FUNCTIONS AND OBLIGATIONS OF THE RECEIVER

Case#1: Larrobis Jr vs. Philippin Veterans Bank 440 SCRA 34 (2004)

FACTS:
 On march 3, 1980, petitioner spouses contracted a monetary loan with respondent Philippine
Veterans Bank in the amount of P135,000,
 Evidenced by a promissory note, due and demandable on February 27, 1981,
 Secured b a Real Estate Mortgage executed on their lot together with the improvements,
 On March 23, 1985, the respondent bank went bankrupt and was placed under
receivership/liquidation b the Central Bank from April 23, 1985 until august 1992,
 On August 23, 185, the bank through Francisco Go, sent the spouses a demand letter for
“accounts receivable in the total amount of P6345 as of August 15, 1984, which pertains to the
insurance premiums advanced by respondent bank over the mortgaged property of
petitioners,
 On august 23, 1995, more than 14 years from the time the load become due and demandable,
 Respondent bank filed a petition for extra judicial foreclosure of mortgage of petitioner’s
property.
Issue:
 WON the period within which the bank was placed under receivership and liquidation was a
fortuitous event which suspended the running of the ten year prescriptive period in bringing
actions.
HELD:
 Wherefore, premises considered judgment is hereby rendered dismissing the complaint for
lack of merit. Likewise the compulsory counter claim of defendant is dismissed for being
unmeritorious.
 It reasoned that defendant bank was placed under receivership by the Central Bank fro April
1985 until 1992,
 From april 1985 until July 1992, defendant bank was restrained from doing its business.
 The defendant banks right to foreclosure the mortgaged property prescribes in 10 years but
sch period was interrupted when it was placed under receivership.
 Article 1154 of the NCC to this effective provides the period during which the obliged was
prevented by a fortuitous event from enforcing his right is not reckoned against him.

Case#2: Banco Filipino vs Ybanez

Facts:
 March 7, 1978, respondents obtained a loan secured by a Deed of Real Estate Mortgage ove
TCT#69836 from petitioner bank,
 The loan was used for the construction of a commercial bldg in Cebu City
 On oct 25, 1978 respondent obtained an additional loan from the petitioner thus increasing
their obligation to 1M. A corresponding amendment of Real Estate Mortgage was thereafter
executed
 December 24, 1982, the loan was again re structured, increasing the loan obligation to P1,
225,000 and the Real Estate Mortgage was again amended.
 Respondents executed a Promissory Note for the sum P 1, 225,000 payable in 15 years with a
stipulated interest of 21% per annum, and stipulating monthly payment of P22, 426
 The 1st payment was payable on January 24, 1983, and the succeeding payments were due
every 24th of each month. The note also stipulated that in case of default in the payment of
any of the monthly amortization and interest, respondents shall pay a penalty equivalent to
3% of the amount due each month.
 Respondents total payment from 1983 to 1988 amounted to P1455385
 From 1989 onwards, respondents did not pay a single centavo. They aver that BF had ceased
operations and or was not allowed to continue business, having been place under liquidation
by the CB.
 January 15, 1990 respondent lawyer wrote special acting liquidation Renan Santos and
requested that plaintiff return the mortgage property of the respondent since it had sufficiently
profited from the loan and the interested and penalty charges were excessive.
Issue:
  WON the effect of the temporary closure of BF from January 1, 1985 to July 1, 1994 on the
loan.
 WON the rate of interest set at 21% per annum legal
 WON the 3% monthly surcharge valid
HELD:
 In Banco Filipino savings and mortgage Bank vs Monetary Board, the validity of the closure and
receivership of the BF was put in issue pendency of the case did not diminish the authority of
the designated liquidator to administer and continue banks transactions. The court the banks
liquidator to continue receiving collectibles and receivables or paying off creditors claims and
other transactions pertaining to normal operations of a bank.
 Among these transactions were the prosecution of suits against debtors for collection and for
forlocusre of mortagages.
 The bank was allowed to collect interests on its loans while under liquidation, provide that the
interst were legal
 The 21% rate per annum is hereby declared valid
 The 3% monthly surcharge is nullified for being violative of the usury law at the time
respondents are ordered to pay petitioner the amount of P2, 581,294.93 within 30 days from
receipt of the decision.

