G.R. No.
131953 June 5, 2002
MA. ESTELA MAGLASANG, NICOLAS CABATINGAN and MERLY S.
CABATINGAN, petitioners,
vs.
THE HEIRS OF CORAZON CABATINGAN, namely, LUZ M. BOQUIA,
PERLA M. ABELLA, ESTRELLA M. CAETE, LOURDES M. YUSON, and
JULIA L. MAYOL, HEIRS OF GENOVIVA C. NATIVIDAD namely, OSCAR
C. NATIVIDAD, OLGA NATIVIDAD, ODETTE NATIVIDAD, OPHELIA
NATIVIDAD, RICHARD NATIVIDAD, RAYMUND NATIVIDAD, RICHIE
NATIVIDAD, SONIA NATIVIDAD and ENCARNACION CABATINGAN
VDA. DE TRINIDAD, ALFREDO CABATINGAN and JESUSA C.
NAVADA, respondents.
AUSTRIA-MARTINEZ, J.:
Posed for resolution before the Court in this petition for review
on certiorari filed under Rule 45 of the Rules of Court is the sole issue of
whether the donations made by the late Conchita Cabatingan are
donations inter vivos or mortis causa.
The facts of the case are as follows:
On February 17, 1992, Conchita Cabatingan executed in favor of her brother,
petitioner Nicolas Cabatingan, a "Deed of Conditional of Donation (sic) Inter
Vivos for House and Lot" covering one-half () portion of the former's house
and lot located at Cot-cot, Liloan, Cebu.1 Four (4) other deeds of donation
were subsequently executed by Conchita Cabatingan on January 14, 1995,
bestowing upon: (a) petitioner Estela C. Maglasang, two (2) parcels of land -
one located in Cogon, Cebu (307 sq. m.) and the other, a portion of a parcel
of land in Masbate (50,232 sq. m.); (b) petitioner Nicolas Cabatingan, a portion
of a parcel of land located in Masbate (80,000 sq. m.); and (c) petitioner Merly
S. Cabatingan, a portion of the Masbate property (80,000 sq. m.).2 These
deeds of donation contain similar provisions, to wit:
"That for and in consideration of the love and affection of the DONOR
for the DONEE, x x x the DONOR does hereby, by these presents,
transfer, convey, by way of donation, unto the DONEE the above-
described property, together with the buildings and all improvements
existing thereon, to become effective upon the death of the
DONOR; PROVIDED, HOWEVER, that in the event that the DONEE
should die before the DONOR, the present donation shall be
deemed automatically rescinded and of no further force and
effect; x x x"3 (Emphasis Ours)
On May 9, 1995, Conchita Cabatingan died.
Upon learning of the existence of the foregoing donations, respondents filed
with the Regional Trial Court of Mandaue, Branch 55, an action for Annulment
And/Or Declaration of Nullity of Deeds of Donations and Accounting, docketed
as Civil Case No. MAN-2599, seeking the annulment of said four (4) deeds of
donation executed on January 14, 1995. Respondents allege, inter alia, that
petitioners, through their sinister machinations and strategies and taking
advantage of Conchita Cabatingan's fragile condition, caused the execution of
the deeds of donation, and, that the documents are void for failing to comply
with the provisions of the Civil Code regarding formalities of wills and
testaments, considering that these are donations mortis causa.4 Respondents
prayed that a receiver be appointed in order to preserve the disputed
properties, and, that they be declared as co-owners of the properties in equal
shares, together with petitioner Nicolas Cabatingan.5
Petitioners in their Amended Answer, deny respondents' allegations
contending that Conchita Cabatingan freely, knowingly and voluntarily caused
the preparation of the instruments.6
On respondents' motion, the court a quo rendered a partial judgment on the
pleadings on December 2, 1997 in favor of respondents, with the following
dispositive portion:
"WHEREREFORE, and in consideration of all the foregoing, judgment
is hereby rendered in favor of the plaintiffs and against the defendant
and unwilling co-plaintiff with regards (sic) to the four Deeds of
Donation Annexes "A", "A-1", "B" and Annex "C" which is the subject
of this partial decision by:
Declaring the four Deeds of Donation as null and void ab initio
for being a donation Mortis Causa and for failure to comply with
formal and solemn requisite under Art. 806 of the New Civil
Code;
 b) To declare the plaintiffs and defendants as well as unwilling
co-plaintiff as the heirs of the deceased Conchita Cabatingan
and therefore hereditary co-owners of the properties subject of
this partial decision, as mandated under Art. 777 of the New
Civil Code;
SO ORDERED."7
The court a quo ruled that the donations are donations mortis causa and
therefore the four (4) deeds in question executed on January 14, 1995 are null
and void for failure to comply with the requisites of Article 806 of the Civil Code
on solemnities of wills and testaments.8
Raising questions of law, petitioners elevated the court a quo's decision to this
Court,9 alleging that:
"THE LOWER COURT PALPABLY DISREGARDED THE LONG-
AND-WELL-ESTABLISHED RULINGS OF THIS HONORABLE
SUPREME COURT ON THE CHARACTERIZATION OF DONATIONS
AS INTER VIVOSOR MORTIS CAUSA AND, INSTEAD,
PROCEEDED TO INTERPRET THE DONATIONS IN QUESTION IN
A MANNER CONTRARY THERETO."10
Petitioners insist that the donations are inter vivos donations as these were
made by the late Conchita Cabatingan "in consideration of the love and
affection of the donor" for the donee, and there is nothing in the deeds which
indicate that the donations were made in consideration of Cabatingan's
death.11 In addition, petitioners contend that the stipulation on rescission in
case petitioners die ahead of Cabatingan is a resolutory condition that
confirms the nature of the donation as inter vivos.
Petitioners' arguments are bereft of merit.
In a donation mortis causa, "the right of disposition is not transferred to the
donee while the donor is still alive."12 In determining whether a donation is one
of mortis causa, the following characteristics must be taken into account:
(1) It conveys no title or ownership to the transferee before the death
of the transferor; or what amounts to the same thing, that the transferor
should retain the ownership (full or naked) and control of the property
while alive;
(2) That before his death, the transfer should be revocable by the
transferor at will, ad nutum; but revocability may be provided for
indirectly by means of a reserved power in the donor to dispose of the
properties conveyed;
and
(3) That the transfer should be void if the transferor should survive the
transferee.13
In the present case, the nature of the donations as mortis causa is confirmed
by the fact that the donations do not contain any clear provision that intends
to pass proprietary rights to petitioners prior to Cabatingan's death. 14 The
phrase "to become effective upon the death of the DONOR" admits of no other
interpretation but that Cabatingan did not intend to transfer the ownership of
the properties to petitioners during her lifetime. Petitioners themselves
expressly confirmed the donations as mortis causa in the following
Acceptance and Attestation clauses, uniformly found in the subject deeds of
donation, to wit:
"That the DONEE does hereby accept the foregoing donation mortis
causa under the terms and conditions set forth therein, and avail
herself of this occasion to express her profound gratitude for the
kindness and generosity of the DONOR."
xxx
"SIGNED by the above-named DONOR and DONEE at the foot of this
Deed of Donation mortis causa, which consists of two (2) pages x x
x."15
That the donations were made "in consideration of the love and affection of
the donor" does not qualify the donations as inter vivos because
transfers mortis causa may also be made for the same reason.16
Well in point is National Treasurer of the Phils. v. Vda. de Meimban.17 In
said case, the questioned donation contained the provision:
 "That for and in consideration of the love and affection which the
DONOR has for the DONEE, the said Donor by these presents does
hereby give, transfer, and convey unto the DONEE, her heirs and
assigns a portion of ONE HUNDRED THOUSAND (100,000) SQUARE
METERS, on the southeastern part Pro-indiviso of the above
described property. (The portion herein donated is within Lot 2-B of the
proposed amendment Plan Subdivision of Lots Nos. 1 and 2, Psu-
109393), with all the buildings and improvements thereon, to become
effective upon the death of the DONOR. (italics supplied.)"18
Notably, the foregoing provision is similar to that contained in the donation
executed by Cabatingan. We held in Meimban case that the donation is
a mortis causa donation, and that the above quoted provision establishes the
donor's intention to transfer the ownership and possession of the donated
property to the donee only after the former's death. Further:
"As the donation is in the nature of a mortis causa disposition, the
formalities of a will should have been complied with under Article 728
of the Civil Code, otherwise, the donation is void and would produce
no effect. As we have held in Alejandro v. Geraldez (78 SCRA
245,253), "If the donation is made in contemplation of the donor's
death, meaning that the full or naked ownership of the donated
properties will pass to the donee because of the donor's death, then it
is at that time that the donation takes effect, and it is a donation mortis
causa which should be embodied in a last will and testament. (Citing
Bonsato v. Court of Appeals, 95 Phil. 481)."19
We apply the above rulings to the present case. The herein subject deeds
expressly provide that the donation shall be rescinded in case petitioners
predecease Conchita Cabatingan. As stated in Reyes v. Mosqueda,20 one of
the decisive characteristics of a donation mortis causa is that the transfer
should be considered void if the donor should survive the donee. This is
exactly what Cabatingan provided for in her donations. If she really intended
that the donation should take effect during her lifetime and that the ownership
of the properties donated be transferred to the donee or independently of, and
not by reason of her death, she would have not expressed such proviso in the
subject deeds.1wphi1.nt
Considering that the disputed donations are donations mortis causa, the same
partake of the nature of testamentary provisions 21 and as such, said deeds
must be executed in accordance with the requisites on solemnities of wills and
testaments under Articles 805 and 806 of the Civil Code, to wit:
"ART. 805. Every will, other than a holographic will, must be
subscribed at the end thereof by the testator himself 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 one another.
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, except the last, on the left margin, and all the
