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G.R. No. L-28040 August 18, 1972 TESTATE ESTATE OF JOSEFA TANGCO, JOSE DE BORJA, a !

"#"st$ato$-a%%&''&&( JOSE DE BORJA, as a !"#"st$ato$, CA)ETANO DE BORJA, *AT+LDE DE BORJA a# CR+SANTO DE BORJA , &-&as& . as C/"' $&# o0 Jos&0a Ta#g-o, appellees, vs. TAS+ANA 1DA. DE DE BORJA, S%&-"a' A !"#"st$at$"2 o0 t/& T&stat& Estat& o0 F$a#-"s-o & Bo$3a, appellant. . G.R. No L-28458 August 18, 1972 TESTATE ESTATE OF T6E LATE FRANC+SCO DE BORJA, TAS+ANA O. 1DA. DE DE BORJA, special Administratrix appellee, vs. JOSE DE BORJA, oppositor-appellant. G.R. No. L-28511 August 18, 1972 TAS+ANA 0. 1DA. DE BORJA, as A !"#"st$at$"2 o0 t/& T&stat& Estat& o0 t/& 'at& F$a#-"s-o & Bo$3a, plaintiff-appellee, vs. JOSE DE BORJA, as A !"#"st$ato$ o0 t/& T&stat& Estat& o0 t/& 'at& Jos&0a Ta#g-o, defendant-appellant. L-28040 Pelaez, Jalandoni & Jamir for administrator-appellee. Quiogue & Quiogue for appellee Matilde de Bor a. !ndres Matias for appellee "a#etano de Bor a. $e%illa & !&uino for appellant. L-28'(8 $e%illa & !&uino for spe)ial administratri*-appellee. Pelaez, Jalandoni & Jamir for oppositor-appellant. L-28(++ $e%illa & !&uino for plaintiff-appellee. Pelaez, Jalandoni & Jamir and ,a%id -ue%erra for defendant-appellant. RE)ES, J.B.L., J.:p Of these cases, the first, numbered L-28040 is an appeal by asiana On!sin!co "da. de de #or$a, special administratrix of the testate estate of %rancisco de #or$a, 1 from the approval of a compromise a!reement by the &ourt of %irst 'nstance of (i)al, #ranch ', in its *pecial +roceedin! ,o. (--8.., entitled, / estate 0state of 1osefa an!co, 1ose de #or$a, Administrator/. &ase ,o. L-282.8 is an appeal by administrator 1ose #or$a from the disapproval of the same compromise a!reement by the &ourt of %irst 'nstance of ,ueva 0ci$a, #ranch '', in its *pecial +roceedin! ,o. 832, entitled, / estate 0state of %rancisco de #or$a, asiana O. "da. de de #or$a, *pecial Administratrix/.

And &ase ,o. L-28.44 is an appeal by administrator 1ose de #or$a from the decision of the &ourt of %irst 'nstance of (i)al, #ranch 5, in its &ivil &ase ,o. -422, declarin! the 6acienda 1ala$ala +oblacion, 7hich is the main ob$ect of the aforesaid compromise a!reement, as the separate and exclusive property of the late %rancisco de #or$a and not a con$u!al asset of the community 7ith his first 7ife, 1osefa an!co, and that said hacienda pertains exclusively to his testate estate, 7hich is under administrator in *pecial +roceedin! ,o. 832 of the &ourt of %irst 'nstance of ,ueva 0ci$a, #ranch ''. 't is uncontested that %rancisco de #or$a, upon the death of his 7ife 1osefa an!co on . October 4840, filed a petition for the probate of her 7ill 7hich 7as doc9eted as *pecial +roceedin! ,o. (--8.. of the &ourt of %irst 'nstance of (i)al, #ranch '. he 7ill 7as probated on 2 April 4844. 'n 484., %rancisco de #or$a 7as appointed executor and administrator: in 4822, their son, 1ose de #or$a, 7as appointed co-administrator. ;hen %rancisco died, on 44 April 4824, 1ose became the sole administrator of the testate estate of his mother, 1osefa an!co. ;hile a 7ido7er %rancisco de #or$a alle!edly too9 unto himself a second 7ife, asiana On!sin!co. <pon %rancisco=s death, asiana instituted testate proceedin!s in the &ourt of %irst 'nstance of ,ueva 0ci$a, 7here, in 4822, she 7as appointed special administratrix. he validity of asiana=s marria!e to %rancisco 7as >uestioned in said proceedin!. he relationship bet7een the children of the first marria!e and asiana On!sin!co has been pla!ued 7ith several court suits and counter-suits? includin! the three cases at bar, some ei!hteen @48A cases remain pendin! determination in the courts. he testate estate of 1osefa an!co alone has been unsettled for more than a >uarter of a century. 'n order to put an end to all these liti!ations, a compromise a!reement 7as entered into on 42 October 48.3, 2 by and bet7een /B Che heir and son of %rancisco de #or$a by his first marria!e, namely, 1ose de #or$a personally and as administrator of the estate 0state of 1osefa an!co,/ and /B Che heir and survivin! spouse of %rancisco de #or$a by his second marria!e, asiana On!sin!co "da. de #or$a, assisted by her la7yer, Atty. Luis +ana!uiton 1r./ he terms and conditions of the compromise a!reement are as follo7s:
AD(00E0, 6'* AD(00E0, made and entered into by and bet7een he heir and son of %rancisco de #or$a by his first marria!e, namely, 1ose de #or$a personally and as administrator of the estate 0state of 1osefa an!co, A,F he heir and survivin! spouse of %rancisco de #or$a by his second marria!e, asiana On!sin!co "da. de #or$a, assisted by her la7yer, Atty. Luis +ana!uiton 1r. ;' ,0**0 6 6A it is the mutual desire of all the parties herein terminate and settle, 7ith finality, the various court liti!ations, controversies, claims, counterclaims, etc., bet7een them in connection 7ith the administration, settlement, partition, ad$udication and distribution of the assets as 7ell as liabilities of the estates of %rancisco de #or$a and 1osefa an!co, first spouse of %rancisco de #or$a. 6A 7ith this end in vie7, the parties herein have a!reed voluntarily and 7ithout any reservations to enter into and execute this a!reement under the follo7in! terms and conditions: 4. hat the parties a!ree to sell the +oblacion portion of the 1ala$ala properties situated in 1ala$ala, (i)al, presently under administration in the estate 0state of 1osefa an!co @*p. +roc. ,o. -8.., (i)alA, more specifically described as follo7s:

