UNION BANK OF THE PHILIPPINES, petitioner, vs. EDMUND SANTIBAEZ and FLORENCE SANTIBAEZ ARIOLA, respondents. D E C I S I O N CALLEJO, SR., J p: Before us is a petition for review on certiorari under Rule 45 of the Revised Rules of Court which seeks the reversal of the Decision 1 of the Court of Appeals dated May 30, 2001 in CA-G.R. CV No. 48831 affirming the dismissal 2 of the petitioner's complaint in Civil Case No. 18909 by the Regional Trial Court (RTC) of Makati City, Branch 63. The antecedent facts are as follows: On May 31, 1980, the First Countryside Credit Corporation (FCCC) and Efraim M. Santibaez entered into a loan agreement 3 in the amount of P128,000.00. The amount was intended for the payment of the purchase price of one (1) unit Ford 6600 Agricultural All-Purpose Diesel Tractor. In view thereof, Efraim and his son, Edmund, executed a promissory note in favor of the FCCC, the principal sum payable in five equal annual amortizations of P43,745.96 due on May 31, 1981 and every May 31st thereafter up to May 31, 1985. On December 13, 1980, the FCCC and Efraim entered into another loan agreement, 4 this time in the amount of P123,156.00. It was intended to pay the balance of the purchase price of another unit of Ford 6600 Agricultural All- Purpose Diesel Tractor, with accessories, and one (1) unit Howard Rotamotor Model AR 60K. Again, Efraim and his son, Edmund, executed a promissory note for the said amount in favor of the FCCC. Aside from such promissory note, they also signed a Continuing Guaranty Agreement 5 for the loan dated December 13, 1980. jur2005cd Sometime in February 1981, Efraim died, leaving a holographic will. 6 Subsequently in March 1981, testate proceedings commenced before the RTC of Iloilo City, Branch 7, docketed as Special Proceedings No. 2706. On April 9, 1981, Edmund, as one of the heirs, was appointed as the special administrator of the estate of the decedent. 7 During the pendency of the testate proceedings, the surviving heirs, Edmund and his sister Florence Santibaez Ariola, executed a Joint Agreement 8 dated July 22, 1981, wherein they agreed to divide between themselves and take possession of the three (3) tractors; that is, two (2) tractors for Edmund and one (1) tractor for Florence. Each of them was to assume the indebtedness of their late father to FCCC, corresponding to the tractor respectively taken by them. SEIcAD On August 20, 1981, a Deed of Assignment with Assumption of Liabilities 9 was executed by and between FCCC and Union Savings and Mortgage Bank, wherein the FCCC as the assignor, among others, assigned all its assets and liabilities to Union Savings and Mortgage Bank. Demand letters 10 for the settlement of his account were sent by petitioner Union Bank of the Philippines (UBP) to Edmund, but the latter failed to heed the same and refused to pay. Thus, on February 5, 1988, the petitioner filed a Complaint 11 for sum of money against the heirs of Efraim Santibaez, Edmund and Florence, before the RTC of Makati City, Branch 150, docketed as Civil Case No. 18909. Summonses were issued against both, but the one intended for Edmund was not served since he was in the United States and there was no information on his address or the date of his return to the Philippines. 12 Accordingly, the complaint was narrowed down to respondent Florence S. Ariola. On December 7, 1988, respondent Florence S. Ariola filed her Answer 13 and alleged that the loan documents did not bind her since she was not a party thereto. Considering that the joint agreement signed by her and her brother Edmund was not approved by the probate court, it was null and void; hence, she was not liable to the petitioner under the joint agreement. On January 29, 1990, the case was unloaded and re-raffled to the RTC of Makati City, Branch 63. 14 Consequently, trial on the merits ensued and a decision was subsequently rendered by the court dismissing the complaint for lack of merit. The decretal portion of the RTC decision reads: WHEREFORE, judgment is hereby rendered DISMISSING the complaint for lack of merit. 15 The trial court found that the claim of the petitioner should have been filed with the probate court before which the testate estate of the late Efraim Santibaez was pending, as the sum of money being claimed was an obligation incurred by the said decedent. The trial court also found that the Joint Agreement apparently executed by his heirs, Edmund and Florence, on July 22, 1981, was, in effect, a partition of the estate of the decedent. However, the said agreement was void, considering that it had not been approved by the probate court, and that there can be no valid partition until after the will has been probated. The trial court further declared that petitioner failed to prove that it was the now defunct Union Savings and Mortgage Bank to which the FCCC had assigned its assets and liabilities. The court also agreed to the contention of respondent Florence S. Ariola that the list of assets and liabilities of the FCCC assigned to Union Savings and Mortgage Bank did not clearly refer to the decedent's account. Ruling that the joint agreement executed by the heirs was null and void, the trial court held that the petitioner's cause of action against respondent Florence S. Ariola must necessarily fail. The petitioner appealed from the RTC decision and elevated its case to the Court of Appeals (CA), assigning the following as errors of the trial court: 1.THE COURT A QUO ERRED IN FINDING THAT THE JOINT AGREEMENT (EXHIBIT A) SHOULD BE APPROVED BY THE PROBATE COURT. 2.THE COURT A QUO ERRED IN FINDING THAT THERE CAN BE NO VALID PARTITION AMONG THE HEIRS UNTIL AFTER THE WILL HAS BEEN PROBATED. 3.THE COURT A QUO ERRED IN NOT FINDING THAT THE DEFENDANT HAD WAIVED HER RIGHT TO HAVE THE CLAIM RE-LITIGATED IN THE ESTATE PROCEEDING. 16 The petitioner asserted before the CA that the obligation of the deceased had passed to his legitimate children and heirs, in this case, Edmund and Florence; the unconditional signing of the joint agreement marked as Exhibit "A" estopped respondent Florence S. Ariola, and that she cannot deny her liability under the said document; as the agreement had been signed by both heirs in their personal capacity, it was no longer necessary to present the same before the probate court for approval; the property partitioned in the agreement was not one of those enumerated in the holographic will made by the deceased; and the active participation of the heirs, particularly respondent Florence S. Ariola, in the present ordinary civil action was tantamount to a waiver to re-litigate the claim in the estate proceedings. On the other hand, respondent Florence S. Ariola maintained that the money claim of the petitioner should have been presented before the probate court. 17 The appellate court found that the appeal was not meritorious and held that the petitioner should have filed its claim with the probate court as provided under Sections 1 and 5, Rule 86 of the Rules of Court. It further held that the partition made in the agreement was null and void, since no valid partition may be had until after the will has been probated. According to the CA, page 2, paragraph (e) of the holographic will covered the subject properties (tractors) in generic terms when the deceased referred to them as "all other properties." Moreover, the active participation of respondent Florence S. Ariola in the case did not amount to a waiver. Thus, the CA affirmed the RTC decision, viz.: WHEREFORE, premises considered, the appealed Decision of the Regional Trial Court of Makati City, Branch 63, is hereby AFFIRMED in toto. ISAcHD SO ORDERED. 18 In the present recourse, the petitioner ascribes the following errors to the CA: I. THE HONORABLE COURT OF APPEALS ERRED IN FINDING THAT THE JOINT AGREEMENT SHOULD BE APPROVED BY THE PROBATE COURT. II. THE COURT OF APPEALS ERRED IN FINDING THAT THERE CAN BE NO VALID PARTITION AMONG THE HEIRS OF THE LATE EFRAIM SANTIBAEZ UNTIL AFTER THE WILL HAS BEEN PROBATED. III. THE COURT OF APPEALS ERRED IN NOT FINDING THAT THE RESPONDENT HAD WAIVED HER RIGHT TO HAVE THE CLAIM RE- LITIGATED IN THE ESTATE PROCEEDING. IV. RESPONDENTS CAN, IN FACT, BE HELD JOINTLY AND SEVERALLY LIABLE WITH THE PRINCIPAL DEBTOR THE LATE EFRAIM SANTIBAEZ ON THE STRENGTH OF THE CONTINUING GUARANTY AGREEMENT EXECUTED IN FAVOR OF PETITIONER- APPELLANT UNION BANK. V. THE PROMISSORY NOTES DATED MAY 31, 1980 IN THE SUM OF P128,000.00 AND DECEMBER 13, 1980 IN THE AMOUNT OF P123,000.00 CATEGORICALLY ESTABLISHED THE FACT THAT THE RESPONDENTS BOUND THEMSELVES JOINTLY AND SEVERALLY LIABLE WITH THE LATE DEBTOR EFRAIM SANTIBAEZ IN FAVOR OF PETITIONERUNION BANK. 19 The petitioner claims that the obligations of the deceased were transmitted to the heirs as provided in Article 774 of the Civil Code; there was thus no need for the probate court to approve the joint agreement where the heirs partitioned the tractors owned by the deceased and assumed the obligations related thereto. Since respondent Florence S. Ariola signed the joint agreement without any condition, she is now estopped from asserting any position contrary thereto. The petitioner also points out that the holographic will of the deceased did not include nor mention any of the tractors subject of the complaint, and, as such was beyond the ambit of the said will. The active participation and resistance of respondent Florence S. Ariola in the ordinary civil action against the petitioner's claim amounts to a waiver of the right to have the claim presented in the probate proceedings, and to allow any one of the heirs who executed the joint agreement to escape liability to pay the value of the tractors under consideration would be equivalent to allowing the said heirs to enrich themselves to the damage and prejudice of the petitioner. The petitioner, likewise, avers that the decisions of both the trial and appellate courts failed to consider the fact that respondent Florence S. Ariola and her brother Edmund executed loan documents, all establishing the vinculum juris or the legal bond between the late Efraim Santibaez and his heirs to be in the nature of a solidary obligation. Furthermore, the Promissory Notes dated May 31, 1980 and December 13, 1980 executed by the late Efraim Santibaez, together with his heirs, Edmund and respondent Florence, made the obligation solidary as far as the said heirs are concerned. The petitioner also proffers that, considering the express provisions of the continuing guaranty agreement and the promissory notes executed by the named respondents, the latter must be held liable jointly and severally liable thereon. Thus, there was no need for the petitioner to file its money claim before the probate court. Finally, the petitioner stresses that both surviving heirs are being sued in their respective personal capacities, not as heirs of the deceased. cSITDa
In her comment to the petition, respondent Florence S. Ariola maintains that the petitioner is trying to recover a sum of money from the deceased Efraim Santibaez; thus the claim should have been filed with the probate court. She points out that at the time of the execution of the joint agreement there was already an existing probate proceedings of which the petitioner knew about. However, to avoid a claim in the probate court which might delay payment of the obligation, the petitioner opted to require them to execute the said agreement. According to the respondent, the trial court and the CA did not err in declaring that the agreement was null and void. She asserts that even if the agreement was voluntarily executed by her and her brother Edmund, it should still have been subjected to the approval of the court as it may prejudice the estate, the heirs or third parties. Furthermore, she had not waived any rights, as she even stated in her answer in the court a quo that the claim should be filed with the probate court. Thus, the petitioner could not invoke or claim that she is in estoppel. Respondent Florence S. Ariola further asserts that she had not signed any continuing guaranty agreement, nor was there any document presented as evidence to show that she had caused herself to be bound by the obligation of her late father. The petition is bereft of merit. The Court is posed to resolve the following issues: a) whether or not the partition in the Agreement executed by the heirs is valid; b) whether or not the heirs' assumption of the indebtedness of the deceased is valid; and c) whether the petitioner can hold the heirs liable on the obligation of the deceased. At the outset, well-settled is the rule that a probate court has the jurisdiction to determine all the properties of the deceased, to determine whether they should or should not be included in the inventory or list of properties to be administered. 20 The said court is primarily concerned with the administration, liquidation and distribution of the estate.21 In our jurisdiction, the rule is that there can be no valid partition among the heirs until after the will has been probated. In testate succession, there can be no valid partition among the heirs until after the will has been probated. The law enjoins the probate of a will and the public requires it, because unless a will is probated and notice thereof given to the whole world, the right of a person to dispose of his property by will may be rendered nugatory. The authentication of a will decides no other question than such as touch upon the capacity of the testator and the compliance with those requirements or solemnities which the law prescribes for the validity of a will. 22 This, of course, presupposes that the properties to be partitioned are the same properties embraced in the will. 23 In the present case, the deceased, Efraim Santibaez, left a holographic will 24 which contained, inter alia, the provision which reads as follows: (e)All other properties, real or personal, which I own and may be discovered later after my demise, shall be distributed in the proportion indicated in the immediately preceding paragraph in favor of Edmund and Florence, my children. We agree with the appellate court that the above-quoted is an all-encompassing provision embracing all the properties left by the decedent which might have escaped his mind at that time he was making his will, and other properties he may acquire thereafter. Included therein are the three (3) subject tractors. This being so, any partition involving the said tractors among the heirs is not valid. The joint agreement 25 executed by Edmund and Florence, partitioning the tractors among themselves, is invalid, specially so since at the time of its execution, there was already a pending proceeding for the probate of their late father's holographic will covering the said tractors. aSCHcA It must be stressed that the probate proceeding had already acquired jurisdiction over all the properties of the deceased, including the three (3) tractors. To dispose of them in any way without the probate court's approval is tantamount to divesting it with jurisdiction which the Court cannot allow. 26 Every act intended to put an end to indivision among co-heirs and legatees or devisees is deemed to be a partition, although it should purport to be a sale, an exchange, a compromise, or any other transaction. 27 Thus, in executing any joint agreement which appears to be in the nature of an extra-judicial partition, as in the case at bar, court approval is imperative, and the heirs cannot just divest the court of its jurisdiction over that part of the estate. Moreover, it is within the jurisdiction of the probate court to determine the identity of the heirs of the decedent. 28 In the instant case, there is no showing that the signatories in the joint agreement were the only heirs of the decedent. When it was executed, the probate of the will was still pending before the court and the latter had yet to determine who the heirs of the decedent were. Thus, for Edmund and respondent Florence S. Ariola to adjudicate unto themselves the three (3) tractors was a premature act, and prejudicial to the other possible heirs and creditors who may have a valid claim against the estate of the deceased. The question that now comes to fore is whether the heirs' assumption of the indebtedness of the decedent is binding. We rule in the negative. Perusing the joint agreement, it provides that the heirs as parties thereto "have agreed to divide between themselves and take possession and use the above-described chattel and each of them to assume the indebtedness corresponding to the chattel taken as herein after stated which is in favor of First Countryside Credit Corp." 29 The assumption of liability was conditioned upon the happening of an event, that is, that each heir shall take possession and use of their respective share under the agreement. It was made dependent on the validity of the partition, and that they were to assume the indebtedness corresponding to the chattel that they were each to receive. The partition being invalid as earlier discussed, the heirs in effect did not receive any such tractor. It follows then that the assumption of liability cannot be given any force and effect. The Court notes that the loan was contracted by the decedent. The petitioner, purportedly a creditor of the late Efraim Santibaez, should have thus filed its money claim with the probate court in accordance with Section 5, Rule 86 of the Revised Rules of Court, which provides: Section 5.Claims which must be filed under the notice. If not filed barred; exceptions. All claims for money against the decedent, arising from contract, express or implied, whether the same be due, not due, or contingent, all claims for funeral expenses for the last sickness of the decedent, and judgment for money against the decedent, must be filed within the time limited in the notice; otherwise they are barred forever, except that they may be set forth as counterclaims in any action that the executor or administrator may bring against the claimants. Where an executor or administrator commences an action, or prosecutes an action already commenced by the deceased in his lifetime, the debtor may set forth by answer the claims he has against the decedent, instead of presenting them independently to the court as herein provided, and mutual claims may be set off against each other in such action; and if final judgment is rendered in favor of the defendant, the amount so determined shall be considered the true balance against the estate, as though the claim had been presented directly before the court in the administration proceedings. Claims not yet due, or contingent, may be approved at their present value. The filing of a money claim against the decedent's estate in the probate court is mandatory. 30 As we held in the vintage case of Py Eng Chong v. Herrera: 31 . . . This requirement is for the purpose of protecting the estate of the deceased by informing the executor or administrator of the claims against it, thus enabling him to examine each claim and to determine whether it is a proper one which should be allowed. The plain and obvious design of the rule is the speedy settlement of the affairs of the deceased and the early delivery of the property to the distributees, legatees, or heirs. 'The law strictly requires the prompt presentation and disposition of the claims against the decedent's estate in order to settle the affairs of the estate as soon as possible, pay off its debts and distribute the residue. 32 Perusing the records of the case, nothing therein could hold private respondent Florence S. Ariola accountable for any liability incurred by her late father. The documentary evidence presented, particularly the promissory notes and the continuing guaranty agreement, were executed and signed only by the late Efraim Santibaez and his son Edmund. As the petitioner failed to file its money claim with the probate court, at most, it may only go after Edmund as co-maker of the decedent under the said promissory notes and continuing guaranty, of course, subject to any defenses Edmund may have as against the petitioner. As the court had not acquired jurisdiction over the person of Edmund, we find it unnecessary to delve into the matter further. DSTCIa We agree with the finding of the trial court that the petitioner had not sufficiently shown that it is the successor-in-interest of the Union Savings and Mortgage Bank to which the FCCC assigned its assets and liabilities. 33 The petitioner in its complaint alleged that "by virtue of the Deed of Assignment dated August 20, 1981 executed by and between First Countryside Credit Corporation and Union Bank of the Philippines . . ." 34 However, the documentary evidence 35 clearly reflects that the parties in the deed of assignment with assumption of liabilities were the FCCC, and the Union Savings and Mortgage Bank, with the conformity of Bancom Philippine Holdings, Inc. Nowhere can the petitioner's participation therein as a party be found. Furthermore, no documentary or testimonial evidence was presented during trial to show that Union Savings and Mortgage Bank is now, in fact, petitioner Union Bank of the Philippines. As the trial court declared in its decision:
. . . [T]he court also finds merit to the contention of defendant that plaintiff failed to prove or did not present evidence to prove that Union Savings and MortgageBank is now the Union Bank of the Philippines. Judicial notice does not apply here. "The power to take judicial notice is to [be] exercised by the courts with caution; care must be taken that the requisite notoriety exists; and every reasonable doubt upon the subject should be promptly resolved in the negative." (Republic vs. Court of Appeals, 107 SCRA 504). 36 This being the case, the petitioner's personality to file the complaint is wanting. Consequently, it failed to establish its cause of action. Thus, the trial court did not err in dismissing the complaint, and the CA in affirming the same. IN LIGHT OF ALL THE FOREGOING, the petition is hereby DENIED. The assailed Court of Appeals Decision is AFFIRMED. No costs. SO ORDERED. Puno, Austria-Martinez, Tinga and Chico-Nazario, JJ., concur. Footnotes 1.Penned by Associate Justice Bienvenido L. Reyes with Associate Justices Eubulo G. Verzola (deceased), and Marina L. Buzon, concurring. 2.Penned by Presiding Judge Julio R. Logarta. 3.Records, pp. 8-12. 4.Id. at 13-18. 5.Id. at 19-20. 6.Exhibit 7. 7.Annex A of the Answer, Records, p. 48. 8.Exhibit A. 9.Exhibit G. 10.Exhibits E and F. 11.Records, p. 1. 12.See Sheriff's Return of Service, Id. at 39. 13.Records, p. 42. 14.Id. at 83. 15.Id. at 522. 16.CA Rollo, p. 43. 17.Id. at 76. 18.Rollo, p. 30. 19.Id. at 7-8. 20.See Ortega v. Court of Appeals, 153 SCRA 96 (1987); See also Morales v. CFI of Cavite, Br. V, 146 SCRA 373 (1986). 21.See De la Cruz v. Camon, 16 SCRA 886 (1966). 22.Vda. de Kilayko v. Tengco, 207 SCRA 600 (1992). 23.Ralla v. Untalan, 172 SCRA 858 (1989). 24.Exhibit 7. 25.Exhibit A. 26.See Sandoval v. Santiago, 83 Phil 784 (1949). 27.Article 1082, New Civil Code. 28.See Reyes v. Ysip, 97 Phil 11 (1955). 29.See Exhibit 7. 30.See De Bautista v. De Guzman, 125 SCRA 676 (1983). 31.70 SCRA 130 (1976). 32.Ibid. 33.See Exhibit G. 34.Records, p. 4. 35.Exhibit G. 36.Records, p. 521.