pages shall be numbered correlatively in letters placed on the upper
part of each page.
The attestation shall state the number of 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 the instrumental witnesses,
and that the latter witnessed and signed the will and all the pages
thereof in the presence of the testator and of one another.
If the attestation clause is in a language not known to the witnesses, it
shall be interpreted to them. (n)
ART. 806. Every will must be acknowledged before a notary public by
the testator and the witnesses. The notary public shall not be required
to retain a copy of the will, or file another with the office of the Clerk of
Court. (n)"
The deeds in question although acknowledged before a notary public of the
donor and the donee, the documents were not executed in the manner
provided for under the above-quoted provisions of law.
Thus, the trial court did not commit any reversible error in declaring the subject
deeds of donation null and void.
WHEREFORE, the petition is hereby DENIED for lack of merit.
SO ORDERED
G.R. No. 129008 January 13, 2004
TEODORA A. RIOFERIO, VERONICA O. EVANGELISTA assisted by her
husband ZALDY EVANGELISTA, ALBERTO ORFINADA, and ROWENA
O. UNGOS, assisted by her husband BEDA UNGOS, petitioners,
vs.
COURT OF APPEALS, ESPERANZA P. ORFINADA, LOURDES P.
ORFINADA, ALFONSO ORFINADA, NANCY P. ORFINADA, ALFONSO
JAMES P. ORFINADA, CHRISTOPHER P. ORFINADA and ANGELO P.
ORFINADA,respondents.
DECISION
TINGA, J.:
Whether the heirs may bring suit to recover property of the estate pending the
appointment of an administrator is the issue in this case.
This Petition for Review on Certiorari, under Rule 45 of the Rules of Court,
seeks to set aside the Decision1 of the Court of Appeals in CA-G.R. SP No.
42053 dated January 31, 1997, as well as its Resolution2 dated March 26,
1997, denying petitioners motion for reconsideration.
On May 13, 1995, Alfonso P. Orfinada, Jr. died without a will in Angeles City
leaving several personal and real properties located in Angeles City, Dagupan
City and Kalookan City.3 He also left a widow, respondent Esperanza P.
Orfinada, whom he married on July 11, 1960 and with whom he had seven
children who are the herein respondents, namely: Lourdes P. Orfinada,
Alfonso "Clyde" P. Orfinada, Nancy P. Orfinada-Happenden, Alfonso James
P. Orfinada, Christopher P. Orfinada, Alfonso Mike P. Orfinada (deceased)
and Angelo P. Orfinada.4
Apart from the respondents, the demise of the decedent left in mourning his
paramour and their children. They are petitioner Teodora Riofero, who
became a part of his life when he entered into an extra-marital relationship
with her during the subsistence of his marriage to Esperanza sometime in
1965, and co-petitioners Veronica5, Alberto and Rowena.6
On November 14, 1995, respondents Alfonso James and Lourdes Orfinada
discovered that on June 29, 1995, petitioner Teodora Rioferio and her children
executed an Extrajudicial Settlement of Estate of a Deceased Person with
Quitclaim involving the properties of the estate of the decedent located in
Dagupan City and that accordingly, the Registry of Deeds in Dagupan issued
Certificates of Titles Nos. 63983, 63984 and 63985 in favor of petitioners
Teodora Rioferio, Veronica Orfinada-Evangelista, Alberto Orfinada and
Rowena Orfinada-Ungos. Respondents also found out that petitioners were
able to obtain a loan of P700,000.00 from the Rural Bank of Mangaldan Inc.
by executing a Real Estate Mortgage over the properties subject of the extra-
judicial settlement.7
On December 1, 1995, respondent Alfonso "Clyde" P. Orfinada III filed
a Petition for Letters of Administration docketed as S.P. Case No. 5118 before
the Regional Trial Court of Angeles City, praying that letters of administration
encompassing the estate of Alfonso P. Orfinada, Jr. be issued to him.8
On December 4, 1995, respondents filed a Complaint for the
Annulment/Rescission of Extra Judicial Settlement of Estate of a Deceased
Person with Quitclaim, Real Estate Mortgage and Cancellation of Transfer
Certificate of Titles with Nos. 63983, 63985 and 63984 and Other Related
Documents with Damages against petitioners, the Rural Bank of Mangaldan,
Inc. and the Register of Deeds of Dagupan City before the Regional Trial
Court, Branch 42, Dagupan City.9
On February 5, 1996, petitioners filed their Answer to the aforesaid complaint
interposing the defense that the property subject of the contested deed of
extra-judicial settlement pertained to the properties originally belonging to the
parents of Teodora Riofero10 and that the titles thereof were delivered to her
as an advance inheritance but the decedent had managed to register them in
his name.11 Petitioners also raised the affirmative defense that respondents
are not the real parties-in-interest but rather the Estate of Alfonso O. Orfinada,
Jr. in view of the pendency of the administration proceedings.12 On April 29,
1996, petitioners filed a Motion to Set Affirmative Defenses for Hearing13 on
the aforesaid ground.
The lower court denied the motion in its Order14 dated June 27, 1996, on the
ground that respondents, as heirs, are the real parties-in-interest especially in
the absence of an administrator who is yet to be appointed in S.P. Case No.
5118. Petitioners moved for its reconsideration15 but the motion was likewise
denied.16
This prompted petitioners to file before the Court of Appeals their Petition for
Certiorari under Rule 65 of the Rules of Court docketed as CA G.R. S.P. No.
42053.17 Petitioners averred that the RTC committed grave abuse of
discretion in issuing the assailed order which denied the dismissal of the case
on the ground that the proper party to file the complaint for the annulment of
the extrajudicial settlement of the estate of the deceased is the estate of the
decedent and not the respondents.18
The Court of Appeals rendered the assailed Decision19 dated January 31,
1997, stating that it discerned no grave abuse of discretion amounting to lack
or excess of jurisdiction by the public respondent judge when he denied
petitioners motion to set affirmative defenses for hearing in view of its
discretionary nature.
A Motion for Reconsideration was filed by petitioners but it was
denied.20 Hence, the petition before this Court.
The issue presented by the petitioners before this Court is whether the heirs
have legal standing to prosecute the rights belonging to the deceased
subsequent to the commencement of the administration proceedings.21
Petitioners vehemently fault the lower court for denying their motion to set the
case for preliminary hearing on their affirmative defense that the proper party
to bring the action is the estate of the decedent and not the respondents. It
must be stressed that the holding of a preliminary hearing on an affirmative
defense lies in the discretion of the court. This is clear from the Rules of Court,
thus:
SEC. 5. Pleadings grounds as affirmative defenses.- Any of the
grounds for dismissal provided for in this rule, except improper venue,
may be pleaded as an affirmative defense, and a preliminary
hearing may be had thereon as if a motion to dismiss had been
filed.22 (Emphasis supplied.)
Certainly, the incorporation of the word "may" in the provision is clearly
indicative of the optional character of the preliminary hearing. The word
denotes discretion and cannot be construed as having a mandatory
effect.23Subsequently, the electivity of the proceeding was firmed up beyond
cavil by the 1997 Rules of Civil Procedure with the inclusion of the phrase "in
the discretion of the Court", apart from the retention of the word "may" in
Section 6,24in Rule 16 thereof.
Just as no blame of abuse of discretion can be laid on the lower courts
doorstep for not hearing petitioners affirmative defense, it cannot likewise be
faulted for recognizing the legal standing of the respondents as heirs to bring
the suit.
Pending the filing of administration proceedings, the heirs without doubt have
legal personality to bring suit in behalf of the estate of the decedent in
accordance with the provision of Article 777 of the New Civil Code "that (t)he
rights to succession are transmitted from the moment of the death of the
decedent." The provision in turn is the foundation of the principle that the
property, rights and obligations to the extent and value of the inheritance of a
person are transmitted through his death to another or others by his will or by
operation of law.25
Even if administration proceedings have already been commenced, the heirs
may still bring the suit if an administrator has not yet been appointed. This is
the proper modality despite the total lack of advertence to the heirs in the rules
on party representation, namely Section 3, Rule 326 and Section 2, Rule
8727 of the Rules of Court. In fact, in the case of Gochan v. Young,28 this Court
recognized the legal standing of the heirs to represent the rights and properties
of the decedent under administration pending the appointment of an
administrator. Thus:
The above-quoted rules,29 while permitting an executor or
administrator to represent or to bring suits on behalf of the deceased,
do not prohibit the heirs from representing the deceased. These rules
are easily applicable to cases in which an administrator has
already been appointed. But no rule categorically addresses the
situation in which special proceedings for the settlement of an
estate have already been instituted, yet no administrator has been
appointed. In such instances, the heirs cannot be expected to wait for
the appointment of an administrator; then wait further to see if the
administrator appointed would care enough to file a suit to protect the
rights and the interests of the deceased; and in the meantime do
nothing while the rights and the properties of the decedent are violated
or dissipated.
Even if there is an appointed administrator, jurisprudence recognizes two
exceptions, viz: (1) if the executor or administrator is unwilling or refuses to
bring suit;30 and (2) when the administrator is alleged to have participated in
the act complained of31 and he is made a party defendant.32 Evidently, the
necessity for the heirs to seek judicial relief to recover property of the estate
is as compelling when there is no appointed administrator, if not more, as
where there is an appointed administrator but he is either disinclined to bring
suit or is one of the guilty parties himself.

