TRUTH. HONOR. EXCELLENCE.
#ConsentIsSimple
“Consensual sex is just sex. To say that implies that there is such a thing as
‘non consensual sex’ which, there isn’t. That’s rape. That is what it needs to be
called. There is only sex or rape. Do not teach people that rape is just another
type of sex. They are two very separate events. You wouldn’t say ‘breathing
swimming’ and ‘non breathing swimming’. You say swimming and drowning.”
There is no such thing as consensual sex. If it’s not consensual, it’s not sex. It’s
rape.
Rule 59: Receivership
Section 1. Appointment of receiver. — Upon a verified application, one or more receivers
of the property subject of the action or proceeding may be appointed by the court where
the action is pending or by the Court of Appeals or by the Supreme Court, or a member
thereof, in the following cases:
(a) When it appears from the verified application, and such other proof as the
court may require, that the party applying for the appointment of a
receiver has an interest in the property or fund which is the subject of the
action or proceeding, and that such property or fund is in danger of being
lost, removed, or materially injured unless a receiver be appointed to
administer and preserve it;
(b) 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 dissipated 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;
(c) 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 obligor
refuses to apply his property in satisfaction of the judgment, or otherwise
to carry the judgment into effect;
(d) 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.
During the pendency of an appeal, the appellate court may allow an application for the
appointment of a receiver to be filed in and decided by the court of origin and the receiver
appointed to be subject to the control of said court.
Normandy v. Duque
G.R. No. L-25407. August 29, 1969
This case stems from a previous case between the WARVETS and the Spouses Cochingyan,
where a receiver was appointed. Ramon E. Saura, the former First Receiver of the World War
II Veterans Enterprises, inc. (WARVETS), is now asking for reimbursement of the sum of
P5,236.00, representing the amount which he allegedly paid in advance as compensation to a
clerk whose services he availed himself of while he was still a receiver. The issue involved in
Consent is inherent in sex.
ProvRem2018 | Atty. Melo If there is no consent, it is not sex. It is rape.
#BelieveSurvivors
#MenCanStopRape
this case now is the reimbursement sought by the receiver for a clerk he hired without prior
leave of court, which is not allowed by the rules.
Facts: (Background of the Current Case) In August 1957, the Cabinet approved the proposal of
the World War II Veterans Enterprises, Inc. to undertake the procurement and sale of specific
items of reparation goods from Japan, valued at $8,000,000.00, in order to generate trust funds
for the benefit of veterans, war widows and orphans as contemplated in the Reparations
Agreement between the Philippines and Japan.
The World War II Veterans Enterprises, Inc. entered into a Joint Account Agreement with the
spouses Susana and Jose Cochingyan, Sr., doing business under the name and style of the
Catholic Church Mart, whereby the latter was given the right to dispose of the reparation
goods aforementioned of the total value of $8,000,000.00, with marginal profits of 40% on non-
unclassified goods and 60% on unclassified items in favor of the former.
On or about the same time, World War II Veterans Enterprises, Inc. entered into the two
contracts in question with the Filipinas Merchandising Corporation, whereby the latter was
allowed to negotiate the sale and distribution of the same reparation goods valued at
$2,000,000.00 and $6,000,000.00 with marginal profits of 15% and 20%, respectively.
(Basically, WARVETS offered the same items to Spouses Cochingyan and Filipinas
Merchendising for sale and distribution to generate trust funds for victims of WW II.)
Spouses Cochingyan filed a suit for specific performance because of the overlapping contracts
but it was eventually dismissed because the Spouses, WARVETS, and Filipinas entered into a
Memorandum of Agreement where the Filipinas Merchandising Corporation, for a
consideration, assigned to and relinquished in favor of the Cochingyans all its rights and
privileges under its two contracts.
WARVETS agreed to receive greatly reduced marginal profits, from the Cochingyans, of 20%
and 25% on non-unclassified and unclassified items, respectively from 40% and 60%.
Because of the reduced percentage, the ultimate beneficiaries, namely, the veterans, war
widows and orphans would suffer losses equivalent to a decrease or reduction in expected
profits. As things now stand, the interest of the beneficiaries cannot be amply protected by the
World War II Veterans Enterprises, Inc. which naturally feels bound to support its
commitment under the Memorandum of Settlement. Thus, the Court considered the petition
for the appointment of a receiver to be well founded, and granted it.
Current Case:
Saura was appointed was the receiver for the WARVETS-Cochingyan case mentioned above.
During his term, he went to Japan by authority of the lower court's order to check on the
reported undervaluation of goods shipped to the WARVETS and of preparing the shipment of
the goods which had not yet been committed.
The lower court reimbursed Saura for his expenses on this trip.
Except for this reimbursed amount, he received no other fee or compensation from the
WARVETS for a continuous period of three (3) years, while he performed his duties as
receiver. Hence, he filed a motion in the lower court to fix not only his compensation but also
that of his co-receiver, Macario Ofilada.