Case#3 – Producers Bank vs NLRC 355 SCRA 489 (2001)

Facts:
 The employee of the producer bank file a petition to the NLRC that the PBP not complied the
wage#6 and non payment of holiday pay.
 The petitioner contends that the NLRC gravely abused its discretion in ruling as it did for the
succeeding reasons:
1. It contravened the SC decision in traders Royal bank vs NLRC
2. Its ruling is not justified by law and Art. 100 of the labor code
3. Its ruling is contrary to the BA
4. The so called “company practice invoked by its has no legal and moral bases”
 Petitioner under conservatorship and distressed is exempted under wage#6.
Issues:
 Alleged diminution of benefits, - Christmas and 13th bonus
 Non compliance with the wage order#6
 Non payment of legal holiday pay
Held:
 The granting of a bonus is a management prerogative, something given in addition to what is
ordinarily received by or strictly due the recipient.
 Section 28 A Appointment of conservator – whenever, on the basis of a report submitted b
appropraiate supervising and examining department, the MB fins that a bank is in a state of
continuing in ability or unwillingness to maintain a condition of solvency and liquidity deemed
adequate to protect the depositors and creditors, the MB may appoint a conservator to take
charge of the asses, liabilities and the management of that banking institution all monies and
debs due said bank exercise all powers necessary to preserve the assets of the bank
reorganize the management thereof and resorted.
 He shall have the power to overrule or revoke the actions of the previous management and
board of directors of the bank, any provision of law to the notwithstanding, and such other
powers as the monetary board shall deemed necessary.

Case#4 – Cental bank vs CA 220 SCRA 236

Facts:
 Based on the financial reports submitted to the central bank, which states that the financial
conditions of the Triumph savings bank (TSB is one of the insolvency and its continuance in
business world involve probable loss to its depositors and creditors.
 The monetary board issued a resolution ordering the closure of TSB,
 Forbidding it from doing business in the Philippines,
 Placing it under receivership and appointing Ramon V. Taiaogi as receiver
  The TSB filed a complaint assailing the Resolution on the grounds of lack of prior notice and
hearing.
Issue:
 WON a MB Resolution be annulled on the ground of lack of prior notice and hearing.
Held:
 Section 29 of the CB act does not contemplate prior notice and hearing before a bank may be
declared to stop operations and placed under receivership.
 When it provides for the filing of the case within 10 days after the receiver takes charge of the
assets of the bank
 It is unmistakable that the assailed actions should precede the filing for the case,
 Plainly, the legislature could not have intend “ no prior notice and hearing” un the closure of
the bank and at the same time allow suit to annul it on the bias of the absence thereof.
 The “ close now and hear later” scheme is grounded on practical and legal consideration to
prevent the unwarranted dissipation of the banks asset and as a valid exercise of the police
power to protect the depositors, creditors, stockholders and the general public.
Case#5 – Rural Bank of Buhi vs CA 162 SCRA 288 (1998)

Case#6 – Abacus Real Estate Devt Center vs manila Banking Corp

Facts:
 On May 22, 1987, the CB of the Philippines, now BSP, ordered the closure of Manila bank and
placed it under receivership with Felcican Miranda, Jr bening initially appointed as receiver.
 On nov 11, 1988, the CB by virtue of MB resolution#505 ordered the liquidation of Manila Bank
and designated Atty, Renan V. Santos as liquidator
 Since no disposition of assets could be made due to the litigation concerning Manila Banks
closure, an arrangement was thought of whereby the property would first be leased to Manila
Equitites Corporation (MEQCO, for brevity) wholly owned subsidiary of Manila Bank, with
MEQCO there after subleasing the property to the lauleano group.
 March 30, 1990, the laureano group transferred and assigned to Bitanga all of its rights in
Abacus and the “exclusive option to purchase”. However, Manila bank refused to honor the
same.
Issue:
 Won respondent banks appeal to the court of appeals was filed on time.
 WON petitioner abacus has acquired the right to purchase the lot and building in question.
HELD:
 (1) Section 3, Rule 41 of the 1997 Rules of Civil Procedure, “ the period of appeal shall be
interrupted by a timely motion for new trial or reconsideration”
 Since, according to petitioner, respondent filed its Motion for Reconsideration on the last day of
the period to appeal, it only had 1 more day within which to file an appeal, so much so that
when it received on August 23, 1999 a copy of the trial courts order denying its motion for
reconsideration, Respondent bank had only up to August 24, 1999 within which to file the
corresponding appeal
  As respondent bank appealed the decision of the trial court only on August 25, 1999, petitioner
thus argues that respondents appeal was filed out of time.
 (2) Congress itself has recognized that a bank receiver only has power of administration.
 Section 30 of the New central bank act expressly provides that the receiver shall immediately
gather and take charge of all the assets and liabilities of the institution, administer the same
for the benefit of tits creditors, and exercise the general powers of a receiver under the
Revised Rules of Court but shall not with the exception of administrative expenditures, pay or
commit any act that will involve the transfer or disposition of any assets of the institution
 In all, respondent banks receiver was without any power to approve or ratify the exclusive
option to purchase” granted by the late vince G.. Puyat, who in the first place was himself
bereft of any authority, to bind the bank under such exclusive option.
 Respondent Manila bank was not thus be compelled to sell the land and building in question to
petitioner abacus under the terms of the latters “exclusive option to purchase”.

