Calo vs. Roldan

The nature of an action is determined solely by the facts alleged in the complaint, and the provisional remedy of receivership cannot be granted where the plaintiff's action is one for injunction and the plaintiff alleges ownership and actual possession of the property in litigation. A receiver may only be appointed when the property is actually in litigation according to the allegations of the complaint, 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.

Petitioners Tranquilino Calo and Doroteo San Jose were defendants in Civil Case No. 7951 before the Court of First Instance of Laguna, while respondents Regino Relova and Teodula Bartolome were the plaintiffs in that case. The respondents, who were husband and wife, filed an action against the petitioners involving two parcels of land—an unplanted rice land and a coconut land—located in Pila, Laguna. The Rules of Court provide for several provisional remedies—attachment, preliminary injunction, receivership, and delivery of personal property—which are available to litigants for the preservation or protection of their rights during the pendency of the principal action, but only where the nature of the action requires such protection.

Respondents Regino Relova and Teodula Bartolome, spouses, filed a complaint in the Court of First Instance of Laguna against petitioners Tranquilino Calo and Doroteo San Jose. In their complaint, respondents alleged that they were the owners and possessors of two parcels of land—parcel (a), an unplanted rice land, and parcel (b), a coconut land—both located in Pila, Laguna. Respondents further alleged that petitioners, without any legal right and in connivance with each other, through force, stealth, threats, and intimidation, intended to enter and work or harvest whatever existing fruits might be found on the lands, in violation of respondents' proprietary rights. Respondents prayed for the approval of a P2,000 bond, the issuance of a writ of preliminary injunction ex-parte restraining petitioners from entering or harvesting the lands, judgment declaring the preliminary injunction final, and payment of P200 as damages for the alleged destruction of a madre-cacao fence and barbed wires on June 26, 1945.

Petitioners filed an opposition dated August 8, 1945, to the issuance of the writ of preliminary injunction, claiming that they were the owners of the lands and had been in actual possession thereof since 1925. In their answer filed on August 14, 1945, petitioners reiterated that they were the owners and were then in actual possession of the property, and that respondents had never been in possession thereof. After a hearing on August 9, 1945, at which both parties presented evidence, Judge Rilloraza denied the petition for preliminary injunction on the ground that the defendants were in actual possession of the lands. Respondents filed a motion for reconsideration on August 20, 1945, but this motion remained undecided when Judge Rilloraza was assigned to another court.

On September 4, 1945, respondents filed a reply to petitioners' answer, reiterating their allegation that they were possessors in good faith of the properties in question. On December 17, 1945, respondents filed an urgent petition ex-parte praying that their motion for reconsideration be granted and/or for the appointment of a receiver of the properties, on the grounds that (a) respondents had an interest in the properties and the fruits thereof were in danger of being lost unless a receiver was appointed, and (b) the appointment of a receiver was the most convenient and feasible means of preserving, administering, and disposing of the properties in litigation. On the same date, respondent Judge Roldan decided to consider the motion for reconsideration in due time and granted the petition for appointment of a receiver.

The Supreme Court noted that respondents had also filed another case, Case No. 7989, against Roberto Calo and his brothers and sisters, in which the Court of First Instance of Laguna had also appointed a receiver. The cause of action alleged in that case was substantially the same as the cause of action in the present case.

• Excess of Jurisdiction: Petitioners argued that respondent Judge Roldan exceeded his jurisdiction or acted with grave abuse of discretion in appointing a receiver of the lands and their fruits, which according to the complaint were in the actual possession of and belonged to the respondents.
• Lack of Plain Remedy: Petitioners contended that there was no appeal or any other plain, speedy, and adequate remedy in the ordinary course of law against the receivership order, which was an incidental or interlocutory one, thus justifying the petition for certiorari.
• Contempt: Petitioners also prayed that respondents Relova be punished for contempt of court for allegedly disobeying the injunction issued by the Supreme Court requiring them to desist from enforcing the receivership order and from entering the palay therein.

• Nature of Action: Respondents contended in their answer that the action they filed was not only for injunction but also to quiet title over the two parcels of land described in the complaint.
• Propriety of Receivership: Respondents argued that the appointment of a receiver was proper because they had an interest in the properties in question, the fruits thereof were in danger of being lost unless a receiver was appointed, and the appointment was the most convenient and feasible means of preserving, administering, and disposing of the properties in litigation.

• Jurisdiction of the Trial Court: Whether respondent Judge Roldan acted in excess of his jurisdiction or with grave abuse of discretion in appointing a receiver in Civil Case No. 7951.
• Propriety of Receivership in an Injunction Action: Whether the appointment of a receiver is a proper provisional remedy in an action for injunction where the plaintiff alleges ownership and actual possession of the property.
• Effect of the Reply on the Nature of the Action: Whether respondents' prayer in their reply to be declared owners in fee simple changed the nature of the action from injunction to one to quiet title.
• Receivership in Case No. 7989: Whether the order appointing a receiver in the related Case No. 7989 was likewise issued in excess of jurisdiction.
• Contempt: Whether respondents Relova should be punished for contempt for disobeying the Supreme Court's injunction.