All told, therefore, the rule that the heirs have no legal standing to sue for the
recovery of property of the estate during the pendency of administration
proceedings has three exceptions, the third being when there is no appointed
administrator such as in this case.

As the appellate court did not commit an error of law in upholding the order of
the lower court, recourse to this Court is not warranted.

WHEREFORE, the petition for review is DENIED. The assailed decision and
resolution of the Court of Appeals are hereby AFFIRMED. No costs.

SO ORDERED.
G.R. No. 104482 January 22, 1996
BELINDA TAEDO, for herself and in representation of her brothers
and sisters, and TEOFILA CORPUZ TAEDO, representing her minor
daughter VERNA TAEDO, petitioners,
vs.
THE COURT OF APPEALS, SPOUSES RICARDO M. TAEDO AND
TERESITA BARERA TAEDO,respondents.
DECISION
PANGANIBAN, J.:
Is a sale of future inheritance valid? In multiple sales of the same real property,
who has preference in ownership? What is the probative value of the lower
court's finding of good faith in registration of such sales in the registry of
property? These are the main questions raised in this Petition for review
on certiorari under Rule 45 of the Rules of Court to set aside and reverse the
Decision1 of the Court of Appeals2 in CA-G.R. CV NO. 24987 promulgated on
September 26, 1991 affirming the decision of the Regional Trial Court, Branch
63, Third Judicial Region, Tarlac, Tarlac in Civil Case No. 6328, and its
Resolution denying reconsideration thereof, promulgated on May 27, 1992.
By the Court's Resolution on October 25, 1995, this case (along with several
others) was transferred from the First to the Third Division and after due
deliberation, the Court assigned it to the undersigned ponente for the writing
of this Decision.
The Facts
On October 20, 1962, Lazardo Taedo executed a notarized deed of absolute
sale in favor of his eldest brother, Ricardo Taedo, and the latter's wife,
Teresita Barera, private respondents herein, whereby he conveyed to the
latter in consideration of P1,500.00, "one hectare of whatever share I shall
have over Lot No. 191 of the cadastral survey of Gerona, Province of Tarlac
and covered by Title T-13829 of the Register of Deeds of Tarlac", the said
property being his "future inheritance" from his parents (Exh. 1). Upon the
death of his father Matias, Lazaro executed an "Affidavit of Conformity" dated
February 28, 1980 (Exh. 3) to "re-affirm, respect, acknowledge and validate
the sale I made in 1962." On January 13, 1981, Lazaro executed another
notarized deed of sale in favor of private respondents covering his "undivided
ONE TWELVE (1/12) of a parcel of land known as Lot 191 . . . " (Exh. 4). He
acknowledged therein his receipt of P10,000.00 as consideration therefor. In
February 1981, Ricardo learned that Lazaro sold the same property to his
children, petitioners herein, through a deed of sale dated December 29, 1980
(Exh. E). On June 7, 1982, private respondents recorded the Deed of Sale
(Exh. 4) in their favor in the Registry of Deeds and the corresponding entry
was made in Transfer Certificate of Title No. 166451 (Exh. 5).
Petitioners on July 16, 1982 filed a complaint for rescission (plus damages) of
the deeds of sale executed by Lazaro in favor of private respondents covering
the property inherited by Lazaro from his father.
Petitioners claimed that their father, Lazaro, executed an "Absolute Deed of
Sale" dated December 29, 1980 (Exit. E). Conveying to his ten children his
allotted portion tinder the extrajudicial partition executed by the heirs of Matias,
which deed included the land in litigation (Lot 191).
Petitioners also presented in evidence: (1) a private writing purportedly
prepared and signed by Matias dated December 28, 1978, stating that it was
his desire that whatever inheritance Lazaro would receive from him should be
given to his (Lazaro's) children (Exh. A); (2) a typewritten document dated
March 10, 1979 signed by Lazaro in the presence of two witnesses, wherein
he confirmed that he would voluntarily abide by the wishes of his father,
Matias, to give to his (Lazaro's) children all the property he would inherit from
the latter (Exh. B); and (3) a letter dated January 1, 1980 of Lazaro to his
daughter, Carmela, stating that his share in the extrajudicial settlement of the
estate of his father was intended for his children, petitioners herein (Exh. C).
Private respondents, however presented in evidence a "Deed of Revocation
of a Deed of Sale" dated March 12, 1981 (Exh. 6), wherein Lazaro revoked
the sale in favor of petitioners for the reason that it was "simulated or fictitious
without any consideration whatsoever".
Shortly after the case a quo was filed, Lazaro executed a sworn statement
(Exh. G) which virtually repudiated the contents of the Deed of Revocation of
a Deed of Sale (Exh. 6) and the Deed of Sale (Exh. 4) in favor of private
respondents. However, Lazaro testified that he sold the property to Ricardo,
and that it was a lawyer who induced him to execute a deed of sale in favor of
his children after giving him five pesos (P5.00) to buy a "drink" (TSN
September 18, 1985, pp. 204-205).
The trial court decided in favor of private respondents, holding that petitioners
failed "to adduce a proponderance of evidence to support (their) claim." On
appeal, the Court of Appeals affirmed the decision of the trial court, ruling that
the Deed of Sale dated January 13, 1981 (Exh. 9) was valid and that its
registration in good faith vested title in said respondents.
The Issues
Petitioners raised the following "errors" in the respondent Court, which they
also now allege in the instant Petition:
I. The trial court erred in concluding that the Contract of Sale of October
20, 1962 (Exhibit 7, Answer) is merely voidable or annulable and not
void ab initio pursuant to paragraph 2 of Article 1347 of the New Civil
Code involving as it does a "future inheritance".
II. The trial court erred in holding that defendants-appellees acted in
good faith in registering the deed of sale of January 13, 1981 (Exhibit
9) with the Register of Deeds of Tarlac and therefore ownership of the
land in question passed on to defendants-appellees.
III. The trial court erred in ignoring and failing to consider the
testimonial and documentary evidence of plaintiffs-appellants which
clearly established by preponderance of evidence that they are indeed
the legitimate and lawful owners of the property in question.
IV. The decision is contrary to law and the facts of the case and the
conclusions drawn from the established facts are illogical and off-
tangent.
From the foregoing, the issues may be restated as follows:
1. Is the sale of a future inheritance valid?
2. Was the subsequent execution on January 13, 1981 (and
registration with the Registry of Property) of a deed of sale covering
the same property to the same buyers valid?
3. May this Court review the findings of the respondent Court (a)
holding that the buyers acted in good faith in registering the said
subsequent deed of sale and (b) in "failing to consider petitioners'
evidence"? Are the conclusions of the respondent Court "illogical and
off-tangent"?
The Court's Ruling
At the outset, let it be clear that the "errors" which are reviewable by this Court
in this petition for review on certiorariare only those allegedly committed by the
respondent Court of Appeals and not directly those of the trial court, which is
not a party here. The "assignment of errors" in the petition quoted above are
therefore totally misplaced, and for that reason, the petition should be
dismissed. But in order to give the parties substantial justice we have decided
to delve into the issues as above re-stated. The errors attributed by petitioners
to the latter (trial) court will be discussed only insofar as they are relevant to
the appellate court's assailed Decision and Resolution.
The sale made in 1962 involving future inheritance is not really at issue here.
In context, the assailed Decision conceded "it may be legally correct that a
contract of sale of anticipated future inheritance is null and void."3
But to remove all doubts, we hereby categorically rule that, pursuant to Article
1347 of the Civil Code, "(n)o contract may be entered into upon a future
inheritance except in cases expressly authorized by law."
Consequently, said contract made in 1962 is not valid and cannot be the
source of any right nor the creator of any obligation between the parties.
Hence, the "affidavit of conformity" dated February 28, 1980, insofar as it
sought to validate or ratify the 1962 sale, is also useless and, in the words of
the respondent Court, "suffers from the same infirmity." Even private
respondents in their memorandum4 concede this.
However, the documents that are critical to the resolution of this case are: (a)
the deed of sale of January 13, 1981 in favor of private respondents covering
Lazaro's undivided inheritance of one-twelfth (1/12) share in Lot No. 191,
which was subsequently registered on June 7, 1982; and (b) the deed of sale
dated December 29, 1980 in favor of petitioners covering the same property.
These two documents were executed after the death of Matias (and his
spouse) and after a deed of extra-judicial settlement of his (Matias') estate was
executed, thus vesting in Lazaro actual title over said property. In other words,
these dispositions, though conflicting, were no longer infected with the
infirmities of the 1962 sale.
Petitioners contend that what was sold on January 13, 1981 was only one-half
hectare out of Lot No. 191, citing as authority the trial court's decision. As
earlier pointed out, what is on review in these proceedings by this Court is the
Court of Appeals' decision which correctly identified the subject matter of
the January 13, 1981 sale to be the entire undivided 1/12 share of Lazaro in
Lot No. 191 and which is the same property disposed of on December 29,
1980 in favor of petitioners.
Critical in determining which of these two deeds should be given effect is the
registration of the sale in favor of private respondents with the register of
deeds on June 7, 1982.
Article 1544 of the Civil Code governs the preferential rights of vendees in
cases of multiple sales, as follows:
Art. 1544. If the same thing should have been sold to different vendees,
the ownership shall be transferred to the person who may have first
taken possession thereof in good faith, if it should be movable property.
Should it be immovable property, the ownership shall belong to the
person acquiring it who in good faith first recorded it in the Registry of
Property.
Should there be no inscription, the ownership shall pertain to the
person who in good faith was first in the possession; and, in the
absence thereof, to the person who presents the oldest title, provided
there is good faith.
The property in question is land, an immovable, and following the above-
quoted law, ownership shall belong to the buyer who in good faith registers it
first in the registry of property. Thus, although the deed of sale in favor of
private respondents was later than the one in favor of petitioners, ownership
would vest in the former because of the undisputed fact of registration. On the
other hand, petitioners have not registered the sale to them at all.
Petitioners contend that they were in possession of the property and that
private respondents never took possession thereof. As between two
purchasers, the one who registered the sale in his favor has a preferred right
over the other who has not registered his title, even if the latter is in actual