||| (Union Bank of the Phil. v. Santiba, G.R. No. 149926, February 23, 2005)
THIRD DIVISION [G.R. No. 168970. January 15, 2010.] CELESTINO BALUS, petitioner, vs. SATURNINO BALUS and LEONARDA BALUS VDA. DE CALUNOD, respondents. DECISION PERALTA, J p: Assailed in the present petition for review on certiorari under Rule 45 of the Rules of Court is the Decision 1 of the Court of Appeals (CA) dated May 31, 2005 in CA- G.R. CV No. 58041 which set aside the February 7, 1997 Decision of the Regional Trial Court (RTC) of Lanao del Norte, Branch 4 in Civil Case No. 3263. The facts of the case are as follows: Herein petitioner and respondents are the children of the spouses Rufo and Sebastiana Balus. Sebastiana died on September 6, 1978, while Rufo died on July 6, 1984. On January 3, 1979, Rufo mortgaged a parcel of land, which he owns, as security for a loan he obtained from the Rural Bank of Maigo, Lanao del Norte (Bank). The said property was originally covered by Original Certificate of Title No. P-439(788) and more particularly described as follows: A parcel of land with all the improvements thereon, containing an area of 3.0740 hectares, more or less, situated in the Barrio of Lagundang, Bunawan, Iligan City, and bounded as follows: Bounded on the NE., along line 1-2, by Lot 5122, Csd-292; along line 2-12, by Dodiongan River; along line 12-13 by Lot 4649, Csd-292; and along line 12-1, by Lot 4661, Csd-292. . . . 2 Rufo failed to pay his loan. As a result, the mortgaged property was foreclosed and was subsequently sold to the Bank as the sole bidder at a public auction held for that purpose. On November 20, 1981, a Certificate of Sale 3 was executed by the sheriff in favor of the Bank. The property was not redeemed within the period allowed by law. More than two years after the auction, or on January 25, 1984, the sheriff executed a Definite Deed of Sale 4 in the Bank's favor. Thereafter, a new title was issued in the name of the Bank. SDATEc On October 10, 1989, herein petitioner and respondents executed an Extrajudicial Settlement of Estate 5 adjudicating to each of them a specific one- third portion of the subject property consisting of 10,246 square meters. The Extrajudicial Settlement also contained provisions wherein the parties admitted knowledge of the fact that their father mortgaged the subject property to the Bank and that they intended to redeem the same at the soonest possible time. Three years after the execution of the Extrajudicial Settlement, herein respondents bought the subject property from the Bank. On October 12, 1992, a Deed of Sale of Registered Land 6 was executed by the Bank in favor of respondents. Subsequently, Transfer Certificate of Title (TCT) No. T-39,484 (a.f.) 7 was issued in the name of respondents. Meanwhile, petitioner continued possession of the subject lot. On June 27, 1995, respondents filed a Complaint 8 for Recovery of Possession and Damages against petitioner, contending that they had already informed petitioner of the fact that they were the new owners of the disputed property, but the petitioner still refused to surrender possession of the same to them. Respondents claimed that they had exhausted all remedies for the amicable settlement of the case, but to no avail. On February 7, 1997, the RTC rendered a Decision 9 disposing as follows: WHEREFORE, judgment is hereby rendered, ordering the plaintiffs to execute a Deed of Sale in favor of the defendant, the one-third share of the property in question, presently possessed by him, and described in the deed of partition, as follows: A one-third portion of Transfer Certificate of Title No. T-39,484 (a.f.), formerly Original Certificate of Title No. P-788, now in the name of Saturnino Balus and Leonarda B. Vda. de Calunod, situated at Lagundang, Bunawan, Iligan City, bounded on the North by Lot 5122; East by shares of Saturnino Balus and LeonardaBalus-Calunod; South by Lot 4649, Dodiongan River; West by Lot 4661, consisting of 10,246 square meters, including improvements thereon. and dismissing all other claims of the parties. The amount of P6,733.33 consigned by the defendant with the Clerk of Court is hereby ordered delivered to the plaintiffs, as purchase price of the one-third portion of the land in question. Plaintiffs are ordered to pay the costs. SO ORDERED. 10 The RTC held that the right of petitioner to purchase from the respondents his share in the disputed property was recognized by the provisions of the Extrajudicial Settlement of Estate, which the parties had executed before the respondents bought the subject lot from the Bank. Aggrieved by the Decision of the RTC, herein respondents filed an appeal with the CA. On May 31, 2005, the CA promulgated the presently assailed Decision, reversing and setting aside the Decision of the RTC and ordering petitioner to immediately surrender possession of the subject property to the respondents. The CA ruled that when petitioner and respondents did not redeem the subject property within the redemption period and allowed the consolidation of ownership and the issuance of a new title in the name of the Bank, their co-ownership was extinguished. Hence, the instant petition raising a sole issue, to wit: WHETHER OR NOT CO-OWNERSHIP AMONG THE PETITIONER AND THE RESPONDENTS OVER THE PROPERTY PERSISTED/CONTINUED TO EXIST (EVEN AFTER THE TRANSFER OF TITLE TO THE BANK) BY VIRTUE OF THE PARTIES' AGREEMENT PRIOR TO THE REPURCHASE THEREOF BY THE RESPONDENTS; THUS, WARRANTING THE PETITIONER'S ACT OF ENFORCING THE AGREEMENT BY REIMBURSING THE RESPONDENTS OF HIS (PETITIONER'S) JUST SHARE OF THE REPURCHASE PRICE. 11 The main issue raised by petitioner is whether co-ownership by him and respondents over the subject property persisted even after the lot was purchased by the Bank and title thereto transferred to its name, and even after it was eventually bought back by the respondents from the Bank. cda Petitioner insists that despite respondents' full knowledge of the fact that the title over the disputed property was already in the name of the Bank, they still proceeded to execute the subject Extrajudicial Settlement, having in mind the intention of purchasing back the property together with petitioner and of continuing their co-ownership thereof. Petitioner posits that the subject Extrajudicial Settlement is, in and by itself, a contract between him and respondents, because it contains a provision whereby the parties agreed to continue their co-ownership of the subject property by "redeeming" or "repurchasing" the same from the Bank. This agreement, petitioner contends, is the law between the parties and, as such, binds the respondents. As a result, petitioner asserts that respondents' act of buying the disputed property from the Bank without notifying him inures to his benefit as to give him the right to claim his rightful portion of the property, comprising 1/3 thereof, by reimbursing respondents the equivalent 1/3 of the sum they paid to the Bank. The Court is not persuaded. Petitioner and respondents are arguing on the wrong premise that, at the time of the execution of the Extrajudicial Settlement, the subject property formed part of the estate of their deceased father to which they may lay claim as his heirs. At the outset, it bears to emphasize that there is no dispute with respect to the fact that the subject property was exclusively owned by petitioner and respondents' father, Rufo, at the time that it was mortgaged in 1979. This was stipulated by the parties during the hearing conducted by the trial court on October 28, 1996. 12 Evidence shows that a Definite Deed of Sale 13 was issued in favor of the Bank on January 25, 1984, after the period of redemption expired. There is neither any dispute that a new title was issued in the Bank's name before Rufo died on July 6, 1984. Hence, there is no question that the Bank acquired exclusive ownership of the contested lot during the lifetime of Rufo. The rights to a person's succession are transmitted from the moment of his death. 14 In addition, the inheritance of a person consists of the property and transmissible rights and obligations existing at the time of his death, as well as those which have accrued thereto since the opening of the succession. 15 In the present case, since Rufo lost ownership of the subject property during his lifetime, it only follows that at the time of his death, the disputed parcel of land no longer formed part of his estate to which his heirs may lay claim. Stated differently, petitioner and respondents never inherited the subject lot from their father. Petitioner and respondents, therefore, were wrong in assuming that they became co-owners of the subject lot. Thus, any issue arising from the supposed right of petitioner as co-owner of the contested parcel of land is negated by the fact that, in the eyes of the law, the disputed lot did not pass into the hands of petitioner and respondents as compulsory heirs of Rufo at any given point in time. acCETD The foregoing notwithstanding, the Court finds a necessity for a complete determination of the issues raised in the instant case to look into petitioner's argument that the Extrajudicial Settlement is an independent contract which gives him the right to enforce his right to claim a portion of the disputed lot bought by respondents. It is true that under Article 1315 of the Civil Code of the Philippines, contracts are perfected by mere consent; and from that moment, the parties are bound not only to the fulfillment of what has been expressly stipulated but also to all the consequences which, according to their nature, may be in keeping with good faith, usage and law. Article 1306 of the same Code also provides that the contracting parties may establish such stipulations, clauses, terms and conditions as they may deem convenient, provided these are not contrary to law, morals, good customs, public order or public policy. In the present case, however, there is nothing in the subject Extrajudicial Settlement to indicate any express stipulation for petitioner and respondents to continue with their supposed co-ownership of the contested lot. On the contrary, a plain reading of the provisions of the Extrajudicial Settlement would not, in any way, support petitioner's contention that it was his and his sibling's intention to buy the subject property from the Bank and continue what they believed to be co-ownership thereof. It is a cardinal rule in the interpretation of contracts that the intention of the parties shall be accorded primordial consideration. 16 It is the duty of the courts to place a practical and realistic construction upon it, giving due consideration to the context in which it is negotiated and the purpose which it is intended to serve. 17 Such intention is determined from the express terms of their agreement, as well as their contemporaneous and subsequent acts. 18 Absurd and illogical interpretations should also be avoided. 19 For petitioner to claim that the Extrajudicial Settlement is an agreement between him and his siblings to continue what they thought was their ownership of the subject property, even after the same had been bought by the Bank, is stretching the interpretation of the said Extrajudicial Settlement too far. In the first place, as earlier discussed, there is no co-ownership to talk about and no property to partition, as the disputed lot never formed part of the estate of their deceased father. Moreover, petitioner's asseveration of his and respondents' intention of continuing with their supposed co-ownership is negated by no less than his assertions in the present petition that on several occasions he had the chance to purchase the subject property back, but he refused to do so. In fact, he claims that after the Bank acquired the disputed lot, it offered to re-sell the same to him but he ignored such offer. How then can petitioner now claim that it was also his intention to purchase the subject property from the Bank, when he admitted that he refused the Bank's offer to re-sell the subject property to him? In addition, it appears from the recitals in the Extrajudicial Settlement that, at the time of the execution thereof, the parties were not yet aware that the subject property was already exclusively owned by the Bank. Nonetheless, the lack of knowledge on the part of petitioner and respondents that the mortgage was already foreclosed and title to the property was already transferred to the Bank does not give them the right or the authority to unilaterally declare themselves as co-owners of the disputed property; otherwise, the disposition of the case would be made to depend on the belief and conviction of the party-litigants and not on the evidence adduced and the law and jurisprudence applicable thereto. THCSEA Furthermore, petitioner's contention that he and his siblings intended to continue their supposed co-ownership of the subject property contradicts the provisions of the subject Extrajudicial Settlement where they clearly manifested their intention of having the subject property divided or partitioned by assigning to each of the petitioner and respondents a specific 1/3 portion of the same. Partition calls for the segregation and conveyance of a determinate portion of the property owned in common. It seeks a severance of the individual interests of each co-owner, vesting in each of them a sole estate in a specific property and giving each one a right to enjoy his estate without supervision or interference from the other. 20 In other words, the purpose of partition is to put an end to co-ownership, 21 an objective which negates petitioner's claims in the present case. WHEREFORE, the instant petition is DENIED. The assailed Decision of the Court of Appeals, dated May 31, 2005 in CA-G.R. CV No. 58041, is AFFIRMED. SO ORDERED. Corona, Velasco, Jr., Nachura and Mendoza, JJ., concur. Footnotes 1.Penned by Associate Justice Arturo G. Tayag, with Associate Justices Rodrigo F. Lim, Jr. and Normandie B. Pizarro, concurring; CA rollo, pp. 69-76. 2.See Certificate of Sale and Definite Deed of Sale, Exhibits "A" and "B," respectively, records, pp. 74-75. 3.Exhibit "A," records, p. 74. 4.Exhibit "B," id. at 75. 5.Exhibit "C"/"4," id. at 76. 6.Exhibit "D," id. at 79. 7.Exhibit "E," id. at 80. 8.Records, pp. 1-6. 9.Id. at 131-140. 10.Id. at 139-140. 11.Rollo, p. 21. 12.See TSN, October 28, 1996 p. 2. 13.Exhibit "B," records, p. 75. 14.Civil Code, Art. 777. 15.Civil Code, Art. 781. 16.Alio v. Heirs of Angelica A. Lorenzo, G.R. No. 159550, June 27, 2008, 556 SCRA 139, 148. 17.TSPIC Corporation v. TSPIC Employees Union (FFW), G.R. No. 163419, February 13, 2008, 545 SCRA 215, 226. 18.Tating v. Marcella, G.R. No. 155208, March 27, 2007, 519 SCRA 79, 87. 19.TSPIC Corporation v. TSPIC Employees Union (FFW), supra note 17. 20.Arbolario v. Court of Appeals, 449 Phil. 357, 369 (2003). 21.Cruz v. Court of Appeals, G.R. No. 122904, April 15, 2005, 456 SCRA 165, 171; Lopez v. Court of Appeals, 446 Phil. 722, 743 (2003). ||| (Balus v. Balus, G.R. No. 168970, January 15, 2010) EN BANC [G.R. No. L-4963. January 29, 1953.] MARIA USON, plaintiff-appellee, vs. MARIA DEL ROSARIO, CONCEPCION NEBREDA, CONRADO NEBREDA, DOMINADOR NEBREDA, and FAUSTINO NEBREDA, Jr., defendants-appellants. Priscilo Evangelista for appellee. Brigido G. Estrada for appellant. SYLLABUS 1.DESCENT AND DISTRIBUTION; HUSBAND AND WIFE; RIGHTS OF LAWFUL WIFE AS AFFECTED BY THE NEW CIVIL CODE. The right of ownership of the lawful wife of a decedent who had died before the new Civil Code took effect became vested in her upon his death, and this is so because of the imperative provision of the law which commands that the rights of succession are transmitted from the moment of death (Art. 657, old Civil Code; Ilustre vs. Frondosa, 17 Phil., 321). The new right recognized by the new Civil Code in favor of the illegitimate children of the deceased can not be asserted to the impairment of the vested right of the lawful wife over the lands in dispute. While article 2253 of the new Civil Code provides that rights which are declared for the first time shall have retroactive effect even though the event which gave rise to them may have occurred under the former legislation, yet this is so only when the new rights do not prejudice any vested or acquired right of the same origin. 2.ID.; ID.; RENUNCIATION OF INHERITANCE MADE BY LAWFUL WIFE; FUTURE INHERITANCE, NOT SUBJECT TO CONTRACT. Although the lawful wife has expressly renounced her right to inherit any future property that her husband may acquire and leave upon his death, such renunciation cannot be entertained for the simple reason that future inheritance cannot be the subject of a contract nor can it be renounced (1 Manresa, 6th ed., 123; Osorio vs. Osorio, et al., 41 Phil., 531). 3.ID.; ID.; DONATIONS BY DECEASED; ESSENTIAL FORMALITIES OF DONATION. Assignments, if any, made by the deceased of real property for which there was no material consideration, should be made in a public document and must be accepted either in the same document or in a separate one (Art. 633, old Civil Code). Assignments or donations which lack this essential formality have no valid effect. D E C I S I O N BAUTISTA ANGELO, J p: This is an action for the recovery of the ownership and possession of five (5) parcels of land situated in the municipality of Labrador, Province of Pangasinan, filed by Maria Uson against Maria del Rosario and her four children named Concepcion, Conrado, Dominador, and Faustino, surnamed Nebreda, who are all of minor age, before the Court of First Instance of Pangasinan. Maria Uson was the lawful wife of Faustino Nebreda who upon his death in 1945 left the lands involved in this litigation. Faustino Nebreda left no other heir except his widow Maria Uson. However, plaintiff claims that when Faustino Nebreda died in 1945, his common- law wife Maria del Rosario took possession illegally of said lands thus depriving her of their possession and enjoyment. Defendants in their answer set up as special defense that on February 21, 1931, Maria Uson and her husband, the late Faustino Nebreda, executed a public document whereby they agreed to separate as husband and wife and, in consideration of their separation, Maria Uson was given a parcel of land by way of alimony and in return she renounced her right to inherit any other property that may be left by her husband upon his death (Exhibit 1). After trial, at which both parties presented their respective evidence, the court rendered decision ordering the defendants to restore to the plaintiff the ownership and possession of the lands in dispute without special pronouncement as to costs. Defendants interposed the present appeal. There is no dispute that Maria Uson, plaintiff-appellee, is the lawful wife of Faustino Nebreda, former owner of the five parcels of lands litigated in the present case. There is likewise no dispute that Maria del Rosario, one of the defendants-appellants, was merely a common-law wife of the late Faustino Nebreda with whom she had four illegitimate children, her now co-defendants. It likewise appears that Faustino Nebreda died in 1945 much prior to the effectivity of the new Civil Code. With this background, it is evident that when Faustino Nebreda died in 1945 the five parcels of land he was seized of at the time passed from the moment of his death to his only heir, his widow Maria Uson (Article 657, old Civil Code). As this Court aptly said, "The property belongs to the heirs at the moment of the death of the ancestor as completely as if the ancestor had executed and delivered to them a deed for the same before his death" (Ilustre vs. Alaras Frondosa, 17 Phil., 321). From that moment, therefore, the rights of inheritance of Maria Uson over the lands in question became vested. The claim of the defendants that Maria Uson had relinquished her right over the lands in question because she expressly renounced to inherit any future property that her husband may acquire and leave upon his death in the deed of separation they had entered into on February 21, 1931, cannot be entertained for the simple reason that future inheritance cannot be the subject of a contract nor can it be renounced (1 Manresa, 123, sixth edition; Tolentino on Civil Code, p. 12; Osorio vs. Osorio and Ynchausti Steamship Co., 41 Phil., 531). But defendants contend that, while it is true that the four minor defendants are illegitimate children of the late Faustino Nebreda and under the old Civil Code are not entitled to any successional rights, however, under the new Civil Code which became in force in June, 1950, they are given the status and rights of natural children and are entitled to the successional rights which the law accords to the latter (Article 2264 and article 287, new Civil Code), and because these successional rights were declared for the first time in the new code, they shall be given retroactive effect even though the event which gave rise to them may have occurred under the prior legislation (Article 2253, new Civil Code). There is no merit in this claim. Article 2253 above referred to provides indeed that rights which are declared for the first time shall have retroactive effect even though the event which gave rise to them may have occurred under the former legislation, but this is so only when the new rights do not prejudice any vested or acquired right of the same origin. Thus, said article provides that "if a right should be declared for the first time in this Code, it shall be effective at once, even though the act or event which gives rise thereto may have been done or may have occurred under the prior legislation, provided said new right does not prejudice or impair any vested or acquired right, of the same origin." As already stated in the early part of this decision, the right of ownership of Maria Uson over the lands in question became vested in 1945 upon the death of her late husband and this is so because of the imperative provision of the law which commands that the rights to succession are transmitted from the moment of death (Article 657, old Civil Code). The new right recognized by the new Civil Code in favor of the illegitimate children of the deceased cannot, therefore, be asserted to the impairment of the vested right of Maria Uson over the lands in dispute. As regards the claim that Maria Uson, while her deceased husband was lying in state, in a gesture of pity or compassion, agreed to assign the lands in question to the minor children for the reason that they were acquired while the deceased was living with their mother and Maria Uson wanted to assuage somewhat the wrong she has done to them, this much can be said; apart from the fact that this claim is disputed, we are of the opinion that said assignment, if any, partakes of the nature of a donation of real property, inasmuch as it involves no material consideration, and in order that it may be valid it shall be made in a public document and must be accepted either in the same document or in a separate one (Article 633, old Civil Code). Inasmuch as this essential formality has not been followed, it results that the alleged assignment or donation has no valid effect. Wherefore, the decision appealed from is affirmed, without costs. Paras, C.J., Pablo, Bengzon, Padilla, Tuason, Montemayor, Reyes, Jugo and Labrador, JJ., concur. ||| (Uson v. Del Rosario, G.R. No. L-4963, January 29, 1953)