Case#7: Villanueva vs CA 244 SCRA 395 (1995)

 Private respondent Catalina Sanchez, the widow of Roberto Sanchez, averred that her
 husband was the owner a parcel of land which was registered without her knowledge in
 the name of the petitioners on the strength of an alleged deed of sale.
 Petitioners questioned the personality of the private respondent to file the complaint,
 contending that the late Roberto Sanchez was never married but had a common-law
 wife by whom he had two children.
 The trial court rendered a decision in favor of the petitioners, holding that the deed of
 sale was not spurious. The trial court rejected the contract of marriage submitted by the
 private respondent, because although the document was dated September 21, 1964,
 the Torrens certificate issued to Roberto Sanchez over the subject land on August 25,
 1965, described his civil status as "single."
 The Court of Appeals reversed the decision of the trial court. Hence the present petition.
ISSUE:
 W/N the civil status of the deceased in the TCT as ³single´ defeats the presumption of
 marriage.
HELD:
 No. The Court notes at the outset that Catalina Sanchez has proved her status as
 the widow of Roberto Sanchez with her submission of the marriage contract. That
 evidence rendered unnecessary the presumption that "a man and a woman deporting
 themselves as husband and wife have entered into a lawful contract of marriage". It is
 strange that the trial court should reject Exhibit "A" in favor of the Transfer Certificate of
 Title describing Roberto Sanchez as "single,"7 disregarding the elementary principle
 that the best documentary evidence of a marriage is the marriage contract itself. A
 Torrens certificate is the best evidence of ownership of registered land, not of the civi