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 TRUTH. HONOR. EXCELLENCE.
An opposition had been interposed and the lower court denied Saura’s motion. He filed a
motion for reconsideration of the said denial but without waiting for its outcome, he filed
another motion resigning 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 by the Court.
Subsequently, a certain Atty. Magno, on his own behalf, presented before the lower court a
motion for the payment of attorney's fees to him in the amount of P10,000.00 for his alleged
services as legal counsel for Saura when he was still a receiver.
Saura 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. The 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 Saura in the whole sum prayed for by him as premium on his bond.
(At this point, Saura already two reimbursements – for his Japan trip, and the premium he
paid for the bond, and a compensation of P10,000 for being a receiver.)
Court’s basis for its ruling, in case Sir asks: The motion, to the mind of the Court, is not
well taken, because Saura is himself a lawyer and he did not have to retain legal counsel. If he
did, the matter should be for his own account, particularly because it was a unilateral act on
Saura's part to get Magno as his lawyer in the receivership. Nevertheless, the Court is not
unaware 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 order mentioned above, Saura once again filed
another motion, this time for the amount he allegedly paid as compensation of a clerk whom he
employed when he was still a receiver.
Saura alleged that in view of the voluminous paper and legal work which he had to attend to
as receiver, it was necessary for him to engage the service of a typist-stenographer, one
Melchor C. Ordoño, who doubled as messenger, filing clerk, utility clerk and records clerk.
The lower court denied Saura’s motion.
Issue: W/N Saura is entitled to the reimbursement he is seeking for hiring a clerk. –NO.
Ruling: 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.
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.
Consent is inherent in sex.
ProvRem2018 | Atty. Melo If there is no consent, it is not sex. It is rape.
#ConsentIsSimple
#BelieveSurvivors
#MenCanStopRape
Even if no one opposed Saura’s motion, 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 reason for withholding approval of the reimbursement in question is
precisely because "whatever amount he (the receiver) now seeks in addition to the P10,000
would be improper. Moreover, he is now estopped from claiming any further amount as
compensation for alleged clerical services employed by him as such receiver without prior
approval or authority of this Court."
Calo and San Jose v. Roldan
G.R. No. L-252. March 30, 1946
This is a petition for writ of certiorari against the respondent Judge Roldan on the ground that
the he exceeded his jurisdiction or acted with grave abuse of discretion in appointing a receiver
of certain lands and their fruits which were in the actual possession of and belong to said
plaintiffs. (A case against a judge who appointed a receiver over certain lands and fruits which
were possessed by plaintiffs.)
Facts: Plaintiff spouses are the owners and the possessors of the parcels of land in issue.
(Unplanted rice and coconut)
The defendants, without any legal right whatsoever and in connivance with each other,
through the use of force, stealth, threats and intimidation, intend or are intending to enter and
work or harvest whatever existing fruits may now be found in the lands above-mentioned.
(Plaintiffs are owners of land and the defendants are trying to enter it to harvest fruits found in
it.)
Plaintiffs filed a motion for preliminary injunction to which the defendants opposed.
Defendants allege that they are owners of the lands and have been in actual possession thereof
since 1925 and that the plaintiffs have never been in possession thereof.
Plaintiffs filed a reply to defendants' answer in which, among others, reiterate their allegation
in the complaint that they are possessors in good faith of the properties in question.
Plaintiffs filed an urgent petition ex-parte praying that plaintiffs' motion for reconsideration of
the order denying their petition for preliminary injunction be granted and/or for the
appointment of a receiver of the properties described in the complaint, on the ground that (a)
the plaintiffs have an interest in the properties in question, and the fruits thereof were in
danger of being lost unless a receiver was appointed; and that (b) the appointment of a receiver
was the most convenient and feasible means of preserving, administering and or disposing of
the properties in litigation which included their fruits.
Judge Roldan granted the petition for appointment of and appointed a receiver in the case.
Issue: W/N the appointment of a receiver by Judge Roldan was proper. –NO.
Ruling: A receiver may be appointed to take charge of personal or real property which is the
subject of an ordinary civil action, when it appears that the party applying for the appointment
of a receiver has an interest in the property or fund which is the subject of the action or
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 TRUTH. HONOR. EXCELLENCE.
litigation, and that such property or fund is in danger of being lost, removed or materially
injured unless a receiver is appointed to guard and preserve it.
Therefore, the property or fund to which a receiver is to be appointed must be in litigation
according to the allegations of the complaint. The object of appointing a receiver is to secure
and preserve the property or thing in controversy pending the litigation. If it is not in litigation
and is in actual possession of the plaintiff, the latter can not apply for and obtain the
appointment of a receiver for there would be no reason for such appointment.
