Duque v. Court of First Instance
REITERATIONFacts
The Antecedents: Civil Case No. 34998 was a derivative suit filed by minority stockholders of World War Veterans Enterprises, Inc., seeking to annul agreements entered into by the directors and intervenors Jose and Susana Cochingyan. Initially, Ramon E. Saura was appointed receiver. Subsequently, defendants and intervenors sought Saura's suspension and the appointment of a co-receiver, which was denied by the trial court. Procedural History: In G.R. No. L-18359, petitioners sought certiorari for the refusal to suspend Saura. This Court appointed Macario Ofilada as a provisional second receiver. Later, Saura resigned, and his resignation was accepted. The defendants and intervenors moved for Ofilada's permanent appointment. Plaintiff Lorenzo B. Camins opposed, seeking Ofilada's discharge and the appointment of Philippine Veterans Bank as receiver. The respondent Judge, Hon. Francisco Arca, denied the appointment of the Bank and Ofilada's discharge, subsequently appointing Ofilada as permanent receiver. In G.R. No. L-23754, Camins and Normandy sought certiorari to annul the orders of September 24 and 26, 1964, and to have the Philippine Veterans Bank appointed as sole receiver. The Petition: Petitioners in G.R. No. L-18359 alleged grave abuse of discretion in the refusal to suspend Saura. Petitioners in G.R. No. L-23754 sought the annulment of the orders appointing Ofilada as permanent receiver and the appointment of the Philippine Veterans Bank as sole receiver, alleging partiality and incompetence of Ofilada.
Issue(s)
Whether the respondent court committed a grave abuse of discretion in refusing to suspend Ramon Saura as receiver. Whether the respondent judge committed a grave abuse of discretion in appointing Macario Ofilada as permanent receiver and refusing to appoint the Philippine Veterans Bank as receiver, despite allegations of partiality and incompetence.
Ruling
The petition in G.R. No. L-23754 is denied. Case G.R. No. L-18359 is dismissed as academic.
Ratio Decidendi
On the issue of grave abuse of discretion in refusing to suspend Ramon Saura (G.R. No. L-18359): This case became academic when receiver Ramon E. Saura resigned and his resignation was accepted by the court below. Therefore, the petition seeking his suspension or removal is moot and academic. The Supreme Court's prior appointment of Macario Ofilada as a provisional second receiver was for the protection of petitioners' rights during the pendency of the motion for removal in the lower court, and did not prejudge the question of Saura's removal. On the issue of appointing Macario Ofilada as permanent receiver and refusing the Philippine Veterans Bank (G.R. No. L-23754): The appointment and discharge of receivers are matters primarily addressed to the discretion of the trial court. A reviewing court will not interfere with this discretion unless it is convinced that it has been abused. The trial court's choice between candidates for receivership, after the parties have been fully heard, is also within its discretion. The Supreme Court found no evidence that the lower court's decision to appoint Ofilada as permanent receiver, despite his official duties as Clerk of Court, was so arbitrary and capricious as to warrant appellate intervention. The charges of incompetence and partiality against Ofilada were considered and rejected by the trial court, and the Supreme Court found no arbitrary action in this regard. The Court also noted that developments such as Ofilada's impending retirement and nomination as judge, and the nomination of another party, were not shown to have been presented to the lower court, and advised that these should be presented first to the trial judge for his consideration.
Main Doctrine
The appointment and discharge of receivers, as well as the choice between candidates for receivership, are matters primarily addressed to the discretion of the trial court, and a reviewing court will not interfere unless such discretion has been gravely abused.