Acuña vs. Caluag

A trial court retains jurisdiction, pending appeal, to appoint a receiver under Rule 61 and order the delivery of possession of the property in litigation to that receiver for the preservation of the property and the collection of rents; such an order does not adjudicate the ultimate right to possession but merely conserves the subject matter pending appellate review.

The dispute originated from a real estate mortgage executed by petitioner spouses Acuña over two parcels of land to secure a P25,000 loan from respondent Santos. Santos foreclosed after default, obtained a judgment by compromise, and purchased the properties at the auction sale. Despite the finality of the foreclosure judgment, the parties subsequently entered a new agreement granting petitioners the opportunity to repurchase the properties for P40,000 until December 31, 1953, with monthly payments of P500 for use and occupation; the agreement stipulated automatic nullity and immediate enforcement of the writ of possession upon default. Petitioners failed to comply, triggering the issuance of alias writs of possession, an appeal by petitioners, and the appointment of a receiver pendente lite.

• The Mortgage and Foreclosure: On April 21, 1950, petitioner spouses Emiliano and Nieves Acuña executed a real estate mortgage over two parcels of land in favor of respondent Reynaldo T. Santos to secure a P25,000 loan at 12% annual interest. The mortgage contained stipulations for insurance, liquidated damages, and attorney’s fees. Santos filed a complaint for foreclosure (Civil Case No. 1433) on May 2, 1951, after default.
• Compromise Judgment and Sale: On August 1, 1951, the parties submitted a written agreement reciting the loan, default, reduction of liquidated damages to P500, and prayed for judgment. Respondent Judge Caluag rendered judgment in accordance with the compromise on the same day. The decision became final and executory; a writ of execution issued; the mortgaged properties were sold at public auction to Santos as highest bidder. The Sheriff’s certificate of sale dated February 23, 1952, was approved and confirmed by the court on March 10, 1952. A writ of possession issued on May 10, 1952, and the writ itself was issued five days later. Petitioners’ urgent motion for extension of time to vacate was denied on July 2, 1952, on the ground that the decision was final and the court had lost jurisdiction.
• The June 9, 1953 Agreement (Repurchase): After an alias writ of possession issued on June 2, 1953, Santos and petitioners, through counsel, submitted an “Agreement and Petition” on June 9, 1953, which expressly superseded all prior agreements. Petitioners undertook to purchase the properties for P40,000 payable on or before December 31, 1953, and to pay P500 monthly for use and occupation starting May 20, 1953. The agreement provided that failure to pay any monthly installment or the P40,000 would render the agreement “immediately and automatically null and void,” with petitioners agreeing to voluntarily surrender possession. The agreement further stated it was not a lease, did not waive Santos’s rights under the judgment, and that all prior amounts paid were forfeited. The trial court approved the agreement and held the alias writ in abeyance.
• Default and Further Alias Writs: Petitioners failed to comply with the terms of the June 9, 1953 agreement. On September 23, 1953, upon Santos’s ex parte petition, Judge Caluag issued an order finding default and directing the immediate issuance of an alias writ of possession, which the clerk of court issued the same day. On May 8, 1954, petitioners moved to quash this alias writ on grounds of novation and lapse of 60 days. The court initially restrained enforcement because more than 60 days had elapsed, but on July 8, 1954, ordered the issuance of yet another alias writ of possession to enforce the underlying decision.
• Appeal and Appointment of Receiver: Petitioners perfected an appeal from the July 8, 1954 order, docketed in the Supreme Court as G.R. No. L-8881. While the appeal was pending, on October 28, 1955, Judge Caluag appointed respondent Guillermo Romero as receiver of the properties over petitioners’ opposition. On February 7, 1956, the court ordered the sheriff to place the receiver in possession. On February 27, 1956, the court ordered petitioners to surrender possession to the receiver within two days under penalty of contempt. Petitioners’ motion for reconsideration, arguing loss of jurisdiction due to the perfected appeal, was denied on April 25, 1956, with a further directive to deliver possession within two days or “be dealt with accordingly.” Petitioners then filed this certiorari petition.