• Jurisdiction of the Trial Court: Yes. Respondent Judge Roldan acted in excess of his jurisdiction in appointing a receiver, and the order appointing the receiver, as well as all other orders and proceedings in connection with the receivership, are null and void.
• Propriety of Receivership in an Injunction Action: No. Appointment of a receiver is not proper and does not lie in an action of injunction such as the one filed by the plaintiffs, because according to plaintiffs' theory or allegations in their complaint, neither the lands nor the palay harvested therein are in litigation.
• Effect of the Reply on the Nature of the Action: No. The allegations in plaintiffs' reply did not change the nature of the action alleged in the complaint or add a new cause of action, because a plaintiff cannot, after defendant's answer, amend his complaint by changing the cause of action or adding a new one without previously obtaining leave of court.
• Receivership in Case No. 7989: Yes. As the cause of action alleged in the complaint in Case No. 7989 was substantially the same as the cause of action in the present case, the order appointing a receiver in that case was likewise issued in excess of jurisdiction and is null and void.
• Contempt: No. The petition for contempt was denied because the palay was harvested by the receiver and not by respondents Relova.

• Jurisdiction of the Trial Court: The Court reasoned that what determines the nature of an action filed in the courts are the facts alleged in the complaint as constituting the cause of action. The facts averred as a defense in the defendant's answer do not and cannot determine or change the nature of the plaintiff's action. According to the complaint, the plaintiffs' action was one of ordinary injunction, as they alleged ownership and actual possession of the lands and sought to restrain defendants from entering or harvesting the fruits thereof. The provisional remedies of attachment, preliminary injunction, receivership, and delivery of personal property are remedies to which parties may resort for the preservation or protection of their rights during the pendency of the principal action, but only if the action by its nature requires such protection. Since the plaintiffs' action was one for injunction, the proper provisional remedy was preliminary prohibitory injunction, not receivership. The Court emphasized that a plaintiff will not and legally cannot ask for the appointment of a receiver of property which he alleges to belong to him and to be actually in his possession, for the owner and possessor of a property is more interested than other persons in preserving and administering it.

• Propriety of Receivership in an Injunction Action: The Court explained that a receiver may be appointed to take charge of personal or real property which is the subject of an ordinary civil action when the party applying has an interest in the property and such property is in danger of being lost, removed, or materially injured, or when the appointment is the most convenient and feasible means of preserving, administering, or disposing of the property in litigation. However, the property must be in litigation according to the allegations of the complaint. In this case, the litigation or issue raised by plaintiffs in their complaint was not the ownership or possession of the lands and their fruits, but whether defendants intended to enter or harvest whatever existing fruits could be found in the lands alleged to be the exclusive property and in the actual possession of the plaintiffs. The Court further held that even if the plaintiffs had amended their complaint to allege that the ownership and possession of the lands were in litigation, the respondent judge would still have acted in excess of jurisdiction in appointing a receiver, because 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.

• Effect of the Reply on the Nature of the Action: The Court held that the fact that plaintiffs, in their reply, prayed that they be declared owners in fee simple did not change the nature of the action alleged in the complaint or add a new cause of action, because the allegations in the reply were in answer to defendants' defenses. A plaintiff cannot, after defendant's answer, amend his complaint by changing the cause of action or adding a new one without previously obtaining leave of court under section 2, Rule 17. The Court also rejected respondents' contention that the action was one to quiet title, noting that an equitable action to quiet title may be filed only where no other remedy at law exists or where the legal remedy would not afford adequate remedy. In this case, the action of injunction was the proper and adequate remedy in law, for a judgment in favor of plaintiffs would quiet their title to the lands.

• Receivership in Case No. 7989: The Court expressed its opinion, to avoid multiplicity of suits, that since the cause of action alleged in the complaint in Case No. 7989 was substantially the same as the cause of action in the present case, the order of the Court of First Instance of Laguna appointing a receiver in that case was issued in excess of its jurisdiction and was therefore null and void.

• Contempt: The Court denied the petition for contempt because it appeared from the evidence in the record that the palay was harvested by the receiver and not by respondents Relova, and therefore the respondents did not disobey the injunction issued by the Court.

• Nature of the Action Determined by the Complaint — What determines the nature of an action filed in the courts are the facts alleged in the complaint as constituting the cause of action. The facts averred as a defense in the defendant's answer do not and cannot determine or change the nature of the plaintiff's action. The theory adopted by the plaintiff in his complaint is one thing, and that of the defendant in his answer is another. In this case, the Court applied this doctrine to hold that the respondents' action was one for injunction, not receivership or quiet title, based solely on the allegations in the complaint.