Linda al ,orte con el (io +u7an! >ue la separa de la $urisdiccion del Eunicipio de +ililla de la +rovincia de (i)al, y con el pico del Eonte Gambrano? al Oeste con La!una de #ay? por el *ur con los herederos de Earcelo de #or$a? y por el 0ste con los terrenos de la %amilia Earonilla 7ith a se!re!ated area of approximately 4,343 hectares at the amount of +0.30 per s>uare meter. 2. hat 1ose de #or$a a!rees and obli!ates himself to pay asiana On!sin!co "da. de de #or$a the total amount of 0i!ht 6undred housand +esos @+800,000A +hilippine &urrency, in cash, 7hich represent +200,000 as his share in the payment and +.00,000 as pro-rata shares of the heirs &risanto, &ayetano and Eatilde, all surnamed de #or$a and this shall be considered as full and complete payment and settlement of her hereditary share in the estate of the late %rancisco de #or$a as 7ell as the estate of 1osefa an!co, *p. +roc. ,o. 832-,ueva 0ci$a and *p. +roc. ,o. -8..-(i)al, respectively, and to any properties be>ueathed or devised in her favor by the late %rancisco de #or$a by Last ;ill and estament or by Fonation 'nter "ivos or Eortis &ausa or purportedly conveyed to her for consideration or other7ise. he funds for this payment shall be ta9en from and shall depend upon the receipt of full payment of the proceeds of the sale of 1ala$ala, /+oblacion./ 3. hat asiana On!sin!co "da. de de #or$a hereby assumes payment of that particular obli!ation incurred by the late %rancisco de #or$a in favor of the (ehabilitation %inance &orporation, no7 Fevelopment #an9 of the +hilippines, amountin! to approximately +30,000.00 and also assumes payment of her 4H2 share of the 0state and 'nheritance taxes on the 0state of the late %rancisco de #or$a or the sum of +3,200.00, more or less, 7hich shall be deducted by the buyer of 1ala$ala, /+oblacion/ from the payment to be made to asiana On!sin!co "da. de #or$a under para!raph 2 of this A!reement and paid directly to the Fevelopment #an9 of the +hilippines and the heirs-children of %rancisco de #or$a. 4. hereafter, the buyer of 1ala$ala /+oblacion/ is hereby authori)ed to pay directly to asiana On!sin!co "da. de de #or$a the balance of the payment due her under para!raph 2 of this A!reement @approximately +-..,200.00A and issue in the name of asiana On!sin!co "da. de de #or$a, correspondin! certified chec9sHtreasury 7arrants, 7ho, in turn, 7ill issue the correspondin! receipt to 1ose de #or$a. 2. 'n consideration of above payment to asiana On!sin!co "da. de de #or$a, 1ose de #or$a personally and as administrator of the estate 0state of 1osefa an!co, and asiana On!sin!co "da. de de #or$a, for themselves and for their heirs, successors, executors, administrators, and assi!ns, hereby forever mutually renounce, 7ithdra7, 7aive, remise, release and dischar!e any and all manner of action or actions, cause or causes of action, suits, debts, sum or sums of money, accounts, dama!es, claims and demands 7hatsoever, in la7 or in e>uity, 7hich they ever had, or no7 have or may have a!ainst each other, more specifically *p. +roceedin!s ,os. -8.. and 4822, &%'-(i)al, and *p. +roc. ,o. 832-,ueva 0ci$a, &ivil &ase ,o. 3033, &%' ,ueva 0ci$a and &ivil &ase ,o. -422-&%', (i)al, as 7ell as the case filed a!ainst Eanuel Iui$al for per$ury 7ith the +rovincial %iscal of (i)al, the intention bein! to completely, absolutely and finally release each other, their heirs, successors, and assi!ns, from any and all liability, arisin! 7holly or partially, directly or indirectly, from the administration, settlement, and distribution of the assets as 7ell as liabilities of the estates of %rancisco de #or$a and 1osefa an!co, first spouse of %rancisco de #or$a, and lastly, asiana On!sin!co "da. de de #or$a expressly and specifically renounce absolutely her ri!hts as heir over any hereditary share in the estate of %rancisco de #or$a. .. hat asiana On!sin!co "da. de de #or$a, upon receipt of the payment under para!raph 4 hereof, shall deliver to the heir 1ose de #or$a all the papers, titles and documents belon!in! to %rancisco de #or$a 7hich are in her possession and said heir 1ose de #or$a shall issue in turn the correspondin! receive thereof. -. hat this a!reement shall ta9e effect only upon the fulfillment of the sale of the properties mentioned under para!raph 4 of this a!reement and upon receipt of the total and full payment of the proceeds of the sale of the 1ala$ala property /+oblacion/, other7ise, the non-fulfillment of the said sale 7ill render this instrument ,<LL A,F "O'F A,F ;' 6O< 0%%0& 60(0A% 0(.

