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SECTION 1 Bond to be given before issuance of letters; Amount; Conditions. Before a guardian appointed enters upon the execution of his trust, or letters of guardianship issue, he shall give a bond, in such sum as the court directs, conditioned as follows: (a.)To make and return to the court, within three (3) months, a true and complete inventory of all the estate, real and personal, of his ward which shall come to his possession or knowledge or to the possession or knowledge of any other person for him; (b) To faithfully execute the duties of his trust, to manage and dispose of the estate according to these rules for the best interests of the ward, and to provide for the proper care, custody, and education of the ward; (c) To render a true and just account of all the estate of the ward in his hands, and of all proceeds or interest derived therefrom, and of the management and disposition of the same, at the time designated by these rules and such other times as the court directs; and at the expiration of his trust to settle his accounts with the court and deliver and pay over all the estate, effects, and moneys remaining in his hands, or due from him on such settlement, to the person lawfully entitled thereto; d) To perform all orders of the court by him to be performed.
CONDITIONS OF THE BOND: 1. To file with the court a complete inventory of the estate if the ward within three (3) months. 2. To faithfully execute the duties of his trust to manage and dispose of the estatea according to the Rules of Court for the best interest of the ward, and to provide for the proper care, custody and education of the ward. 3. To render a true account of all the estate, and of the management and disposition of the same. 4. To settle his accounts with the court and deliver over all the estate remaining in his hands to the person entitled thereto. 5. To perform all orders of the court by him to be performed. PURPOSES OF THE BOND: • Protect the minor or incompetent’s property to the end that he may be assured of an honest administration of his funds. • Provide security to those interested in the proper settlement of the estate. NECESSITY FOR THE BOND • When required by statutes to give bond, no person can qualify and act as guardian without complying with this condition precedent. • The court should not grant letters of guardianship without requiring a bond. • Amount - Must be fixed by the court with reference to the infant’s estate; - In fixing the amount, the court is not bound by the allegations in the petition as to the value of the estate
it may be prosecuted in the (A. • Right of Surety Sureties of the guardian against whom judgment has been entered may demand the benefit of a levy (exclusion) of the principal’s property even when judgment is rendered against both surety and principal. for the use and benefit of the ward or of any other person legally interested in the estate. • Liability of Sureties Depends on the extent of the obligation created by the terms of the bond and statutes. TERAN Facts: Salvador Guerrero (plaintiff) commenced an action against Leopoldo Teran to recover the sum of P4.) separate action.129. 56 and costs. CASE 1: GUERRERO vs. 1906.) same guardianship proceeding or in a (B. ADDITIONAL BOND • It is within the authority of the court to accept a new bond from a guardian who has already given a bond to require additional security where such a course seems proper for the protection of the ward’s estate. to secure the wards in their individual rights. may be prosecuted in the same proceeding or in a separate action for the use and benefit of the ward or of any other person legally interested in the estate. While the power to require new or additional security is sometimes given by statute. after due notice to interested persons.TIME WHEN BOND TAKES EFFECT • As of the day of its date and of his appointment. SECTION 2 When new bond may be required and old sureties discharged Whenever it is deemed necessary. in case of the breach of a condition thereof. • When the bond given is insufficient. the court may require a new bond to be given by the guardian. Actions thereon Every bond given by a guardian shall be filed in the office of the clerk of the court. when no injury can result therefrom to those interested in the estate. OTHER MATTERS • Bonds – How construed In accordance with the intention and scope of the guardian and his surety in giving it. it has been held to exist independently of any statutory provision. and. HOW MAY A GUARDIAN’S BOND BE PROSECUTED? • In case of breach of the conditions of the bond. and may discharge the sureties on the old bond from further liability. 2 . notwithstanding the bond may have been filed later. until October. This amount was claimed by the Plaintiff from the Defendant upon the theory that the Defendant had been the administrator of the estate of Antonio Sanchez Munoz from the September. • Duty of Surety See that the conditions are fulfilled by the guardian. 1901. it is not only the right but the duty of the court to require additional security. And a new bond may be required when the guardian is about to receive funds not in contemplation when the original bond was executed. SECTION 3 Bonds to be filed.