National Investment and Development Corp. v. Aquino
G.R. No. L-34192. June 30, 1988
Another case involving a judge who granted the appointment of a receiver when there was no
right, interest, or claim in the property present and existing at the time.
Facts: Batjak, a Filipino-American corporation primarily engaged in the manufacture of
coconut oil and copra cake for export, almost went bankrupt. As of 1965, Batjak's indebtedness
to some private banks and to the Philippine National Bank (PNB) amounted to
P11,915,000.00.
As security for the payment of its obligations and advances against shipments, Batjak
mortgaged its three (3) coco-processing oil mills to Manila Banking Corporation (Manila
Bank), Republic Bank (RB), and Philippine Commercial and Industrial Bank (PCIB).
(Basically, Batjak was at the point of bankruptcy so it mortgaged its three mills to the three
banks mentioned above as security for payment of obligations.)
Batjak applied to PNB for additional financial assistance to place the three (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.
(Umutang sila sa PNB to pay their other obligations with the other banks and to ensure the
efficiency of their three mills.)
The application for additional financial assistance was approved and the properties of Batjak
were released by the three banks mentioned above. However, Batjak must execute a first
mortgage on all their properties located in Davao, Misamis Occidental, and Leyte in favor of
PNB, and assign leasehold rights on the property located in Davao City, also in favor of PNB.
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
liquidate Batjak's obligations to Republic Bank (RB), Manufacturers Bank and Trust Company
(MBTC) and Philippine Commercial & Industrial Bank (PCIB), 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.
As agreed, Batjak executed a first mortgage in favor of PNB on all its properties located in
Misamis Occidental and Leyte. Its property in Davao was mortgaged to Manila Bank but was
Consent is inherent in sex.
ProvRem2018 | Atty. Melo If there is no consent, it is not sex. It is rape.
#ConsentIsSimple
#BelieveSurvivors
#MenCanStopRape
released upon payment by Batjak, which was advanced by NIDC, a wholly-owned subsidiary of
PNB. To secure the advance, Batjak mortgaged the oil mill in Sasa, Davao City to NIDC.
(Other issues involving corp matters like voting trust issue, which I will not discuss anymore.)
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 after, final Certificates of Sale were issued by the provincial sheriffs to PNB after
Batjak failed to exercise its right to redeem the foreclosed properties within the allowable one
year period of redemption. Subsequently, PNB transferred the ownership of the two (2) oil
mills to NIDC which, as aforestated, was a wholly-owned PNB subsidiary.
The third mill was similarly foreclosed extrajudicial by NIDC. It was sold to NIDC as the
highest bidder. After Batjak failed to redeem the property, NIDC consolidated its ownership of
the oil mill.
(All three mortgaged mills were foreclosed and Batjak failed to redeem them within the
redemption period. Thus, ownership of said mills were officially transferred to NIDC.)
Three years later, Batjak wrote a letter to NIDC inquiring if the latter was still interested in
negotiating the renewal of the Voting Trust Agreement. It then requested for the turn-over
and transfer of all Batjak assets, properties, management and operations, assuming that
NIDC was no longer interested because of its non-reply.
Batjak filed a special civil action for mandamus with preliminary injunction against NIDC.
NIDC and PNB filed an opposition to the  ex parte  application for the issuance of a writ of
preliminary prohibitory and mandatory injunction.
Before the Court could act on this, Batjak filed a petition for receivership as alternative to writ
of preliminary prohibitory and mandatory injunction, which was opposed by PNB and NIDC.
Judge Aquino appointed three receivers and denied the motion for reconsideration of such by
PNB and NIDC.
Issue: W/N the appointment of three receivers by Judge Aquino was proper. –NO.
Ruling: 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. 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 two (2) of the three (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.
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 TRUTH. HONOR. EXCELLENCE.
(Basically, Batjak lost interest over the three mills when its mortgage was foreclosed and
certificates of title were issued to PNB and NIDC.)
Moreover, the prevention of imminent danger to property is the guiding principle that governs
courts in the matter of appointing receivers. Under Sec. 1 (b), Rule 59 of the Rules of Court, it
is necessary in granting the relief of receivership that the property or fired be in danger of loss,
removal or material injury.
In the case at bar, Batjak in its petition for receivership, or in its amended petition therefor,
failed to present any evidence, to establish the requisite condition that the property is in
danger of being lost, removed or materially injured unless a receiver is appointed to guard and
preserve it.
Delos Reyes v. Bayona
G.R. No. L-13832. March 29, 1960
Facts: Plaintiff de los Reyes obtained a loan of P120,000 in Japanese military war notes from
Maria B. Castro.
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.
Claiming that the deed of sale with right to repurchase did not express the true intention of
the parties, but that was merely a mortgage to secure the payment of the loan, Reyes filed a
case against Castro.
(Basically, Reyes borrowed money from Castro and mortgaged his two lands to secure payment.
