Julio Vivares and Mila Ignaling v Engr Jose Reyes

Recievership No receivership of property in custodia legis

Facts:
1. Severino Reyes is the father of Respondent Jose Reyes and Torcuato Reyes. When
Severino died, they had an oral partition of the properties.
2. Torcuato died with a last will, with petitioner Vivares as executor and Ignaling as the
lawful heir.
3. Petitioners filed an action for Partition and Recovery of Real Estate before the RTC against
Respondent.
a. They allege:
i. They believe that Torcuato did not receive his full share of the properties
of his father Severino
b. The parties in this case eventually agreed on May 2 1992 that the properties from
the estate of Severino already transferred in the names of Jose and Torcuato prior
to the latters death shall be excluded from litigation. What is left being contested
are the properties still in the name of Severino (subject properties).
c. RTC directed the formation of a 3-man commission for the purpose of collating
the disputed properties. The properties were then annotated with notice of lis
pendens.
d. Petitioners moved to place properties under receivership
i. They allege:
1. Respondent Jose, without their knowledge and to their prejudice,
sold to third parties and transferred to his own name several
common properties
2. That Respondent fraudulently antedated the transfers to make it
appear as if it was made before their May 2, 1992 agreement.
3. That Respondent is in possession of the subject properties and is
enjoying the fruits thereof without accounting.
ii. Respondent opposed, denying the allegations
iii. RTC, after Petitioners filed their offer of exhibits in support of
receivership, granted their motion.
1. Respondent filed MR. RTC allowed him to present his evidence
2. Before the hearing, however, Respondent moved to postpone the
scheduled hearing, because he would be in the USA. RTC denied,
and reinstated its order granting the receivership.
e. Respondent moved to discharge receiver, reiterating the reasons why he moved
to postpone the hearing, and prayed for a discharge of the Receiver upon the
filing of a counterbond pursuant to R59 S3. Petitioners oppose. Respondent then
filed a motion to cancel notice of lis pendens because one of the properties of a
third party was mistakenly included in the subject properties.
f. RTC denied both motions of Respondent.

i. Respondent moved for partial MR, attaching Deeds of Sale to evidence

the exclusion of the said property.
ii. RTC denied MR.
4. On appeal, CA reversed RTC, ruled IFO of Respondent
5. Hence, this petition.
Issue: W/N the receivership is justified
Held: No.
Ratio:
There is no sufficient cause for receivership.
RTC acted arbitrarily in granting the petition for receivership as there is no sufficient cause or
reason to justify it. Petitioners allege that the receivership is proper because of the fraudulent
acts and antedated transfers. However, the antedating does not necessarily mean that the
transfers were attended by fraud.
One who alleges fraud has the burden to prove it. Respondent adduced documentary proof that
Torcuato himself conveyed several lots in the estate of Severino based on the oral partition
between him and Jose. To accept the transfers made by Torcuato but reject the transferred made
by Jose would be highly inequitable. In their May 2, 1992 agreement, Petitioners has already
accepted the oral partition made by Torcuato and Jose in excluding the properties already
transferred and litigating only those still in Severinos name. Petitioners cannot now impugn this
oral partition.
Recievership should have been discharged should Respondent have been permitted to post a
counterbond.
Anchored on R59 S3, first sentence, the receivership should have been discharged since the
Respondent is willing to post a counterbond. Moreso telling is the last sentence which says that
receivership should be discharged if it was shown to be without sufficient cause.
Petitioner contends that receivership should not be discharged simply because of the
counterbond. Since this is the first time Petitioners raised this ground, they are barred by
estoppel for failing to raise it in the lower courts. Even if SC were to entertain this, the wording
of R59 S3 is merely permissive; the court may or may not automatically discharge the
receivership and has to consider other options why the receivership should be set aside.
Reciever is not proper when the rights of the parties, one of whom is in possession of the
property, are still to be determined by the trial court.
It is undisputed that Respondent is still in possession over some of the disputed properties.
Between a possessor and a party claiming adverse rights, the former is accorded better rights.
Art. 539 of NCC protects the possessor in his right to possession, and should not be disturbed
except for exceptional or extreme cases.

Lis pendens should stay until the determination of who owns what is determined by trial court.
CA lifting of lis pendens reversed.