', ;' ,0** ;60(0O%, the parties hereto have her unto set their hands in the &ity of Eanila, +hilippines, the 42th of October, 48.3.

On 4. Eay 48.., 1ose de #or$a submitted for &ourt approval the a!reement of 42 October 48.3 to the &ourt of %irst 'nstance of (i)al, in *pecial +roceedin! ,o. (--8..? and a!ain, on 8 Au!ust 48.., to the &ourt of %irst 'nstance of ,ueva 0ci$a, in *pecial +roceedin! ,o. 832. asiana On!sin!co "da. de de #or$a opposed in both instances. he (i)al court approved the compromise a!reement, but the ,ueva 0ci$a court declared it void and unenforceable. *pecial administratrix asiana On!sin!co "da. de de #or$a appealed the (i)al &ourt=s order of approval @no7 *upreme &ourt D.(. case ,o. L-28040A, 7hile administrator 1ose de #or$a appealed the order of disapproval @D.(. case ,o. L-282.8A by the &ourt of %irst 'nstance of ,ueva 0ci$a. he !enuineness and due execution of the compromised a!reement of 42 October 48.3 is not disputed, but its validity is, nevertheless, attac9ed by asiana On!sin!co on the !round that: @4A the heirs cannot enter into such 9ind of a!reement 7ithout first probatin! the 7ill of %rancisco de #or$a? @2A that the same involves a compromise on the validity of the marria!e bet7een %rancisco de #or$a and asiana On!sin!co? and @3A that even if it 7ere valid, it has ceased to have force and effect. 'n assailin! the validity of the a!reement of 42 October 48.3, asiana On!sin!co and the +robate &ourt of ,ueva 0ci$a rely on this &ourt=s decision in -ue%ara %s. -ue%ara. -4 +hil. 4-8, 7herein the &ourt=s ma$ority held the vie7 that the presentation of a 7ill for probate is mandatory and that the settlement and distribution of an estate on the basis of intestacy 7hen the decedent left a 7ill, is a!ainst the la7 and public policy. 't is li9e7ise pointed out by appellant asiana On!sin!co that *ection 4 of (ule -4 of the (evised (ules explicitly conditions the validity of an extra$udicial settlement of a decedent=s estate by a!reement bet7een heirs, upon the facts that /@ifA the decedent left no .ill and no debts, and the heirs are all of a!e, or the minors are represented by their $udicial and le!al representatives .../ he 7ill of %rancisco de #or$a havin! been submitted to the ,ueva 0ci$a &ourt and still pendin! probate 7hen the 48.3 a!reement 7as made, those circumstances, it is ar!ued, bar the validity of the a!reement. <pon the other hand, in claimin! the validity of the compromise a!reement, 1ose de #or$a stresses that at the time it 7as entered into, on 42 October 48.3, the !overnin! provision 7as *ection 4, (ule -4 of the ori!inal (ules of &ourt of 4840, 7hich allo7ed the extra$udicial settlement of the estate of a deceased person re!ardless of 7hether he left a 7ill or not. 6e also relies on the dissentin! opinion of 1ustice Eoran, in -ue%ara %s. -ue%ara, -4 +hil. 4-8, 7herein 7as expressed the vie7 that if the parties have already divided the estate in accordance 7ith a decedent=s 7ill, the probate of the 7ill is a useless ceremony? and if they have divided the estate in a different manner, the probate of the 7ill is 7orse than useless. he doctrine of -ue%ara %s. -ue%ara, ante, is not applicable to the case at bar. his is apparent from an examination of the terms of the a!reement bet7een 1ose de #or$a and asiana On!sin!co. +ara!raph 2 of said a!reement specifically stipulates that the sum of +800,000 payable to asiana On!sin!co J
shall be considered as full J complete payment J settlement of her hereditary share in the estate of the late %rancisco de #or$a as 7ell as the estate of 1osefa an!co, ... and to any properties be>ueathed or devised in her favor by the late %rancisco de #or$a by Last ;ill and estament or by Fonation 'nter "ivos or Eortis &ausa or purportedly conveyed to her for consideration or other7ise.