possession of the immovable property.5
As to third issue, while petitioners conceded the fact of registration, they
nevertheless contended that it was done in bad faith. On this issue, the
respondent Court ruled;
Under the second assignment of error, plaintiffs-appellants contend
that defendants-appellees acted in bad faith when they registered the
Deed of Sale in their favor as appellee Ricardo already knew of the
execution of the deed of sale in favor of the plaintiffs; appellants cite
the testimony of plaintiff Belinda Taedo to the effect that defendant
Ricardo Taedo called her up on January 4 or 5, 1981 to tell her that
he was already the owner of the land in question "but the contract of
sale between our father and us were (sic) already consumated" (pp. 9-
10, tsn, January 6, 1984). This testimony is obviously self-serving, and
because it was a telephone conversation, the deed of sale dated
December 29, 1980 was not shown; Belinda merely told her uncle that
there was already a document showing that plaintiffs are the owners
(p. 80). Ricardo Taedo controverted this and testified that he learned
for the first time of the deed of sale executed by Lazaro in favor of his
children "about a month or sometime in February 1981" (p. 111, tsn,
Nov. 28, 1984). . . .6
The respondent Court, reviewing the trial court's findings, refused to overturn
the latter's assessment of the testimonial evidence, as follows;
We are not prepared to set aside the finding of the lower court
upholding Ricardo Taedo's testimony, as it involves a matter of
credibility of witnesses which the trial judge, who presided at the
hearing, was in a better position to resolve. (Court of Appeals'
Decision, p. 6.)
In this connection, we note the tenacious allegations made by petitioners, both
in their basic petition and in their memorandum, as follows:
 1. The respondent Court allegedly ignored the claimed fact that
respondent Ricardo "by fraud and deceit and with foreknowledge" that
the property in question had already been sold to petitioners, made
Lazaro execute the deed of January 13, 1981;
2. There is allegedly adequate evidence to show that only 1/2 of the
purchase price of P10,000.00 was paid at the time of the execution of
the deed of sale, contrary to the written acknowledgment, thus showing
bad faith;
3. There is allegedly sufficient evidence showing that the deed of
revocation of the sale in favor of petitioners "was tainted with fraud or
deceit."
4. There is allegedly enough evidence to show that private
respondents "took undue advantage over the weakness and
unschooled and pitiful situation of Lazaro Taedo . . ." and that
respondent Ricardo Taedo "exercised moral ascendancy over his
younger brother he being the eldest brother and who reached fourth
year college of law and at one time a former Vice-Governor of Tarlac,
while his younger brother only attained first year high school . . . ;
5. The respondent Court erred in not giving credence to petitioners'
evidence, especially Lazaro Taedo's Sinumpaang Salaysay dated
July 27, 1982 stating that Ricardo Taedo deceived the former in
executing the deed of sale in favor of private respondents.
To be sure, there are indeed many conflicting documents and testimonies as
well as arguments over their probative value and significance. Suffice it to say,
however, that all the above contentions involve questions of fact, appreciation
of evidence and credibility of witnesses, which are not proper in this review. It
is well-settled that the Supreme Court is not a trier of facts. In petitions for
review under Rule 45 of the Revised Rules of Court, only questions of law may
be raised and passed upon. Absent any whimsical or capricious exercise of
judgment, and unless the lack of any basis for the conclusions made by the
lower courts be amply demonstrated, the Supreme Court will not disturb their
findings. At most, it appears that petitioners have shown that their evidence
was not believed by both the trial and the appellate courts, and that the said
courts tended to give more credence to the evidence presented by private
respondents. But this in itself is not a reason for setting aside such findings.
We are far from convinced that both courts gravely abused their respective
authorities and judicial prerogatives.
As held in the recent case of Chua Tiong Tay vs. Court of Appeals and
Goldrock Construction and Development Corp.7
The Court has consistently held that the factual findings of the trial court, as
well as the Court of Appeals, are final and conclusive and may not be reviewed
on appeal. Among the exceptional circumstances where a reassessment of
facts found by the lower courts is allowed are when the conclusion is a finding
grounded entirely on speculation, surmises or conjectures; when the inference
made is manifestly absurd, mistaken or impossible; when there is grave abuse
of discretion in the appreciation of facts; when the judgment is premised on a
misapprehension of facts; when the findings went beyond the issues of the
case and the same are contrary to the admissions of both appellant and
appellee. After a careful study of the case at bench, we find none of the above
grounds present to justify the re-evaluation of the findings of fact made by the
courts below.
In the same vein, the ruling in the recent case of South Sea Surety and
Insurance Company, Inc. vs. Hon. Court of Appeals, et al.8 is equally
applicable to the present case:
We see no valid reason to discard the factual conclusions of the
appellate court. . . . (I)t is not the function of this Court to assess and
evaluate all over again the evidence, testimonial and documentary,
adduced by the parties, particularly where, such as here, the findings
of both the trial court and the appellate court on the matter coincide.
(emphasis supplied)
WHEREFORE, the petition is DENIED and the assailed Decision of the Court
of Appeals is AFFIRMED. No Costs.
SO ORDERED.
G.R. No. L-22036 April 30, 1979
TESTATE ESTATE OF THE LATE REVEREND FATHER PASCUAL
RIGOR. THE PARISH PRIEST OF THE ROMAN CATHOLIC CHURCH OF
VICTORIA, TARLAC, petitioner-appellant,
vs.
BELINA RIGOR, NESTORA RIGOR, FRANCISCA ESCOBAR DE RIGOR
and JOVITA ESCOBAR DE FAUSTO, respondents-appellees.
AQUINO, J.:
This case is about the efficaciousness or enforceability of a devise of ricelands
located at Guimba, Nueva Ecija, with a total area of around forty- four hectares
That devise was made in the will of the late Father Pascual Rigor, a native of
Victoria Tarlac, in favor of his nearest male relative who would study for the
priesthood.
The parish priest of Victoria, who claimed to be a trustee of the said lands,
appealed to this Court from the decision of the Court of Appeals affirming the
order of the probate court declaring that the said devise was inoperative (Rigor
vs. Parish Priest of the Roman Catholic Church of Victoria, Tarlac, CA-G.R.
No. 24319-R, August 1, 1963).
The record discloses that Father Rigor, the parish priest of Pulilan, Bulacan,
died on August 9, 1935, leaving a will executed on October 29, 1933 which
was probated by the Court of First Instance of Tarlac in its order of December
5, 1935. Named as devisees in the will were the testators nearest relatives,
namely, his three sisters: Florencia Rigor-Escobar, Belina Rigor-Manaloto and
Nestora Rigor-Quiambao. The testator gave a devise to his cousin, Fortunato
Gamalinda.
In addition, the will contained the following controversial bequest
(paragraphing supplied to facilitate comprehension of the testamentary
provisions):
Doy y dejo como legado CUATRO (4) PARCELAS de terreno
palayeros situados en el municipiooo de Guimba de la
provinciaaa de NUEVA ECIJA, cuyo num. de CERTIFICADO
DE TRANSFERENCIA DE TITULO SON; Titulo Num. 6530,
mide 16,249 m. cuadrados de superficie Titulo Num. 6548,
mide 242,998 m. cuadrados de superficie y annual 6525, mide
62,665 m. cuadrados de superficie; y Titulo Num. 6521, mide
119,251 m. cuadrados de superficie; a cualquier pariente mio
varon mas cercano que estudie la carrera eclesiatica hasta
ordenarse de Presbiterado o sea Sacerdote; las condiciones
de estate legado son;
(1.a) Prohibe en absoluto la venta de estos terrenos arriba
situados objectos de este legado;
(2.a) Que el legatario pariente mio mas cercano tendra
derecho de empezar a gozar y administrar de este legado al
principiar a curzar la Sagrada Teologio, y ordenado de
Sacerdote, hasta su muerte; pero que pierde el legatario este
derecho de administrar y gozar de este legado al dejar de
continuar sus estudios para ordenarse de Presbiterado
(Sacerdote).
Que el legatario una vez Sacerdote ya estara obligado a
celebrar cada ao VEINTE (20) Misas rezadas en sufragio de
mi alma y de mis padres difuntos, y si el actual legatario,
quedase excomulgado, IPSO FACTO se le despoja este
legado, y la administracion de esto pasara a cargo del actual
Parroco y sus sucesores de la Iglecia Catolica de Victoria,
Tarlac.
Y en intervalo de tiempo que no haya legatario acondicionado
segun lo arriba queda expresado, pasara la administracion de
este legado a cargo del actual Parroco Catolico y sus
sucesores, de Victoria, Tarlac.
El Parroco administrador de estate legado, acumulara,
anualmente todos los productos que puede tener estate
legado, ganando o sacando de los productos anuales el
CINCO (5) por ciento para su administracion, y los derechos
correspondientes de las VEINTE (20) Misas rezadas que
debiera el Parroco celebrar cada ao, depositando todo lo
restante de los productos de estate legado, en un banco, a
nombre de estate legado.
To implement the foregoing bequest, the administratix in 1940 submitted a
project containing the following item:
5. LEGACY OF THE CHURCH
 That it be adjudicated in favor of the legacy purported to be
given to the nearest male relative who shall take the priesthood,
and in the interim to be administered by the actual Catholic
Priest of the Roman Catholic Church of Victoria, Tarlac,
Philippines, or his successors, the real properties hereinbelow
indicated, to wit:
Total amount and value 44.1163 P13,090.00
Judge Roman A. Cruz in his order of August 15, 1940, approving the project
of partition, directed that after payment of the obligations of the estate
(including the sum of P3,132.26 due to the church of the Victoria parish) the
administratrix should deliver to the devisees their respective shares.
It may be noted that the administratrix and Judge Cruz did not bother to
analyze the meaning and implications of Father Rigor's bequest to his nearest
male relative who would study for the priesthood. Inasmuch as no nephew of
the testator claimed the devise and as the administratrix and the legal heirs
believed that the parish priest of Victoria had no right to administer the
ricelands, the same were not delivered to that ecclesiastic. The testate
proceeding remained pending.
About thirteen years after the approval of the project of partition, or on
February 19, 1954, the parish priest of Victoria filed in the pending testate
proceeding a petition praying for the appointment of a new administrator
(succeeding the deceased administration Florencia Rigor), who should deliver
to the church the said ricelands, and further praying that the possessors
thereof be ordered to render an accounting of the fruits. The probate court
granted the petition. A new administrator was appointed. On January 31, 1957
the parish priest filed another petition for the delivery of the ricelands to the
church as trustee.
The intestate heirs of Father Rigor countered with a petition dated March 25,