Case#8 – Ong vs. CA 253 SCRA 105

Facts:
 On 5 February 1991 Jerry Ong filed with the Regional Trial Court of Quezon City a petition for
the surrender of TCT Nos. 13769 and 13770 pursuant to the provisions of Secs. 63(b) and 107
of P.D. 1529[2] against Rural Bank of Olongapo, Inc. (RBO), represented by its liquidator
Guillermo G. Reyes, Jr. and deputy liquidator Abel Allanigue
 Respondents failed to seasonably redeem said parcels of land, for which reason, petitioner has
executed an Affidavit of Consolidation of Ownership which, to date, has not been submitted to
the Registry of Deeds of Tagaytay City, in view of the fact that possession of the aforesaid
titles or owner’s duplicate certificates of title remains with the RBO.
 Petitioner submits that Civil Case No. Q-91-8019 may proceed independently of Sp. Proc. No.
170-0-85. He argues that the disputed parcels of land have been extrajudicially foreclosed and
the corresponding certificate of sale issued in his favor; that considering that respondent RBO
failed to redeem said properties he should now be allowed to consolidate his title thereto; that
respondent RBO’s mortgage of TCT Nos. 13769 and 13770 in favor of petitioner and its
subsequent foreclosure are presumed valid and regular; and, that the liquidation court has no
jurisdiction over subject parcels of land since they are no longer assets of respondent RBO.
Issues:
  The court shall have jurisdiction in the same proceedings to adjudicate disputed claims against
the bank x x x and enforce individual liabilities of the stockholders and do all that is necessary
to preserve the assets of such institution and to implement the liquidation plan approved by
the Monetary Board
Held:
 The fact that the insolvent bank is forbidden to do business, that its assets are turned over to
the Superintendent of Banks, as a receiver, for conversion into cash, and that its liquidation is
undertaken with judicial intervention means that, as far as lawful and practicable, all claims
against the insolvent bank should be filed in the liquidation proceeding
 We explained therein the rationale behind the provision, i.e., the judicial liquidation is intended
to prevent multiplicity of actions against the insolvent bank. It is a pragmatic arrangement
designed to establish due process and orderliness in the liquidation of the bank, to obviate the
proliferation of litigations and to avoid injustice and arbitrariness. The lawmaking body
contemplated that for convenience only one court, if possible, should pass upon the claims
against the insolvent bank and that the liquidation court should assist the Superintendent of
Banks and regulate his operations.
Case# 9 – Central Bank of the Philippines vs Dela Cruz
Facts:
 On August 8, 1994, private respondents filed with the trial court a Complaint for Recovery of
Possession, Damages and Attorney’s Fees with Preliminary Mandatory Injunction3involving a
parcel of land designated as Lot 105, Block 20 ("Lot" for brevity), and the buildings thereon
("Buildings" for brevity), located at San Antonio Village, Matina, Davao City.
 n their complaint, private respondents averred the following: (1) title to the Lot4is registered in
the name of Mindanao Realty Corporation ("MRC" for brevity); (2) respondent Victoria Ababan
and her late husband, Martin Ababan ("Ababan Spouses" for brevity), acquired possessory
rights over the Lot in 1950; (2) the Ababan Spouses are the rightful claimants or occupants of
the Lot; (3) the Ababan Spouses built the original Buildings thereon; (4) the Ababan Spouses
merely allowed and tolerated petitioners to use and take physical possession of the Lot in
November 1991 upon petitioners’ request because they had no place of residence; and (5)
petitioner Jaime Bustamante, the son-in-law of the Ababan Spouses, subsequently began to
claim the Lot and Buildings by making it appear in the records of MRC that he was the claimant
or occupant of the Lot.
 Private respondents prayed that a writ of preliminary mandatory injunction be issued enjoining
petitioners from claiming the Lot and Buildings, that judgment be rendered after trial in their
favor, and that the mandatory injunction be made permanent. Alternatively, private
respondents prayed that petitioners be made to surrender to private respondents the peaceful
possession of the Lot and Buildings and to pay a monthly rental of P5,000.00 from November
1991 until the case is terminated.1âwphi1.nêt
Issues:

1. WHETHER OR NOT THE TRIAL COURT ACTED WITHOUT OR IN EXCESS OF JURISDICTION, OR

WITH GRAVE ABUSE OF DISCRETION, IN ISSUING THE ORDERS DATED APRIL 24, 1995 AND
JUNE 15, 1995, AND THE WRIT OF PRELIMINARY INJUNCTION DATED MAY 10, 1995; AND

2. WHETHER OR NOT THE COURT OF APPEALS, IN AFFIRMING THE TRIAL COURT’S ORDERS AND
WRIT OF PRELIMINARY INJUNCTION, ACTED WITH GRAVE ABUSE OF DISCRETION AMOUNTING
TO LACK OR EXCESS OF JURISDICTION.

Held:
 Generally, the grant or denial of a writ of preliminary injunction in a pending case rests in the
sound discretion of the court taking cognizance of the case.10 The assessment and evaluation
of evidence in the issuance of the writ of preliminary injunction involve findings of facts
ordinarily left to the trial court for its conclusive determination.11
 This Court has ruled that the status quo sought to be preserved by a preliminary injunction is
the last actual, peaceable and unconstested situation which precedes a controversy.18The
status quo should be existing ante litem motam, or at the time of the filing of the case.19For
this reason, a preliminary injunction should not establish new relations between the parties,
but merely maintain or re-establish the pre-existing relationship between them. The trial court
 itself expounded on this when it quoted Merville Park Homeowners Assn. Inc. vs. Velez20 in its
assailed Order of April 24, 1995.21
 "Specifically, we find no irregularity in respondent court’s order directing petitioners to pay
rentals to respondent Victoria Ababan at this stage of the proceedings and in ordering
petitioners to desist and refrain from collecting rentals from the lessees of the buildings in
question. As provisionally found by respondent court in its Order of April 24, 1995,
respondent Victoria Ababan and her late husband are the owners of the buildings in question
which they have constructed, and that petitioners were merely allowed to occupy and stay in
the subject premises. As a necessary and incidental consequence thereof, petitioners must pay
rentals to respondent Victoria Ababan. To allow petitioners to stay in the subject premises
without payment of rentals would render useless the tentative pronouncement of
respondent court that the buildings in question are owned by respondent Victoria Ababan and
her late husband, and that petitioners may not be evicted therefrom pending trial of the case
on the merits.
 This Court has ruled time and again that a preliminary injunction is not proper when its
purpose is to take the property out of the possession or control of one party and transfer the
same to the hands of another who did not have such control at the inception of the case and
whose legal title has not clearly been established.24 In the instant case, the rights of private
respondents and the petitioners to the Lot and Buildings are precisely In contention, and have
yet to be decided by the trial court. A court should avoid issuing a writ of preliminary injunction
which would effectively dispose of the main case without trial.