his provision evidences beyond doubt that the rulin! in the Duevara case is not applicable to

the cases at bar. here 7as here no attempt to settle or distribute the estate of %rancisco de #or$a amon! the heirs thereto before the probate of his 7ill. he clear ob$ect of the contract 7as merely the conveyance by asiana On!sin!co of any and all her individual share and interest, actual or eventual in the estate of %rancisco de #or$a and 1osefa an!co. here is no stipulation as to any other claimant, creditor or le!atee. And as a hereditary share in a decedent=s estate is transmitted or vested immediately from the moment of the death of such )ausante or predecessor in interest @&ivil &ode of the +hilippines, Art. ---A 7 there is no le!al bar to a successor @7ith re>uisite contractin! capacityA disposin! of her or his hereditary share immediately after such death, even if the actual extent of such share is not determined until the subse>uent li>uidation of the estate. 4 Of course, the effect of such alienation is to be deemed limited to 7hat is ultimately ad$udicated to the vendor heir. 6o7ever, the aleatory character of the contract does not affect the validity of the transaction? neither does the coetaneous a!reement that the numerous liti!ations bet7een the parties @the approvin! order of the (i)al &ourt enumerates fourteen of them, (ec. App. pp. -8-82A are to be considered settled and should be dismissed, althou!h such stipulation, as noted by the (i)al &ourt, !ives the contract the character of a compromise that the la7 favors, for obvious reasons, if only because it serves to avoid a multiplicity of suits. 't is li9e7ise 7orthy of note in this connection that as the survivin! spouse of %rancisco de #or$a, asiana On!sin!co 7as his compulsory heir under article 882 et se&. of the present &ivil &ode. ;herefore, barrin! un7orthiness or valid disinheritance, her successional interest existed independent of %rancisco de #or$a=s last 7ill and testament and 7ould exist even if such 7ill 7ere not probated at all. hus, the prere>uisite of a previous probate of the 7ill, as established in the Duevara and analo!ous cases, can not apply to the case of asiana On!sin!co "da. de de #or$a. *ince the compromise contract Annex A 7as entered into by and bet7een /1ose de #or$a personally and as administrator of the estate 0state of 1osefa an!co/ on the one hand, and on the other, /the heir and survivin! spouse of %rancisco de #or$a by his second marria!e, asiana On!sin!co "da. de de #or$a/, it is clear that the transaction 7as bindin! on both in their individual capacities, upon the perfection of the contract, even 7ithout previous authority of the &ourt to enter into the same. he only difference bet7een an extra$udicial compromise and one that is submitted and approved by the &ourt, is that the latter can be enforced by execution proceedin!s. Art. 203- of the &ivil &ode is explicit on the point:
8. Art. 203-. A compromise has upon the parties the effect and authority of res udi)ata? but there shall be no execution except in compliance 7ith a $udicial compromise. 't is ar!ued by asiana On!sin!co that 7hile the a!reement Annex A expressed no definite period for its performance, the same 7as intended to have a resolutory period of .0 days for its effectiveness. 'n support of such contention, it is averred that such a limit 7as expressly stipulated in an a!reement in similar terms entered into by said On!sin!co 7ith the brothers and sister of 1ose de #or$a, to 7it, &risanto, Eatilde and &ayetano, all surnamed de #or$a, except that the consideration 7as fixed at +.00,000 @Opposition, AnnexH(ec. of Appeal, L-28040, pp. 38- 4.A and 7hich contained the follo7in! clause: '''. hat this a!reement shall ta9e effect only upon the consummation of the sale of the property mentioned herein and upon receipt of the total and full payment of the proceeds of the sale by the herein o7ner heirs-children of %rancisco de #or$a, namely, &risanto, &ayetano and Eatilde, all surnamed de #or$a? +rovided that if no sale of the said property mentioned herein is consummated, or the non-receipt of the purchase price thereof by the said o7ners 7ithin the period of sixty @.0A days from the date hereof, this a!reement 7ill become null and void and of no further effect.