1957 praying that the bequest be d inoperative and that they be adjudged as
the persons entitled to the said ricelands since, as admitted by the parish priest
of Victoria, "no nearest male relative of" the testator "has ever studied for the
priesthood" (pp. 25 and 35, Record on Appeal). That petition was opposed by
the parish priest of Victoria.
Finding that petition to be meritorious, the lower court, through Judge Bernabe
de Aquino, declared the bequest inoperative and adjudicated the ricelands to
the testator's legal heirs in his order of June 28, 1957. The parish priest filed
two motions for reconsideration.
Judge De Aquino granted the respond motion for reconsideration in his order
of December 10, 1957 on the ground that the testator had a grandnephew
named Edgardo G. Cunanan (the grandson of his first cousin) who was a
seminarian in the San Jose Seminary of the Jesuit Fathers in Quezon City.
The administrator was directed to deliver the ricelands to the parish priest of
Victoria as trustee.
The legal heirs appealed to the Court of Appeals. It reversed that order. It held
that Father Rigor had created a testamentary trust for his nearest male relative
who would take the holy orders but that such trust could exist only for twenty
years because to enforce it beyond that period would violate "the rule against
perpetuities. It ruled that since no legatee claimed the ricelands within twenty
years after the testator's death, the same should pass to his legal heirs, citing
articles 888 and 912(2) of the old Civil Code and article 870 of the new Civil
Code.
The parish priest in this appeal contends that the Court of Appeals erred in not
finding that the testator created a public charitable trust and in not liberally
construing the testamentary provisions so as to render the trust operative and
to prevent intestacy.
As refutation, the legal heirs argue that the Court of Appeals d the bequest
inoperative because no one among the testator's nearest male relatives had
studied for the priesthood and not because the trust was a private charitable
trust. According to the legal heirs, that factual finding is binding on this Court.
They point out that appellant priest's change of theory cannot be
countenanced in this appeal .
In this case, as in cases involving the law of contracts and statutory
construction, where the intention of the contracting parties or of the lawmaking
body is to be ascertained, the primary issue is the determination of the
testator's intention which is the law of the case (dicat testor et erit lex. Santos
vs. Manarang, 27 Phil. 209, 215; Rodriguez vs. Court of Appeals, L-28734,
March 28, 1969, 27 SCRA 546).
The will of the testator is the first and principal law in the matter of testaments.
When his intention is clearly and precisely expressed, any interpretation must
be in accord with the plain and literal meaning of his words, except when it
may certainly appear that his intention was different from that literally
expressed (In re Estate of Calderon, 26 Phil. 333).
The intent of the testator is the cardinal rule in the construction of wills." It is
"the life and soul of a will It is "the first greatest rule, the sovereign guide, the
polestar, in giving effect to a will". (See Dissent of Justice Moreland in Santos
vs. Manarang, 27 Phil. 209, 223, 237-8.)
One canon in the interpretation of the testamentary provisions is that "the
testator's intention is to be ascertained from the words of the wilt taking into
consideration the circumstances under which it was made", but excluding the
testator's oral declarations as to his intention (Art. 789, Civil Code of the
Philippines).
To ascertain Father Rigor's intention, it may be useful to make the following
re-statement of the provisions of his will.
1. that he bequeathed the ricelands to anyone of his nearest male relatives
who would pursue an ecclesiastical career until his ordination as a priest.
2. That the devisee could not sell the ricelands.
3. That the devisee at the inception of his studies in sacred theology could
enjoy and administer the ricelands, and once ordained as a priest, he could
continue enjoying and administering the same up to the time of his death but
the devisee would cease to enjoy and administer the ricelands if he
discontinued his studies for the priesthood.
4. That if the devisee became a priest, he would be obligated to celebrate
every year twenty masses with prayers for the repose of the souls of Father
Rigor and his parents.
5. That if the devisee is excommunicated, he would be divested of the legacy
and the administration of the riceland would pass to the incumbent parish
priest of Victoria and his successors.
6. That during the interval of time that there is no qualified devisee as
contemplated above, the administration of the ricelands would be under the
responsibility of the incumbent parish priest of Victoria and his successors,
and
7. That the parish priest-administrator of the ricelands would accumulate
annually the products thereof, obtaining or getting from the annual produce
five percent thereof for his administration and the fees corresponding to the
twenty masses with prayers that the parish priest would celebrate for each
year, depositing the balance of the income of the devise in the bank in the
name of his bequest.
From the foregoing testamentary provisions, it may be deduced that the
testator intended to devise the ricelands to his nearest male relative who would
become a priest, who was forbidden to sell the ricelands, who would lose the
devise if he discontinued his studies for the priesthood, or having been
ordained a priest, he was excommunicated, and who would be obligated to
say annually twenty masses with prayers for the repose of the souls of the
testator and his parents.
On the other hand, it is clear that the parish priest of Victoria would administer
the ricelands only in two situations: one, during the interval of time that no
nearest male relative of the testator was studying for the priesthood and two,
in case the testator's nephew became a priest and he was excommunicated.
What is not clear is the duration of "el intervalo de tiempo que no haya
legatario acondicionado", or how long after the testator's death would it be
determined that he had a nephew who would pursue an ecclesiastical
vocation. It is that patent ambiguity that has brought about the controversy
between the parish priest of Victoria and the testator's legal heirs.
Interwoven with that equivocal provision is the time when the nearest male
relative who would study for the priesthood should be determined. Did the
testator contemplate only his nearest male relative at the time of his death? Or
did he have in mind any of his nearest male relatives at anytime after his
death?
We hold that the said bequest refers to the testator's nearest male
relative living at the time of his death and not to any indefinite time thereafter.
"In order to be capacitated to inherit, the heir, devisee or legatee must be living
at the moment the succession opens, except in case of representation, when
it is proper" (Art. 1025, Civil Code).
The said testamentary provisions should be sensibly or reasonably construed.
To construe them as referring to the testator's nearest male relative at anytime
after his death would render the provisions difficult to apply and create
uncertainty as to the disposition of his estate. That could not have been his
intention.
In 1935, when the testator died, his nearest leagal heirs were his three sisters
or second-degree relatives, Mrs. Escobar, Mrs. Manaloto and Mrs. Quiambao.
Obviously, when the testator specified his nearest male relative, he must have
had in mind his nephew or a son of his sister, who would be his third-degree
relative, or possibly a grandnephew. But since he could not prognosticate the
exact date of his death or state with certitude what category of nearest male
relative would be living at the time of his death, he could not specify that his
nearest male relative would be his nephew or grandnephews (the son of his
nephew or niece) and so he had to use the term "nearest male relative".
It is contended by the legal heirs that the said devise was in reality intended
for Ramon Quiambao, the testator's nephew and godchild, who was the son
of his sister, Mrs. Quiambao. To prove that contention, the legal heirs
presented in the lower court the affidavit of Beatriz Gamalinda, the maternal
grandmother of Edgardo Cunanan, who deposed that after Father Rigor's
death her own son, Valentin Gamalinda, Jr., did not claim the devise, although
he was studying for the priesthood at the San Carlos Seminary, because she
(Beatriz) knew that Father Rigor had intended that devise for his nearest male
relative beloning to the Rigor family (pp. 105-114, Record on Appeal).
Mrs. Gamalinda further deposed that her own grandchild, Edgardo G.
Cunanan, was not the one contemplated in Father Rigor's will and that
Edgardo's father told her that he was not consulted by the parish priest of
Victoria before the latter filed his second motion for reconsideration which was
based on the ground that the testator's grandnephew, Edgardo, was studying
for the priesthood at the San Jose Seminary.
Parenthetically, it should be stated at this juncture that Edgardo ceased to be
a seminarian in 1961. For that reason, the legal heirs apprised the Court of
Appeals that the probate court's order adjudicating the ricelands to the parish
priest of Victoria had no more leg to stand on (p. 84, Appellant's brief).
Of course, Mrs. Gamalinda's affidavit, which is tantamount to
evidence aliunde as to the testator's intention and which is hearsay, has no
probative value. Our opinion that the said bequest refers to the testator's
nephew who was living at the time of his death, when his succession was
opened and the successional rights to his estate became vested, rests on a
judicious and unbiased reading of the terms of the will.
Had the testator intended that the "cualquier pariente mio varon mas cercano
que estudie la camera eclesiatica" would include indefinitely anyone of his
nearest male relatives born after his death, he could have so specified in his
will He must have known that such a broad provision would suspend for an
unlimited period of time the efficaciousness of his bequest.
What then did the testator mean by "el intervalo de tiempo que no haya
legatario acondicionado"? The reasonable view is that he was referring to a
situation whereby his nephew living at the time of his death, who would like to
become a priest, was still in grade school or in high school or was not yet in
the seminary. In that case, the parish priest of Victoria would administer the
ricelands before the nephew entered the seminary. But the moment the
testator's nephew entered the seminary, then he would be entitled to enjoy
and administer the ricelands and receive the fruits thereof. In that event, the
trusteeship would be terminated.
Following that interpretation of the will the inquiry would be whether at the time
Father Rigor died in 1935 he had a nephew who was studying for the
priesthood or who had manifested his desire to follow the ecclesiastical career.
That query is categorically answered in paragraph 4 of appellant priest's
petitions of February 19, 1954 and January 31, 1957. He unequivocally
alleged therein that "not male relative of the late (Father) Pascual Rigor has does not take effect, there will be intestate succession as to the property
ever studied for the priesthood" (pp. 25 and 35, Record on Appeal). recovered by the said legacy (Macrohon Ong Ham vs. Saavedra, 51 Phil. 267).