Case#10 – Manalo vs CA 244 SCRA 395 (1995)

FACTS:

 Troadio Manalo, a resident of 1996 Maria Clara Street, Sampaloc, Manila died intestate
on February 14, 1992. He was survived by his wife, Pilar S. Manalo, and his eleven (11)
children, namely: Purita M. Jayme, Antonio Manalo, Milagros M. Terre, Belen M.
Orillano, Isabelita Manalo, Rosalina M. Acuin, Romeo Manalo, Roberto Manalo, Amalia
Manalo, Orlando Manalo and Imelda Manalo, who are all of legal age.
 At the time of his death on February 14, 1992, Troadio Manalo left several real
properties located in Manila and in the province of Tarlac including a business under
the name and style Manalo's Machine Shop with offices at No. 19 Calavite Street, La
Loma, Quezon City and at NO. 45 General Tinio Street, Arty Subdivision, Valenzuela,
Metro Manila.
 On November 26, 1992, herein respondents, who are eight (8) of the surviving children
of the late Troadio Manalo, namely; Purita, Milagros, Belen Rocalina, Romeo, Roberto,
Amalia, and Imelda filed a petition with the respondent Regional Trial Court of Manila
of the judicial settlement of the estate of their late father, Troadio Manalo, and for the
appointment of their brother, Romeo Manalo, as administrator thereof.
 Moreover, a writ of preliminary injunction may only require a party to refrain from a
particular act or acts.26The portion of the Order of the trial court directing the
petitioners to pay rent is therefore not the proper subject of a preliminary injunction,
but of a preliminary mandatory injunction which the trial court has seen fit not to
grant.

ISSUE:
 Whether or not the respondent Court of Appeals erred in upholding the questioned orders of
the respondent trial court which denied their motion for the outright dismissal of the petition
for judicial settlement of estate despite the failure of the petitioners therein to aver that
 earnest efforts toward a compromise involving members of the same family have been made
prior to the filling of the petition but that the same have failed.
HELD:
 Herein petitioners claim that the petition in SP. PROC. No. 92- 63626 is actually an ordinary
civil action involving members of the same family.It is a fundamental rule that in the
determination of the nature of an action or proceeding, the averments and the character of the
relief sought in the complaint, or petition, as in the case at bar, shall be controlling. A careful
srutiny of the Petition for Issuance of Letters of Administration, Settlement and Distribution of
Estatein SP. PROC. No. 92-63626 belies herein petitioners' claim that the same is in the nature
of an ordinary civil action. The said petition contains sufficient jurisdictional facts required in a
petition for the settlement of estate of a deceased person such as the fat of death of the late
Troadio Manalo on February 14, 1992, as well as his residence in the City of Manila at the time
of his said death. The fact of death of the decedent and of his residence within he country are
foundation facts upon which all the subsequent proceedings in the administration of the estate
rest. The petition is SP.PROC No. 92-63626 also contains an enumeration of the names of his
legal heirs including a tentative list of the properties left by the deceased which are sought to
be settled in the probate proceedings. In addition, the relief's prayed for in the said petition
leave no room for doubt as regard the intention of the petitioners therein (private respondents
herein) to seek judicial settlement of the estate of their deceased father, Troadio Manalo.
 It is our view that herein petitioners may not be allowed to defeat the purpose of the
essentially valid petition for the settlement of the estate of the late Troadio Manalo by raising
matters that as irrelevant and immaterial to the said petition. It must be emphasized that the
trial court, siting as a probate court, has limited and special jurisdiction and cannot hear and
dispose of collateral matters and issues which may be properly threshed out only in an
ordinary civil action. In addition, the rule has always been to the effect that the jurisdiction of a
court, as well as the concomitant nature of an action, is determined by the averments in the
complaint and not by the defenses contained in the answer. If it were otherwise, it would not
be too difficult to have a case either thrown out of court or its proceedings unduly delayed by
simple strategem.21 So it should be in the instant petition for settlement of estate.