On!sin!co=s ar!ument loses validity 7hen it is considered that 1ose de #or$a 7as not a party to this particular contract @Annex 4A, and that the same appears not to have been finali)ed, since it bears no date, the day bein! left blan9 /this J day of October 48.3/? and 7hile si!ned by the parties, it 7as not notari)ed, althou!h plainly intended to be so done, since it carries a proposed notarial ratification clause. %urthermore, the compromise contract 7ith 1ose de #or$a @Annex AA, provides in its par. 2 heretofore transcribed that of the total consideration of +800, 000 to be paid to On!sin!co, +.00,000 represent the /prorata share of the heirs &risanto, &ayetano and Eatilde all surnamed de #or$a/ 7hich corresponds to the consideration of +.00,000 recited in Annex 4, and that circumstance is proof that the duly notari)ed contract entered into 7it 1ose de #or$a under date 42 October 48.3 @Annex AA, 7as desi!ned to absorb and supersede the separate unformali)e a!reement 7ith the other three #or$a heirs. 6ence, the .0 days resolutory term in the contract 7ith the latter @Annex 4A not bein! repeated in Annex A, can not apply to the formal compromise 7ith 1ose de #or$a. 't is moreover manifest that the stipulation that the sale of the 6acienda de 1ala$ala 7as to be made 7ithin sixty days from the date of the a!reement 7ith 1ose de #or$a=s co-heirs @Annex 4A 7as plainly omitted in Annex A as improper and ineffective, since the 6acienda de 1ala$ala @+oblacionA that 7as to be sold to raise the +800,000 to be paid to On!sin!co for her share formed part of the estate of %rancisco de #or$a and could not be sold until authori)ed by the +robate &ourt. he &ourt of %irst 'nstance of (i)al so understood it, and in approvin! the compromise it fixed a term of 420 days counted from the finality of the order no7 under appeal, for the carryin! out by the parties for the terms of the contract. his brin!s us to the plea that the &ourt of %irst 'nstance of (i)al had no $urisdiction to approve the compromise 7ith 1ose de #or$a @Annex AA because asiana On!sin!co 7as not an heir in the estate of 1osefa an!co pendin! settlement in the (i)al &ourt, but she 7as an heir of %rancisco de #or$a, 7hose estate 7as the ob$ect of *pecial +roceedin! ,o. 832 of the &ourt of %irst 'nstance of ,ueva 0ci$a. his circumstance is irrelevant, since 7hat 7as sold by asiana On!sin!co 7as only her eventual share in the estate of her late husband, not the estate itself? and as already sho7n, that eventual share she o7ned from the time of %rancisco=s death and the &ourt of ,ueva 0ci$a could not bar her sellin! it. As o7ner of her undivided hereditary share, asiana could dispose of it in favor of 7homsoever she chose. *uch alienation is expressly reco!ni)ed and provided for by article 4088 of the present &ivil &ode:
Art. 4088. *hould any of the heirs sell his hereditary ri!hts to a stran!er before the partition, any or all of the co-heirs may be subro!ated to the ri!hts of the purchaser by reimbursin! him for the price of the sale, provided they do so 7ithin the period of one month from the time they 7ere notified in 7ritin! of the sale of the vendor.

'f a sale of a hereditary ri!ht can be made to a stran!er, then a fortiori sale thereof to a coheir could not be forbidden. asiana On!sin!co further ar!ues that her contract 7ith 1ose de #or$a @Annex /A/A is void because it amounts to a compromise as to her status and marria!e 7ith the late %rancisco de #or$a. he point is 7ithout merit, for the very openin! para!raph of the a!reement 7ith 1ose de #or$a @Annex /A/A describes her as /the heir and survivin! spouse of %rancisco de #or$a by his second marria!e, asiana On!sin!co "da. de de #or$a/, 7hich is in itself definite admission of her civil status. here is nothin! in the text of the a!reement that 7ould sho7 that this reco!nition of On!sin!co=s status as the survivin! spouse of %rancisco de #or$a 7as only made in consideration of the cession of her hereditary ri!hts. 't is finally char!ed by appellant On!sin!co, as 7ell as by the &ourt of %irst 'nstance of ,ueva