EN BANC [G.R. No. L-6622. July 31, 1957.] Intestate Estate of the deceased MARCELO DE BORJA. CRISANTO DE BORJA, administrator-appellant, vs. JUAN DE BORJA, ET AL., oppositors-appellees. E. V. Filamor for appellant. Juan de Borja for himself and co-appellees. SYLLABUS 1.PLEADING AND PRACTICE; NATURE OF COUNTERCLAIM. A counterclaim is a relief available to a party-defendant against the adverse party which may or may not be independent from the main issue. 2.ID.; PARTIES; COUNSEL FOR A PARTY SHOULD NOT BE INCLUDED AS DEFENDANT IN COUNTERCLAIM. The appearance of a lawyer as Counsel for a party and his participation in a case as such counsel does not make him a party to the action. The fact that he represents the interests of his client or that he acts in their behalf will not hold him liable for or make him entitled to any award that the Court may adjudicate to the parties, other than his professional fees. The principle that a counterclaim cannot be filed against persons who are acting in representation of another such as trustees in their individual capacities (Chambers vs. Cameron 2 Fed. Rules Service 155; 29 of Supp. 742), could be applied with more force and effect in the case of a counsel whose participation in the action is merely confined to the preparation of the defense of the client. 3.COURTS; JURISDICTION OF PROBATE COURT LIMITED AND SPECIAL. In taking cognizance of a special proceedings for the purpose of settling the estate of a deceased person, the Court of First Instance in its capacity as a probate Court is clothed with a limited jurisdiction which cannot expand to Collateral matters not arising out of or in anyway related to the settlement and adjudication of the properties of the deceased for it is a settled rule that the jurisdiction of a probate Court is limited and special. Although there is a tendency now to relax this rule and extend the jurisdiction of the probate Court in respect to matters incidental and collateral to the exercise of its recognized powers, this should be understood to comprehend only cases related to those powers specifically allowed by the statutes. 4.DAMAGES; COUNTERCLAIM; TESTATE OF INTESTATE PROCEEDINGS: MORAL DAMAGES IS EXTRANEOUS MATTER From whatever angle it may be looked at, a counterclaim for moral damages demanded by an administrator against the heirs for alleged utterances, pleadings and actuations made in the course of a proceeding, is an extraneous matter in a testate or intestate proceedings. The injection into the action of incidental questions entirely foreign in probate proceedings should not be encouraged for to do otherwise would run counter to the clear intention of the law. 5.EXECUTOR AND ADMINISTRATORS; ACTS CF ADMINISTRATOR CONSIDERED MALADMINISTRATION; ACCOUNTABILITY FOR LOSS OR DAMAGE. Where the records are replete with instances of highly irregular practices of the administrator such as the pretended ignorance of the necessity of a book or ledger or at least a list of chronological and dated entries of money or produce the intestate acquired and the amount of disbursement made for the same properties; that admittedly the administrator did not have even a list of the names of the lessees of the properties under his administration, nor even a list of those who owed back rentals, and mixing the funds of the estate under his administration with his personal funds instead of keeping a current account for the Intestate in his capacity as administrator, in such instances the probate Court is justified in finding him guilty of acts of maladministration and in holding him accountable for loss or damage to Intestate. D E C I S I O N FELIX, J p: The case. Quintin, Francisco, Crisanta and Juliana, all surnamed de Borja, are the legitimate children of Marcelo de Borja, who, upon his demise sometime in 1924 or 1925, left a considerable amount of property. Intestate proceedings must have followed, and the pre-war records of the case either burned, lost or destroyed during the last war, because the record shows that in 1930 Quintin de Borja was already the administrator of the Intestate Estate of Marcelo de Borja. In the early part of 1938, Quintin de Borja died and Crisanto de Borja, son of Francisco de Borja, was appointed and took over as administrator of the Estate. Francisco de Borja, on the other hand, assumed his duties as executor of the will of Quintin de Borja, but upon petition of the heirs of said deceased on the ground that his interests were conflicting with that of his brother's estate, he was later required by the Court to resign as such executor and was succeeded by Rogelio Limaco, a son-in-law of Quintin de Borja. It also appears that on February 16, 1940, at the hearing set for the approval of the statement of accounts of the late administrator of the Intestate Estate of Marcelo de Borja, then being opposed by Francisco de Borja, the parties submitted an agreement, which was approved by the Court (Exh. A). Said agreement, translated into English, reads as follows: 1.All the accounts submitted and those that are to be submitted corresponding to this year will be considered approved; 2.No heir shall claim anything of the harvests from the lands in Cainta that came from Exequiel Ampil, deceased, nor from the land in Tabuatin, Nueva Ecija; 3.That the amounts of money taken by each heir shall be considered as deposited in conjunction with the other properties of the Intestate and shall form part of the mass without drawing any interest; 4.That it shall be understood as included in this mass the sum of twelve thousand pesos (P12,000) that the sisters Crisanta and Juliana de Borja paid of their own money as part of the price of the lands in Cainta and three thousand pesos (P3,000) the price of the machinery for irrigation; 5.The right, interests or participation that the deceased Quintin de Borja has or may have in Civil Case No. 6190 of the Court of First Instance of Nueva Ecija, shall be likewise included in the total mass of the inheritance of the Intestate; 6.Not only the lands in Tabuatin but also those in Cainta coming from the now deceased Exequiel Ampil shall also form part of the total mass of the inheritance of the Intestate of the late Marcelo de Borja; 7.Once the total of the inheritance of the Intestate is made up as specified before in this Agreement, partition thereof will be made as follows: From the total mass shall be deducted in case or in kind, Twelve Thousand Pesos (P12,000) that shall be delivered to Da. Juliana de Borja and Da. Crisanta deBorja in equal shares, and the rest shall be divided among the four heirs, i.e., Don Francisco de Borja, the heirs of Quintin de Borja, Da. Juliana de Borja and Da. Crisanta de Borja, in equal parts. (TRANSLATION) The Intestate remained under the administration of Crisanto de Borja until the outbreak of the war. From then on and until the termination of the war, there was a lull and state of inaction in Special Proceeding No. 2414 of the Court of First Instance of Rizal, Pasig branch (In the Matter of the Intestate Estate of Marcelo de Borja), until upon petition filed by Miguel B. Dayco, as administrator of the estate of his deceased mother, Crisanta de Borja, who is one of the heirs, for the reconstitution of the records of this case, the Court on December 11, 1945, ordered the reconstitution of the same, requiring the administrator to submit his report and a copy of the project of partition. On January 3, 1946, the administrator, Dr. Crisanto de Borja, filed his accounts for the period ranging from March 1 to December 22, 1945, which according to the heirs of Quintin de Borja were so inadequate and general that on February 28, 1946, they filed a motion for specification. On April 30, 1946, they also filed their opposition to said statement of accounts alleging that the income reported in said statement was very much less than the true and actual income of the estate and that the expenses appearing therein were exaggerated and/or not actually incurred, and prayed that the statement of accounts submitted by the administrator be disapproved. The administrator later filed another report of his administration, dated August 9, 1949, corresponding to the period lapsed from December 23, 1945, to July 31, 1949, showing a cash balance of P71.96, but with pending obligation amounting to P35,415. On August 22, 1949, Juan de Borja and sisters, heirs of the deceased Quintin de Borja, filed their opposition to the statement of accounts filed by the administrator on the ground that same was not detailed enough to enable the interested parties to verify the same; that they cannot understand why the Intestate could suffer any loss considering that during the administration of the same by the late Quintin de Borja, the Estate accumulated gains of more than P100,000 in the form of advances to the heirs as well as cash balance; that they desired to examine the accounts of Dr. Crisanto de Borja to verify the loss and therefore prayed that the administrator be ordered to deposit with the Clerk of Court all books, receipts, accounts and other papers pertaining to the Estate of Marcelo de Borja. This motion was answered by the administrator contending that the Report referred to was already clear and enough, the income as well as the expenditures being specified therein; that he had to spend for the repairs of the properties of the Estate damaged during the Japanese occupation; that the allegation that during the administration of Quintin de Borja the Estate realized a profit of P100,000 was not true, because instead of gain there was even a shortage in the funds although said administrator had collected all his fees (honorarios) and commissions corresponding to the entire period of his incumbency; that the obligations mentioned in said Report will be liquidated before the termination of the proceedings in the same manner as it is done in any other intestate case; that he was willing to submit all the receipts of the accounts for the examination of the interested parties before the Clerk or before the Court itself; that this Intestate could be terminated, the project of partition having been allowed and confirmed by the Supreme Court and that the Administrator was also desirous of terminating it definitely for the benefit of all the parties.
On September 14, 1949, the administrator filed another statement of accounts covering the period of from March 1, 1945, to July 31, 1949, which showed a cash balance of P71.95, with pending obligations in the sum of P35,810. The heirs of Quintin de Borja, Juan de Borja and his sisters, registered their opposition to said statement of accounts and prayed the Court to disapprove the same and to appoint an accountant to go over the books of the administrator and to submit a report thereon as soon as possible. The heir Juliana de Borja also formally offered her objection to the approval of the accounts submitted by the administrator and prayed further that said administrator be required to submit a complete accounting of his administration of the Estate from 1937 to 1949. On the other hand, Francisco de Borja and Miguel B. Dayco, as the only heir of the deceased Crisanta de Borja, submitted to the Court an agreement to relieve the administrator from accounting for the period of the Japanese occupation; that as to the accounting from 1937 to 1941, they affirmed their conformity with the agreement entered into by all the heirs appearing in the Bill of Exceptions of Juliana de Borja; and that they have no objection to the approval of the statement of accounts submitted by the administrator covering the years 1945 to 1949. On December 6, 1949, the administrator, answered the opposition of the heir Juliana de Borja, alleging that the corresponding statement of accounts for the years 1937, 1938, 1939, 1940 and 1941 were presented and approved by the Court before and during the Japanese occupation, but the records of the same were destroyed in the Office of the Clerk of that Court during the liberation of the province of Rizal, and his personal records were also lost during the Japanese occupation, when his house was burned; that Judge Pea who was presiding over the Court in 1945 impliedly denied the petition of the heirs to require him to render an accounting for the period from 1942 to the early part of 1945, for the reason that whatever money obtained from the Estate during said period could not be made the subject of any adjudication it having been declared fiat money and without value, and ordered that the statement of accounts be presented only for the period starting from March 1, 1945. The administrator further stated that he was anxious to terminate this administration but some of the heirs had not yet complied with the conditions imposed in the project of partition which was approved by the Supreme Court; that in accordance with said partition agreement, Juliana de Borja must deliver to the administrator all the jewelry, objects of value, utensils and other personal belongings of the deceased spouses Marcelo de Borja and Tarcila Quiogue, which said heir had kept and continued to retain in her possession; that the heirs of Quintin de Borja should deliver to the administrator all the lands and a document transferring in favor of the Intestate the two parcels of land with a total area of 71 hectares of cultivated land in Cabanatuan, Nueva Ecija which were in the possession of said heirs, together with the house of Feliciana Mariano Vda. de Sarangaya, which were the objects of Civil Case No. 6190 mentioned in Paragraph 11 of the project of partition; that as a consequence of the said dispossession, the heirs of Quintin de Borja must deliver to the administrator the products of the 71 hectares of land in Cabanatuan, Nueva Ecija, and the rentals of the house of Feliciana Mariano or else render to the Court an accounting of the products of these properties from the time they took possession of the same in 1937 to the present; that there was a pending obligation amounting to P36,000 as of September 14, 1949, which the heirs should pay before the properties adjudicated to them would be delivered. The Court, however, ordered the administrator on December 10, 1949, to show and prove by evidence why he should not be required to include in his accounts the proceeds of his administration from 1937. Meantime, Juliana de Borja filed a Constancia denying possession of any jewelry belonging to the deceased spouses Marcelo de Borja and Tarcila Quiogue or any other persona] belonging of said spouses, and signified her willingness to turn over to the administrator the silverwares mentioned in Paragraph III of the project of partition, which were the only property in her care, on the date that she would expect the delivery to her of her share in the inheritance from her deceased parents. On July 6, 1950, Juan de Borja and his sisters Marcela, Saturnina, Eufracia, Jacoba and Olimpia, all surnamed de Borja, as heirs of Quintin de Borja, filed a motion for the delivery to them of their inheritance in the estate, tendering to the administrator a document ceding and transferring to the latter all the rights, interests and participation of Quintin de Borja in Civil Case No. 7190 of the Court of First Instance of Nueva Ecija, pursuant to the provisions of the Project of Partition, and expressing their willingness to put up a bond if required to do so by the Court, and on July 18, 1950, the Court ordered the administrator to deliver to Marcela, Juan, Saturnina, Eufracia, Jacoba and Olimpia, all surnamed de Borja, all the properties adjudicated to them in the Project of Partition dated February 8, 1944, upon the latter's filing a bond in the sum of P10,000 conditioned upon the payment of such obligation as may be ordered by the Court after a hearing on the controverted accounts of the administrator. The Court considered the fact that the heirs had complied with the requirement imposed by the Project of Partition when they tendered the document ceding and transferring the rights and interests of Quintin de Borja in the aforementioned lands and expressed the necessity of terminating the proceedings as soon as practicable, observing that the Estate had been under administration for over twenty-five years already. The Court, however, deferred action on the petition filed by the special administratrix of the Intestate Estate of Juliana de Borja until after compliance with the conditions imposed by the project of partition. But on July 20, 1950, apparently before the properties were delivered to the heirs, Francisco de Borja and Miguel B. Dayco filed a motion informing the Court that the two parcels of land located in Cabanatuan, Nueva Ecija, produced some 21,300 cavans of palay, amounting to P213,000 at P10 per cavan, which were enjoyed by some heirs; that the administrator Crisanto de Borja had not taken possession of the same for circumstances beyond his control; and that there also existed the sum of P70,204 which the former administrator, Quintin de Borja, received from properties that were redeemed, but which amount did not come into the hands of the present administrator because according to reliable information, same was delivered to the heir Juliana de Borja who deposited it in her name at the Philippine National Bank. It was, therefore prayed that the administrator be required to exert the necessary effort to ascertain the identity of the person or persons who were in possession of the same amount and of the value of the products of the lands in Mayapyap, Cabanatuan, Nueva Ecija, and to recover the same for the Intestate Estate. On July 28, 1950, the special administratrix of the estate of Juliana de Borja, then deceased, filed an answer to the motion of these two heirs, denying the allegation that said heir received any product of the lands mentioned from Quintin de Borja, and informed the Court that the Mayapyap property had always been in the possession of Francisco de Borja himself and prayed the Court that the administrator be instructed to demand all the fruits and products of said property from Francisco de Borja. On July 28, 1950, the heirs of Quintin de Borja also filed their opposition to the said motion of Francisco de Borja and Miguel B. Dayco on the ground that the petition was superfluous because the present proceeding was only for the approval of the statement of accounts filed by the administrator; that said motion was improper because it was asking the Court to order the administrator to perform what he was duty bound to do; and that said heirs were already barred or estopped from raising that question in view of their absolute ratification of and assent to the statement of accounts submitted by the administrator. On August 16, 1950, by order of the Court, the properties adjudicated to Juliana de Borja in the Project of Partition were finally delivered to the estate of said heir upon the filing of a bond for P20,000. In that same order, the Court denied the administrator's motion to reconsider the order of July 18, 1950, requiring him to deliver to the heirs of Quintin de Borja the properties corresponding to them, on the ground that there existed no sufficient reason to disturb said order. It also ruled that as the petition of Francisco de Borja and Miguel B. Dayco made mention of certain properties allegedly belonging to the Intestate, said petition should properly be considered together with the final accounts of the administrator. The administrator raised the matter by certiorari to this Tribunal, which was docketed as G. R. No. L-4179, and on May 30, 1951, We rendered decision affirming the order complained of, finding that the heirs Juan de Borja and sisters have complied with the requirement imposed in the Project of Partition upon the tender of the document of cession of rights and quit-claim executed by Marcela de Borja, the administratrix of the Estate of Quintin de Borja, and holding that the reasons advanced by the administrator in opposing the execution of the order of delivery were trivial. On August 27, 1951, the administrator filed his amended statement of accounts covering the period from March 1, 1945, to July 31, 1949, which showed a cash balance of P36,660. An additional statement of accounts filed on August 31, 1951 for the period of from August 1, 1949, to August 31, 1951, showed a cash balance of P5,851.17 and pending obligations in the amount of P6,165.03.
The heirs of Quintin de Borja again opposed the approval of these statements of accounts charging the administrator with having failed to include the fruits which the estate should have accrued from 1941 to 1951 amounting to P479,429.70, but as the other heirs seemed satisfied with the accounts presented by said administrator and as their group was only one of the 4 heirs of Intestate Estate, they prayed that the administrator be held liable for only P119,932.42 which was 1/4 of the amount alleged to have been omitted. On October 4, 1951, the administrator filed a reply to said opposition containing a counterclaim for moral damages against all the heirs of Quintin de deBorja in the sum of P30,000 which was admitted by the Court over the objection of the heirs of Quintin de Borja that the said pleading was filed out of time. The oppositors, the heirs of Quintin de Borja, then filed their answer to the counterclaim denying the charges therein, but later served interrogatories on the administrator relative to the averments of said counterclaim. Upon receipt of the answer to said interrogatories specifying the acts upon which the claim for moral damages was based, the oppositors filed an amended answer contending that inasmuch as the acts, manifestations and pleadings referred to therein were admittedly committed and prepared by their lawyer, Atty. Amador E. Gomez, same cannot be made the basis of a counterclaim, said lawyer not being a party to the action, and furthermore, as the acts upon which the claim for moral damages were based had been committed prior to the effectivity of the new Civil Code, the provisions of said Code on moral damages could not be invoked. On January 15, 1952, the administrator filed an amended counterclaim including the counsel for the oppositors as defendant. There followed a momentary respite in the proceedings until another judge was assigned to preside over said court to dispose of the old cases pending therein. On August 15, 1952, Judge Encarnacion issued an order denying admission to administrator's amended counterclaim directed against the lawyer, Atty. Amador E. Gomez, holding that a lawyer, not being a party to the action, cannot be made answerable for counterclaims. Another order was also issued on the same date dismissing the administrator's counterclaim for moral damages against the heirs of Quintin de Borja and their counsel for the alleged defamatory acts, manifestations and utterances, and stating that granting the same to be meritorious, yet it was a strictly private controversy between said heirs and the administrator which would not in any way affect the interest of the Intestate, and, therefore, not proper in an intestate proceedings. The Court stressed that to allow the ventilation of such personal controversies would further delay the proceedings in the case which had already lagged for almost 30 years, a situation which the Court would not countenance. Having disposed of these pending incidents which arose out of the principal issue, that is, the disputed statement of accounts submitted by the administrator, the Court rendered judgment on September 5, 1952, ordering the administrator to distribute the funds in his possession to the heirs as follows: P1,395.90 to the heirs of Quintin de Borja; P314.99 to Francisco de Borja; P314.99 to the Estate of Juliana de Borja and P314.99 to Miguel B. Dayco, but as the latter still owed the intestate the sum of P900, said heirs was ordered to pay instead the 3 others the sum of P146.05 each. After considering the testimonies of the witnesses presented by both parties and the available records on hand, the Court found the administrator guilty of maladministration and sentenced Crisanto de Borja to pay to the oppositors, the heirs of Quintin deBorja, the sum of P83,337.31, which was 1/4 of the amount which the estate lost, with legal interest from the date of the judgment. On the same day, the Court also issued an order requiring the administrator to deliver to the Clerk of that Court PNB Certificate of Deposit No. 211649 for P978.50 which was issued in the name of Quintin deBorja. The administrator, Dr. Crisanto de Borja, gave notice to appeal from the lower Court's orders of August 15, 1952, the decision of September 5, 1952, and the order of even date, but when the Record on Appeal was finally approved, the Court ordered the exclusion of the appeal from the order of September 5, 1952, requiring the administrator to deposit the PNB Certificate of Deposit No. 211649 with the Clerk of Court, after the oppositors had shown that during the hearing of that incident, the parties agreed to abide by whatever resolution the Court would make on the ownership of the funds covered by that deposit. The issues. Reducing the issues to bare essentials, the questions left for our determination are: (1) whether the counsel for a party in a case may be included as a defendant in a counterclaim; (2) whether a claim for moral damages may be entertained in a proceeding for the settlement of an estate; (3) what may be considered as acts of maladministration and whether an administrator, as the one in the case at bar, may be held accountable for any loss or damage that the estate under his administration may incur by reason of his negligence, bad faith or acts of maladministration; and (4) in the case at bar has the Intestate or any of the heirs suffered any loss or damage by reason of the administrator's negligence, bad faith or maladministration? If so, what is the amount of such loss or damage? I. Section 1, Rule 10, of the Rules of Court defines a counterclaim as: SECTION 1.Counterclaim Defined. A counterclaim is any claim, whether for money or otherwise, which a party may have against the opposing party. A counterclaim need not diminish or defeat the recovery sought by the opposing party, but may claim relief exceeding in amount or different in kind from that sought by the opposing party's claim. It is an elementary rule of procedure that a counterclaim is a relief available to a party-defendant