Inasmuch as the testator was not survived by any nephew who became a We find no merit in the appeal The Appellate Court's decision is affirmed.
priest, the unavoidable conclusion is that the bequest in question was Costs against the petitioner.
ineffectual or inoperative. Therefore, the administration of the ricelands by the
parish priest of Victoria, as envisaged in the wilt was likewise inoperative. SO ORDERED

The appellant in contending that a public charitable trust was constituted by

the testator in is favor assumes that he was a trustee or a substitute devisee
That contention is untenable. A reading of the testamentary provisions
regarding the disputed bequest not support the view that the parish priest of
Victoria was a trustee or a substitute devisee in the event that the testator was
not survived by a nephew who became a priest.

It should be understood that the parish priest of Victoria could become a

trustee only when the testator's nephew living at the time of his death, who
desired to become a priest, had not yet entered the seminary or, having been
ordained a priest, he was excommunicated. Those two contingencies did not
arise, and could not have arisen in this case because no nephew of the
testator manifested any intention to enter the seminary or ever became a
priest.

The Court of Appeals correctly ruled that this case is covered by article 888 of
the old Civil Code, now article 956, which provides that if "the bequest for any
reason should be inoperative, it shall be merged into the estate, except in
cases of substitution and those in which the right of accretion exists" ("el
legado ... por qualquier causa, no tenga efecto se refundira en la masa de la
herencia, fuera de los casos de sustitucion y derecho de acrecer").

This case is also covered by article 912(2) of the old Civil Code, now article G.R. No. L-25952 June 30, 1967
960 (2), which provides that legal succession takes place when the will "does
not dispose of all that belongs to the testator." There being no substitution nor MARGARITA SALVADOR, in her own behalf and as Attorney-in-fact of
accretion as to the said ricelands the same should be distributed among the CANDIDA SALVADOR, ET AL.,petitioners,
testator's legal heirs. The effect is as if the testator had made no disposition vs.
as to the said ricelands. THE HON. JUDGE ANDRES STA. MARIA, DOMINADOR CARDENAS,
REMEDIOS CABRERA, ALBERTO M. K. JAMIR and SIMEON
The Civil Code recognizes that a person may die partly testate and partly ENRIQUEZ, respondents.
intestate, or that there may be mixed succession. The old rule as to the
indivisibility of the testator's win is no longer valid. Thus, if a conditional legacy BENGZON, J.P., J.:
Seven parcels of titled land and two parcels of untitled land, situated in Bigaa,
Bulacan, were owned by Celestino Salvador. In 1941, he executed a deed of
sale over them in favor of the spouses Alfonso Salvador and Anatolia Halili.
Alleging that the sale was void for lack of consideration, he filed on May
12,1955, against said vendees, a suit for reconveyance of said parcels of land
(CFI of Bulacan, Br. I, Civil Case No. 1082).
On April 27, 1956, Celestino Salvador died, testate. As his alleged heirs,
twenty-one persons1 were on May 18, 1956 substituted as plaintiffs in the
action for reconveyance. And meanwhile, special proceedings for the probate
of his will and for letters testamentary was instituted (CFI of Bulacan, Br. II,
Sp. Proceedings No. 940). In said proceedings, Dominador Cardenas was
appointed on June 11, 1956 special administrator of Celestino Salvador's
testate estate.1wph1.t Following this, on November 22, 1965, said Br. I, ordered the corresponding
On September 4, 1956 the administrator filed in Sp. Proceedings No. 940 an
inventory of properties of the estate, covering the same parcels of land subject
matter of the reconveyance action. On September 7, 1956, Celestino
Salvador's will was admitted to probate and Dominador Cardenas was
appointed executor of said will. Actual issuance of letters testamentary to him
was made on October 27, 1956.
Twenty-three (23) persons were instituted heirs in the will. Of these, nine (9)
were not among the twenty-one (21) alleged relatives substituted in the
reconveyance case; and of the twenty-one (21) substituted alleged heirs
seven (7) were not instituted in the will. 2
In the suit for reconveyance, on November 26, 1956, the Court (CFI of
Bulacan, Br. I) rendered judgment, ordering the defendants therein (the
spouses Alfonso and Anatolia), to reconvey the parcels of land to the estate
of Celestino Salvador. Appeal therefrom to the Court of Appeals was
interposed by said defendants.1wph1.t
On August 12, 1961, the Court of Appeals affirmed the reconveyance
judgment, with the correction that reconveyance be in favor of the twenty-
one (21) heirs substituted as plaintiffs therein.
About three years later, pursuant to an order of the CFI of Bulacan, Br. II, in
the testacy proceedings, dated April 21, 1964, one of the parcels of land
involved, Lot 6, was sold so that with its proceeds debtors who filed claims
may be paid. The Philippine National Bank bought it at P41,184.00. Said
amount was then deposited in the same bank by the administrator, subject to
Court order.
On December 18, 1964, defendants in the suit for reconveyance executed a
deed of reconveyance over the subject parcels of land, in favor of Celestino
Salvador's estate. Revoking the same as lot in accordance with the final
judgment therein, the CFI of Bulacan, Br. I, on September 24, 1965, ordered
a new deed of reconveyance to be executed, in favor of the twenty-one
persons substituted as plaintiffs in that action. Accordingly, on September 30,
1965, a new deed of reconveyance was made, in favor of said twenty-one (21)
persons as heirs of Celestino.
title certificate (TCT No. 54639) in the administrator's name, cancelled; new
title certificate to be issued in the names of the same twenty-one (21) persons.
Said order was carried out, and TCT No. 63734 was issued in the names of
the twenty-one persons. 3
On December 7, 1965, Br. I (reconveyance court) ordered the Philippine
National Bank to release the P41,184.00 proceeds of the sale of Lot 6, to the
twenty-one (21) plaintiffs in the reconveyance case. Apparently, although the
passbook was given by the administrator to said twenty-one persons, no
release was made, as the Philippine National Bank awaited Br. II's order.
Br. II, on March 1, 1966, approved the following claims against the estate:
Taxes Nat'l. gov't P5,328.23
Atty's fees Atty. Enriquez 8,000.00
Atty's fees Atty. Jamir 12,000.00
Loan R. Cabrera 13,544.35
TOTAL........ 38,872.58
=========
On March 30, 1966, said Br. II (probate court), ordered return of the passbook
to the administrator; and release to the administrator by the PNB of the
P41,184.00, or so much thereof is needed to pay the afore-stated debts of the
estate.
After failing to get reconsideration of said order, the twenty-one (21)
substituted heirs, on April 25, 1966, filed with Us the present special civil action
for certiorari with preliminary injunction to assail the order to pay the debts of
the estate with the P41,184.00 proceeds of the sale of Lot 6; and to question
Br. II's (probate court) power to dispose of the parcels of land involved in the
reconveyance suit in Br. I.
At any rate, the proceeds of Lot 6 alone (P41,184.00) appears more than
sufficient to pay the debt (P38,872.58); and there will remain the other parcels
of land not sold. As to the question of who will receive how much as heirs, the
same is properly determinable by the settlement court, after payment of the
debts (Pimentel v. Palanca, 5 Phil. 436; Maningat v. Castillo, 75 Phil. 532;
Jimoga-on v. Belmonte, supra).
Wherefore, the petition for certiorari is denied, without costs. So ordered.

Raised are these issues: (1) Are the parcels of land and the proceeds of the
sale of one of them, properties of the estate or not? (2) Does final judgment in
the reconveyance suit in favor of the twenty-one so-called heirs who
substituted Celestino Salvador, bar the disposition of the reconveyed
properties by the settlement court?

It is a settled point of law that the right of heirs to specific, distributive shares
of inheritance does not become finally determinable until all the debts of the
estate are paid. Until then, in the face of said claims, their rights cannot be
enforced, are inchoate, and subject to the existence of a residue after payment
of the debts (Castellvi de Raquiza v. Castellvi, L-17630, October 31, 1963;
Jimoga-on v. Belmonte, 84 Phil. 545; Sec. 1, Rule 90, Rules of Court).

Petitioners do not question the existence of the debts abovementioned. They

only contend that the properties involved having been ordered by final
judgment reconveyed to them, not to the estate the same are not properties
of the estate but their own, and thus, not liable for debts of the estate.

Said contention is self-refuting. Petitioners rely for their rights on their alleged
character as heirs of Celestino; as such, they were substituted in the G.R. No. 149926 February 23, 2005
reconveyance case; the reconveyance to them was reconveyance to them as
heirs of Celestino Salvador. It follows that the properties they claim are, even UNION BANK OF THE PHILIPPINES, petitioner,
by their own reasoning, part of Celestino's estate. The right thereto as vs.
allegedly his heirs would arise only if said parcels of land are part of the estate EDMUND SANTIBAEZ and FLORENCE SANTIBAEZ
of Celestino, not otherwise. Their having received the same, therefore, in the ARIOLA, respondents.
reconveyance action, was perforce in trust for the estate, subject to its
obligations. They cannot distribute said properties among themselves as DECISION
substituted heirs without the debts of the estate being first satisfied.
CALLEJO, SR., J.:
Before us is a petition for review on certiorari under Rule 45 of the Revised
Rules of Court which seeks the reversal of the Decision1 of the Court of
Appeals dated May 30, 2001 in CA-G.R. CV No. 48831 affirming the
dismissal2 of the petitioners 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 agreement3 in the amount of 128,000.00.
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 43,745.96 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 123,156.00. 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 Agreement5 for the loan dated
December 13, 1980.
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 Agreement8 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.
On August 20, 1981, a Deed of Assignment with Assumption of Liabilities9 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 letters10 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
Complaint11 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 Answer13 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 paragraph (e) of the holographic will covered the subject properties (tractors)
the decedents account. Ruling that the joint agreement executed by the heirs in generic terms when the deceased referred to them as "all other properties."
was null and void, the trial court held that the petitioners cause of action Moreover, the active participation of respondent Florence S. Ariola in the case
against respondent Florence S. Ariola must necessarily fail. did not amount to a waiver. Thus, the CA affirmed the RTC decision, viz.:

The petitioner appealed from the RTC decision and elevated its case to the WHEREFORE, premises considered, the appealed Decision of the Regional
Court of Appeals (CA), assigning the following as errors of the trial court: Trial Court of Makati City, Branch 63, is hereby AFFIRMED in toto.