Castro, on the other hand, alleges that what happened was not a mortgage but a sale of the two
lands to her with right of repurchase by Reyes.)
Reyes alleges that he had repeatedly tendered to Castro the payment of the principal of the
loan, but that she refused to accept it. Thus, he filed the civil case and at the same time
consigned to the Court the amount of P120,000 as payment of the loan since Castro would not
accept it.
Castro filed a case of unlawful detainer against Reyes. Despite Reyes’ answer that it was a
mortgage and not a sale, the Justice of the Peace rendered judgment in favor of Castro.
Pending appeal of the unlawful detainer case, the 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.
However, as a result of the writ of execution issued by the Court, Castro was placed in
possession of the property in question from 1955-1957. She only gave up possession of said
properties when the Court rendered a decision in the certiorari case filed by Reyes (see
paragraph before this one.)
The Court ruled in that case 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
Consent is inherent in sex.
ProvRem2018 | Atty. Melo If there is no consent, it is not sex. It is rape.
#ConsentIsSimple
#BelieveSurvivors
#MenCanStopRape
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.
(Court ruled in favor of Reyes as owner.)
Castro appealed the decision above but was denied by the CA.
Reyes then notified of the hearing for the Urgent Petition of Receivership filed by Castro.
Reyes opposed this, and the motion was denied by Judge Bayona. However, Reyes received an
copy of the order appointing a certain Tenchavez as receiver of the properties in question. This
order was based on an ex-parte petition reiterating the request for appointment of a receiver.
Issue: W/N the appointment of a receiver in this case was proper. –NO.
Ruling: The lower court and the appellate court’s decisions show that in justice to the parties,
they considered possession of Reyes instead of Castro as more reasonable and just. 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.
Section 2. Bond on appointment of receiver. — Before issuing the order appointing
a receiver the court shall require the applicant to file a bond executed to the party
against whom the application is presented, in an amount to be fixed by the court, to
the effect that the applicant will pay such party all damages he may sustain by
reason of the appointment of such receiver in case the applicant shall have
procured such appointment without sufficient cause; and the court may, in its
discretion, at any time after the appointment, require an additional bond as further
security for such damages. 
Section 4. Oath and bond of receiver. — Before entering upon his duties, the
receiver shall be sworn to perform them faithfully, and shall file a bond, executed to
such person and in such sum as the court may direct, to the effect that he will
faithfully discharge his duties in the action or proceeding and obey the orders of the
court.
Descallar v. Court of Appeals
G.R. No. 106473. July 12, 1993
Facts: Respondent, a realtor, filed against petitioner Descallar 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.
Respondent alleged that he purchased said properties from 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, respondent
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.
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 TRUTH. HONOR. EXCELLENCE.
In her answer, Descallar alleged that the property belongs to her as the registered owner, and
that 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.
Respondent 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 for MR but was denied. She likewise appealed to the CA but was denied.
Hence, this appeal.
Issues:
1. W/N the 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.
2. W/N the appointment of the judge’s clerk of court as receiver was proper. –NO.
Ruling:
1. 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.
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.
There is no showing that grave or irremediable damage may result to respondent unless a
receiver is appointed. The property in question is real property, hence, it is neither perishable
or consumable. 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.
The petitioner, besides being the actual possessor of the disputed property, is also the
registered owner thereof, as evidenced by TCTs registered under her name. 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.
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.
2. This practice has been frowned upon by this Court. 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 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,
Consent is inherent in sex.
ProvRem2018 | Atty. Melo If there is no consent, it is not sex. It is rape.
#ConsentIsSimple
#BelieveSurvivors
#MenCanStopRape
except in extreme cases when there is clear proof of its necessity to save the plaintiff from
grave and irremediable loss of damage, it is evident that the action of the respondent judge
is unwarranted and unfair to the defendants.
Section 8. Termination of receivership; compensation of receiver. — Whenever the
court, motu proprio or on motion 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 possession to the person adjudged to be 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 circumstances of the
case warrant, to be taxed as costs against the defeated party, or apportioned, as
justice requires.
Section 6. General powers of receiver. — Subject to the control of the court in which
the action or proceeding is pending a receiver shall have the power to bring and
defend, in such capacity, actions in his own name; to take and keep possession of
the property in controversy; to receive rents; to collect debts due to himself as
receiver or to the fund, property, estate, person, or corporation of which he is the
receiver; to compound for and compromise the same; to make transfers; to pay
outstanding debts; to divide the money and other property that shall remain among
the persons legally entitled to receive the same; and generally to do such acts
respecting the property as the court may authorize. However, funds in the hands of
a receiver may be invested only by order of the court upon the written consent of all
the parties to the action.
Section 9. Judgment to include recovery against sureties. — The amount, if any, to
be awarded to any party upon any bond filed in accordance with the provisions of
this Rule, shall be claimed, ascertained, and granted under the same procedure
prescribed in section 20 of Rule 57.