against the adverse party which may or may not be independent from the main issue. There is no controversy in the case at bar, that the acts, manifestations and actuations alleged to be defamatory and upon which the counterclaim was based were done or prepared by counsel for oppositors; and the administrator contends that as the very oppositors manifested that whatever civil liability arising from acts, actuations, pleadings and manifestations attributable to their lawyer is enforceable against said lawyer, the amended counterclaim was filed against the latter not in his individual or personal capacity but as counsel for the oppositors. It is his stand, therefore, that the lower court erred in denying admission to said pleading. We differ from the view taken by the administrator. The appearance of a lawyer as counsel for a party and his participation in a case as such counsel does not make him a party to the action. The fact that he represents the interests of his client or that he acts in their behalf will not hold him liable for or make him entitled to any award that the Court may adjudicate to the parties, other than his professional fees. The principle that a counterclaim cannot be filed against persons who are acting in representation of another such as trustees in their individual capacities (Chambers vs. Cameron, 2 Fed. Rules Service, p. 155; 29 F. Supp. 742) could be applied with more force and effect in the case of a counsel whose participation in the action is merely confined to the preparation of the defense of his client. Appellant, however, asserted that he filed the counterclaim against said lawyer not in his individual capacity but as counsel for the heirs of Quintin de Borja. But as we have already stated that the existence of a lawyer-client relationship does not make the former a party to the action, even this allegation of appellant will not alter the result We have arrived at. Granting that the lawyer really employed intemperate language in the course of the hearings or in the preparation of the pleadings filed in connection with this case, the remedy against said counsel would be to have him cited for contempt of court or take other administrative measures that may be proper in the case, but certainly not a counterclaim for moral damages. II. Special Proceedings No. 6414 of the Court of First Instance of Rizal (Pasig branch) was instituted for the purpose of settling the Intestate Estate of Marcelo deBorja. In taking cognizance of the case, the Court was clothed with a limited jurisdiction which cannot expand to collateral matters not arising out of or in any way related to the settlement and adjudication of the properties of the deceased, for it is a settled rule that the jurisdiction of a probate court is limited and special (Guzman vs. Anog, 37 Phil. 361). Although there is a tendency now to relax this rule and extend the jurisdiction of the probate court in respect to matters incidental and collateral to the exercise of its recognized powers (14 Am. Jur. 251-252), this should be understood to comprehend only cases related to those powers specifically allowed by the statutes. For it was even said that: "Probate proceedings are purely statutory and their functions limited to the control of the property upon the death of its owner, and cannot extend to the adjudication of collateral questions" (Woesmes, The American Law of Administration, Vol. I, p. 514, 662- 663). It was in the acknowledgment of its limited jurisdiction that the lower court dismissed the administrator's counterclaim for moral damages against the oppositors, particularly against Marcela de Borja who allegedly uttered derogatory remarks intended to cast dishonor to said administrator sometime in 1950 or 1951, his Honor's ground being that the court exercising limited jurisdiction cannot entertain claims of this kind which should properly belong to a court of general jurisdiction. From whatever angle it may be looked at, a counterclaim for moral damages demanded by an administrator against the heirs for alleged utterances, pleadings and actuations made in the course of the proceeding, is an extraneous matter in a testate or intestate proceedings. The injection into the action of incidental questions entirely foreign in probate proceedings should not be encouraged for to do otherwise would run counter to the clear intention of the law, for it was held that:
"The speedy settlement of the estate of deceased persons for the benefit of the creditors and those entitled to the residue by way of inheritance or legacy after the debts and expenses of administration have been paid, is the ruling spirit of our probate law" (Magbanua vs. Akel, 72 Phil., 567, 40 Off. Gaz., 1871). III. and IV. This appeal arose from the opposition of the heirs of Quintin de Borja to the approval of the statements of accounts rendered by the administrator of the Intestate Estate of Marcelo de Borja, on the ground that certain fruits which should have accrued to the estate were unaccounted for, which charge the administrator denied. After a protracted and extensive hearing on the matter, the Court, finding the administrator, Dr. Crisanto de Borja, guilty of certain acts of maladministration, held him liable for the payment to the oppositors, the heirs of Quintin de Borja, of 1/4 of the unreported income which the estate should have received. The evidence presented in the court below bear out the following facts: (a)The estate owns a 6-door building, Nos. 1541, 1543, 1545, 1547, 1549 and 1551 in Azcarraga Street, Manila, situated in front of the Arranque market. Of this property, the administrator reported to have received for the estate the following rentals: Period of TimeTotal rentalsUnnual monthly rental March to December, 1945P3,085.00P51.42 January to December, 19464,980.0069.17 January to December, 19478,330.00115.70 January to December, 19489,000.00125.00 January to December, 19498,840.00122.77 January to December, 19506,060.00184.16 TOTALP40,295.00 The oppositors, in disputing this reported income, presented at the witness stand Lauro Aguila, a lawyer who occupied the basement of Door No. 1541 and the whole of Door No. 1543 from 1945 to November 15, 1949, and who testified that he paid rentals on said apartments as follows: 1945 Door No. 1541 (basement) FebruaryP20.00Door No. 1543 March20.00For 7 months at P300 April60.00a monthP2,100.00 May-December800.00 TotalP900.00 1946 January-DecemberP1,200.00January-DecemberP4,080.00 1947 JanuaryP100.00JanuaryP380.00 February100.00February380 00 March180.00March 1-15190.00 April-December1,440.00March 16-December4,085.00 1,820.00P5,035.00 1948 January-DecemberP1,920.00January-DecemberP5,150.00 1949 January-November 15P1,680.00January-DecemberP4,315.00 From the testimony of said witness, it appears that from 1945 to November 15, 1949, he paid a total of P28,200 for the lease of Door No. 1543 and the basement of Door No. 1541. These figures were not controverted or disputed by the administrator but claimed that said tenant subleased the apartments occupied by Pedro Enriquez and Soledad Sodora and paid the said rentals, not to the administrator, but to said Enriquez. The transcript of the testimony of this witness really bolster this contention - that Lauro Aguila talked with said Pedro Enriquez when he leased the aforementioned apartments and admitted paying the rentals to the latter and not to the administrator. It is interesting to note that Pedro Enriquez is the same person who appeared to be the administrator's collector, duly authorized to receive the rentals from this Azcarraga property and for which services, said Enriquez received 5 per cent of the amount he might be able to collect as commission. If we are to believe appellant's contention, aside from the commission that Pedro Enriquez received he also sublet the apartments he was occupying at a very much higher rate than that he actually paid the estate without the knowledge of the administrator or with his approval. As the administrator also seemed to possess that peculiar habit of giving little importance to bookkeeping methods, for he never kept a ledger or book of entry for amounts received for the estate, We find no record of the rentals the lessees of the other doors were paying. It was, however, brought about at the hearing that the 6 doors of this building are of the same sizes and construction and the lower Court based its computation of the amount this property should have earned for the estate on the rental paid by Atty. Aguila for the 1 1/2 doors that he occupied. We see no excuse why the administrator could not have taken cognizance of these rates and received the same for the benefit of the estate he was administering, considering the fact that he used to make trips to Manila usually once a month and for which he charged to the estate P8 as transportation expenses for every trip. Basing on the rentals paid by Atty. Aguila for 1 1/2 doors, the estate would have received P112,800 from February 1, 1945, to November 15, 1949, for the 6 doors, but the lower Court held him accountable not only for the sum of P34,235 reported for the period ranging from March 1, 1945, to December 31, 1949, but also for a deficit of P90,525 or a total of P124,760. The record shows, however that the upper floor of Door No. 1549 was vacant in September, 1949, and as Atty. Aguila used to pay P390 a month for the use of an entire apartment from September to November, 1949, and he also paid P160 for the use of the basement of an apartment (Door No. 1541), the use, therefore, of said upper floor would cost P230 which should be deducted, even if the computation of the lower Court would have to be followed. There being no proper evidence to show that the administrator collected more rentals than those reported by him, except in the instance already mentioned, We are reluctant to hold him accountable in the amount for which he was held liable by the lower Court, and We think that under the circumstances it would be more just to add to the sum reported by the administrator as received by him as rents for 1945-1949 only, the difference between the sum reported as paid by Atty. Aguila and the sum actually paid by the latter as rents of 1 1/2 of the apartments during the said period, or P25,457.09 1/4 of which is P6,364.27 which shall be paid to the oppositors. The record also shows that in July, 1950, the administrator delivered to the other heirs Doors Nos. 1545, 1547, 1549 and 1551 although Doors Nos. 1541 and 1543 adjudicated to the oppositors remained under his administration. For the period from January to June, 1950, that the entire property was still administered by him, the administrator reported to have received for the 2 oppositors' apartments for said period of six months at P168.33 a month, the sum of P1,010 which belongs to the oppositors and should be taken from the amount reported by the administrator. The lower Court computed at P40 a month the pre-war rental admittedly received for every apartment, the income that said property would have earned from 1941 to 1944, or a total of P11,520, but as We have to exclude the period covered by the Japanese occupation, the estate should receive only P2,880 1/4 of which P720 the administrator should pay to the oppositors for the year 1941. (b)The Intestate estate also owned a parcel of land in Mayapyap, Nueva Ecija, with an area of 71 hectares, 95 ares and 4 centares, acquired by Quintin de Borjafrom the spouses Cornelio Sarangaya and Feliciana Mariano in Civil Case No. 6190 of the Court of First Instance of said province. In virtue of the agreement entered into by the heirs, this property was turned over by the estate of Quintin de Borja to the intestate and formed part of the general mass of said estate. The report of the administrator failed to disclose any return from this property alleging that he had not taken possession of the same. He does not deny however that he knew of the existence of this land but claimed that when he demanded the delivery of the Certificate of Title covering this property, Rogelio Limaco, then administrator of the estate of Quintin de Borja, refused to surrender the same and he did not take any further action to recover the same. To counteract the insinuation that the Estate of Quintin de Borja was in possession of this property from 1940 to 1950, the oppositors presented several witnesses, among them was an old man, Narciso Punzal, who testified that he knew both Quintin and Francisco de Borja; that before the war or sometime in 1937, the former administrator of the Intestate, Quintin de Borja, offered him the position of overseer (encargado) of this land but he was not able to assume the same due to the death of said administrator; that on July 7, 1951, herein appellant invited him to go to his house in Pateros, Rizal, and while in said house, he was instructed by appellant to testify in court next day that he was the overseer of the Mayapyap property for Quintin de Borja from 1937-1944, delivering the yearly proceeds of 1,000 cavanes of palay to Rogelio Limaco; that he did not need to be afraid because both Quintin de Borja and Rogelio Limaco were already dead. But as he knew that the facts on which he was to testify were false, he went instead to the house of one of the daughters of Quintin de Borja, who, together with her brother, Atty. Juan de Borja, accompanied him to the house of the counsel for said oppositors before whom his sworn declaration was taken (Exh. 3). Other witnesses, i.e., Isidro Benuya, Federico Cojo, Emilio de la Cruz and Ernesto Mangulabnan, testified that they were some of the tenants of the Mayapyap property; that they were paying their shares to the overseers of Francisco de Borja and sometimes to his wife, which the administrator was not able to contradict, and the lower Court found no reason why the administrator would fail to take possession of this property considering that this was even the subject of the agreement of February 16, 1940, executed by the heirs of the Intestate. The lower Court, giving due credence to the testimonies of the witnesses for the oppositors, computed the loss the estate suffered in the form of unreported income from the rice lands for 10 years at P67,000 (6,700 a year) and the amount of P4,000 from the remaining portion of the land not devoted to rice cultivation which was being leased at P20 per hectare. Consequently, the Court held the administrator liable to appellees in the sum of P17,750 which is 1/4, of the total amount which should have accrued to the estate for this item.
But if We exclude the 3 years of occupation, the income for 7 years would be P46,900 for the ricelands and P2,800 (at P400 a year) for the remaining portion not devoted to rice cultivation or a total of P48,700, 1/4 of which is P12,175 which We hold the administrator liable to the oppositors. (c)The Hacienda Jalajala located in said town of Rizal, was divided into 3 parts: the Punta section belonged to Marcelo de Borja, the Bagombong pertained to Bernardo de Borja and Francisco de Borja got the Jalajala proper. For the purpose of this case, we will just deal with that part called Junta. This property has an area of 1,345, hectares, 29 ares and 2 centares (Exh. 36) of which, according to the surveyor who measured the same, 200 hectares were of cultivated rice fields and 100 hectares dedicated to the planting of upland rice. It has also timberland and forest which produce considerable amount of trees and firewoods. From the said property which has an assessed value of P115,000 and for which the estates pay real estate tax of P1,500 annually, the administrator reported the following. Expenditures (not including administration's YearIncomefees. 1945P625.00P1,310.42 19461,800.003,471.00 19472,550.002,912.91 19481,828.003,311.88 19493,204.504,792.09 19502,082.002,940.91 P12,089.50P18,739.21 This statement was assailed by the oppositors and to substantiate their charge that the administrator did not file the true income of the property, they presented several witnesses who testified that there were about 200 tenants working therein, that these tenants paid to Crisanto de Borja rentals at the rate of 6 cavanes of palay per hectare; that in the years of 1943 and 1944, the Japanese were the ones who collected their rentals, and that the estate could have received no less than 1,000 cavanes of palay yearly. After the administrator had presented witnesses to refute the facts previously testified to by the witnesses for the oppositors, the Court held that the report of the administrator did not contain the real income of the property devoted to rice cultivation, which was fixed at 1,000 cavanes every year for 1941, 1942, 1945, 1946, 1947, 1948, 1949 and 1950, or a total of 8,000 cavanes valued at P73,000. But as the administrator accounted for the sum of P11,155 collected from rice harvests and if to this amount we add the sum of P8,739.20 for expenses, this will make a total of P19,894.20, thus leaving a deficit of P53,105.80, 1/4 of which will be P13,276.45 which the administrator is held liable to pay the heirs of Quintin de Borja. It was also proved during the hearing that the forestland of this property yields considerable amount of marketable firewoods. Taking into consideration the testimonies of witnesses for both parties, the Court arrived at the conclusion that the administrator sold to Gregorio Santos firewoods worth P600 in 1941, P3,500 in 1945 and P4,200 in 1946 or a total of P8,300. As the report included only the amount of P625, there was a balance of P7,675 in favor of the estate. The oppositors were not able to present any proof of sales made after these years, if there were any and the administrator was held accountable to the oppositors for only P1,918.75. (d)The estate also owned ricefields in Cainta, Rizal, with a total area of 22 hectares, 76 ares and 66 centares. Of this particular item, the administrator reported an income of P12,104 from 1945 to 1951. The oppositors protested against this report and presented witnesses to disprove the same. Basilio Javier worked as a tenant in the land of Juliana de Borja which is near the land belonging to the Intestate, the 2 properties being separated only by a river. As tenant of Juliana de Borja, he knew the tenants working on the property and also knows that both lands are of the same class, and that an area accommodating one cavan of seedlings yields at most 100 cavanes and 60 cavanes at the least. The administrator failed to overcome this testimony. The lower Court considering the facts testified to by this witness made a finding that the property belonging to this Intestate was actually occupied by several persons accommodating 13 1/2 cavanes of seedlings; that as for every cavan of seedlings, the land produces 60 cavanes of palay, the whole area under cultivation would have yielded 810 cavanes a year and under the 50-50 sharing system (which was testified to by witness Javier), the estate should have received no less than 405 cavanes every year. Now, for the period of 7 years from 1941 to 1950, excluding the 3 years of war the corresponding earning of the estate should be 2,835 cavanes, out of which the 405 cavanes from the harvest of 1941 is valued at P1,215 and the rest 2,430 cavanes at P10 is valued at P24,300, or all in all P25,515. If from this amount the reported income of P12,104 is deducted, there will be a balance of P13,411.10 1/4, of which or P3,352.75 the administrator is held liable to pay to the oppositors. (e)The records show that the administrator paid surcharges and penalties with a total of P988.75 for his failure to pay on time the taxes imposed on the properties under his administration. He advanced the reason that he lagged in the payment of those tax obligations because of lack of cash balance for the estate. The oppositors, however, presented evidence that on October 29, 1939, the administrator received from Juliana de Borja the sum of P20,475.17 together with certain papers pertaining to the intestate (Exh. 4), aside from the checks in the name of Quintin de Borja. Likewise, for his failure to pay the taxes on the building at Azcarraga for 1947, 1948 and 1949, said property was sold at public auction and the administrator had to redeem the same at P3,295.48, although the amount that should have been paid was only P2,917.26. The estate therefore suffered a loss of P378.22. Attributing these surcharges and penalties to the negligence of the administrator, the lower Court adjudged him liable to pay the oppositors 1/4 of P1,366.97, the total loss suffered by the Intestate, or P341.74. (f)Sometime in 1942, a big fire razed numerous houses in Pateros, Rizal, including that of Dr. Crisanto de Borja. Thereafter, he claimed that among the properties burned therein was his safe containing P15,000 belonging to the estate under his administration. The administrator contended that this loss was already proved to the satisfaction of the Court who approved the same by order of January 8, 1943, purportedly issued by Judge Servillano Platon (Exh. B). The oppositors contested the genuineness of this order and presented on April 21, 1950, an expert witness who conducted several tests to determine the probable age of the questioned document, and arrived at the conclusion that the questioned ink writing "(Fdo)" appearing at the bottom of Exhibit B cannot be more than 4 years old (Exh. 39). However, another expert witness presented by the administrator contradicted this finding and testified that this conclusion arrived at by expert witness Mr. Pedro Manzaares was not supported by authorities and was merely the result of his own theory, as there was no method yet discovered that would determine the age of a document, for every document has its own reaction to different chemicals used in the tests. There is, however, another fact that called the attention of the lower Court: the administrator testified that the money and other papers delivered by Juliana de Borja to him on October 29, 1939, were saved from said fire. The administrator justified the existence of these valuables by asserting that these properties were locked by Juliana de Borja in her drawer in the "casa solariega" in Pateros and hence was not in his safe when his house, together with the safe, was burned. This line of reasoning is really subject to doubt and the lower Court opined, that it runs counter to the ordinary course of human behavior for an administrator to leave in the drawer of the "aparador" of Juliana de Borja the money and other documents belonging to the estate under his administration, which delivery has receipted for, rather than to keep it in his safe together with the alleged P15,000 also belonging to the Intestate. The subsequent orders of Judge Platon also put the defense of appellant to bad light, for on February 6, 1943, the Court required Crisanto de Borja to appear before the Court of examination of the other heirs in connection with the reported loss, and on March 1, 1943, authorized the lawyers for the other parties to inspect the safe allegedly burned (Exh. 35). It is inconceivable that Judge Platon would still order the inspection of the safe if there was really an order approving the loss of those P15,000. We must not forget, in this connection, that the records of this case were burned and that at the time of the hearing of this incident in 1951, Judge Platon was already dead. The lower Court also found no reason why the administrator should keep in his possession such amount of money, for ordinary prudence would dictate that as an administration funds that come into his possession in a fiduciary capacity should not be mingled with his personal funds and should have been deposited in the Bank in the name of the intestate. The administrator was held responsible for this loss and ordered to pay 1/4 thereof, or the sum of P3,750. (g)Unauthorized expenditures 1.The report of the administrator contained certain sums amounting to P2,130 paid to and receipted by Juanita V. Jarencio the administrator's wife, as his private secretary. In explaining this item, the administrator alleged that he needed her services to keep receipts and records for him, and that he did not secure first the authorization from the court before making these disbursements because it was merely a pure administrative function. The keeping of receipts and retaining in his custody records connected with the management of the properties under administration is a duty that properly belongs to the administrator, necessary to support the statement of accounts that he is obliged to submit to the court for approval. If ever his wife took charge of the safekeeping of these receipts and for which she should be compensated, the same should be taken from his fee. This disbursement was disallowed by the Court for being unauthorized and the administrator required to pay the oppositors 1/4 thereof or P532.50.