1. THE COURT A QUO ERRED IN FINDING THAT THE JOINT SO ORDERED.18

AGREEMENT (EXHIBIT A) SHOULD BE APPROVED BY THE
PROBATE COURT. In the present recourse, the petitioner ascribes the following errors to the CA:

2. THE COURT A QUO ERRED IN FINDING THAT THERE CAN BE I.

NO VALID PARTITION AMONG THE HEIRS UNTIL AFTER THE
WILL HAS BEEN PROBATED. THE HONORABLE COURT OF APPEALS ERRED IN FINDING THAT THE
JOINT AGREEMENT SHOULD BE APPROVED BY THE PROBATE COURT.
3. THE COURT A QUO ERRED IN NOT FINDING THAT THE
DEFENDANT HAD WAIVED HER RIGHT TO HAVE THE CLAIM RE- II.
LITIGATED IN THE ESTATE PROCEEDING.16
THE COURT OF APPEALS ERRED IN FINDING THAT THERE CAN BE NO
The petitioner asserted before the CA that the obligation of the deceased had VALID PARTITION AMONG THE HEIRS OF THE LATE EFRAIM
passed to his legitimate children and heirs, in this case, Edmund and Florence; SANTIBAEZ UNTIL AFTER THE WILL HAS BEEN PROBATED.
the unconditional signing of the joint agreement marked as Exhibit "A"
estopped respondent Florence S. Ariola, and that she cannot deny her liability III.
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 COURT OF APPEALS ERRED IN NOT FINDING THAT THE
the probate court for approval; the property partitioned in the agreement was RESPONDENT HAD WAIVED HER RIGHT TO HAVE THE CLAIM RE-
not one of those enumerated in the holographic will made by the deceased; LITIGATED IN THE ESTATE PROCEEDING.
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-
IV.
litigate the claim in the estate proceedings.
RESPONDENTS CAN, IN FACT, BE HELD JOINTLY AND SEVERALLY
On the other hand, respondent Florence S. Ariola maintained that the money
LIABLE WITH THE PRINCIPAL DEBTOR THE LATE EFRAIM SANTIBAEZ
claim of the petitioner should have been presented before the probate court.17
ON THE STRENGTH OF THE CONTINUING GUARANTY AGREEMENT
EXECUTED IN FAVOR OF PETITIONER-APPELLANT UNION BANK.
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
V.
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,
THE PROMISSORY NOTES DATED MAY 31, 1980 IN THE SUM OF
128,000.00 AND DECEMBER 13, 1980 IN THE AMOUNT OF 123,000.00
CATEGORICALLY ESTABLISHED THE FACT THAT THE RESPONDENTS
BOUND THEMSELVES JOINTLY AND SEVERALLY LIABLE WITH THE
LATE DEBTOR EFRAIM SANTIBAEZ IN FAVOR OF PETITIONER UNION
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 petitioners 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
jurisor 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.
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.1a\^/phi1.net
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.1awphi1.nt
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 will24 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 agreement25 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 fathers holographic will covering the said tractors.
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 courts 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.l^vvphi1.net 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 decedents 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.
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
evidence35 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 petitioners 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 Mortgage
Bank 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 petitioners 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.
EN BANC
[G.R. No. L-8437. November 28, 1956.]
ESTATE OF K. H. HEMADY, deceased, vs. LUZON SURETY CO., INC.,
claimant-Appellant.
DECISION
REYES, J. B. L., J.:
Appeal by Luzon Surety Co., Inc., from an order of the Court of First Instance
of Rizal, presided by Judge Hermogenes Caluag, dismissing its claim against
the Estate of K. H. Hemady (Special Proceeding No. Q-293) for failure to state
a cause of action.
The Luzon Surety Co. had filed a claim against the Estate based on twenty
different indemnity agreements, or counter bonds, each subscribed by a
distinct principal and by the deceased K. H. Hemady, a surety solidary
guarantor) in all of them, in consideration of the Luzon Surety Co.s of having
guaranteed, the various principals in favor of different creditors. The twenty
counterbonds, or indemnity agreements, all contained the following
stipulations:
Premiums. As consideration for this suretyship, the undersigned jointly and
severally, agree to pay the COMPANY the sum of ________________
(P______) pesos, Philippines Currency, in advance as premium there of for
every __________ months or fractions thereof, this ________ or any renewal
or substitution thereof is in effect.
Indemnity. The undersigned, jointly and severally, agree at all times to
indemnify the COMPANY and keep it indemnified and hold and save it
harmless from and against any and all damages, losses, costs, stamps, taxes,
penalties, charges, and expenses of whatsoever kind and nature which the
COMPANY shall or may, at any time sustain or incur in consequence of having
become surety upon this bond or any extension, renewal, substitution or
alteration thereof made at the instance of the undersigned or any of them or
any order executed on behalf of the undersigned or any of them; and to pay,
reimburse and make good to the COMPANY, its successors and assigns, all
sums and amount of money which it or its representatives shall pay or cause
to be paid, or become liable to pay, on account of the undersigned or any of
them, of whatsoever kind and nature, including 15% of the amount involved in
the litigation or other matters growing out of or connected therewith for counsel
or attorneys fees, but in no case less than P25. It is hereby further agreed that
in case of extension or renewal of this ________ we equally bind ourselves
for the payment thereof under the same terms and conditions as above
mentioned without the necessity of executing another indemnity agreement
for the purpose and that we hereby equally waive our right to be notified of any
renewal or extension of this ________ which may be granted under this
indemnity agreement.
Interest on amount paid by the Company. Any and all sums of money so
paid by the company shall bear interest at the rate of 12% per annum which
interest, if not paid, will be accummulated and added to the capital quarterly
order to earn the same interests as the capital and the total sum thereof, the
capital and interest, shall be paid to the COMPANY as soon as the COMPANY
shall have become liable therefore, whether it shall have paid out such sums
of money or any part thereof or not.
xxx xxx xxx
Waiver. It is hereby agreed upon by and between the undersigned that any
question which may arise between them by reason of this document and which
has to be submitted for decision to Courts of Justice shall be brought before
the Court of competent jurisdiction in the City of Manila, waiving for this
purpose any other venue. Our right to be notified of the acceptance and
approval of this indemnity agreement is hereby likewise waived.
xxx xxx xxx
Our Liability Hereunder. It shall not be necessary for the COMPANY to bring
suit against the principal upon his default, or to exhaust the property of the
principal, but the liability hereunder of the undersigned indemnitor shall be
jointly and severally, a primary one, the same as that of the principal, and shall
be exigible immediately upon the occurrence of such default. (Rec. App. pp.
98- 102.)
The Luzon Surety Co., prayed for allowance, as a contingent claim, of the
value of the twenty bonds it had executed in consideration of the counter
bonds, and further asked for judgment for the unpaid premiums and
documentary stamps affixed to the bonds, with 12 per cent interest thereon.
Before answer was filed, and upon motion of the administratrix of Hemadys
estate, the lower court, by order of September 23, 1953, dismissed the claims
of Luzon Surety Co., on two grounds: (1) that the premiums due and cost of
documentary stamps were not contemplated under the indemnity agreements
to be a part of the undertaking of the guarantor (Hemady), since they were not
liabilities incurred after the execution of the counterbonds; and (2) that
whatever losses may occur after Hemadys death, are not chargeable to his
estate, because upon his death he ceased to be guarantor.
Taking up the latter point first, since it is the one more far reaching in effects,
the reasoning of the court below ran as follows:
The administratrix further contends that upon the death of Hemady, his
liability as a guarantor terminated, and therefore, in the absence of a showing
that a loss or damage was suffered, the claim cannot be considered
contingent. This Court believes that there is merit in this contention and finds
support in Article 2046 of the new Civil Code. It should be noted that a new
requirement has been added for a person to qualify as a guarantor, that
is integrity. As correctly pointed out by the Administratrix, integrity is something
purely personal and is not transmissible. Upon the death of Hemady, his
integrity was not transmitted to his estate or successors. Whatever loss
therefore, may occur after Hemadys death, are not chargeable to his estate
because upon his death he ceased to be a guarantor.
Another clear and strong indication that the surety company has exclusively
relied on the personality, character, honesty and integrity of the now deceased
K. H. Hemady, was the fact that in the printed form of the indemnity agreement
there is a paragraph entitled Security by way of first mortgage, which was
expressly waived and renounced by the security company. The security
company has not demanded from K. H. Hemady to comply with this
requirement of giving security by way of first mortgage. In the supporting
papers of the claim presented by Luzon Surety Company, no real property
was mentioned in the list of properties mortgaged which appears at the back
of the indemnity agreement. (Rec. App., pp. 407-408).
We find this reasoning untenable. Under the present Civil Code (Article 1311),
as well as under the Civil Code of 1889 (Article 1257), the rule is that
Contracts take effect only as between the parties, their assigns and heirs,
except in the case where the rights and obligations arising from the contract
are not transmissible by their nature, or by stipulation or by provision of law.
While in our successional system the responsibility of the heirs for the debts
of their decedent cannot exceed the value of the inheritance they receive from
him, the principle remains intact that these heirs succeed not only to the rights
of the deceased but also to his obligations. Articles 774 and 776 of the New
Civil Code (and Articles 659 and 661 of the preceding one) expressly so
provide, thereby confirming Article 1311 already quoted.
ART. 774. Succession is a mode of acquisition by virtue of which the
property, rights and obligations to the extent of the value of the inheritance, of