Pacific Merchandising Corp. v. Consolacion Insurance and Surety Co.
G.R. No. L-30204. October 29, 1976
Facts: Petitioner Pacific Merchandising Corporation filed an action to collect the sum of
P2,562.88 from Consolacion Insurance & Surety Co., Inc., who in turn filed a third-party
complaint against Gregorio V. Pajarillo.
The City Court rendered judgment in favor of the plaintiff (Pacific Merchandising) and against
the defendant (Consolacion Insurance), ordering the latter to pay the former the sum of
P2,562.88 with interest. Pajarillo appealed and the case was elevated to the CFI.
Background of the Case: By virtue of a writ of execution in the case entitled  Pacific
Merchandising Corporation vs. Leo Enterprises, the Sheriff of Manila levied and attached the
following: an Automaticket Machine, and projectors.
Pajarillo was appointed as receiver of all the assets, properties and equipment of Paris
Theatre, operated by Leo Enterprises, Inc.
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 TRUTH. HONOR. EXCELLENCE.
The sale at public auction of the above properties was postponed and was later cancelled due
to the representation of Atty. Pajarillo as Receiver of Paris Theatre operated by Leo
Enterprises, Inc. in which he undertook the payment of the judgment rendered in favor of the
plaintiff against Leo Enterprises, Inc.
Pajarillo approached Consolacion Surety and applied for a surety bond in the amount of
P5,000.00, to be rated in favor of Pacific Merchandising in order to guarantee to said plaintiff
the payment of obligations in its favor by the Leo Enterprises, Inc.
The bond applied for was executed in favor of Pacific Merchandising with Pajarillo as principal
and Consolacion as surety in the context of the allegations of the preceding paragraph. In
order to protect Consolacion Surety from injury and damage, Pajarillo executed in favor of the
former an INDEMNITY AGREEMENT.
Pacific Merchandising received from 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 attorney’s fees
equivalent to 25% of the amount due as provided for in said undertaking.
Pacific Merchandising’s counsel demanded from the said principal, Greg V. Pajarillo, the
payment of the installments, which remain unpaid in spite of said demand.
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.
Pajarillo answered stating that he was no longer 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.
The Court affirmed the decision of the City Court ordering Pajarillo to pay Consolacion Surety
whatever amount the latter pays to the plaintiff under said judgment.
Hence, this appeal.
Issue: W/N Pajarillo is liable to Pacific Merchandising Corp. for the unpaid amount. –YES.
Ruling: 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. Pajarillo never secured the court’s approval of either the agreement or
undertaking he entered into with Pacific Merchandising and Consolacion Surety. Not having
been approved or authorized by the receivership court should, it should be considered as his
personal undertaking or obligation.
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.
Having failed to perform his duty, to the prejudice of the creditor, Pajarillo should not be
permitted to take advantage of his own wrong. The judgment creditor having been induced to
enter into the aforesaid agreement by Pajarillo it was the duty of Pajarillo 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
Consent is inherent in sex.
ProvRem2018 | Atty. Melo If there is no consent, it is not sex. It is rape.
#ConsentIsSimple
#BelieveSurvivors
#MenCanStopRape
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.
Additional Information on Receivership in this Case:
Was 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,” followed or not?
NOT.
The Court stated in its ruling that if such agreements entered into by Pajarillo 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.
Traders Royal Bank v. Intermediate Appellate Court
G.R. No. 111357. June 17, 1997
Facts: This case involves properties which were placed under receivership pending the
resolution of a case involving the ownership of said properties.
The Court rendered a decision ruling that the deceased spouses Jose and Salvacion Tayengco
to be the lawful owners of the properties under receivership, and that the appointment of
petitioner Traders Royal Bank (TRB) as receiver pendente lite is valid.
In view of these rulings, the receivership proceeding was duly terminated. Thus, TRB rendered
its final accounting of the funds under receivership and retained the amount of P219,016.24 as
its receiver's fee, instead of turning over the entire fund to the Tayengcos. The Regional Trial
Court of Iloilo approved the final accounting submitted by TRB, including the deduction of its
fee from the fund under receivership.
The Tayengcos assailed the order before the Court of Appeals contending that TRB's
compensation should have been charged against the losing party and not from the funds under
receivership.
The CA 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.
TRB filed an MR but was denied.
Issue: W/N the decision of the appellate court reversing the order of the trial court approving
Trader Royal Bank's compensation to be  charged  solely  against the  funds under its
receivership is proper. –YES.
Ruling: Section 8, Rule 59 of the Rules of Court explicitly provides 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. Hence, it was correctly reversed by the Court of Appeals.
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 TRUTH. HONOR. EXCELLENCE.
Section 3. Denial of application or discharge of receiver. — The application may be
denied, or the receiver discharged, when the adverse party 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. The
receiver may also be discharged if it is shown that his appointment was obtained
without sufficient cause.