2.The salaries of Pedro Enriquez, as collector of the Azcarraga property; of Briccio Matienzo and Leoncio Perez, as encargados, and of Vicente Panganiban and Herminigildo Macetas as forest-guards were found justified, although unauthorized, as they appear to be reasonable and necessary for the care and preservation of the Intestate. 3.The lower Court disallowed as unjustified and unnecessary the expenses for salaries paid to special policemen amounting to P1,509. Appellant contended that he sought for the services of Macario Kamungol and others to act as special policemen during harvest time because most of the workers tilling the Punta property were not natives of Jalajala but of the neighboring towns and they were likely to run away with the harvest without giving the share of the estate if they were not policed. This kind of reasoning did not appear to be convincing to the trial judge as the cause for such fear seemed to exist only in the imagination. Granting that such kind of situation existed, the proper thing for the administrator to do would have been to secure the previous authorization from the Court if he failed to secure the help of the local police. He should be held liable for this unauthorized expenditure and pay the heirs of Quintin de Borja 1/4 thereof or P377.25. 4.From the year 1942 when his house was burned, the administrator and his family took shelter at the house belonging to the Intestate known as "casa solariega" which, in the Project of Partition, was adjudicated to his father, Francisco de Borja. This property, however, remained under his administration and for its repairs he spent from 1945-1950, P1,465.14, duly receipted. None of these repairs appear to be extraordinary for the receipts were for nipa, for carpenters and thatchers. Although it is true that Rule 85, Section 2 provides that: SEC. 2.EXECUTOR OR ADMINISTRATOR TO KEEP BUILDINGS IN REPAIR. An executor or administrator shall maintain in tenantable repair the houses and other structures and fences belonging to the estate, and deliver the same in such repair to the heirs or devisees when directed so to do by the court. yet considering that during his occupancy of the said "casa solariega" he was not paying any rental at all, it is but reasonable that he should take care of the expenses for the ordinary repair of said house. Appellant asserted that had he and his family not occupied the same, they would have to pay someone to watch and take care of said house. But this will not excuse him from this responsibility for the disbursements he made in connection with the aforementioned repairs because even if he stayed in another house, he would have had to pay rentals or else take charge also of expenses for the repairs of his residence. The administrator should be held liable to the oppositors in the amount of P366.28. 5.Appellant reported to have incurred expenses amounting to P6,304.75 for alleged repairs on the rice mill in Pateros, also belonging to the Intestate. Of the disbursements made therein, the items corresponding, to Exhibits I, I-1, I-21, L-26, L-15, L-64 and L-65, in the total sum of P570.70 were rejected by the lower court on the ground that they were all unsigned although some were dated. The lower Court, however, made an oversight in including the sum of P150 covered by Exhibit L-26 which was duly signed by Claudio Reyes because this does not refer to the repair of the rice-mill but for the roofing of the house and another building and shall be allowed. Consequently, the sum of P570.70 shall be reduced to P420.70 which added to the sum of P3,059 representing expenditures rejected as unauthorized to wit: Exhibit L-59P500.00Yek Wing Exhibit L-60616.00Yek Wing Exhibit L-61600.00Yek Wing Exhibit L-62840.00Yek Wing Exhibit L-63180.00Yek Wing Exhibit Q-2323.00scale "Howe" TotalP3,059.00 will give a total of P3,479 1/4 of which is P869.92 that belongs to the oppositors. 6.On the reported expenses for planting in the Cainta ricefields: In his statement of accounts, appellant reported to have incurred a total expense of P5,977 for the planting of the ricefields in Cainta, Rizal, from the agricultural year 1945-46 to 1950-51. It was proved that the prevailing sharing system in this part of the country was on 50-50 basis. Appellant admitted that expenses for planting were advanced by the estate and liquidated after each harvest. But the report, except for the agricultural year 1950 contained nothing of the payments that the tenants should have made. If the total expenses for said planting amounted to P5,977, 1/2 thereof or P2,988.50 should have been paid by the tenants as their share of such expenditures, and as P965 was reported by the administrator as paid back in 1950, there still remains a balance of P2,023.50 unaccounted for. For this shortage, the administrator is responsible and should pay the oppositors 1/4 thereof or P505.87. 7.On the transportation expenses of the administrator: It appears that from the year 1945 to 1951, the administrator charged the estate with a total of P5,170 for transportation expenses. The unreceipted disbursements were correspondingly itemized, a typical example of which is as follows: "1950 "Gastos de viaje del administrador "From Pateros "To Pasig50 x P 4.00 = P200.00 "To Manila50 x P10.00 = P500.00 "To Cainta8 x P 8.00 = P 64.00 "To Jalajala5 x P35.00 = P175.00 P939.00" (Exhibit W-54) From the report of the administrator, We are being made to believe that the Intestate estate is a losing proposition and assuming arguendo that this is true, that precarious financial condition which he, as administrator, should know, did not deter Crisanto de Borja from charging to the depleted funds of the estate comparatively big amounts for his transportation expenses. Appellant tried to justify these charges by contending that he used his own car in making those trips to Manila, Pasig and Cainta and a launch in visiting the properties in Jalajala, and they were for the gasoline consumed. This rather unreasonable spending of the estate's fund prompted the Court to observe that one will have to spend only P0.40 for transportation in making a trip from Pateros to Manila and practically the same amount in going to Pasig. From his report for 1949 alone, appellant made a total of 97 trips to these places or an average of one trip for every 3 1/2 days. Yet We must not forget that it was during this period that the administrator failed or refused to take cognizance of the prevailing rentals of commercial places in Manila that caused certain loss to the estate and for which he was accordingly held responsible. For the reason that the alleged disbursements made for transportation expenses cannot be said to be economical, the lower Court held that the administrator should be held liable to the oppositors for 1/4 thereof or the sum of P1,292.50, though We think that this sum should still be reduced to P500. 8.Other expenses: The administrator also ordered 40 booklets of printed contracts of lease in the name of the Hacienda Jalajala which cost P150. As the said hacienda was divided into 3 parts, one belonging to this Intestate and the other two parts to Francisco de Borja and Bernardo de Borja, ordinarily the Intestate should only shoulder 1/3 of the said expense, but as the tenants who testified during the hearing of the matter testified that those printed forms were not being used, the Court adjudged the administrator personally responsible for this amount. The records reveal, however, that this printed form was not utilized because the tenants refused to sign any, and We can presume that when the administrator ordered for the printing of the same, he did not foresee this situation. As there is no showing that said printed contracts were used by another and that they are still in the possession of the administrator which could be utilized anytime, this disbursement may be allowed. The report also contains a receipt of payment made to Mr. Severo Abellera in the sum of P375 for his transportation expenses as one of the two commissioners who prepared the Project of Partition. The oppositors were able to prove that on May 24, 1941, the Court authorized the administrator to withdraw from the funds of the Intestate the sum of P300 to defray the transportation expenses of the commissioners. The administrator, however, alleged that he used this amount for the payment of certain fees necessary in connection with the approval of the proposed plan of the Azcarraga property which was then being processed in the City Engineer's Office. From that testimony, it would seem that appellant could even go to the extent of disobeying the order of the Court specifying for what purpose that amount should be appropriated and took upon himself the task of judging for what it will serve best. Since he was not able to show or prove that the money intended and ordered by the Court to be paid for the transportation expenses of the commissioners was spent for the benefit of the estate as claimed, the administrator should be held responsible therefor and pay to the oppositors 1/4 of P375 or the sum of P93.75. The records reveal that for the service of summons to the defendants in Civil Case No. 84 of the Court of First Instance of Rizal, P104 was paid to the Provincial Sheriff of the same province (Exhibit H-7). However, an item for P40 appeared to have been paid to the Chief of Police of Jalajala allegedly for the service of the same summons. Appellant claimed that as the defendants in said case lived in remote barrios, the services of the Chief of Police as delegate or agent of the Provincial Sheriff were necessary. He forgot probably the fact that local chiefs of police are deputy sheriffs ex-officio. The administrator was therefore ordered by the lower Court to pay 1/4 of said amount or P10 to the oppositors. The administrator included in his Report the sum of P550 paid to Atty. Filamor for his professional services rendered for the defense of the administrator in G. R. No. L-4179, which was decided against him, with costs. The lower Court disallowed this disbursement on the ground that this Court provided that the costs of that litigation should not be borne by the estate but by the administrator himself, personally.
Costs of a litigation in the Supreme Court taxed by the Clerk of Court, after a verified petition has been filed by the prevailing party, shall be awarded to said party and will only include his fee and that of his attorney for their appearance which shall not be more than P40; expenses for the printing and the copies of the record on appeal; all lawful charges imposed by the Clerk of Court; fees for the taking of depositions and other expenses connected with the appearance of witnesses or for lawful fees of a commissioner (De la Cruz, Philippine Supreme Court Practice, p. 70-71). If the costs provided for in that case, which this Court ordered to be chargeable personally against the administrator are not recoverable by the latter, with more reason this item could not be charged against the Intestate. Consequently, the administrator should pay the oppositors 1/4 of the sum of P550 or P137.50. (e)The lower Court in its decision required appellant to pay the oppositors the sum of P1,395 out of the funds still in the possession of the administrator. In the statement of accounts submitted by the administrator, there appeared a cash balance of P5,851.17 as of August 31, 1951. From this amount, the sum of P1,002.96 representing the Certificate of Deposit No. 21619 and Check No. 57338, both of the Philippine National Bank and in the name of Quintin de Borja, was deducted leaving a balance of P4,848. As Judge Zulueta ordered the delivery to the oppositors of the amount of P1,890 in his order of October 8, 1951; the delivery of the amount of P810 to the estate of Juliana de Borja in his order of October 23, 1951, and the sum of P932.32 to the same estate of Juliana de Borja by order of the Court of February 29, 1952, or a total of P3,632.32 after deducting the same from the cash in the possession of the administrator, there will only be a remainder of P134.98. The Intestate is also the creditor of Miguel B. Dayco, heir and administrator of the estate of Crisanta de Borja, in the sum of P900 (Exhibits S and S-1). Adding this credit to the actual cash on hand, there will be a total of P1,034.98, 1/4 of which or P258.74 properly belongs to the oppositors. However, as there is only a residue of P134.98 in the hands of the administrator and dividing it among the 3 groups of heirs who are not indebted to the Intestate, each group will receive P44.99, and Miguel B. Dayco is under obligation to reimburse P213.76 to each of them. The lower Court ordered the administrator to deliver to the oppositors the amount of P1,395.90 and P314.99 each to Francisco de Borja and the estate of Juliana deBorja, but as We have arrived at the computation that the three heirs not indebted to the Intestate ought to receive P44.99 each out of the amount of P134.98, the oppositors are entitled to the sum of P1,080.91 the amount deducted from them as taxes but which the Court ordered to be returned to them plus P44.99 or a total of P1,125.90. It appearing, however, that in a Joint Motion dated November 27, 1952, duly approved by the Court, the parties agreed to fix the amount at P1,125.58, as the amount due and said heirs have already received this amount in satisfaction of this item, no other sum can be chargeable against the administrator. (f)The probate Court also ordered the administrator to render an accounting of his administration during the Japanese occupation on the ground that although appellant maintained that whatever money he received during that period is worthless, same having been declared without any value, yet during the early years of the war, or during 1942-43, the Philippine peso was still in circulation, and articles of prime necessity as rice and firewood commanded high prices and were paid with jewels or other valuables. But We must not forget that in his order of December 11, 1945, Judge Pea required the administrator to render an accounting of his administration only from March 1, 1945, to December of the same year without ordering said administrator to include therein the occupation period. Although the Court below mentioned the condition then prevailing during the war-years, We cannot simply presume, in the absence of proof to that effect, that the administrator received such valuables or properties for the use or in exchange of any asset or produce of the Intestate, and in view of the aforementioned order of Judge Pea, which We find no reason to disturb, We see no practical reason for requiring appellant to account for those occupation years when everything was affected by the abnormal conditions created by the war. The records of the Philippine National Bank show that there was a current account jointly in the names of Crisanto de Borja and Juanita V. Jarencio, his wife, with a balance of P36,750.35 in Japanese military notes and admittedly belonging to the Intestate and We do not believe that the oppositors or any of the heirs would be interested in an accounting for the purpose of dividing or distributing this deposit. (g)On the sum of P13,294 for administrator's fees: It is not disputed that the administrator set aside for himself and collected from the estate the sum of P13,294 as his fees from 1945 to 1951 at the rate of P2,400 a year. There is also no controversy as to the fact that this appropriated amount was taken without the order or previous approval by the probate Court. Neither is there any doubt that the administration of the Intestate estate by Crisanto de Borja is far from satisfactory. Yet it is a fact that Crisanto de Borja exercised the functions of an administrator and is entitled also to a certain amount as compensation for the work and services he has rendered as such. Now, considering the extent and size of the estate, the amount involved and the nature of the properties under administration, the amount collected by the administrator for his compensation at P200 a month is not unreasonable and should therefore be allowed. It might be argued against this disbursement that the records are replete with instances of highly irregular practices of the administrator, such as the pretended ignorance of the necessity of a book or ledger or at least a list of chronological and dated entries of money or produce the Intestate acquired and the amount of disbursements made for the same properties; that admittedly he did not have even a list of the names of the lessees to the properties under his administration, nor even a list of those who owed back rentals, and although We certainly agree with the probate Court in finding appellant guilty of acts of maladministration, specifically in mixing the funds of the estate under his administration with his personal funds instead of keeping a current account for the Intestate in his capacity as administrator, We are of the opinion that despite these irregular practices for which he was held already liable and made in some instances to reimburse the Intestate for amounts that were not properly accounted for, his claim for compensation as administrator's fees shall be as they are hereby allowed. Recapitulation. Taking all the matters threshed herein together, the administrator is held liable to pay to the heirs of Quintin de Borja the following: Under Paragraphs III and IV: (a)P7,084.27 (b)12,175.00 (c)16,113.95 (d)3,352.75 (e)341.74 (f)3,750.00 (g)1.532.50 2.377.25 4.366.28 5.869.92 6.505.87 7.500.00 8-a. b.93.75 c.10.00 d.137.50 P46,210.78 In view of the foregoing, the decision appealed from is modified by reducing the amount that the administrator was sentenced to pay the oppositors to the sum of P46,210.78 (instead of P83,337.31), plus legal interests on this amount from the date of the decision appealed from, which is hereby affirmed in all other respects. Without pronouncement as to costs. It is so ordered. Paras, C.J., Bengzon, Montemayor, Reyes, A., Bautista Angelo, Labrador, Concepcion and Endencia, JJ., concur.
||| (De Borja v. De Borja, G.R. No. L-6622, July 31, 1957) FIRST DIVISION [G.R. No. L-41715. June 18, 1976.] ROSALIO BONILLA (a minor) SALVACION BONILLA (a minor) and PONCIANO BONILLA (their father) who represents the minors, petitioners, vs. LEONBARCENA, MAXIMA ARIAS BALLENA, ESPERANZA BARCENA, MANUEL BARCENA, AGUSTINA NERI, widow of JULIAN TAMAYO and HON. LEOPOLDO GIRONELLA of the Court First Instance of Abra, respondents. Federico Paredes for petitioners. Demetrio V. Pre for private respondents. SYNOPSIS On March 31, 1975, Fortunata Barcena instituted a civil action to quiet title over certain parcels of land. About three months later, Fortunata Barcena died and defendants moved to dismiss the complaint. Counsels for plaintiff asked for substitution by her minor children and her husband, but the court dismissed the case and refused to reconsider. Hence this petition for review. The Supreme Court reversed the respondent court, set aside the order of dismissal and the orders denying the motion for reconsideration, and directed the respondent court to allow the substitution of the minor children and to appoint a qualified person as guardian ad litem for them. SYLLABUS 1.CIVIL PROCEDURES; DEATH OF A PARTY; SUBSTITUTION OF PARTIES. While it is true that a a person who is dead cannot sue in court, yet he can be substituted by his heirs in pursuing the case up to its completion. Where plaintiff was still alive when the complaint was filed, the Court acquires jurisdiction over the person. If thereafter she dies, Section 16, Rule 3 of the Rules of Court, prescribes the procedures whereby a party who dies during the pendency of the proceedings can be substituted; and where proper substitution of parties had been asked for, it is grave error for the court to dismiss the complaint on the ground that a dead person has no legal personality to sue. 2.CIVIL LAW; SUCCESSION; RIGHTS TO SUCCESSION TRANSMITTED FROM THE MOMENT OF DEATH OF DECEDENT. From the moment of the death of the decedent, the heirs become the absolute owners of his property, subject to the rights and obligations of the decedent, and they cannot be deprived of right thereto except by the methods provided for by law. The moment of death is the determining factor where the heirs acquire a definite right to the inheritance whether such right to be pure or contingent. The right of the heirs to the property of the deceased vests in them even before judicial declaration of their being heirs in the testate or intestate proceedings. 3.ID.; ID.; ID.; HEIRS BECOME PARTIES IN INTEREST. The death of the plaintiff during the pendency of an action to quiet title of a parcel of land did not extinguish her claim or right to the parcels of land in litigation but was transmitted to her heirs upon her death. Her heirs have thus acquired interest in the properties in litigation and became parties in interest in the case. There is therefore, no reason for the Court not to follow their substitution as parties in interest for the deceased plaintiff. 4.CIVIL PROCEDURE; ACTIONS; SURVIVAL OF ACTIONS. The question as to whether an action survives or not defends on the nature of the action and the damaged sued for. In causes of action which survive the wrong complained, of affects primarily and principally property and property rights, the injuries to the person being merely incidental, while in the causes of action which do not survive the injury complained of is to the person, the property and rights of property affected being incidental. 5.ID.; ID.; ID.; ACTION TO QUIET TITLE. An action to quiet title over a parcel of land affects primarily and principally property and property rights and therefore, is one that survives even after plaintiff's death. It is therefore, the duty of the trial. Court to order the legal representative of the deceased plaintiff to appear and to be substituted for said deceased, pursuant to Section 17, Rule 3 of the Rules of Court. 6.ID.; ID.; ID.; REFUSAL OF COURT TO ALLOW SUBSTITUTION ON THE GROUND THAT THE HEIRS WERE STILL MINORS IS A GRAVE ERROR. Where, upon the death of the plaintiff in an action to quiet title, counsel has not only asked that the minor children be substituted for her but also suggested that the uncle be appointed as guardian ad litemfor them because their father is busy earning a living for the family; it is grave error for the respondent court to refuse the request for substitution on the ground that the children were still minors and cannot sue, because it ought to know that Section 17, Rule 3 of the Rules of Court, directs the Court to appoint a guardian ad litem for the minor. D E C I S I O N MARTIN, J p: This is a petition for review 1 of the Order of the Court of First Instance of Abra in Civil Case No. 856, entitled Fortunata Barcena vs. Leon Barcena, et al., denying the motions for reconsideration of its order dismissing the complaint in the aforementioned case. cdll On March 31, 1975 Fortunata Barcena, mother of minors Rosalio Bonilla and Salvacion Bonilla and wife of Ponciano Bonilla, instituted a civil action in the Court of First Instance of Abra, to quiet title over certain parcels of land located in Abra. On May 9, 1975, defendants filed a written motion to dismiss the complaint, but before the hearing of the motion to dismiss, the counsel for the plaintiff moved to amend the complaint in order to include certain allegations therein. The motion to amend the complaint was granted and on July 17, 1975, plaintiffs filed their amended complaint. On August 4, 1975, the defendants filed another motion to dismiss the complaint on the ground that Fortunata Barcena is dead and, therefore, has no legal capacity to sue. Said motion to dismiss was heard on August 14, 1975. In said hearing, counsel for the plaintiff confirmed the death of Fortunata Barcena and asked for substitution by her minor children and her husband, the petitioners herein; but the court after the hearing immediately dismissed the case on the ground that a dead person cannot be a real party in interest and has no legal personality to sue. LLjur On August 19, 1975, counsel for the plaintiff received a copy of the order dismissing the complaint and on August 23, 1975, he moved to set aside the order of the dismissal pursuant to Sections 16 and 17 of Rule 3 of the Rules of Court. 2 On August 28, 1975, the court denied the motion for reconsideration filed by counsel for the plaintiff for lack of merit. On September 1, 1975, counsel for deceased plaintiff filed a written manifestation praying that the minors Rosalio Bonilla and Salvacion Bonilla be allowed to substitute their deceased mother, but the court denied the counsel's prayer for lack of merit. From the order, counsel for the deceased plaintiff filed a second motion for reconsideration of the order dismissing the complaint claiming that the same is in violation of Sections 16 and 17 of Rule 3 of the Rules of Court but the same was denied. Hence, this petition for review. The Court reverses the respondent Court and sets aside its order dismissing the complaint in Civil Case No. 856 and its orders denying the motion for reconsideration of said order of dismissal. While it is true that a person who is dead cannot sue in court, yet he can be substituted by his heirs in pursuing the case up to its completion. The records of this case show that the death of Fortunata Barcena took place on July 9, 1975 while the complaint was filed on March 31, 1975. This means that when the complaint was filed on March 31, 1975, Fortunata Barcena was still alive, and therefore, the court had acquired jurisdiction over her person. If thereafter she died, the Rules of Court prescribes the procedure whereby a party who died during the pendency of the proceeding can be substituted. Under Section 16, Rule 3 of the Rules of Court "whenever a party to a pending case dies . . . it shall be the duty of his attorney to inform the court promptly of such death . . . and to give the name and residence of his executor, administrator, guardian or other legal representatives." This duty was complied with by the counsel for the deceased plaintiff when he manifested before the respondent Court that Fortunata Barcena died on July 9, 1975 and asked for the proper substitution of parties in the case. The respondent Court, however, instead of allowing the substitution, dismissed the complaint on the ground that a dead person has no legal personality to sue. This is a grave error. Article 777 of the Civil Code provides "that the rights to the succession are transmitted from the moment of the death of the decedent." From the moment of the death of the decedent, the heirs become the absolute owners of his property, subject to the rights and obligations of the decedent, and they cannot be deprived of their rights thereto except by the methods provided for by law. 3 The moment of death is the determining factor when the heirs acquire a definite right to the inheritance whether such right be pure or contingent. 4 The right of the heirs to the property of the deceased vests in them even before judicial declaration of their being heirs in the testate or intestate proceedings. 5 When Fortunata Barcena, therefore, died her claim or right to the parcels of land in litigation in Civil Case No. 856, was not extinguished by her death but was transmitted to her heirs upon her death. Her heirs have thus acquired interest in the properties in litigation and became parties in interest in the case. There is, therefore, no reason for the respondent Court to allow their substitution as parties in interest for the deceased plaintiff. Under Section 17, Rule 3 of the Rules of Court "after a party dies and the claim is not thereby extinguished, the court shall order, upon proper notice, the legal representative of the deceased to appear and be substituted for the deceased, within such time as may be granted . . ." The question as to whether an action survives or not depends on the nature of the action and the damage sued for. 6 In the causes of action which survive the wrong complained affects primarily and principally property and property rights, the injuries to the person being merely incidental, while in the causes of action which do not survive the injury complained of is to the person, the property and rights of property affected being incidental. 7 Following the foregoing criterion the claim of the deceased plaintiff which is an action to quiet title over the parcels of land in litigation affects primarily and principally property and property rights and therefore is one that survives even after her death. It is, therefore, the duty of the respondent Court to order the legal representative of the deceased plaintiff to appear and to be substituted for her. But what the respondent Court did, upon being informed by the counsel for the deceased plaintiff that the latter was dead, was to dismiss the complaint. This should not have been done for under the same Section 17, Rule 3 of the Rules of Court, it is even the duty of the court, if the legal representative fails to appear, to order the opposing party to procure the appointment of a legal representative of the deceased. In the instant case the respondent Court did not have to bother ordering the opposing party to procure the appointment of a legal representative of the deceased because her counsel has not only asked that the minor children be substituted for her but also suggested that their uncle be appointed as guardian ad litem for them because their father is busy in Manila earning a living for the family. But the respondent Court refused the request for substitution on the ground that the children were still minors and cannot sue in court. This is another grave error because the respondent Court ought to have known that under the same Section 17, Rule 3 of the Rules of Court, the court is directed to appoint a guardian ad litem for the minor heirs. Precisely in the instant case, the counsel for the deceased plaintiff has suggested to the respondent Court that the uncle of the minors be appointed to act as guardian ad litem for them. Unquestionably, the respondent Court has gravely abused its discretion in not complying with the clear provision of the Rules of Court dismissing the complaint of the plaintiff in Civil Case No. 856 and refusing the substitution of parties in the case. prLL
IN VIEW OF THE FOREGOING, the order of the respondent Court dismissing the complaint in Civil Case No. 856 of the Court of First Instance of Abra and the motions for reconsideration of the order of dismissal of said complaint are set aside and the respondent Court is hereby directed to allow the substitution of the minor children, who are the petitioners therein for the deceased plaintiff and to appoint a qualified person as guardian ad litem for them. Without pronouncement as to costs. SO ORDERED." Teehankee (Chairman), Makasiar, Esguerra and Muoz Palma, JJ., concur. Footnotes 1.Which this Court treats as special civil action as per its Resolution dated February 11, 1976. 2.Section 16. Duty of Attorney upon death, incapacity, or incompetency of party. Whenever a party to a pending case; becomes incapacitated or incompetent, it shall be the duty of his attorney to inform the court promptly of such death, incapacity or incompetency, and to give the name and residence of his executor, administrator, guardian or other legal representative. Section 17.Death of party. After a party dies and the claim is not thereby extinguished, the court shall order, upon proper notice, the legal representative of the deceased to appear and to be substituted for deceased, within a period of thirty (30) days, or within such time as may be granted. If the legal representative fails to appear within said time, the court may order the opposing party to procure the appointment of a legal representative of the deceased within a time to be specified by the court, and the representative shall immediately appear for and on behalf of the interest of the deceased. The court charges involved in procuring such appointment, if defrayed by the opposing party, may be recovered as costs. The heirs of the deceased may be allowed to be substituted for the deceased, without requiring the appointment of an executor or administrator and the court may appoint guardian ad litem for the minor heirs. 3.Buan vs. Heirs of Buan, 53 Phil. 654. 4.Ibarle vs. Po, 92 Phil. 721. 5.Morales, et al. vs. Ybaez, 98 Phil. 677. 6.Iron Gate Bank vs. Brady, 184 U.S. 665, 22 SCT 529, 46 L. ed. 739. 7.Wenber vs. St. Paul City Co., 97 Feb. 140 R. 39 C.C.A. 79.
