Tantano vs. Espina-Caboverde

G.R. No. 203585               July 29, 2013

MILA CABOVERDE TANTANO and ROSELLER CABOVERDE, Petitioners,
vs.
DOMINALDA ESPINA-CABOVERDE, EVE CABOVERDE-YU, FE CABOVERDE-LABRADOR, and JOSEPHINE E. CABOVERDE, Respondents.

Facts:

Petitioners files a complaint of annulment of the Deed of Sale purportedly transferring lots from their parents Maximo and Dominalda. During the pendency of the case the parties executed a Partial Settlement Agreement (PSA) where they fixed the sharing of the uncontroverted properties among themselves, in particular, the adverted additional eight (8) parcels of land including their respective products and improvements. Under the PSA, Dominalda’s daughter, Josephine, shall be appointed as Administrator. The PSA provided that Dominalda shall be entitled to receive a share of one-half (1/2) of the net income derived from the uncontroverted properties. The PSA also provided that Josephine shall have special authority, among others, to provide for the medicine of her mother.

Both Annabelle Saldia and Jesus Tan then took their respective oaths of office and filed a motion to fix and approve bond which was approved by the trial court over petitioners’ opposition.

Petitioners harp on the fact that the court a quo failed to require Dominalda to post a bond prior to the issuance of the order appointing a receiver, in violation of Section 2, Rule 59 of the Rules of court

Respondents insist that where there is sufficient cause to appoint a receiver, there is no need for an applicant’s bond because under Sec. 2 of Rule 59, the very purpose of the bond is to answer for all damages that may be sustained by a party by reason of the appointment of a receiver in case the applicant shall have procured such appointment without sufficient cause.

Issue:

WON posting bond is required in receivership?

Held:

Sec. 2 of Rule 59 is very clear in that 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. The use of the word "shall" denotes its mandatory nature; thus, the consent of the other party, or as in this case, the consent of petitioners, is of no moment. Hence, the filing of an applicant’s bond is required at all times. On the other hand, the requirement of a receiver’s bond rests upon the discretion of the court. Sec. 2 of Rule 59 clearly states that the court may, in its discretion, at any time after the appointment, require an additional bond as further security for such damages.