• Loss of Jurisdiction: Petitioners argued that the perfection of their appeal in the main case, which involved the possession of the property, divested the trial court of jurisdiction over the question of possession; thus, the court could no longer deprive them of actual possession and deliver it to a receiver.
• Interference with Appealed Issue: Petitioners insinuated that the order to deliver possession to the receiver “touches a matter litigated by the appeal, i.e., the physical possession of the petitioners,” and therefore improperly intruded upon the appellate court’s domain.

• Retained Jurisdiction for Preservation: Respondents maintained that under the law, particularly Rule 61, Sections 1(d) and 7, the trial court retained jurisdiction over the preservation of the property under litigation pending appeal, which included the authority to appoint a receiver with the power to take and keep possession of the property.
• Uncontested Appointment and Necessity: Respondents pointed out that petitioners did not contest the legality and propriety of the receiver’s appointment and did not move for reconsideration of that order. They further alleged that petitioners were insolvent, the buildings and improvements were in danger of destruction or impairment, and petitioners had failed to pay the monthly P500 rentals from August 1953, accumulating arrears of about P15,000—all warranting the receivership.

• Jurisdiction over Receivership Pending Appeal: Whether the trial court, after the perfection of an appeal, retained jurisdiction to appoint a receiver and to order petitioners to deliver possession of the property under litigation to that receiver.

• Jurisdiction over Receivership Pending Appeal: The trial court retained jurisdiction. Although the perfection of an appeal generally deprives the trial court of jurisdiction over the case, it retains jurisdiction to issue orders for the preservation of the property under litigation and involved in the appeal. Rule 61, Section 1(d) and Section 7, expressly authorizes the appointment of a receiver who may take and keep possession of the property in controversy. The appointment and the order to deliver possession to the receiver did not touch upon or decide the question of which party had the better right to possession—that issue remained pending on appeal. The measure merely ensured that, pendente lite, the property and its rents were conserved through the court’s officer. Petitioners’ failure to timely contest the appointment further militated against their challenge. The orders directing petitioners to surrender possession to the receiver were therefore valid and enforceable.

• Retained Jurisdiction for Preservation of Property Pending Appeal — Perfection of an appeal divests the trial court of jurisdiction over the case, but the court retains jurisdiction to take measures for the preservation of the property in litigation pending the appeal. This retained jurisdiction includes the authority to appoint a receiver under Rule 61 and to place the receiver in possession of the disputed property. The receiver’s possession is a conservatory remedy that does not adjudicate the ultimate issue of rightful possession on appeal.
• Receivership as a Conservatory, Non-Adjudicatory Remedy — An order appointing a receiver and directing the delivery of possession to the receiver does not decide the question litigated in the appeal (i.e., which party has a better right to possession). It serves only to preserve the res and collect rents pending resolution of the appeal, effectuated through the trial court’s officer.

• “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.” — This encapsulates the ratio decidendi on the extent of the trial court’s residual jurisdiction.
• “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.” — This clarifies that the receiver’s possession is purely conservatory and not an adjudication on the merits of possession.

• Velasco & Co. vs. Go Chuico, 28 Phil. 39 — Followed; established the principle that a trial court retains jurisdiction pending appeal to take measures for the preservation of the property in litigation, including the appointment of a receiver.
• Jocson vs. Presbitero et al., 97 Phil. 6 — Followed; similarly affirmed the trial court’s residual jurisdiction to preserve the subject matter of the appeal through receivership.

• Rule 61, Sections 1(d) and 7, Rules of Court — Section 1(d) allows the appointment of a receiver when the property in litigation is in danger of being lost, removed, or materially injured; Section 7 empowers the receiver to take and keep possession of the property. The trial court’s appointment of a receiver and the order to surrender possession to him were anchored on these provisions, applied as part of the court’s retained jurisdiction to preserve the property pendente lite.

Bengzon, Padilla, Reyes A., Bautista Angelo, Labrador, Concepcion, Endencia, and Felix, JJ., concurred.

None.