0ci$a in its order of 24 *eptember 48.4, in *pecial +roceedin!s ,o. 832 @Amended (ecord on Appeal in L-282.8, pa!e 42-A, that the compromise a!reement of 43 October 48.3 @Annex /A/A had been abandoned, as sho7n by the fact that, after its execution, the &ourt of %irst 'nstance of ,ueva 0ci$a, in its order of 24 *eptember 48.4, had declared that /no amicable settlement had been arrived at by the parties/, and that 1ose de #or$a himself, in a motion of 4- 1une 48.4, had stated that the proposed amicable settlement /had failed to materiali)e/. 't is difficult to believe, ho7ever, that the amicable settlement referred to in the order and motion above-mentioned 7as the compromise a!reement of 43 October 48.3, 7hich already had been formally si!ned and executed by the parties and duly notari)ed. ;hat the record discloses is that some time after its formali)ation, On!sin!co had unilaterally attempted to bac9 out from the compromise a!reement, pleadin! various reasons restated in the opposition to the &ourt=s approval of Annex /A/ @(ecord on Appeal, L-20840, pa!e 23A: that the same 7as invalid because of the lapse of the alle!edly intended resolutory period of .0 days and because the contract 7as not preceded by the probate of %rancisco de #or$a=s 7ill, as re>uired by this &ourt=s -ue%arra %s. -ue%ara rulin!? that Annex /A/ involved a compromise affectin! On!sin!co=s status as 7ife and 7ido7 of %rancisco de #or$a, etc., all of 7hich ob$ections have been already discussed. 't 7as natural that in vie7 of the 7ido7=s attitude, 1ose de #or$a should attempt to reach a ne7 settlement or novatory a!reement before see9in! $udicial sanction and enforcement of Annex /A/, since the latter step mi!ht ultimately entail a lon!er delay in attainin! final remedy. hat the attempt to reach another settlement failed is apparent from the letter of On!sin!co=s counsel to 1ose de #or$a >uoted in pa!es 32-3. of the brief for appellant On!sin!co in D.(. ,o. 28040? and it is more than probable that the order of 24 *eptember 48.4 and the motion of 4- 1une 48.4 referred to the failure of the parties= >uest for a more satisfactory compromise. #ut the inability to reach a novatory accord can not invalidate the ori!inal compromise @Annex /A/A and $ustifies the act of 1ose de #or$a in finally see9in! a court order for its approval and enforcement from the &ourt of %irst 'nstance of (i)al, 7hich, as heretofore described, decreed that the a!reement be ultimately performed 7ithin 420 days from the finality of the order, no7 under appeal. ;e conclude that in so doin!, the (i)al court acted in accordance 7ith la7, and, therefore, its order should be upheld, 7hile the contrary resolution of the &ourt of %irst 'nstance of ,ueva 0ci$a should be, and is, reversed. 'n her brief, asiana On!sin!co also pleads that the time elapsed in the appeal has affected her unfavorably, in that 7hile the purchasin! po7er of the a!reed price of +800,000 has diminished, the value of the 1ala$ala property has increased. #ut the fact is that her delay in receivin! the payment of the a!reed price for her hereditary interest 7as primarily due to her attempts to nullify the a!reement @Annex /A/A she had formally entered into 7ith the advice of her counsel, Attorney +ana!uiton. And as to the devaluation de fa)to of our currency, 7hat ;e said in ,izon /i%era %s. ,izon, L-242.4, 30 1une 48-0, 33 *&(A 224, that /estates 7ould never be settled if there 7ere to be a revaluation 7ith every subse>uent fluctuation in the values of currency and properties of the estate/, is particularly opposite in the present case. &omin! no7 to &ase D.(. ,o. L-28.44, the issue is 7hether the 6acienda de 1ala$ala @+oblacionA, concededly ac>uired by %rancisco de #or$a durin! his marria!e to his first 7ife, 1osefa an!co, is the husband=s private property @as contended by his second spouse, asiana On!sin!coA, or 7hether it forms part of the con$u!al @!anancialA partnership 7ith 1osefa an!co. he &ourt of %irst 'nstance of (i)al @1ud!e 6erminio Eariano, presidin!A declared that there 7as ade>uate evidence to overcome the presumption in favor of its con$u!al character established by Article 4.0 of the &ivil &ode.

;e are of the opinion that this >uestion as bet7een asiana On!sin!co and 1ose de #or$a has become moot and academic, in vie7 of the conclusion reached by this &ourt in the t7o precedin! cases @D.(. ,o. L-282.8A, upholdin! as valid the cession of asiana On!sin!co=s eventual share in the estate of her late husband, %rancisco de #or$a, for the sum of +800,000 7ith the accompanyin! reciprocal >uit-claims bet7een the parties. #ut as the >uestion may affect the ri!hts of possible creditors and le!atees, its resolution is still imperative. 't is undisputed that the 6acienda 1ala$ala, of around 4,3.3 hectares, had been ori!inally ac>uired $ointly by %rancisco de #or$a, #ernardo de #or$a and Earcelo de #or$a and their title thereto 7as duly re!istered in their names as co-o7ners in Land (e!istration &ase ,o. 228 of the province of (i)al, D.L.(.O. (ec. ,o. 2.403 @Fe #ar$o vs. 1u!o, 24 +hil. 4.2A. *ubse>uently, in 4834, the 6acienda 7as partitioned amon! the co-o7ners: the +unta section 7ent to Earcelo de #or$a? the #a!ombon! section to #ernardo de #or$a, and the part in 1ala$ala proper @+oblacionA corresponded to %rancisco de #or$a @". Fe #or$a vs. Fe #or$a 404 +hil. 844, 832A. he lot allotted to %rancisco 7as described as J
<na +arcela de terreno en +oblacion, 1ala$ala: ,. +uan! (iver? 0. 6ermo!ena (omero? *. 6eirs of Earcelo de #or$a O. La!una de #ay? containin! an area of 43,488,8-0 s>. m. more or less, assessed at +28-,440. @(ecord on Appeal, pa!es - and 402A