||| (Bonilla v. Barcena, G.R. No. L-41715, June 18, 1976) FIRST DIVISION [G.R. No. 166236. July 29, 2010.] 2:15 P.M. NOLI ALFONSO and ERLINDA FUNDIALAN, petitioners, vs. SPOUSES HENRY and LIWANAG ANDRES, respondents. DECISION DEL CASTILLO, J p: Technical rules may be relaxed only for the furtherance of justice and to benefit the deserving. In the present petition for review, petitioners assail the August 10, 2004 Resolution 1 of the Court of Appeals (CA) in CA-G.R. CV. No. 78362, which dismissed the appeal before it for failure of petitioners to file their brief within the extended reglementary period. Factual Antecedents The present case stemmed from a complaint for accion publiciana with damages filed by respondent spouses Henry and Liwanag Andres against Noli Alfonso and spousesReynaldo and Erlinda Fundialan before the Regional Trial Court (RTC), Branch 77, San Mateo, Rizal. On July 8, 1997, the RTC rendered a Decision 2 in favor of respondents. The dispositive portion of the Decision states: WHEREFORE, premises considered judgment is rendered in favor of the plaintiffs and against the defendants and all persons claiming rights under them who are ordered: 1.to vacate the premises located at 236 General Luna St., Dulongbayan 11, San Mateo, Rizal; 2.to jointly and severally pay the sum [of] P100.00 as reasonable compensation for the use of said premises commencing from 04 September 1995; [and] IECAaD 3.to jointly and severally pay the sum of P10,000.00 as and for attorney's fees and to pay the cost of suit. SO ORDERED. 3 Petitioners, 4 thus, appealed to the CA. Proceedings Before the Court of Appeals On November 5, 2003, petitioners' previous counsel was notified by the CA to file appellants' brief within 45 days from receipt of the notice. The original 45-day period expired on December 21, 2003. But before then, on December 8, 2003, petitioners' former counsel filed a Motion to Withdraw Appearance. Petitioners consented to the withdrawal. On December 19, 2003, petitioners themselves moved for an extension of 30 days or until January 21, 2004 within which to file their appellants' brief. Then on March 3, 2004, petitioners themselves again moved for a fresh period of 45 days from March 3, 2004 or until April 18, 2004 within which to file their appellants' brief. On March 17, 2004, the CA issued a Resolution: 5 a) noting the withdrawal of appearance of petitioners' former counsel; b) requiring petitioners to cause the Entry of Appearance of their new counsel; and c) granting petitioners' motions for extension of time to file their brief for a period totaling 75 days, commencing from December 21, 2003 or until March 5, 2004. Petitioners themselves received a copy of this Resolution only on April 6, 2004. By that time, the extension to file appellants' brief had already long expired. On April 14, 2004, the Public Attorney's Office (PAO), having been approached by petitioners, entered 6 its appearance as new counsel for petitioners. However, on August 10, 2004, the CA issued the assailed Resolution dismissing petitioners' appeal, to wit: FOR failure of defendants-appellants to file their brief within the extended reglementary period which expired on March 5, 2004 as per Judicial Records Division report dated July 26, 2004, the appeal is hereby DISMISSED pursuant to Sec. 1 (e), Rule 50 of the 1997 Rules of Civil Procedure. SO ORDERED. On September 6, 2004, the PAO filed their Motion for Reconsideration 7 which requested for a fresh period of 45 days from September 7, 2004 or until October 22, 2004 within which to file appellants' brief. On October 21, 2004, the brief 8 was filed by the PAO. On November 26, 2004, the CA issued a Resolution 9 which denied petitioners' motion for reconsideration. Hence, this petition for review. CIETDc Issues Petitioners raise the following issues: I THE HONORABLE COURT OF APPEALS ERRED IN DISMISSING PETITIONERS' APPEAL FOR FAILURE TO FILE THEIR DEFENDANTS-APPELLANTS' BRIEF, DESPITE THE ATTENDANCE OF PECULIAR FACTS AND CIRCUMSTANCES SURROUNDING SUCH FAILURE, LIKE THE GROSS AND RECKLESS NEGLIGENCE OF THEIR FORMER COUNSEL, THE ABSENCE OF MANIFEST INTENT TO CAUSE DELAY, THE SERIOUS QUESTIONS OF LAW POSED FOR RESOLUTION BEFORE THE APPELLATE COURT, AND THE FACT THAT THE APPELLANTS' BRIEF HAD ALREADY BEEN FILED WITH THE COURT OF APPEALS AND ALREADY FORMED PART OF THE RECORDS OF THE CASE. II THE DISMISSAL OF PETITIONERS' APPEAL BY THE HONORABLE COURT OF APPEALS IS HIGHLY UNJUSTIFIED, INIQUITOUS AND UNCONSCIONABLE BECAUSE IT OVERLOOKED AND/OR DISREGARDED THE MERITS OF PETITIONERS' CASE WHICH INVOLVES A DEPRIVATION OF THEIR PROPERTY RIGHTS. 10 Petitioners' Arguments Petitioners contend that their failure to file their appellants' brief within the required period was due to their indigency and poverty. They submit that there is no justification for the dismissal of their appeal specially since the PAO had just entered its appearance as new counsel for petitioners as directed by the CA, and had as yet no opportunity to prepare the brief. They contend that appeal should be allowed since the brief had anyway already been prepared and filed by the PAO before it sought reconsideration of the dismissal of the appeal and is already part of the records. They contend that the late filing of the brief should be excused under the circumstances so that the case may be decided on the merits and not merely on technicalities. Respondents' Arguments On the other hand, respondents contend that failure to file appellants' brief on time is one instance where the CA may dismiss an appeal. In the present case, they contend that the CA exercised sound discretion when it dismissed the appeal upon petitioners' failure to file their appellants' brief within the extended period of 75 days after the original 45-day period expired. Our Ruling The petition has no merit. cCAIaD Failure to file Brief on Time Rule 50 of the Rules of Court states: Section 1.Grounds for dismissal of appeal. An appeal may be dismissed by the Court of Appeals, on its own motion or on that of the appellee, on the following grounds: xxx xxx xxx (e)Failure of the appellant to serve and file the required number of copies of his brief or memorandum within the time provided by these Rules; Petitioners plead for the suspension of the rules and cite a number of cases where the Court excused the late filing of a notice of appeal as well as the late filing of the appellant's brief. They further cite Development Bank of the Philippines v. Court of Appeals 11 where the late filing of the appellant's brief was excused because the Court found the case impressed with public interest. The cases cited by petitioners are not in point. In the present civil case which involves the failure to file the appellants' brief on time, there is no showing of any public interest involved. Neither is there a showing that an injustice will result due to the application of technical rules. Poverty cannot be used as an excuse to justify petitioners' complacency in allowing months to pass by before exerting the required effort to find a replacement lawyer. Poverty is not a justification for delaying a case. Both parties have a right to a speedy resolution of their case. Not only petitioners, but also the respondents, have a right to have the case finally settled without delay. Furthermore, the failure to file a brief on time was due primarily to petitioners' unwise choices and not really due to poverty. Petitioners were able to get a lawyer to represent them despite their poverty. They were able to get two other lawyers after they consented to the withdrawal of their first lawyer. But they hired their subsequent lawyers too late. It must be pointed out that petitioners had a choice of whether to continue the services of their original lawyer or consent to let him go. They could also have requested the said lawyer to file the required appellants' brief before consenting to his withdrawal from the case. But they did neither of these. Then, not having done so, they delayed in engaging their replacement lawyer. Their poor choices and lack of sufficient diligence, not poverty, are the main culprits for the situation they now find themselves in. It would not be fair to pass on the bad consequences of their choices to respondents. Petitioners' low regard for the rules or nonchalance toward procedural requirements, which they camouflage with the cloak of poverty, has in fact contributed much to the delay, and hence frustration of justice, in the present case. IaSAHC No compelling reason to disregard technicalities Petitioners beg us to disregard technicalities because they claim that on the merits their case is strong. A study of the records fails to so convince us. Petitioners theorize that publication of the deed of extrajudicial settlement of the estate of Marcelino Alfonso is required before their father, Jose Alfonso (Jose) could validly transfer the subject property. We are not convinced. In Alejandrino v. Court of Appeals, 12 the Court upheld the effectivity of a deed of extrajudicial settlement that was neither notarized nor published. Significantly, the title of the property owned by a person who dies intestate passes at once to his heirs. Such transmission is subject to the claims of administration and the property may be taken from the heirs for the purpose of paying debts and expenses, but this does not prevent an immediate passage of the title, upon the death of the intestate, from himself to his heirs. 13 The deed of extrajudicial settlement executed by Filomena Santos Vda. de Alfonso and Jose evidences their intention to partition the inherited property. It delineated what portion of the inherited property would belong to whom. The sale to respondents was made after the execution of the deed of extrajudicial settlement of the estate. The extrajudicial settlement of estate, even though not published, being deemed a partition 14 of the inherited property, Jose could validly transfer ownership over the specific portion of the property that was assigned to him. 15 The records show that Jose did in fact sell to respondents the subject property. The deed of sale executed by Jose in favor of the respondents being a public document, is entitled to full faith and credit in the absence of competent evidence that its execution was tainted with defects and irregularities that would warrant a declaration of nullity. As found by the RTC, petitioners failed to prove any defect or irregularities in the execution of the deed of sale. They failed to prove by strong evidence, the alleged lack of consent of Jose to the sale of the subject real property. As found by the RTC, although Jose was suffering from partial paralysis and could no longer sign his name, there is no showing that his mental faculties were affected in such a way as to negate the existence of his valid consent to the sale, as manifested by his thumbmark on the deed of sale. The records sufficiently show that he was capable of boarding a tricycle to go on trips by himself. Sufficient testimonial evidence in fact shows that Jose asked respondents to buy the subject property so that it could be taken out from the bank to which it was mortgaged. This fact evinces that Jose's mental faculties functioned intelligently. In view of the foregoing, we find no compelling reason to overturn the assailed CA resolution. We find no injustice in the dismissal of the appeal by the CA. Justice dictates that this case be put to rest already so that the respondents may not be deprived of their rights. WHEREFORE, the petition is DENIED. The August 10, 2004 Resolution of the Court of Appeals in CA-G.R. CV. No. 78362 is AFFIRMED. ASDCaI SO ORDERED. Corona, C.J., Velasco, Jr., Leonardo-de Castro and Perez, JJ., concur. Footnotes 1.CA rollo, p. 82; penned by Associate Justice Ruben T. Reyes and concurred in by Associate Justices Perlita J. Tria-Tirona and Jose C. Reyes, Jr. 2.Records, pp. 93-101; penned by Judge Francisco C. Rodriguez, Jr. 3.Id. at 101. 4.Reynaldo Fundialan did not file a Notice of Appeal; id. at 102. 5.CA rollo, p. 77. 6.Id. at 78-79. 7.Id. at 85-89. 8.Id. at 96-110. 9.Id. at 121-123. 10.Rollo, p. 157. 11.411 Phil. 121, 135 (2001). 12.356 Phil. 851, 862 (1998). 13.Heirs of Ignacio Conti v. Court of Appeals, 360 Phil. 536, 546 (1998). CIVIL CODE, Art. 774. 14.Art. 1082 of the Civil Code states: "Every act which is intended to put an end to indivision among co-heirs and legatees or devisees is deemed to be a partition, although it should purport to be a sale, an exchange, a compromise, or any other transaction." 15.See Alejandrino v. Court of Appeals, supra note 12. ||| (Alfonso v. Spouses Andres, G.R. No. 166236, July 29, 2010)
SECOND DIVISION [G.R. No. 82027. March 29, 1990.] ROMARICO G. VITUG, petitioner, vs. THE HONORABLE COURT OF APPEALS and ROWENA FAUSTINO- CORONA, respondents. Rufino B. Javier Law Office for petitioner. Quisumbing, Torres & Evangelista for private respondent. D E C I S I O N SARMIENTO, J p: This case is a chapter in an earlier suit decided by this Court 1 involving the probate of the two wills of the late Dolores Luchangco Vitug, who died in New York, U.S.A., on November 10, 1980, naming private respondent Rowena Faustino-Corona executrix. In our said decision, we upheld the appointment of Nenita Alonte as co-special administrator of Mrs. Vitug's estate with her (Mrs. Vitug's) widower, petitioner Romarico G. Vitug, pending probate. cdphil On January 13, 1985, Romarico G. Vitug filed a motion asking for authority from the probate court to sell certain shares of stock and real properties belonging to the estate to cover allegedly his advances to the estate in the sum of P667,731.66, plus interests, which he claimed were personal funds. As found by the Court of Appeals, 2 the alleged advances consisted of P58,147.40 spent for the payment of estate tax, P518,834.27 as deficiency estate tax, and P90,749.99 as "increment thereto." 3 According to Mr. Vitug, he withdrew the sums of P518,834.27 and P90,749.99 from savings account No. 35342- 038 of the Bank of America, Makati, Metro Manila. On April 12, 1985, Rowena Corona opposed the motion to sell on the ground that the same funds withdrawn from savings account No. 35342-038 were conjugal partnership properties and part of the estate, and hence, there was allegedly no ground for reimbursement. She also sought his ouster for failure to include the sums in question for inventory and for "concealment of funds belonging to the estate." 4 Vitug insists that the said funds are his exclusive property having acquired the same through a survivorship agreement executed with his late wife and the bank on June 19, 1970. The agreement provides: We hereby agree with each other and with the BANK OF AMERICAN NATIONAL TRUST AND SAVINGS ASSOCIATION (hereinafter referred to as the BANK), that all money now or hereafter deposited by us or any or either of us with the BANK in our joint savings current account shall be the property of all or both of us and shall be payable to and collectible or withdrawable by either or any of us during our lifetime, and after the death of either or any of us shall belong to and be the sole property of the survivor or survivors, and shall be payable to and collectible or withdrawable by such survivor or survivors. LLpr We further agree with each other and the BANK that the receipt or check of either, any or all of us during our lifetime, or the receipt or check of the survivor or survivors, for any payment or withdrawal made for our above-mentioned account shall be valid and sufficient release and discharge of the BANK for such payment or withdrawal. 5 The trial court 6 upheld the validity of this agreement and granted "the motion to sell some of the estate of Dolores L. Vitug, the proceeds of which shall be used to pay the personal funds of Romarico Vitug in the total sum of P667,731.66 . . . ." 7 On the other hand, the Court of Appeals, in the petition for certiorari filed by the herein private respondent, held that the above-quoted survivorship agreement constitutes a conveyance mortis causa which "did not comply with the formalities of a valid will as prescribed by Article 805 of the Civil Code," 8 and secondly, assuming that it is a mere donation inter vivos, it is a prohibited donation under the provisions of Article 133 of the Civil Code. 9 The dispositive portion of the decision of the Court of Appeals states: WHEREFORE, the order of respondent Judge dated November 26, 1985 (Annex II, petition) is hereby set aside insofar as it granted private respondent's motion to sell certain properties of the estate of Dolores L. Vitug for reimbursement of his alleged advances to the estate, but the same order is sustained in all other respects. In addition, respondent Judge is directed to include provisionally the deposits in Savings Account No. 35342-038 with the Bank of America, Makati, in the inventory of actual properties possessed by the spouses at the time of the decedent's death. With costs against private respondent. 10 In his petition, Vitug, the surviving spouse, assails the appellate court's ruling on the strength of our decisions in Rivera v. People's Bank and Trust Co. 11 and Macam v. Gatmaitan 12 in which we sustained the validity of "survivorship agreements" and considering them as aleatory contracts. 13 The petition is meritorious. The conveyance in question is not, first of all, one of mortis causa, which should be embodied in a will. A will has been defined as "a personal, solemn, revocable and free act by which a capacitated person disposes of his property and rights and declares or complies with duties to take effect after his death." 14 In other words, the bequest or device must pertain to the testator. 15 In this case, the monies subject of savings account No. 35342-038 were in the nature of conjugal funds. In the case relied on, Rivera v. People's Bank and Trust Co., 16 we rejected claims that a survivorship agreement purports to deliver one party's separate properties in favor of the other, but simply, their joint holdings: LLjur xxx xxx xxx . . . Such conclusion is evidently predicated on the assumption that Stephenson was the exclusive owner of the funds deposited in the bank, which assumption was in turn based on the facts (1) that the account was originally opened in the name of Stephenson alone and (2) that Ana Rivera "served only as housemaid of the deceased." But it not infrequently happens that a person deposits money in the bank in the name of another; and in the instant case it also appears that Ana Rivera served her master for about nineteen years without actually receiving her salary from him. The fact that subsequently Stephenson transferred the account to the name of himself and/or Ana Rivera and executed with the latter the survivorship agreement in question although there was no relation of kinship between them but only that of master and servant, nullifies the assumption that Stephenson was the exclusive owner of the bank account. In the absence, then, of clear proof to the contrary, we must give full faith and credit to the certificate of deposit which recites in effect that the funds in question belonged to Edgar Stephenson and Ana Rivera; that they were joint (and several) owners thereof; and that either of them could withdraw any part or the whole of said account during the lifetime of both, and the balance, if any, upon the death of either, belonged to the survivor. 17 xxx xxx xxx In Macam v. Gatmaitan, 18 it was held: xxx xxx xxx This Court is of the opinion that Exhibit C is an aleatory contract whereby, according to article 1790 of the Civil Code, one of the parties or both reciprocally bind themselves to give or do something as an equivalent for that which the other party is to give or do in case of the occurrence of an event which is uncertain or will happen at an indeterminate time. As already stated, Leonarda was the owner of the house and Juana of the Buick automobile and most of the furniture. By virtue ofExhibit C, Juana would become the owner of the house in case Leonarda died first, and Leonarda would become the owner of the automobile and the furniture if Juana were to die first. In this manner Leonarda and Juana reciprocally assigned their respective property to one another conditioned upon who might die first, the time of death determining the event upon which the acquisition of such right by the one or the other depended. This contract, as any other contract, is binding upon the parties thereto. Inasmuch as Leonarda had died before Juana, the latter thereupon acquired the ownership of the house, in the same manner as Leonarda would have acquired the ownership of the automobile and of the furniture if Juana had died first. 19 xxx xxx xxx There is no showing that the funds exclusively belonged to one party, and hence it must be presumed to be conjugal, having been acquired during the existence of the marital relations. 20 Neither is the survivorship agreement a donation inter vivos, for obvious reasons, because it was to take effect after the death of one party. Secondly, it is not a donation between the spouses because it involved no conveyance of a spouse's own properties to the other. LLphil It is also our opinion that the agreement involves no modification of the conjugal partnership, as held by the Court of Appeals, 21 by "mere stipulation," 22 and that it is no "cloak" 23 to circumvent the law on conjugal property relations. Certainly, the spouses are not prohibited by law to invest conjugal property, say, by way of a joint and several bank account, more commonly denominated in banking parlance as an "and/or" account. In the case at bar, when the spouses Vitug opened savings account No. 35342-038, they merely put what rightfully belonged to them in a money-making venture. They did not dispose of it in favor of the other, which would have arguably been sanctionable as a prohibited donation. And since the funds were conjugal, it can not be said that one spouse could have pressured the other in placing his or her deposits in the money pool. The validity of the contract seems debatable by reason of its "survivor-take-all" feature, but in reality, that contract imposed a mere obligation with a term, the term being death. Such agreements are permitted by the Civil Code. 24 Under Article 2010 of the Code:
ART. 2010.By an aleatory contract, one of the parties or both reciprocally bind themselves to give or to do something in consideration of what the other shall give or do upon the happening of an event which is uncertain, or which is to occur at an indeterminate time. Under the aforequoted provision, the fulfillment of an aleatory contract depends on either the happening of an event which is (1) "uncertain," (2) "which is to occur at an indeterminate time." A survivorship agreement, the sale of a sweepstake ticket, a transaction stipulating on the value of currency, and insurance have been held to fall under the first category, while a contract for life annuity or pension under Article 2021, et sequentia, has been categorized under the second. 25 In either case, the element of risk is present. In the case at bar, the risk was the death of one party and survivorship of the other. prcd However, as we have warned: xxx xxx xxx But although the survivorship agreement is per se not contrary to law its operation or effect may be violative of the law. For instance, if it be shown in a given case that such agreement is a mere cloak to hide an inofficious donation, to transfer property in fraud of creditors, or to defeat the legitime of a forced heir, it may be assailed and annulled upon such grounds. No such vice has been imputed and established against the agreement involved in this case. 26 xxx xxx xxx There is no demonstration here that the survivorship agreement had been executed for such unlawful purposes, or, as held by the respondent court, in order to frustrate our laws on wills, donations, and conjugal partnership. The conclusion is accordingly unavoidable that Mrs. Vitug having predeceased her husband, the latter has acquired upon her death a vested right over the amounts under savings account No. 35342-038 of the Bank of America. Insofar as the respondent court ordered their inclusion in the inventory of assets left by Mrs. Vitug, we hold that thecourt was in error. Being the separate property of petitioner, it forms no more part of the estate of the deceased. cdrep WHEREFORE, the decision of the respondent appellate court, dated June 29, 1987, and its resolution, dated February 9, 1988, are SET ASIDE. No costs. SO ORDERED. Melencio-Herrera, Paras, Padilla and Regalado JJ., concur. Footnotes 1.Corona v. Court of Appeals, No. 59821, August 30, 1982, 116 SCRA 316. 2.Kapunan, Santiago, M., J., ponente; Puno Reynato S. and Marigomen, Alfredo, JJ., concurring. 3.Rollo, 21. 4.Id., 22. 5.Id. 6.Judge (now Justice of the Court of Appeals) Asaali S. Isnani, presiding. 7.Rollo, 23. 8.Id., 26. 9.Now, Article 87 of the Family Code. 10.Rollo, 28-29. 11.73 Phil. 546 (1942). 12.64 Phil. 187 (1937). 13.CIVIL CODE, Art. 2010. 14.III TOLENTINO, CIVIL CODE OF THE PHILIPPINES 26 (1973 ed.), citing 1 GOMEZ 53. 15.See CIVIL CODE, supra., arts. 793, 794, 930. 16.Supra. 17.Supra., 547. 18.Supra. 19.Supra., 190-191. 20.CIVIL CODE, supra, art. 160. 21.In the words of the Appellate Court: "Since private respondent and his late wife did not enter into a marriage settlement before marriage, their property relationship was that of conjugal partnership governed by the Civil Code. The system of conjugal partnership prohibits, as already mentioned, donation between the spouses during the marriage, except that which takes effect after the death of the donor, in which case, the donation shall comply with the formalities of a will (Arts. 133, 728, 805). To allow the prohibited donation by giving it a cloak of aleatory contract would sanction a (modification) of a marriage settlement during marriage by a mere stipulation. As mandated by Art. 52, the nature, consequences and incidents of marriage, which is not a mere contract but an inviolable social institution are governed by law, and not subject to stipulation.". 22.Id. 23.Id. 24.CIVIL CODE, supra., art. 1193. 25.V PARAS, CIVIL CODE OF THE PHILIPPINES, 782 (1986 ed.). 26.Rivera, supra, 548.