Vivares v. Reyes
G.R. No. 155408. February 13, 2008
Facts: Respondent Jose and Torcuator inherited properties from their father, Severino. They
had an oral partition of the properties and separately appropriated to themselves said
properties.
Torcuator died. Petitioner Vivares was the designated executor of Torcuato’s last will and
testament, while petitioner Ignaling was declared a lawful heir of Torcuato.
Believing that Torcuato did not receive his full share in the estate of Severino, petitioners
instituted an action for Partition and Recovery of Real Estate before the Camiguin RTC. With
the approval of the trial court, the parties agreed that properties from the estate of Severino,
which were already transferred in the names of respondent and Torcuato prior to Torcuator’s
death, shall be excluded from litigation.  In short, what was being contested were the
properties that were still in the name of Severino.
For the purpose of collating the common properties that were disputed, the trial court directed
the formation of a three-man commission with due representation from both parties, and the
third member, appointed by the trial court.
The disputed properties were then annotated with notices of lis pendens upon the instance of
petitioners.
Petitioners filed a  Motion to Place Properties in Litigation under Receivership alleging that
respondent had, without prior court approval and without petitioners knowledge, sold to third
parties and transferred in his own name several common properties, and that respondent
fraudulently antedated, prior to May 12, 1992, some conveyances and transfers to make it
appear that these were no longer part of the estate of Severino under litigation.
They further claimed that respondent was and is in possession of the common properties in the
estate of Severino, and exclusively enjoying the fruits and income of said properties and
without rendering an accounting on them and turning over the share pertaining to Torcuato.
Respondent opposed denying that he had fraudulently transferred any property of the estate of
Severino and asserting that any transfer in his name of said properties was a result of the oral
partition between him and Torcuato that enabled the latter as well to transfer several common
properties in his own name.
The trial court granted petitioner’s motion and appointed Salantin as receiver conditioned on
the filing of a PhP 50,000 bond.
Consent is inherent in sex.
ProvRem2018 | Atty. Melo If there is no consent, it is not sex. It is rape.
#ConsentIsSimple
#BelieveSurvivors
#MenCanStopRape
Respondent filed a motion for reconsideration, contending that the appointment of a receiver
was unduly precipitate considering that he was not represented by counsel and thus was
deprived of due process.
The trial court allowed respondent to present his evidence to contest petitioners’ grounds for
the appointment of a receiver, and the trial court set the reception of respondent’s evidence.
However, the respondent was in the United States for medical examination. He filed a Motion
for Postponement but was denied.
Respondent filed a Manifestation with Motion to Discharge Receiver, reiterating the
circumstances which prevented him from attending the hearing and praying for the discharge
of the receiver upon the filing of a counterbond in an amount to be fixed by the court in
accordance with Section 3, Rule 59 of the Rules of Court.
Respondent also filed a Motion to Cancel Notice of Lis Pendens. The petitioners opposed it.
The trial court issued a Resolution, denying respondent’s motions to discharge receiver and
cancel the notice of  lis pendens. He filed an MR but was partially denied for failing to raise
new matters in the motion.
Issues:
1. W/N the appointment of a receiver was justified. –NO.
2. W/N the annotation of a notice of lis pendens precludes the appointment of a receiver when
there is a need to safeguard the properties in litigation. –YES, in this case.
3. W/N the duly appointed receiver of properties in litigation should be discharged simply
because the adverse party offers to post a bond. –NO. (But the SC did not entertain this
issue on the ground that it was not raised as an issue before in the lower court.)
Ruling:
1. a. Petitioners miserably failed to adduce clear, convincing, and hard evidence to show the
alleged fraud in the transfers and the antedating of said transfers.  The fact that the
transfers were dated prior to the demise of Torcuato does not necessarily mean the
transfers were attended by fraud.  He who alleges fraud has the burden to prove it.
Moreover, respondent has adduced documentary proof that Torcuato himself similarly
conveyed several lots in the estate of Severino based on the oral partition between the
siblings. To lend credence to the transfers executed by Torcuato but distrust to those made
by respondent would be highly inequitable as correctly opined by the court  a quo.
Receivership is a harsh remedy to be granted only in extreme situations.
b. Respondent is willing to post a counterbond in the amount to be fixed by the court based on
Sec. 3, Rule 59. On this rule, the trial court should have dispensed with the services of the
receiver, more so considering that the alleged fraud put forward to justify the receivership was
not at all established.
2. The notice of lis pendens, by itself, may not be the most convenient and feasible means of
preserving or administering the property in litigation. However, the situation is different
in the case at bar.  A counterbond will also be posted by the respondent to answer for all
damages petitioners may suffer by reason of any transfer of the disputed properties in the
future.
These considerations, plus the finding that the appointment of the receiver was without
sufficient cause, have demonstrated the vulnerability of petitioners postulation.