Held: The Defendant Leopoldo Teran was. that she had been removed as said guardian did not relieve her. until the 6th day of October. still owed to the Defendant the difference between P188. While there are some indications in the record that the Defendant continued to act as the administrator of said estate after the appointment of the said Maria Munoz y Gomez. owed the Plaintiff the sum of P3. 14. 39 but claimed that the Plaintiff owed him the sum of P482. The order therefore revoking the appointment of the said Maria Munoz y Gomez became final.The defendant admitted that he owed the Plaintiff P188. 1906. or in the improvement or security of other real estate of the ward. the guardian may present a 3 . must be held responsible for the property belonging to said minors during the period while she (Maria Munoz y Gomez) was the actual guardian of said minors. Issue: Whether Munoz is relieved from her liability as guardian after her appointment as guardian has been revoked. for which latter amount the Defendant prayed for judgment. as administrator of the estate of Antonio Sanchez Muñoz. or invested in some productive security. 1902. up to and including the 6th day of October. After hearing the lower court found from the evidence that the Defendant. The record however discloses that upon the March 18. 75. appointed as administrator of said estate. • The bond of the guardian is a continuing one against the obligors and their estates until all of its conditions are fulfilled. which appeal was subsequently withdrawn. 39 and P482. nor her bondsmen from liability to the minors during the time that she was duly acting as said guardian. therefore. yet the fact exists that the said Maria Munoz Gomez was the actual representative of the said Maria Manuela and Maria del Carmen Sanchez Munoz in the administration of their interests in the estate of the said Antonio Sanchez Munoz. or the sum of P293. however. From this decision. the Defendant appealed averring that the court erred in holding that the Defendant. 1906. and therefore the said Maria Munoz y Gomez. as such guardian and administratrix of the estate of the said minors. and the proceeds thereof put out at interest. 1902. with interest and costs against the Plaintiff.447. 1901. RULE 95 SELLING AND ENCUMBERING PROPERTY OF WARD SECTION 1 Petition of guardian for leave to sell or encumber estate When the income of an estate under guardianship is insufficient to maintain the ward and his family. or to maintain and educate the ward when a minor. with interest until fully paid. and that the Plaintiff. 14. The mere fact. from September 1901 to October 1906 managed and administered the estate of Sanchez Muñoz as a judicial administrator or executor. or mortgaged or otherwise encumbered. on the September 17. the Court of First Instance appointed Maria Munoz y Gomez as guardian for Maria Manuela and Maria del Carmen Sanchez Munoz. 46. from and after the 18th day of March. From the order of the judge annulling the appointment of the said Maria Munoz y Gomez her lawyers appealed to the Supreme Court. or when it appears that it is for the benefit of the ward that his real estate or some part thereof be sold.
to appear at a reasonable time and place therein specified to show cause why the prayer of the petition should not be granted. Issue: Does the sale by a guardian of a minor's property require judicial approval? Held: YES. statute or order of court • A sale of the ward’s realty by the guardian without authority of the court is void. SECTION 2 Order to show cause thereupon If it seems probable that such sale or encumbrance is necessary. or b. the court shall make an order directing the next of kin of the ward. 4. the powers and duties of the widow as legal administrator of her minor children's property are merely powers of possession and management. Note: Petition must be verified. Under Art. owned a parel of registered land which their mother (Dolores) as guardian.000. WHEN SHALL THE COURT MAKE AN ORDER DIRECTING NEXT OF KIN AND ALL INTERESTED PERSONS TO SHOW CAUSE WHY PETITON SHOULD BE GRANTED: If it seems probable that such sale or encumbrance a. CA Facts: Plaintiffs as minors.verified petition to the court by which he was appointed setting forth such facts. Hence. a parent acting merely as a legal administrator of the property of his minor children does not have the power to dispose of or alienate the property of the said child without judicial approval. Hearing so that they may show cause why petition should not be granted.00 under a deed of absolute sale to the spouses Apolonia and Federico. encumber or dispose must 4 . It appears that it is for the benefit of the ward.) beneficial to the ward CASE 2: LINDAIN VS. The Regional trial Court ruled that the sale is indeed null and void.) necessary. or would be beneficial to the ward. Notice must be given to the next of kin of the ward and all persons interested in the estate. Petition must be verified 5. while upon appeal. the Court of Appeals (CA) confirmed the sale as valid and dismissed the complaint. mortgage. or 3. Hence this petition. 320 (NCC). The latter knew that the sale was without judicial approval but still proceeded with the transaction. sold for P2. and praying that an order issue authorizing the sale or encumbrance. Failure – not a jurisdictional defect • A guardian has no authority to sell real estate of his ward merely by reason of his general powers and in the absence of any authority to sell conferred by will. the power to sell. and all persons interested in the estate. The income is insufficient to maintain and educate ward and when a minor. GROUNDS (When Guardian may sell or encumber the Esate of the ward): 1. The plaintiffs now contend that the sale is null and void as it was without the court's approval. 6. The income of the estate of the minor or incompetent is insufficient to maintain the ward and his family 2. And under Rule 84 (Code of Civil Procedure).