On 20 ,ovember 48.2, asiana O. "da. de #or$a, as Administratrix of the estate 0state of %rancisco de #or$a, instituted a complaint in the &ourt of %irst 'nstance of (i)al @&ivil &ase ,o. -422A a!ainst 1ose de #or$a, in his capacity as Administrator of 1osefa an!co @%rancisco de #or$a=s first 7ifeA, see9in! to have the 6acienda above described declared exclusive private property of %rancisco, 7hile in his ans7er defendant @no7 appellantA 1ose de #or$a claimed that it 7as con$u!al property of his parents @%rancisco de #or$a and 1osefa an!coA, conformably to the presumption established by Article 4.0 of the +hilippine &ivil &ode @reproducin! Article 440- of the &ivil &ode of 4888A, to the effect that:
Art. 4.0. All property of the marria!e is presumed to belon! to the con$u!al partnership, unless it be proved that it pertains exclusively to the husband or to the 7ife.

Fefendant 1ose de #or$a further counterclaimed for dama!es, compensatory, moral and exemplary, as 7ell as for attorney=s fees. After trial, the &ourt of %irst 'nstance of (i)al, per 1ud!e 6erminio Eariano, held that the plaintiff had adduced sufficient evidence to rebut the presumption, and declared the 6acienda de 1ala$ala @+oblacionA to be the exclusive private property of the late %rancisco de #or$a, and his Administratrix, asiana On!sin!co "da. de #or$a, to be entitled to its possession. Fefendant 1ose de #or$a then appealed to this &ourt. he evidence reveals, and the appealed order admits, that the character of the 6acienda in >uestion as o7ned by the con$u!al partnership Fe #or$a- an!co 7as solemnly admitted by the late %rancisco de #or$a no less than t7o times: first, in the (eamended 'nventory that, as executor of the estate of his deceased 7ife 1osefa an!co, he filed in the *pecial +roceedin!s ,o. -8.. of the &ourt of %irst 'nstance of (i)al on 23 1uly 4823 @0xhibit /2/A? and a!ain, in the (eamended Accountin! of the same date, also filed in the proceedin!s aforesaid @0xhibit /-/A. *imilarly, the plaintiff asiana O. "da. de #or$a, herself, as oppositor in the 0state of 1osefa an!co, submitted therein an inventory dated - *eptember 4824 @0xhibit /3/A listin! the 1ala$ala property amon! the /&on$u!al +roperties of the *pouses %rancisco de #or$a and 1osefa an!co/. And once more, asiana On!sin!co, as administratrix of the 0state of %rancisco de #or$a, in *pecial +roceedin!s ,o. 832 of the &ourt of %irst 'nstance of ,ueva

0ci$a, submitted therein in Fecember, 4822, an inventory 7herein she listed the 1ala$ala 6acienda under the headin! /&on$u!al +roperty of the Feceased *pouses %rancisco de #or$a and 1osefa an!co, 7hich are in the possession of the Administrator of the estate 0state of the Feceased 1osefa an!co in *pecial +roceedin!s ,o. -8.. of the &ourt of %irst 'nstance of (i)al/ @0xhibit /4/A. ,ot7ithstandin! the four statements aforesaid, and the fact that they are plain admissions a!ainst interest made by both %rancisco de #or$a and the Administratrix of his estate, in the course of $udicial proceedin!s in the (i)al and ,ueva 0ci$a &ourts, supportin! the le!al presumption in favor of the con$u!al community, the &ourt belo7 declared that the 6acienda de 1ala$ala @+oblacionA 7as not con$u!al property, but the private exclusive property of the late %rancisco de #or$a. 't did so on the stren!th of the follo7in! evidences: @aA the s7orn statement by %rancis de #or$a on . Au!ust 4824 @0xhibit /%/A that J
6e tomado possession del peda)o de terreno ya delimitado @e>uivalente a 4H4 parte, 33hectareasA ad$unto a mi terreno personal y exclusivo @+oblacion de 1ala$ala, (i)alA.

