furthermore, under
the Rules of Court, the receiver must file a bond; and yet Bacaron was exempted from such obligation. The effect of
the whole proceeding was to discharge the receiver ship at the request of the defendant, without so much a bond
— contrary to sec. 4, Rule 61, of the Rules of Court.

ENRIQUE ABRIGO, petitioner , vs. THE HON. JUDGE UNION C. KAYANAN

SYLLABUS

79 REMEDIAL LAW; SPECIAL PROCEEDINGS; APPOINTMENT OF RECEIVER IN ACTION INVOLVING TITLE TO REALTY
IMPROPER. — In actions involving titles to real property, the appointment of a receiver cannot be entertained
because its effect would be to take the property out of the possession of the defendant, except in extreme cases
when there is clear proof of its necessity to save the plaintiff from grave and irremediable loss or damage, it is
evident that the action of the respondent judge is unwarranted and unfair to the defendants.

2. ID.; ID.; ID.; RECEIVER NOT IN A BETTER POSITION THAN POSSESSOR IN DEALING WITH SQUATTERS. —
The reason for the appointment of the receiver was the fact that the land had been entered by numerous
squatters. But a receiver who is also burdened with his duties as Clerk of Court cannot be in a better position than
the actual possessors in dealing with squatters.

3. ID.; ID.; ID.; DISCHARGE OF RECEIVER WHEN THE PARTY OPPOSING THE APPOINTMENT FILES A BOND. —
The respondent judge should at least have accepted the bond offered by the petitioner. Rule 59. Sec. 4 stipulates
that "the receiver (may be) discharged when the party opposing the appointment files a bond executed to the
applicant in an amount to be fixed by the court, to the effect that such party will pay the applicant all damages he
may suffer by reason of the acts, omissions or other matters specifieds in the application as ground for such
appointment (Lacson vs. Hodges. 80 Phil. 216 (19481).

4. ID.; ID.; ORDERS VOID, WHEN ISSUED WITHOUT NOTICE AND IN ABSENCE OF ADVERSE PARTY. — Anent the
order of the respondent judge that the petitioner should reimburse to the plaintiffs the sum of P300.00 for the
reason stated in the Order dated January 14. 1968, it suffices to state that it was issued without notice and in the
absence of the party affected and consequently void for lack of jurisdiction in its issuance.

DECISION

ABAD SANTOS, J p:

Petition to annul and set aside several orders of the respondent judge on the ground that they were issued with
grave abuse of discretion.

In Civil Case No. 178-G (later designated as No. 07) of the defunct Court of First Instance of Quezon, the plaintiffs
sought the partition of seven (7) parcels of land under a claim of co-ownership with the defendants. The plaintiffs
claimed that except for one-half of the fifth parcel (e), two of the defendants, Leon and Enrique Abrigo, were in
possession of the lands. The defendants put up the defense of ownership; they claimed ownership by hereditary
title by virtue of an alleged duly approved Amended Project of Partition in the Testate Estate of Nazario Abrigo.

As stated above, this parcel, including several others, are said to be in the possession of Leon and Enrique Abrigo.

The plaintiffs filed an Urgent Motion for the appointment of a receiver to administer parcel (a) on the ground that
numerous squatters had invaded the property to the plaintiffs' great damage and prejudice. The motion was set for
hearing on November 3, 1967, but counsel for the defendants asked by telegram that the hearing be re-set to
another date because of another court engagement. The motion was heard as scheduled in the absence of
defendants' counsel.

Atty. Pedro S. Nantes, Acting Clerk of Court, Branch IV, CFI, Quezon City is hereby appointed as receiver.

The respondent judge, issued the following Order: Mr. Benjamin M. Santiago is hereby appointed as
Assistant to the Receiver. The defendants filed an Opposition to the Motion for the appointment of a
receiver but by then the two Orders above- quoted had been issued. Accordingly, the defendants filed a
Motion to have the Orders of November 3 and 8, 1967, reconsidered but the Motion was denied by the
respondent judge.

One of the defendants who is the petitioner herein, filed a Motion for the reconsideration he claimed that there
was no legal basis for the appointment of a receiver under the facts of the case; and alternatively, he offered to
post a bond so that the receiver be discharged. The Motion was denied.

ISSUE:

Whether or not the respondent judge erred in appointing a receiver.

HELD:
The petition is highly impressed with merit.

The respondent judge committed grave abuse of discretion in connection with the appointment of a
receiver and he can be faulted on the following counts:

- The reason for the appointment of the receiver was the fact that the land had been entered by numerous
squatters. But a receiver who is also burdened with his duties as Clerk of Court cannot be in a better position than
the actual possessors in dealing with the squatters.

- The respondent judge should at least have accepted the bond offered by the petitioner. Rule 59, Sec. 4 stipulates
that "the receiver (may be) discharged when the party opposing the appointment files a bond executed to the
applicant in an amount to be fixed by the court, to the effect that such party will pay the applicant all damages he
may suffer by reason of the acts, omissions, or other matters specified in the application as ground for such
appointment." Petition is granted.