the private respondent spouses are not purchasers in good faith as they knew right from the beginning the the transaction was without judicial approval. 5 . the incapacitated was and is under the actual care and custody of his sister. and only they or the creditors who may have been prejudiced by the sale have a right to object thereto. at a named place. Jr. to show cause why the prayer for the sale should not be granted.. and praying that the orders of the respondent court be corrected and the said court directed to revoke the sale. Further. contending that the sale was null and void by reason of the court's failure to adhere to Rule 96. and all persons interested in the estate. an incapacitated under the judicial guardianship of Eulalio Lopez. Salvacion Lopez filed a motion for reconsideration of the court's order authorizing said sale.proceed from the court. In pursuance of this authority. Gamboa and Adelaida Gamboa filed in the proceedings for guardianship. why such petition should not be granted. and upon the motion being denied. on a named date. was the judicial guardian. that a petition to sell the ward’s real estate will be presented to a named court. The order provided that if the guardian did not have funds to pay those debts. • Note: Notice is not necessary where the next of kin to the ward and all persons interested in the estate are her mother and guardian. and Magdalena Estate) WHEN NOTICE IS SUFFICIENT (CONTENTS) • when it recites substantially that notice is thereby given. Jr. If notice omits to state the time or states a time subsequent to that at which the application was acted on. she brought this petition for certiorari and mandamus.. Court of First Instance. Although Eulalio Lopez. may not be dispensed with. Believing that the sale was prejudicial to her brother's interest. OPPOSITION TO SALE OR ENCUMBRANCE • Only the children have an interest in the land of their father besides the creditors. the court did not follow the requirement of to the effect that the court shall direct the next of kin of the ward. NEXT OF KIN • Not the next of kindred but those relatives who share in the estate according to the statute of distribution. uncles and aunts who agreed to make the transfer of their respective shares in the property to the corporation to be organized. including those claiming per stirpes or by representation. (Pardo de Tavera vs El Hogar Filipino Inc. Sr. the court acquires no jurisdiction to order the sale. he should take the necessary steps for the sale of some of the property of the guardianship. TEODORO Facts: Eulalio Lopez. Salvacion Lopez. the minors' action for reconveyance has not yet prescribed. Moreover. the guardian sold the above tract of land and bound himself to pay the mortgage debt and other obligations and to satisfy the balance in two installments. It is admitted that in authorizing the sale of some of the property of the incapacitated. ordered the guardian to pay the movants amounts which represented loans properly authorized by court. and when and where all persons interested may appear and show cause if they have any. and the sale is void. acting upon a motion of Senen L. was the absolute owner of a hacienda. hence. NOTICE IS JURISDICTIONAL The notice to the next of kin mandated under the provision is a jurisdictional requirement. to appear at a reasonable time and place to be specified in the order. CASE 3: LOPEZ vs.
if deemed expedient. or the education of the ward. while the petitioner is only the ward's sister. The order shall specify the causes why the sale or encumbrance is necessary or beneficial. SECTION 3 Hearing on return of order. ORDER OF SALE AND ENCUMBRANCE OF PROPERTY GROUNDS: The Order of Sale must specify the grounds 6 . The incapacitated has children. and should select the part or parts of the property which can be disposed of with the least injury to the ward. not inquire into the title of the property. to sell or encumber the estate. together with their witnesses. require an additional bond as a condition for the granting of the order of sale. and only they or the creditors who may have been prejudiced by the sale have a right to object thereto. one of whom is the judicial guardian. SECTION 4 Contents of order for sale or encumbrance. NATURE OF HEARING FOR SALE OF WARD’S ESTATE • The sole object of the inquiry on an application to sell ward’s real estate property is whether it is to the interest of the ward that the sale shall be made. and grant or refuse the prayer of the petition as the best interests of the ward require. The court however. but the judge may. None of the children of the incapacitated is or was opposed to the sale sought to be set aside. The court shall make such order as to costs of the hearing as may be just. without a sale being had. and her credit was not impaired. Costs At the time and place designated in the order to show cause.Issue: Whether the petitioner has legal interest as “Next of Kin. after full examination. besides the creditors. If. The original bond of the guardian shall stand as security for the proper appropriation of the proceeds of the sale. and security where a part of the payment is deferred. subject to such conditions as to the time and manner of payment. and how long effective. or the investment of the same as the circumstances may require. No order of sale granted in pursuance of this section shall continue in force more than one (1) year after granting the same. It is true that she was a creditor but she does not claim any right to be notified of the sale as such creditor. if a minor. as in the discretion of the court are deemed most beneficial to the ward. Petitioner has no legal interest in her complaint. it appears that it is necessary. • The court should ascertain and determine whether the facts required to the granting of the petition exist. or would be beneficial to the ward. Not being Eulalio Lopez's forced heir. and may direct that estate ordered sold be disposed of at either public or private sale. she was not prejudiced by the sale she seeks to impugn. and other persons interested. the court shall order such sale or encumbrance and that the proceeds thereof be expended for the maintenance of the ward and his family. the court shall hear the proofs and allegations of the petitioner and next of kin. all of age.” Held: "Next of kin” are relatives whose relationship is such that they are entitled to share in the estate as distributees. or for the putting of the same out at interest. Only these had an interest in the land of their father. Bond. or some portion of it.