and @bA the testimony of Dre!orio de #or$a, son of #ernardo de #or$a, that the entire 6acienda had been bou!ht at a foreclosure sale for +40,400.00, of 7hich amount +22,400 7as contributed by #ernardo de #or$a and +42,000. by Earcelo de #or$a? that upon receipt of a subse>uent demand from the provincial treasurer for realty taxes the sum of +4-,000, Earcelo told his brother #ernardo that %rancisco @son of EarceloA 7anted also to be a coo7ner, and upon #ernardo=s assent to the proposal, Earcelo issue a chec9 for +4-,000.00 to pay the bac9 taxes and said that the amount 7ould represent %rancisco=s contribution in the purchase of the 6acienda. he 7itness further testified that J
Earcelo de #or$a said that that money 7as entrusted to him by %rancisco de #or$a .0en 0e .as still a 1a)0elor and 7hich he derived from his business transactions. @6earin!, 2 %ebruary 48.2, t.s.n., pa!es 43-42A @0mphasis suppliedA

he &ourt belo7, reasonin! that not only %rancisco=s s7orn statement over7ei!hed the admissions in the inventories relied upon by defendant-appellant 1ose de #or$a since probate courts can not finally determine >uestions of o7nership of inventoried property, but that the testimony of Dre!orio de #or$a sho7ed that %rancisco de #or$a ac>uired his share of the ori!inal 6acienda 7ith his private funds, for 7hich reason that share can not be re!arded as con$u!al partnership property, but as exclusive property of the buyer, pursuant to Article 438.@4A of &ivil &ode of 4888 and Article 448@4A of the &ivil &ode of the +hilippines. he follo7in! shall be the exclusive property of each spouse:
xxx xxx xxx @4A hat 7hich is purchased 7ith exclusive money of the 7ife or of the husband.

;e find the conclusions of the lo7er court to be untenable. 'n the first place, 7itness Dre!orio de #or$a=s testimony as to the source of the money paid by %rancisco for his share 7as plain hearsay, hence inadmissible and of no probative value, since he 7as merely repeatin! 7hat Earcelo de #or$a had told him @Dre!orioA. here is no 7ay of ascertainin! the truth of the statement, since both Earcelo and %rancisco de #or$a 7ere already dead 7hen Dre!orio testified. 'n addition, the statement itself is improbable, since there 7as no need or occasion for Earcelo de #or$a to explain to Dre!orio ho7 and 7hen %rancisco de #or$a had earned the +4-,000.00 entrusted to Earcelo. A rin! of artificiality is clearly discernible in this portion of Dre!orio=s testimony. As to %rancisco de #or$a=s affidavit, 0xhibit /%/, the >uoted portion thereof @ ante, pa!e 44A

does not clearly demonstrate that the /mi terreno personal y exclusivo @+oblacion de 1ala$ala, (i)alA / refers precisely to the 6acienda in >uestion. he inventories @0xhibits 3 and 4A disclose that there 7ere t7o real properties in 1ala$ala o7ned by %rancisco de #or$a, one of -2.038 s>. m., assessed at +44,.00, and a much bi!!er one of 4,32-.2.0.-0 s>. m., 7hich is evidently the 6acienda de 1ala$ala @+oblacionA. o 7hich of these lands did the affidavit of %rancisco de #or$a @0xhibit /%/A refer toK 'n addition, %rancisco=s characteri)ation of the land as /mi terreno personal y exclusivo/ is plainly self-servin!, and not admissible in the absence of cross examination. 't may be true that the inventories relied upon by defendant-appellant @0xhibits /2/, /3/, /4/ and /-/A are not conclusive on the con$u!al character of the property in >uestion? but as already noted, they are clear admissions a!ainst the pecuniary interest of the declarants, %rancisco de #or$a and his executor-7ido7, asiana On!sin!co, and as such of much !reater probative 7ei!ht than the self-servin! statement of %rancisco @0xhibit /%/A. +lainly, the le!al presumption in favor of the con$u!al character of the 6acienda de 1ala$ala @+oblacionA no7 in dispute has not been rebutted but actually confirmed by proof. 6ence, the appealed order should be reversed and the 6acienda de 1ala$ala @+oblacionA declared property of the con$u!al partnership of %rancisco de #or$a and 1osefa an!co. ,o error havin! been assi!ned a!ainst the rulin! of the lo7er court that claims for dama!es should be ventilated in the correspondin! special proceedin!s for the settlement of the estates of the deceased, the same re>uires no pro announcement from this &ourt. ', "'0; O% 60 %O(0DO',D, the appealed order of the &ourt of %irst 'nstance of (i)al in &ase ,o. L-28040 is hereby affirmed? 7hile those involved in &ases ,os. L-282.8 and L28.44 are reversed and set aside. &osts a!ainst the appellant asiana On!sin!co "da. de #or$a in all three @3A cases. "on)ep)ion, ".J., Ma2alintal, 3aldi%ar, "astro, 4ee0an2ee, Barredo, Ma2asiar, !ntonio and 5sguerra, JJ., )on)ur. 6ernando, J., too2 no part.