||| (Vitug v. Court of Appeals, G.R. No. 82027, March 29, 1990)
SECOND DIVISION [A.M. No. 2026. December 19, 1981.] NENITA DE VERA SUROZA, complainant, vs. JUDGE REYNALDO P. HONRADO of the Court of First Instance of Rizal, Pasig Branch 25 and EVANGELISTA S. YUIPCO, Deputy Clerk of Court, respondents. SYNOPSIS Complainant wife of the preterited heir filed a verified complaint in the Supreme Court against respondent Judge for having probated an alleged fraudulent will of the decedent Marcelina Salvador Suroza naming a supposed granddaughter as the sole heir and giving nothing at all to her supposed father who was still alive, and for having allowed the administratrix and her cohorts to withdraw from various banks, the deposits of the testatrix. Said will was written in English, a language not known to the illiterate testatrix and probably forged because the testatrix and the attesting witnesses did not appear before the notary as admitted by the notary himself. Complainant also denounced deputy clerk of court Yuipco for not giving her access to the record of the probate case and for insinuating that for ten thousand pesos the case might be decided in complainant's favor. In their comment, respondent Judge merely pointed out that the complainant did not appeal from the decree of probate and that upon being ejected the latter asked for a thirty-day period to vacate the house of the testatrix, while respondent Yuipco vehemently denied the charges against her. The case was referred for investigation, report and recommendation to Justice Juan A. Sison of the Court of Appeals who submitted a report dated October 7, 1951. Relying on the decision of the Court of Appeals dismissing complainant's petition for certiorari and prohibition, respondent Judge filed a motion to dismiss the administrative case for having allegedly become moot and academic. The Supreme Court ruled that respondent Judge was guilty of inexcusable negligence and dereliction of duty for his unproper disposition of the testate case which might have resulted in a miscarriage of justice and imposed upon him a fine equivalent to his salary for one month. The case against respondent Yuipco was held as having become moot and academic in view of her being beyond the Court's disciplinary jurisdiction because she is no longer employed in the judiciary. SYLLABUS 1.CONSTITUTIONAL LAW; SUPREME COURT SUPERVISION OVER LOWER COURTS; ADMINISTRATIVE CASE AGAINST JUDGES; REQUIREMENTS TO BE FOUND GUILTY OF SERIOUS MISCONDUCT OR INEFFICIENCY. Administrative action may be taken against a judge of the court of first instance for serious misconduct or inefficiency (Sec. 67, Judiciary Law). Misconduct implies malice or a wrongful intent, not a mere error of judgment. "For serious misconduct to exist, there must be reliable evidence showing that the judicial acts complained of were corrupt or inspired by an intention to violate the law, or were in persistent disregard of well-known legal rules (In re Impeachment of Horrilleno, 43 Phil. 212, 214-215). 2.ID.; ID.; ID.; ID.; INEFFICIENCY DEFINED. Inefficiency implies negligence, incompetence, ignorance and carelessness. A judge would be inexcusably negligent if he failed to observe in the performance of his duties that diligence, prudence and circumspection which the law requires in the rendition of any public service (In re Climaco, Adm. Case No. 134-J, Jan. 21, 1974, 35 SCRA 107, 119). 3.ID.; ID.; ID.; ID.; CIRCUMSTANCES IN THE CASE AT BAR SHOWING NEGLIGENCE AND DERELICTION OF DUTY. In this case, respondent judge, on perusing the will and noting that it was written in English and was thumbmarked by an obviously illiterate testatrix, could have readily perceived that the will is shown in the attestation clause and notarial acknowledgment where the testatrix is repeatedly referred to as the "testator" instead of "testatrix", that he could have noted not only the anomaly as to the language of the will but also that there was something wrong in instituting the supposed granddaughter as sole heiress and giving nothing at all to her supposed father who was still alive, that after the hearing conducted by respondent deputy clerk of court, respondent judge could have noticed that the notary was not presented as a witness, and that in spite of the absence of an opposition, respondent judge should have personally conducted the hearing on the probate of the will so that he could have ascertained whether the will was validly executed. 4.ID.; ID.; ID.; ID.; INSUFFICIENCY IN HANDLING THE TESTATE CASE; PENALTY; CASE AT BAR. For inefficiency in handling the testate case of Marcelina S. Suroza, a fine equivalent to his salary for one month is imposed on respondent judge. 5.ID.; ID.; ID.; ADMINISTRATIVE COMPLAINT AGAINST DEPUTY CLERK OF COURT; BECOMES MOOT AND ACADEMIC WHEN RESPONDENT IS NO LONGER EMPLOYED IN THE JUDICIARY; CASE AT BAR. The case against respondent Deputy Clerk of Court has become moot and academic because she is no longer employed in the judiciary. Since September 1, 1980, she has been assistant city fiscal of Surigao City. She is beyond this Court's disciplinary jurisdiction (Peralta vs. Firme, Adm. Matter No. 2044-CFI, November 21, 1980, 101 SCRA 225). D E C I S I O N AQUINO, J p: Should disciplinary action be taken against respondent judge for having admitted to probate a will, which on its face is void because it is written in English, a language not known to the illiterate testatrix, and which is probably a forged will because she and the attesting witnesses did not appear before the notary as admitted by the notary himself? LibLex That question arises under the pleadings filed in the testate case and in the certiorari case in the Court of Appeals which reveal the following tangled strands of human relationship. Mauro Suroza, a corporal in the 45th Infantry of the U.S. Army (Philippine Scouts), Fort McKinley, married Marcelina Salvador in 1923 (p. 150, Spec. Proc. No. 7816). They were childless. They reared a boy named Agapito who used the surname Suroza and who considered them as his parents as shown in his 1945 marriage contract with Nenita de Vera (p. 15, Rollo of CA-G.R. No. 08654, p. 148, Rollo of Testate Case showing that Agapito was 5 years old when Mauro married Marcelina in 1923). Mauro died in 1942. Marcelina, as a veteran's widow, became a pensioner of the Federal Government. That explains why on her death she had accumulated some cash in two banks. Agapito and Nenita begot a child named Lilia who became a medical technologist and went abroad. Agapito also became a soldier. He was disabled and his wife Nenita was appointed as his guardian in 1953 when he was declared an incompetent in Special Proceedings No. 1807 of the Court of First Instance of Rizal, Pasig Branch I (p. 16, Rollo of CA-G.R. No. 08654-R) In that connection, it should be noted that a woman named Arsenia de la Cruz wanted also to be his guardian in another proceeding. Arsenia tried to prove that Nenita was living separately from Agapito and that she (Nenita) admitted to Marcelina that she was unfaithful to Agapito (pp. 61-63, Record of testate case) Judge Bienvenido A. Tan dismissed the second guardianship proceeding and confirmed Nenita's appointment as guardian of Agapito (p. 16, Rollo of CA case). Agapito has been staying in a veteran's hospital in San Francisco or Palo Alto, California (p. 87, Record) On a date not indicated in the record, the spouses Antonio Sy and Hermogena Talan begot a child named Marilyn Sy, who, when a few days old, was entrusted to Arsenia de la Cruz (apparently a girl friend of Agapito) and who was later delivered to Marcelina Salvador Suroza who brought her up as a supposed daughter of Agapito and as her granddaughter (pp. 23-26, Rollo of CA-G.R. No. SP-08654-R). Marilyn used the surname Suroza. She stayed with Marcelina but was not legally adopted by Agapito. She married Oscar Medrano and is residing at 7666 J.B. Roxas Street, Makati, apparently a neighbor of Marina Paje, a resident of 7668 J.B. Roxas Street. Marcelina supposedly executed a notarial will in Manila on July 23, 1973, when she was 73 years old. That will, which is in English, was thumb marked by her. She was illiterate. Her letters in English to the Veterans Administration were also thumb marked by her (pp. 38-39, CA Rollo). In that will, Marcelina bequeathed all her estate to her supposed granddaughter Marilyn. LLjur Marcelina died on November 15, 1974 at the Veterans Hospital in Quezon City. At the time of her death, she was a resident of 7374 San Maximo Street, Olimpia, Makati, Rizal. She owned a 150-square meter lot and house in that place. She acquired the lot in 1966 (p. 134, Record of testate case) On January 13, 1975, Marina Paje, alleged to be a laundry woman of Marcelina (p. 97, CA Rollo) and the executrix in her will (the alternate executrix was Juanita Macaraeg, mother of Oscar, Marilyn's husband), filed with the Court of First Instance of Rizal, Pasig Branch 25, a petition for the probate of Marcelina's alleged will. The case was assigned to Judge Reynaldo P. Honrado. As there was no opposition, Judge Honrado commissioned his deputy clerk of court, Evangeline S. Yuipco, to hear the evidence. The transcripts of the stenographic notes taken at the hearing before the deputy clerk of court are not in the record. In an order dated March 31, 1975, Judge Honrado appointed Marina as administrative. On the following day, April 1, Judge Honrado issued two orders directing the Merchants Banking Corporation and the Bank of America to allow Marina to withdraw the sum of P10,000 from the savings accounts of Marcelina S. Suroza and Marilyn Suroza and requiring Corazon Castro, the custodian of the passbooks, to deliver them to Marina. Upon motion of Marina, Judge Honrado issued another order dated April 11, 1975, instructing a deputy sheriff to eject the occupants of the testratrix's house, among whom was Nenita V. Suroza, and to place Marina in possession thereof. That order alerted Nenita to the existence of the testamentary proceeding for the settlement of Marcelina's estate. She and the other occupants of the decedent's house filed on April 18 in the said proceedings a motion to set aside the order of April 11 ejecting them. They alleged that the decedent's son Agapito was the sole heir of the deceased, that he has a daughter named Lilia, that Nenita was Agapito's guardian and that Marilyn was not Agapito's daughter nor the decedent's granddaughter (pp. 52-68, Record of testate case). Later, they questioned the probate court's jurisdiction to issue the ejectment order.
In spite of the fact that Judge Honrado was already apprised that persons, other than Marilyn, were claiming Marcelina's estate, he issued on April 23 an order probating her supposed will wherein Marilyn was the instituted heiress (pp. 74- 77, Record). On April 24, Nenita filed in the testate case an omnibus petition "to set aside proceedings, admit opposition with counter-petition of administration and preliminary injunction." Nenita in that motion reiterated her allegation that Marilyn was a stranger to Marcelina, that the will was not duly executed and attested, that it was procured by means of undue influence employed by Marina and Marilyn and that the thumb marks of the testatrix were procured by fraud or trick. prLL Nenita further alleged that the institution of Marilyn as heir was void because of the perpetration of Agapito and that Marina was not qualified to act as executrix (pp. 83-91, Record) To that motion was attached an affidavit of Zenaida A. Peaojas, the housemaid of Marcelina, who swore that the alleged will was falsified (p. 109, Record) Not content with her motion to set aside the ejectment order (filed on April 18) and her omnibus motion to set aside the proceedings (filed on April 24), Nenita filed the next day, April 25, an opposition to the probate of the will and a counter- petition for letters of administration. In that opposition, Nenita assailed the due execution of the will and stated the names and addresses of Marcelina's intestate heirs, her nieces and nephews (pp. 113-121, Record). Nenita was not aware of the decree of probate dated April 23, 1975. To that opposition was attached an affidavit of Dominga Salvador Teodocio, Marcelina's niece, who swore that Marcelina never executed a will (pp. 124-125, Record) Marina in her answer to Nenita's motion to set aside the proceedings admitted that Marilyn was not Marcelina's grand daughter but was the daughter of Agapito and Arsenia de la Cruz and that Agapito was not Marcelina's son but merely an anak-anakan who was not legally adopted (p. 143, Record) Judge Honrado in his order of July 17, 1975 dismissed Nenita's counter-petition for the issuance of letters of administration because of the nonappearance of her counsel at the hearing. She moved for the reconsideration of that order. In a motion dated December 5, 1975, for the consolidation of all pending incidents, Nenita V. Suroza reiterated her contention that the alleged will is void because Marcelina did not appear before the notary and because it is written in English which is not known to her (pp. 208, 209, Record). Judge Honrado in his order of June 8, 1976 "denied" the various incidents "raised" by Nenita (p. 284, Record) Instead of appealing from that order and the order probating the will, Nenita "filed a case to annul" the probate proceedings (p. 332, Record). That case, Civil Case No. 24276,Suroza vs. Paje and Honrado (p. 398, Record), was also assigned to Judge Honrado. He dismissed it in his order of February 16, 1977 (pp. 398-402, Record) Judge Honrado in his order dated December 22, 1977, after noting that the executrix had delivered the estate to Marilyn, and that the estate tax had been paid, closed the testamentary proceeding. About ten months later, in a verified complaint dated October 12,1978, filed in this Court, Nenita charged Judge Honrado with having probated the fraudulent will of Marcelina. The complainant reiterated her contention that the testatrix was illiterate as shown by the fact that she affixed her thumb mark to the will and that she did not know English, the language in which the will was written. (In the decree of probate Judge Honrado did not make any finding that the will was written in a language known to the testatrix) Nenita further alleged that Judge Honrado, in spite of his knowledge that the testatrix had a son named Agapito (the testatrix's supposed sole compulsory and legal heir), who was preterited in the will, did not take into account the consequences of such a preterition. cdll Nenita disclosed that she talked several times with Judge Honrado and informed him that the testatrix did not know the executrix Marina Paje, that the beneficiary's real name is Marilyn Sy and that she was not the next of kin of the testatrix. Nenita denounced Judge Honrado for having acted corruptly in allowing Marina and her cohorts to withdraw from various banks the deposits of Marcelina. She also denounced Evangeline S. Yuipco, the deputy clerk of court, for not giving her access to the record of the probate case by alleging that it was useless for Nenita to oppose the probate since Judge Honrado would not change his decision. Nenita also said that Evangeline insinuated that if she (Nenita) had ten thousand pesos, the case might be decided in her favor. Evangeline allegedly advised Nenita to desist from claiming the properties of the testatrix because she (Nenita) had no rights thereto and, should she persist, she might lose her pension from the Federal Government. Judge Honrado in his brief comment did not deal specifically with the allegations of the complaint. He merely pointed to the fact that Nenita did not appeal from the decree of probate and that in a motion dated July 6, 1976 she asked for a thirty-day period within which to vacate the house of the testatrix. Evangeline S. Yuipco in her affidavit said that she never talked with Nenita and that the latter did not mention Evangeline in her letter dated September 11, 1978 to President Marcos. Evangeline branded as a lie Nenita's imputation that she (Evangeline) prevented Nenita from having access to the record of the testamentary proceeding. Evangeline was not the custodian of the record. Evangeline "strongly, vehemently and flatly denied" Nenita's charge that she (Evangeline) said that the sum of ten thousand pesos was needed in order that Nenita could get a favorable decision. Evangeline also denied that she has any knowledge of Nenita's pension from the Federal Government. The 1978 complaint against Judge Honrado was brought to the attention of this Court in the Court Administrator's memorandum of September 25, 1980. The case was referred to Justice Juan A. Sison of the Court of Appeals for investigation, report and recommendation. He submitted a report dated October 7, 1981. On December 14, 1978, Nenita filed in the Court of Appeals against Judge Honrado a petition for certiorari and prohibition wherein she prayed that the will, the decree of probate and all the proceedings in the probate case be declared void. Attached to the petition was the affidavit of Domingo P. Aquino, who notarized the will. He swore that the testatrix and the three attesting witnesses did not appear before him and that he notarized the will "just to accommodate a brother- lawyer on the condition," that said lawyer would bring to the notary the testatrix and the witnesses but the lawyer never complied with his commitment. The Court of Appeals dismissed the petition because Nenita's remedy was an appeal and her failure to do so did not entitle her to resort to the special civil action of certiorari (Suroza vs. Honrado, CA-G.R. No. SP-08654, May 29. 1981) Relying on that decision, Judge Honrado filed on November 17, 1981 a motion to dismiss the administrative case for having allegedly become moot and academic. We hold that disciplinary action should be taken against respondent judge for his improper disposition of the testate case which might have resulted in a miscarriage of justice because the decedent's legal heirs and not the instituted heiress in the void will should have inherited the decedent's estate. A judge may be criminally liable for knowingly rendering an unjust judgment or interlocutory order or rendering a manifestly unjust judgment or interlocutory order by reason of inexcusable negligence or ignorance (Arts. 204 to 206, Revised Penal Code) Administrative action may be taken against a judge of the court of first instance for serious misconduct or inefficiency (Sec. 67, Judiciary Law). Misconduct implies malice or a wrongful intent, not a mere error of judgment. "For serious misconduct to exist, there must be reliable evidence showing that the judicial acts complained of were corrupt or inspired by an intention to violate the law, or were in persistent disregard of well-known legal rules" (In re Impeachment of Horrilleno, 43 Phil. 212, 214-215). llcd Inefficiency implies negligence, incompetence, ignorance and carelessness. A judge would be inexcusably negligent if he failed to observe in the performance of his duties that diligence, prudence and circumspection which the law requires in the rendition of any public service (In re Climaco, Adm. Case No. 134-J, Jan. 21, 1974, 55 SCRA 107, 119). In this case, respondent judge, on perusing the will and noting that it was written in English and was thumb marked by an obviously illiterate testatrix, could have readily perceived that the will is void. In the opening paragraph of the will, it was stated that English was a language "understood and known" to the testatrix. But in its concluding paragraph, it was stated that the will was read to the testatrix "and translated into Filipino language." (p. 16, Record of testate case) That could only mean that the will was written in a language not known to the illiterate testatrix and, therefore, it is void because of the mandatory provision of Article 804 of the Civil Code that every will must be executed in a language or dialect known to the testator. Thus, a will written in English, which was not known to the Igorot testator, is void and was disallowed (Acop vs. Piraso, 52 Phil. 660) The hasty preparation of the will is shown in the attestation clause and notarial acknowledgment where Marcelina Salvador Suroza is repeatedly referred to as the "testator" instead of "testatrix." Had respondent judge been careful and observant, he could have noted not only the anomaly as to the language of the will but also that there was something wrong in instituting the supposed granddaughter as sole heiress and giving nothing at all to her supposed father who was still alive.