Camarines Sur. A deed of sale was executed by Julia Rabacal. that the sale was not authorized by the court.00 to Rabacal. Issue: Whether or not the sale to Margate is Valid.00 and that the market price of the lot and house was P10. as there was a remaining balance of P500. she had already obtained from Margate the sum of P500. in order to defray the expenses in the prosecution of the Civil Case and for the support and education of the wards. and ordered that the same be registered in the name of Margate. she was unable to find a buyer for said parcel of land.000.000. and executed a deed of sale. acknowledged before a Notary Public. leading the court to cancel the granted authority to sell Appellants argue that the deed of sale executed by Rabacal had no binding effect because the authority to sell was cancelled and the sale was not approved by the guardianship Court. Rabacal) CASE 4: MARGATE VS RABACAL Facts: This is an application for the registration of a residential land with a house. Julio Berina. on which date Margate paid the balance of P3.00. Rabacal. either in person or through the mediation of another.00. the registration court confirmed the title of the applicant. who died survived by his widow. (facts as found by trial court: ) The parcel of land and house. 1491. selling the land in question to Margate for P4. She filed a petition alleging that it was necessary to sell parcel 4 of the inventory. Rabacal was appointed guardian of her minor children. After due hearing. and his minor children. on the ground that the property was under guardianship proceedings when sold. This petition was approved by the court. was owned by Dr. Civil Code) Reason: Guardianship is a trust of the highest order.000. Julia Rabacal.000. who claims to have purchased the property from Julia Rabacal for P4. Rabacal and her minor children opposed the application. Notwithstanding the fact that Rabacal had sold parcel 4 of the inventory. (Art. in the guardianship proceedings. Oppositors appealed to the Court of Appeals which certified the case to SC stating that the issues involved are purely legal in character. the order empowering the guardian to sell property belonging to the ward shall not be effective for more than one year after it has been granted. (Margate vs.00. After the agreement.500.00. Rabacal began getting money from Margate.00 was not fully paid. the oppositors herein. Rabacal offered to sell to Margate the residential lot in question. asserted that despite her efforts. (Lopez vs Teodoro) Note: There being a presumption that the sale of the ward’s estate is valid. it cannot be attacked collateraly in the registration proceedings.DURATION: Unlike the power granted to executors and administrators. by Jose Margate. EXTENSION: Authority to sell or encumber shall not extend beyond 1 year unless renewed by the court GUARDIAN CANNOT PURCHASE: The guardian among others cannot acquire by purchase even at a public or judicial auction. that the purchase price of P4. situated in Iriga. the property of the person or persons who may be under his guardianship. such that when Rabacal secured the authority to sell from the court. 7 . REMEDY: Appeal is the proper remedy against the order of the court authorizing the sale of the ward’s property. authorizing the guardian to sell the residential lot and its improvements.
where at the time that the order canceling the authority to sell was entered. and disposition of the estate and effects. after it was fulfilled by the guardian and there was nothing to cancel. This is deemed an act of dominion. The court may authorize and require the guardian to invest the proceeds of sales or encumbrances. the rights of the buyer. arising after the order of sale is clearly established. It is the guardian’s duty to apply the proceeds to the purposes for which the property was sold. The same rule applies if the term of the lease is longer than one year. INVESTMENT OF THE CHILDS MONEY In authorizing the guardian to invest the proceeds of the sale or encumbrance and any of his ward’s money in his hands in real estate or otherwise. COURT MAY RATIFY THE GUARDIAN’S INVESTMENT LEASE A guardian may lease the property of the ward. DUTY OF GUARDIAN IN INVESTING WARD’S MONEY The guardian is normally the proper custodian of the moneys arising from the sale of the ward’s land. affect. SECTION 5 Court may order investment of proceeds and direct management of estate. and any other of his ward's money in his hands. Account for and turn over the proceeds to ward once the latter reaches majority or becomes entitled. If the lease would be recorded –proper authority of the court. as shall be for the best interest of all concerned. in real estate or otherwise. the guardian had already acted in accordance with the authority and sold the property. as circumstances may require.Held: The cancellation of the authority to sell did not. the court must be guided by the best interest of the child. If the sale was ordered for reinvestment. and may make such other orders for the management. 8 . unless necessity therefore. the guardian has no right to apply the proceeds for the support of the ward. The authority had already been exhausted. investment. and could not.
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