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3. The rule states that the application may be denied or the receiver discharged. In statutory
construction, the word may has always been construed as permissive.  If the intent is to
make it mandatory or ministerial for the trial court to order the recall of the receiver upon
the offer to post a counterbond, then the court should have used the word shall. Thus, the
trial court has to consider the posting of the counterbond in addition to other reasons
presented by the offeror why the receivership has to be set aside.
Section 7. Liability for refusal or neglect to deliver property to receiver. — A person
who refuses or neglects, upon reasonable demand, to deliver to the receiver all the
property, money, books, deeds, notes, bills, documents and papers within his power
or control, subject of or involved in the action or proceeding, or in case of
disagreement, as determined and ordered by the court, may be punished for
contempt and shall be liable to the receiver for the money or the value of the
property and other things so refused or neglected to be surrendered, together with
all damages that may have been sustained by the party or parties entitled thereto
as a consequence of such refusal or neglect.
c. P50,000 damages resulting from an alleged conspiracy between the receiver and the
defendant Rafael Molina Salvador, whereby he latter was permitted to appropriate to
himself, in part at least, the business of De la Riva, and by which the use of a considerable
portion of the property in the hands of the receiver was permitted to said Molina without
compensation, or with a compensation very inadequate.
Second Cause of Action: Wrongful appointment of receiver for being procured without just
cause. The trial court dismissed this and no appeal was taken.
Issue: W/N the plaintiff Dela Riva is entitled to the damages he seeks to recover from
defendant Molina. –NO.
Ruling: The damages resulting from the appointment of the receiver, where the appointment
was procured without just cause, and the damages which arise  after the receiver has been
appointed, due to his negligence or mismanagement rests in different principles. In this case,
the damages dela Riva seeks to recover arose after the receiver was appointed. Molina cannot,
in this action, therefore, be made to respond for the acts of the receiver, it not having been
demonstrated that he exercised control over or that he connived with the receiver.

Dela Riva v. Molina Salvador

G.R. No. L-10106. November 23, 1915 Damages from Appointment of Damages after the Appointment of a
Receiver Receiver
Facts: Background of the Case: Defendant Rafael Molina Salvador began an action against the
plaintiff for the recovery of about P42,000, and secured the appointment of Joaquin Navarro, due to negligence or mismanagement by the
procured without just cause
another of the defendants in this action, receiver of real and personal property owned by De la receiver
Riva.
statutory under the general principles of the law
The receiver took possession of the property and gave a bond in the sum of P50,000
conditioned for the faithful performance of the duties of his office, the other defendants the damages, or part of them, may be injury occurs only after the receiver has
becoming sureties. caused before the receiver qualifies or takes qualified and taken possession of the
possession of the property property
The Supreme Court set aside the order appointing a receiver on the ground that, under the
provisions of law relative to receiverships, there was no authority for the appointment of a liability rests rests on the negligence or
liability rests on statute
receiver in the action named. misconduct of the receiver

The property was inventoried at the time possession was taken by the receiver and valued at the person obtaining the appointment of the *the person obtaining the appointment
around P231,000. After the reversal by the Supreme Court of the order appointing the receiver receiver is responsible for the damages, if he of the receiver is not responsible in any
the latter began a proceeding to account. Objections were presented to certain phases of the has signed the bond described  event
account, but none touching the condition of the property.
*The bond is given by the receiver, and not by the person procuring his appointment, and the
The property, both real and personal, which the receiver had in his possession at the liability of the receiver, if any, arises from his own negligence, and involves in no way the
termination of the receivership was seized by the sheriff of Albay under executions issued on person who obtained his appointment. For the acts of the receiver after his appointment no one
judgments against De la Riva and was duly sold at public sale under said executions. The is responsible but himself and his sureties.
proceeds were not sufficient to pay the judgment under which the levies were made.

Current Case: Umale v. ASB Realty

Plaintiff Dela Rive filed this case in 1908 stating two causes of action. G.R. No. 181126. June 15, 2011

First Cause of Action: Plaintiff seeks to recover: Facts: Amethyst Pearl executed a Deed of Assignment in Liquidation of a parcel of land in
a. P8,000 for the deterioration of the property, during the receivership, due to the negligence favor of ASB Realty in consideration of the full redemption of Amethyst Pearl’s outstanding
of the receiver; capital stock from ASB Realty. ASB became the owner of the land.
b. the sum of P30,000 for the negligent failure of the receiver to continue the business which,
it is alleged, was in operation ta the time the receiver was appointed; and
Consent is inherent in sex. 8
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 TRUTH. HONOR. EXCELLENCE.
ASB Realty commenced an action in the MTC for unlawful detainer against Umale. It alleged
that it entered into a lease contract with Umale. The agreement was for Umale to conduct a
pay-parking business on the property and pay a monthly rent of P60,720.00 to ASB Realty.