• Provisional Remedies Limited to the Nature of the Action — The provisional remedies of attachment, preliminary injunction, receivership, and delivery of personal property are remedies to which parties litigant may resort for the preservation or protection of their rights or interest, and for no other purpose, during the pendency of the principal action. If an action, by its nature, does not require such protection or preservation, said remedies cannot be applied for and granted. To each kind of action or actions a proper provisional remedy is provided for by law. The Rules of Court clearly specify the cases in which they may be properly granted.

• Receivership Not Proper to Disturb Possession — 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. Appointments of receivers of real estate lie largely in the sound discretion of the court, and where the effect of such an appointment is to take real estate out of the possession of the defendant before the final adjudication of the rights of the parties, the appointment should be made only in extreme cases and on a clear showing of necessity therefor in order to save the plaintiff from grave and irremediable loss or damage.

• Amendment of Complaint After Answer — A plaintiff cannot, after defendant's answer, amend his complaint by changing the cause of action or adding a new one without previously obtaining leave of court. In this case, the plaintiffs' prayer in their reply to be declared owners in fee simple did not change the nature of the action because the allegations in the reply were in answer to defendants' defenses, and the nature of the cause of action as set forth in the complaint was not and could not be amended or changed by the reply.

• "It is a truism in legal procedure that what determines the nature of an action filed in the courts are the facts alleged in the complaint as constituting the cause of action. The facts averred as a defense in the defendant's answer do not and can not determine or change the nature of the plaintiff's action." — This passage establishes the foundational doctrine that the complaint's allegations determine the nature of the action, which was the basis for the Court's conclusion that the underlying action was one for injunction and not receivership.

• "The property or fund must, therefore be in litigation according to the allegations of the complaint, and the object of appointing a receiver is to secure and preserve the property or thing in controversy pending the litigation. Of course, 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 thereof, for there would be no reason for such appointment." — This passage defines the requirement that property must be in litigation according to the complaint's allegations before a receiver may be appointed, and explains why a plaintiff who alleges ownership and possession cannot seek receivership.

• "It is a matter not only of law but of plain common sense that a plaintiff will not and legally can not ask for the appointment or receiver of property which he alleges to belong to him and to be actually in his possession. For the owner and possessor of a property is more interested than persons in preserving and administering it." — This passage articulates the common-sense principle that a plaintiff alleging ownership and possession cannot seek the appointment of a receiver over the same property, as the owner-possessor is best positioned to preserve and administer it.

• "Because 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." — This passage states the equitable principle that receivership should not be used to disturb possession where title is disputed, which was central to the Court's ruling that the receivership order was void.

• Mendoza vs. Arellano and B. de Arellano, 36 Phil. 59, 63, 64 — Cited as controlling authority for the principle that appointments of receivers of real estate lie largely in the sound discretion of the court, and where the effect of such appointment is to take real estate out of the possession of the defendant before final adjudication, the appointment should be made only in extreme cases and on a clear showing of necessity to save the plaintiff from grave and irremediable loss or damage.

• Section 1(b), Rule 61, Rules of Court — Provides that 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 has an interest in the property and that such property is in danger of being lost, removed, or materially injured unless a receiver is appointed to guard and preserve it. The Court held that this provision was not satisfied because the property was not in litigation according to the allegations of the complaint.

• Section 1(e), Rule 61, Rules of Court — Provides that a receiver may be appointed when it appears that the appointment is the most convenient and feasible means of preserving, administering, or disposing of the property in litigation. The Court held that this ground was inapplicable because the property was not in litigation according to the plaintiffs' own allegations.

• Section 2, Rule 17, Rules of Court — Provides that a plaintiff cannot, after defendant's answer, amend his complaint by changing the cause of action or adding a new one without previously obtaining leave of court. The Court applied this provision to hold that the plaintiffs' prayer in their reply to be declared owners in fee simple did not change the nature of the action.

• Section 3, Rule 60, Rules of Court — Concerns the conditions for the issuance of a preliminary prohibitory injunction. The Court cited this provision to explain that the proper provisional remedy for the plaintiffs' injunction action was preliminary prohibitory injunction, not receivership.

Moran, C.J., Ozaeta, Jaranilla, De Joya, Pablo, Perfecto, Hilado, and Bengzon, JJ., concurred.

• Justice Briones, with Justice Paras concurring — Justice Briones concurred with the dispositive portion of the decision for the sole reason, briefly but lucidly expounded in the ponencia, that when there is a controversy over the title of property, the appointment of a receiver should not be used to disturb the status quo by transferring possession of the litigated land from one party to another. Only when the dominion is indisputable—for example, when a Torrens title is involved—may a receiver be appointed for the specific purposes indicated by law, among them principally the preservation of the litigated object when it is in danger of being damaged or spoiled.