Furthermore, after the hearing conducted by respondent deputy clerk of court, respondent judge could have noticed that the notary was not presented as a witness. In spite of the absence of an opposition, respondent judge should have personally conducted the hearing on the probate of the will so that he could have ascertained whether the will was validly executed. Under the circumstances, we find his negligence and dereliction of duty to be inexcusable. WHEREFORE, for inefficiency in handling the testate case of Marcelina S. Suroza, a fine equivalent to his salary for one month is imposed on respondent judge (his compulsory retirement falls on December 25, 1981). The case against respondent Yuipco has become moot and academic because she is no longer employed in the judiciary. Since September 1, 1980 she has been assistant city fiscal of Surigao City. She is beyond this Court's disciplinary jurisdiction (Peralta vs. Firme, Adm. Matter No. 2044-CFI, November 21, 1980, 101 SCRA 225) SO ORDERED. Barredo (Chairman), De Castro, Ericta and Escolin, JJ., concur. Abad Santos, J., took no part. Concepcion Jr., J., on leave. ||| (Suroza v. Honrado, A.M. No. 2026-CFI, December 19, 1981) FIRST DIVISION [G.R. No. 147145. January 31, 2005.] TESTATE ESTATE OF THE LATE ALIPIO ABADA, BELINDA CAPONONG-NOBLE, petitioner, vs. ALIPIO ABAJA and NOEL ABELLAR, respondents. D E C I S I O N CARPIO, J p: The Case Before the Court is a petition for review 1 assailing the Decision 2 of the Court of Appeals of 12 January 2001 in CA-G.R. CV No. 47644. The Court of Appeals sustained the Resolution 3 of the Regional Trial Court of Kabankalan, Negros Occidental, Branch 61 ("RTC-Kabankalan"), admitting to probate the last will and testament of Alipio Abada ("Abada"). The Antecedent Facts Abada died sometime in May 1940. 4 His widow Paula Toray ("Toray") died sometime in September 1943. Both died without legitimate children. On 13 September 1968, Alipio C. Abaja ("Alipio") filed with the then Court of First Instance of Negros Occidental (now RTC-Kabankalan) a petition, 5 docketed as SP No. 070 (313-8668), for the probate of the last will and testament ("will") of Abada. Abada allegedly named as his testamentary heirs his natural children Eulogio Abaja ("Eulogio") and Rosario Cordova. Alipio is the son of Eulogio. Nicanor Caponong ("Caponong") opposed the petition on the ground that Abada left no will when he died in 1940. Caponong further alleged that the will, if Abada really executed it, should be disallowed for the following reasons: (1) it was not executed and attested as required by law; (2) it was not intended as the last will of the testator; and (3) it was procured by undue and improper pressure and influence on the part of the beneficiaries. Citing the same grounds invoked by Caponong, the alleged intestate heirs of Abada, namely, Joel, Julian, Paz, Evangeline, Geronimo, Humberto, Teodora and Elena Abada ("Joel Abada, et al."), and Levi, Leandro, Antonio, Florian, Hernani and Carmela Tronco ("Levi Tronco, et al."), also opposed the petition. The oppositors are the nephews, nieces and grandchildren of Abada and Toray. On 13 September 1968, Alipio filed another petition 6 before the RTC- Kabankalan, docketed as SP No. 071 (312-8669), for the probate of the last will and testament of Toray. Caponong, Joel Abada, et al., and Levi Tronco, et al. opposed the petition on the same grounds they cited in SP No. 070 (313-8668). On 20 September 1968, Caponong filed a petition 7 before the RTC-Kabankalan, docketed as SP No. 069 (309), praying for the issuance in his name of letters of administration of the intestate estate of Abada and Toray. In an Order dated 14 August 1981, the RTC-Kabankalan admitted to probate the will of Toray. Since the oppositors did not file any motion for reconsideration, the order allowing the probate of Toray's will became final and executory. 8 In an order dated 23 November 1990, the RTC-Kabankalan designated Belinda Caponong-Noble ("Caponong-Noble") Special Administratrix of the estate of Abada and Toray. 9Caponong-Noble moved for the dismissal of the petition for probate of the will of Abada. The RTC-Kabankalan denied the motion in an Order dated 20 August 1991. 10 Sometime in 1993, during the proceedings, Presiding Judge Rodolfo S. Layumas discovered that in an Order dated 16 March 1992, former Presiding Judge Edgardo Catilo had already submitted the case for decision. Thus, the RTC- Kabankalan rendered a Resolution dated 22 June 1994, as follows: There having been sufficient notice to the heirs as required by law; that there is substantial compliance with the formalities of a Will as the law directs and that the petitioner through his testimony and the deposition of Felix Gallinero was able to establish the regularity of the execution of the said Will and further, there being no evidence of bad faith and fraud, or substitution of the said Will, the Last Will and Testament of Alipio Abada dated June 4, 1932 is admitted and allowed probate. As prayed for by counsel, Noel Abbellar 11 is appointed administrator of the estate of Paula Toray who shall discharge his duties as such after letters of administration shall have been issued in his favor and after taking his oath and filing a bond in the amount of Ten Thousand (P10,000.00) Pesos. Mrs. Belinda C. Noble, the present administratrix of the estate of Alipio Abada shall continue discharging her duties as such until further orders from this Court. SO ORDERED. 12 The RTC-Kabankalan ruled on the only issue raised by the oppositors in their motions to dismiss the petition for probate, that is, whether the will of Abada has an attestation clause as required by law. The RTC-Kabankalan further held that the failure of the oppositors to raise any other matter forecloses all other issues. Not satisfied with the Resolution, Caponong-Noble filed a notice of appeal. In a Decision promulgated on 12 January 2001, the Court of Appeals affirmed the Resolution of the RTC-Kabankalan. The appellate court found that the RTC- Kabankalan properly admitted to probate the will of Abada. Hence, the present recourse by Caponong-Noble. The Issues The petition raises the following issues: 1.What laws apply to the probate of the last will of Abada; 2.Whether the will of Abada requires acknowledgment before a notary public; 13 3.Whether the will must expressly state that it is written in a language or dialect known to the testator; 4.Whether the will of Abada has an attestation clause, and if so, whether the attestation clause complies with the requirements of the applicable laws; 5.Whether Caponong-Noble is precluded from raising the issue of whether the will of Abada is written in a language known to Abada; 6.Whether evidence aliunde may be resorted to in the probate of the will of Abada. The Ruling of the Court The Court of Appeals did not err in sustaining the RTC-Kabankalan in admitting to probate the will of Abada. The Applicable Law Abada executed his will on 4 June 1932. The laws in force at that time are the Civil Code of 1889 or the Old Civil Code, and Act No. 190 or the Code of Civil Procedure 14 which governed the execution of wills before the enactment of the New Civil Code. The matter in dispute in the present case is the attestation clause in the will of Abada. Section 618 of the Code of Civil Procedure, as amended by Act No. 2645, 15 governs the form of the attestation clause of Abada's will. 16 Section 618 of the Code of Civil Procedure, as amended, provides: SEC. 618.Requisites of will. No will, except as provided in the preceding section, 17 shall be valid to pass any estate, real or personal, nor charge or affect the same, unless it be written in the language or dialect known by the testator and signed by him, or by the testator's name written by some other person in his presence, and by his express direction, and attested and subscribed by three or more credible witnesses in the presence of the testator and of each other. The testator or the person requested by him to write his name and the instrumental witnesses of the will, shall also sign, as aforesaid, each and every page thereof, on the left margin, and said pages shall be numbered correlatively in letters placed on the upper part of each sheet. The attestation shall state the number of sheets or pages used, upon which the will is written, and the fact that the testator signed the will and every page thereof, or caused some other person to write his name, under his express direction, in the presence of three witnesses, and the latter witnessed and signed the will and all pages thereof in the presence of the testator and of each other. Requisites of a Will under the Code of Civil Procedure Under Section 618 of the Code of Civil Procedure, the requisites of a will are the following: (1)The will must be written in the language or dialect known by the testator; (2)The will must be signed by the testator, or by the testator's name written by some other person in his presence, and by his express direction; (3)The will must be attested and subscribed by three or more credible witnesses in the presence of the testator and of each other; (4)The testator or the person requested by him to write his name and the instrumental witnesses of the will must sign each and every page of the will on the left margin; (5)The pages of the will must be numbered correlatively in letters placed on the upper part of each sheet; (6)The attestation shall state the number of sheets or pages used, upon which the will is written, and the fact that the testator signed the will and every page of the will, or caused some other person to write his name, under his express direction, in the presence of three witnesses, and the witnesses witnessed and signed the will and all pages of the will in the presence of the testator and of each other. Caponong-Noble asserts that the will of Abada does not indicate that it is written in a language or dialect known to the testator. Further, she maintains that the will is not acknowledged before a notary public. She cites in particular Articles 804 and 805 of the Old Civil Code, thus: Art. 804.Every will must be in writing and executed in [a] language or dialect known to the testator. Art. 806.Every will must be acknowledged before a notary public by the testator and the witnesses. . . . 18 Caponong-Noble actually cited Articles 804 and 806 of the New Civil Code. 19 Article 804 of the Old Civil Code is about the rights and obligations of administrators of the property of an absentee, while Article 806 of the Old Civil Code defines a legitime. Articles 804 and 806 of the New Civil Code are new provisions. Article 804 of the New Civil Code is taken from Section 618 of the Code of Civil Procedure. 20 Article 806 of the New Civil Code is taken from Article 685 of the Old Civil Code 21 which provides: Art. 685.The notary and two of the witnesses who authenticate the will must be acquainted with the testator, or, should they not know him, he shall be identified by two witnesses who are acquainted with him and are known to the notary and to the attesting witnesses. The notary and the witnesses shall also endeavor to assure themselves that the testator has, in their judgment, the legal capacity required to make a will.
Witnesses authenticating a will without the attendance of a notary, in cases falling under Articles 700 and 701, are also required to know the testator. However, the Code of Civil Procedure 22 repealed Article 685 of the Old Civil Code. Under the Code of Civil Procedure, the intervention of a notary is not necessary in the execution of any will. 23 Therefore, Abada's will does not require acknowledgment before a notary public. HCaDET Caponong-Noble points out that nowhere in the will can one discern that Abada knew the Spanish language. She alleges that such defect is fatal and must result in the disallowance of the will. On this issue, the Court of Appeals held that the matter was not raised in the motion to dismiss, and that it is now too late to raise the issue on appeal. We agree with Caponong-Noble that the doctrine of estoppel does not apply in probate proceedings. 24 In addition, the language used in the will is part of the requisites under Section 618 of the Code of Civil Procedure and the Court deems it proper to pass upon this issue. Nevertheless, Caponong-Noble's contention must still fail. There is no statutory requirement to state in the will itself that the testator knew the language or dialect used in the will. 25 This is a matter that a party may establish by proof aliunde. 26 Caponong-Noble further argues that Alipio, in his testimony, has failed, among others, to show that Abada knew or understood the contents of the will and the Spanish language used in the will. However, Alipio testified that Abada used to gather Spanish-speaking people in their place. In these gatherings, Abada and his companions would talk in the Spanish language. 27 This sufficiently proves that Abada speaks the Spanish language. The Attestation Clause of Abada's Will A scrutiny of Abada's will shows that it has an attestation clause. The attestation clause of Abada's will reads: Suscrito y declarado por el testador Alipio Abada como su ultima voluntad y testamento en presencia de nosotros, habiendo tambien el testador firmado en nuestra presencia en el margen izquierdo de todas y cada una de las hojas del mismo. Y en testimonio de ello, cada uno de nosotros lo firmamos en presencia de nosotros y del testador al pie de este documento y en el margen izquierdo de todas y cada una de las dos hojas de que esta compuesto el mismo, las cuales estan paginadas correlativamente con las letras "UNO" y "DOS' en la parte superior de la carrilla. 28 Caponong-Noble proceeds to point out several defects in the attestation clause. Caponong-Noble alleges that the attestation clause fails to state the number of pages on which the will is written. The allegation has no merit. The phrase "en el margen izquierdo de todas y cada una de las dos hojas de que esta compuesto el mismo" which means "in the left margin of each and every one of the two pages consisting of the same" shows that the will consists of two pages. The pages are numbered correlatively with the letters "ONE" and "TWO" as can be gleaned from the phrase "las cuales estan paginadas correlativamente con las letras "UNO" y "DOS." Caponong-Noble further alleges that the attestation clause fails to state expressly that the testator signed the will and its every page in the presence of three witnesses. She then faults the Court of Appeals for applying to the present case the rule on substantial compliance found in Article 809 of the New Civil Code. 29 The first sentence of the attestation clause reads: "Suscrito y declarado por el testador Alipio Abada como su ultima voluntad y testamento en presencia de nosotros, habiendo tambien el testador firmado en nuestra presencia en el margen izquierdo de todas y cada una de las hojas del mismo." The English translation is: "Subscribed and professed by the testator Alipio Abada as his last will and testament in our presence, the testator having also signed it in our presence on the left margin of each and every one of the pages of the same." The attestation clause clearly states that Abada signed the will and its every page in the presence of the witnesses. However, Caponong-Noble is correct in saying that the attestation clause does not indicate the number of witnesses. On this point, the Court agrees with the appellate court in applying the rule on substantial compliance in determining the number of witnesses. While the attestation clause does not state the number of witnesses, a close inspection of the will shows that three witnesses signed it. This Court has applied the rule on substantial compliance even before the effectivity of the New Civil Code. In Dichoso de Ticson v. De Gorostiza, 30 the Court recognized that there are two divergent tendencies in the law on wills, one being based on strict construction and the other on liberal construction. In Dichoso, the Court noted that Abangan v. Abangan, 31 the basic case on the liberal construction, is cited with approval in later decisions of the Court. In Adeva vda. De Leynez v. Leynez, 32 the petitioner, arguing for liberal construction of applicable laws, enumerated a long line of cases to support her argument while the respondent, contending that the rule on strict construction should apply, also cited a long series of cases to support his view. The Court, after examining the cases invoked by the parties, held: . . . It is, of course, not possible to lay down a general rule, rigid and inflexible, which would be applicable to all cases. More than anything else, the facts and circumstances of record are to be considered in the application of any given rule. If the surrounding circumstances point to a regular execution of the will, and the instrument appears to have been executed substantially in accordance with the requirements of the law, the inclination should, in the absence of any suggestion of bad faith, forgery or fraud, lean towards its admission to probate, although the document may suffer from some imperfection of language, or other non- essential defect. . . . . An attestation clause is made for the purpose of preserving, in permanent form, a record of the facts attending the execution of the will, so that in case of failure of the memory of the subscribing witnesses, or other casualty, they may still be proved. (Thompson on Wills, 2d ed., sec. 132.) A will, therefore, should not be rejected where its attestation clause serves the purpose of the law. . . . 33 We rule to apply the liberal construction in the probate of Abada's will. Abada's will clearly shows four signatures: that of Abada and of three other persons. It is reasonable to conclude that there are three witnesses to the will. The question on the number of the witnesses is answered by an examination of the will itself and without the need for presentation of evidence aliunde. The Court explained the extent and limits of the rule on liberal construction, thus: [T]he so-called liberal rule does not offer any puzzle or difficulty, nor does it open the door to serious consequences. The later decisions do tell us when and where to stop; they draw the dividing line with precision. They do not allow evidence aliunde to fill a void in any part of the document or supply missing details that should appear in the will itself. They only permit a probe into the will, an exploration within its confines, to ascertain its meaning or to determine the existence or absence of the requisite formalities of law. This clear, sharp limitation eliminates uncertainty and ought to banish any fear of dire results. 34 (Emphasis supplied) The phrase "en presencia de nosotros" or "in our presence" coupled with the signatures appearing on the will itself and after the attestation clause could only mean that: (1) Abada subscribed to and professed before the three witnesses that the document was his last will, and (2) Abada signed the will and the left margin of each page of the will in the presence of these three witnesses. ATCEIc Finally, Caponong-Noble alleges that the attestation clause does not expressly state the circumstances that the witnesses witnessed and signed the will and all its pages in the presence of the testator and of each other. This Court has ruled: Precision of language in the drafting of an attestation clause is desirable. However, it is not imperative that a parrot-like copy of the words of the statute be made. It is sufficient if from the language employed it can reasonably be deduced that the attestation clause fulfills what the law expects of it. 35 The last part of the attestation clause states "en testimonio de ello, cada uno de nosotros lo firmamos en presencia de nosotros y del testador." In English, this means "in its witness, every one of us also signed in our presence and of the testator." This clearly shows that the attesting witnesses witnessed the signing of the will of the testator, and that each witness signed the will in the presence of one another and of the testator. WHEREFORE, we AFFIRM the Decision of the Court of Appeals of 12 January 2001 in CA-G.R. CV No. 47644. SO ORDERED. Davide, Jr., C.J., Quisumbing, Ynares-Santiago and Azcuna, JJ., concur. Footnotes 1.Under Rule 45 of the 1997 Rules of Civil Procedure. 2.Penned by Associate Justice Presbitero J. Velasco, Jr. (now Court Administrator) with Associate Justices Ruben T. Reyes and Juan Q. Enriquez, Jr., concurring. 3.Penned by Presiding Judge Rodolfo S. Layumas. 4.Alipio C. Abaja tried to secure a copy of Abada's death certificate but the Local Civil Registrar of Cawayan, Negros Occidental informed him that all the records of pre-war deaths were destroyed during the war. 5.In the matter of the Probate of the Last Will and Testament of the late Alipio Abada. 6.In the matter of the Probate of the Last Will and Testament of the late Paula Toray. 7.In the matter of the Intestate Estate of Spouses Alipio Abada and Paula Toray. Petition for Letters of Administration.
8.Records, p. 38. 9.Ibid., p. 41. 10.Ibid., pp. 42-45. 11.It should be Abellar. 12.Rollo, p. 47. 13.Petitioner phrases this issue as to whether the will has to be "notarized." A notarized document includes one that is subscribed and sworn under oath or one that contains a jurat. Acknowledgment is different. Acknowledgment refers to an act in which an individual on a single occasion: (a) appears in person before the notary public and presents an integrally complete instrument or document; (b) is attested to be personally known to the notary public or identified by the notary public through competent evidence of identity as defined by these Rules; and (c) represents to the notary public that the signature on the instrument or document was voluntarily affixed by him for the purposes stated in the instrument or document, declares that he has executed the instrument or document as his free and voluntary act and deed, and, if he acts in a particular representative capacity, that he has the authority to sign in that capacity. (See Section 1, Rule II of 2004 Rules of Notarial Practice) 14.The Code of Civil Procedure took effect on 1 September 1901. 15.An Act amending section six hundred and eighteen of Act Numbered One hundred and ninety, entitled "An Act providing A Code of Procedure in Civil Actions and Special Proceedings in the Philippine Islands," prescribing additional requirement in the execution of wills. It took effect on 1 July 1916. 16.The validity of the execution of a will is governed by the statutes in the force at the time of its execution (In re will of Riosa, 39 Phil. 23 [1918]). Article 795 of the New Civil Code provides: "The validity of a will as to its form depends upon the observance of the law in force at the time it is made." 17.Section 617 governs wills executed by a Spaniard or a resident of the Philippine Islands before Act No. 190 came into force on 1 September 1901. 18.Rollo, p. 151. 19.The New Civil Code took effect on 30 August 1950. 20.TOLENTINO, CIVIL CODE OF THE PHILIPPINES, 67 Vol. III (1998). 21.Ibid., p. 101. 22.FISHER, THE CIVIL CODE OF SPAIN, 198 (1921). 23.Valera v. Purugganan, 4 Phil. 719 (1905). 24.See Fernandez, et al. v. Dimagiba, 128 Phil. 450 (1967). 25.Lopez v. Liboro, 81 Phil. 429 (1948). 26.Ibid. 27.TSN, 26 October 1989, p. 74. 28.Exhibit "A," Folder. 29.Article 809 of the New Civil Code provides: Art. 809. In the absence of bad faith, forgery, or fraud, or undue and improper pressure and influence, defects and imperfections in the form of attestation or in the language used therein shall not render the will invalid if it is proved that the will was in fact executed and attested in substantial compliance with all the requirements of article 805. 30.57 Phil. 437 (1932). 31.40 Phil. 476 (1919). 32.68 Phil. 745 (1939). 33.Ibid. 34.Gil v. Murciano, Resolution on the Motion for Reconsideration, dated 20 March 1953, 88 Phil. 260 (1951). See also Caneda v. Court of Appeals, G.R. No. 103554, 28 May 1993, 222 SCRA 781, where the Court explained the extent and limits of Article 809 of the New Civil Code. 35.Dichoso de Ticson v. De Gorostiza, supra, see note 31.
||| (Testate Estate of Abada v. Abaja, G.R. No. 147145, January 31, 2005)