Upon the expiration of the contract, Umale continued occupying the premises and paying
rentals albeit at an increased monthly rent of P100,000.00.
ASB Realty served on Umale a Notice of Termination of Lease and Demand to Vacate and Pay.
Umale failed to comply with ASB Realtys demands and continued in possession of the subject
premises, even constructing commercial establishments thereon.
Umale admitted occupying the land since 1999 by virtue of a verbal lease contract but
vehemently denied that ASB Realty was his lessor.  He was adamant that his lessor was the
original owner, Amethyst Pearl. Since there was no contract between himself and ASB Realty,
the latter had no cause of action to file the unlawful detainer complaint against him.
Umale challenged ASB Realty’s personality to recover the subject premises considering that
ASB Realty had been placed under receivership by the Securities and Exchange Commission
(SEC) and a rehabilitation receiver had been duly appointed.  Under Section 14(s), Rule 4 of
the Administrative Memorandum No. 00-8-10SC, otherwise known as the Interim Rules of
Procedure on Corporate Rehabilitation (Interim Rules), it is the rehabilitation receiver that
has the power to take possession, control and custody of the debtors assets. Since ASB Realty
claims that it owns the subject premises, it is its duly-appointed receiver that should sue to
recover possession of the same.
ASB Realty replied that it was impossible for Umale to have entered into a Contract of Lease
with Amethyst Pearl in 1999 because Amethyst Pearl had been liquidated in 1996. ASB Realty
insisted that, as evidenced by the written lease contract, Umale contracted with ASB Realty,
not with Amethyst Pearl.  As further proof thereof, ASB Realty cited the official receipt
evidencing the rent payments made by Umale to ASB Realty.
MTC Ruling: MTC dismissed ASB Realty’s complaint against Umale without prejudice.  It
held that ASB Realty had no cause to seek Umales ouster from the subject property because it
was not Umale’s lessor.
RTC Ruling: The MTC erred in dismissing ASB Realty’s complaint for lack of cause of
action.  It found sufficient evidence to support the conclusion that it was indeed ASB Realty
that entered into a lease contract with Umale, hence, the proper party who can assert the
corresponding right to seek Umale’s ouster from the leased premises for violations of the lease
terms.
CA Ruling: Affirmed the RTC decision.
Issue: W/N the corporate officer of ASB Realty is incapacitated to file this suit to recover a
corporate property because ASB Realty has a duly-appointed rehabilitation receiver. –NO.
Alternatively, W/N the laws on corporate rehabilitation, particularly PD 902-A, as amended,
and its corresponding rules of procedure, forfeit the power to sue from the corporate officers
and Board of Directors. –NO.
Consent is inherent in sex.
ProvRem2018 | Atty. Melo If there is no consent, it is not sex. It is rape.
#ConsentIsSimple
#BelieveSurvivors
#MenCanStopRape
Ruling: Being placed under corporate rehabilitation and having a receiver appointed to carry
out the rehabilitation plan do not ipso facto deprive a corporation and its corporate officers of
the power to recover its unlawfully detained property.
Corporate rehabilitation (first introduced through PD 902-A) is defined as the restoration of
the debtor to a position of successful operation and solvency, if it is shown that its continuance
of operation is economically feasible and its creditors can recover by way of the present value
of payments projected in the plan more if the corporation continues as a going concern than if
it is immediately liquidated.
The intention of the law is to effect a feasible and viable rehabilitation by  preserving  a
floundering business as a  going  concern, because the assets of a business are often more
valuable when so maintained than they would be when liquidated.
This concept of preserving the corporations business as a going concern while it is undergoing
rehabilitation is called debtor-in-possession or debtor-in-place. This means that the debtor
corporation (the corporation undergoing rehabilitation), through its Board of Directors and
corporate officers, remains in control of its business and properties, subject only to the
monitoring of the appointed rehabilitation receiver.
PD 902-A, as amended, provides that the receiver shall have the powers enumerated under
Rule 59 of the Rules of Court.  But Rule 59 is a rule of general application.  It applies to
different kinds of receivers – rehabilitation receivers, receivers of entities under management,
ordinary receivers, receivers in liquidation and for different kinds of situations. While the SEC
has the discretion to authorize the rehabilitation receiver, as the case may warrant, to exercise
the powers in Rule 59, the SEC’s exercise of such discretion cannot simply be assumed. There is
no allegation whatsoever in this case that the SEC gave ASB Realty’s rehabilitation receiver the
exclusive right to sue.
While the Court rules that ASB Realty and its corporate officers retain their power to sue to
recover its property and the back rentals from Umale, the necessity of keeping the receiver
apprised of the proceedings and its results is not lost upon this Court.  Tasked to closely
monitor the assets of ASB Realty, the rehabilitation receiver has to be notified of the
developments in the case, so that these assets would be managed in accordance with the
approved rehabilitation plan.
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