a person are transmitted through his death to another or others either by his
will or by operation of law.
ART. 776. The inheritance includes all the property, rights and obligations
of a person which are not extinguished by his death.
In Mojica vs. Fernandez, 9 Phil. 403, this Supreme Court ruled:
Under the Civil Code the heirs, by virtue of the rights of succession are
subrogated to all the rights and obligations of the deceased (Article 661) and
cannot be regarded as third parties with respect to a contract to which the
deceased was a party, touching the estate of the deceased (Barrios vs. Dolor,
2 Phil. 44).
xxx xxx xxx
The principle on which these decisions rest is not affected by the provisions
of the new Code of Civil Procedure, and, in accordance with that principle, the
heirs of a deceased person cannot be held to be third persons in relation to
any contracts touching the real estate of their decedent which comes in to their
hands by right of inheritance; they take such property subject to all the
obligations resting thereon in the hands of him from whom they derive their
rights.
(See also Galasinao vs. Austria, 51 Off. Gaz. (No. 6) p. 2874 and de Guzman
vs. Salak, 91 Phil., 265).
The binding effect of contracts upon the heirs of the deceased party is not
altered by the provision in our Rules of Court that money debts of a deceased
must be liquidated and paid from his estate before the residue is distributed
among said heirs (Rule 89). The reason is that whatever payment is thus made
from the estate is ultimately a payment by the heirs and distributees, since the
amount of the paid claim in fact diminishes or reduces the shares that the heirs
would have been entitled to receive.
Under our law, therefore, the general rule is that a partys contractual rights
and obligations are transmissible to the successors. The rule is a
consequence of the progressive depersonalization of patrimonial rights and
duties that, as observed by Victorio Polacco, has characterized the history of
these institutions. From the Roman concept of a relation from person to
person, the obligation has evolved into a relation from patrimony to patrimony,
with the persons occupying only a representative position, barring those rare
cases where the obligation is strictly personal, i.e., is contracted intuitu
personae, in consideration of its performance by a specific person and by no
other. The transition is marked by the disappearance of the imprisonment for
debt.
Of the three exceptions fixed by Article 1311, the nature of the obligation of
the surety or guarantor does not warrant the conclusion that his peculiar
individual qualities are contemplated as a principal inducement for the
contract. What did the creditor Luzon Surety Co. expect of K. H. Hemady when
it accepted the latter as surety in the counterbonds? Nothing but the
reimbursement of the moneys that the Luzon Surety Co. might have to
disburse on account of the obligations of the principal debtors. This
reimbursement is a payment of a sum of money, resulting from an obligation
to give; and to the Luzon Surety Co., it was indifferent that the reimbursement
should be made by Hemady himself or by someone else in his behalf, so long
as the money was paid to it.
The second exception of Article 1311, p. 1, is intransmissibility by stipulation
of the parties. Being exceptional and contrary to the general rule, this
intransmissibility should not be easily implied, but must be expressly
established, or at the very least, clearly inferable from the provisions of the
contract itself, and the text of the agreements sued upon nowhere indicate that
they are non-transferable.
(b) Intransmisibilidad por pacto. Lo general es la transmisibilidad de
darechos y obligaciones; chan roblesvirtualawlibraryle excepcion, la
intransmisibilidad. Mientras nada se diga en contrario impera el principio de la
transmision, como elemento natural a toda relacion juridica, salvo las
personalisimas. Asi, para la no transmision, es menester el pacto expreso,
porque si no, lo convenido entre partes trasciende a sus herederos.
Siendo estos los continuadores de la personalidad del causante, sobre ellos
recaen los efectos de los vinculos juridicos creados por sus antecesores, y
para evitarlo, si asi se quiere, es indespensable convension terminante en tal
sentido.
Por su esencia, el derecho y la obligacion tienden a ir ms all de las personas
que les dieron vida, y a ejercer presion sobre los sucesores de esa
persona; chan roblesvirtualawlibrarycuando no se quiera esto, se impone una
estipulacion limitativa expresamente de la transmisibilidad o de cuyos tirminos
claramente se deduzca la concresion del concreto a las mismas personas que
lo otorgon. (Scaevola, Codigo Civil, Tomo XX, p. 541-542) (Emphasis
supplied.)
Because under the law (Article 1311), a person who enters into a contract is
deemed to have contracted for himself and his heirs and assigns, it is
unnecessary for him to expressly stipulate to that effect; hence, his failure to
do so is no sign that he intended his bargain to terminate upon his death.
Similarly, that the Luzon Surety Co., did not require bondsman Hemady to
execute a mortgage indicates nothing more than the companys faith and
confidence in the financial stability of the surety, but not that his obligation was
strictly personal.
The third exception to the transmissibility of obligations under Article 1311
exists when they are not transmissible by operation of law. The provision
makes reference to those cases where the law expresses that the rights or
obligations are extinguished by death, as is the case in legal support (Article
300), parental authority (Article 327), usufruct (Article 603), contracts for a
piece of work (Article 1726), partnership (Article 1830 and agency (Article
1919). By contract, the articles of the Civil Code that regulate guaranty or
suretyship (Articles 2047 to 2084) contain no provision that the guaranty is
extinguished upon the death of the guarantor or the surety.
The lower court sought to infer such a limitation from Art. 2056, to the effect
that one who is obliged to furnish a guarantor must present a person who
possesses integrity, capacity to bind himself, and sufficient property to answer
for the obligation which he guarantees. It will be noted, however, that the law
requires these qualities to be present only at the time of the perfection of the
contract of guaranty. It is self-evident that once the contract has become
perfected and binding, the supervening incapacity of the guarantor would not
operate to exonerate him of the eventual liability he has contracted; and if that
be true of his capacity to bind himself, it should also be true of his integrity,
which is a quality mentioned in the article alongside the capacity.
The foregoing concept is confirmed by the next Article 2057 that runs as
follows:
ART. 2057. If the guarantor should be convicted in first instance of a crime
involving dishonesty or should become insolvent, the creditor may demand
another who has all the qualifications required in the preceding article. The
case is excepted where the creditor has required and stipulated that a
specified person should be guarantor.
From this article it should be immediately apparent that the supervening
dishonesty of the guarantor (that is to say, the disappearance of his integrity
after he has become bound) does not terminate the contract but merely
entitles the creditor to demand a replacement of the guarantor. But the step
remains optional in the creditor: it is his right, not his duty; he may waive it if
he chooses, and hold the guarantor to his bargain. Hence Article 2057 of the
present Civil Code is incompatible with the trial courts stand that the
requirement of integrity in the guarantor or surety makes the latters
undertaking strictly personal, so linked to his individuality that the guaranty
automatically terminates upon his death.
The contracts of suretyship entered into by K. H. Hemady in favor of Luzon
Surety Co. not being rendered intransmissible due to the nature of the
undertaking, nor by the stipulations of the contracts themselves, nor by
provision of law, his eventual liability thereunder necessarily passed upon his
death to his heirs. The contracts, therefore, give rise to contingent claims
provable against his estate under section 5, Rule 87 (2 Moran, 1952 ed., p.
437; Gaskell & Co. vs. Tan Sit, 43 Phil. 810, 814).
The most common example of the contigent claim is that which arises when
a person is bound as surety or guarantor for a principal who is insolvent or
dead. Under the ordinary contract of suretyship the surety has no claim
whatever against his principal until he himself pays something by way of
satisfaction upon the obligation which is secured. When he does this, there
instantly arises in favor of the surety the right to compel the principal to
exonerate the surety. But until the surety has contributed something to the
payment of the debt, or has performed the secured obligation in whole or in
part, he has no right of action against anybody no claim that could be
reduced to judgment. (May vs. Vann, 15 Pla., 553; Gibson vs. Mithell, 16 Pla.,
519; Maxey vs. Carter, 10 Yarg. [Tenn.], 521 Reeves vs. Pulliam, 7 Baxt.
[Tenn.], 119; Ernst vs. Nou, 63 Wis., 134.)
For Defendant administratrix it is averred that the above doctrine refers to a
case where the surety files claims against the estate of the principal
debtor; and it is urged that the rule does not apply to the case before us, where
the late Hemady was a surety, not a principal debtor. The argument evinces a
superficial view of the relations between parties. If under the Gaskell ruling,
the Luzon Surety Co., as guarantor, could file a contingent claim against the
estate of the principal debtors if the latter should die, there is absolutely no
reason why it could not file such a claim against the estate of Hemady, since
Hemady is a solidary co-debtor of his principals. What the Luzon Surety Co.
may claim from the estate of a principal debtor it may equally claim from the
estate of Hemady, since, in view of the existing solidarity, the latter does not
even enjoy the benefit of exhaustion of the assets of the principal debtor.
G.R. No. L-68053 May 7, 1990
The foregoing ruling is of course without prejudice to the remedies of the
administratrix against the principal debtors under Articles 2071 and 2067 of LAURA ALVAREZ, FLORA ALVAREZ and RAYMUNDO ALVAREZ,
the New Civil Code. petitioners,
Our conclusion is that the solidary guarantors liability is not extinguished by
his death, and that in such event, the Luzon Surety Co., had the right to file vs.
against the estate a contingent claim for reimbursement. It becomes
unnecessary now to discuss the estates liability for premiums and stamp THE HONORABLE INTERMEDIATE APELLATE COURT and JESUS
taxes, because irrespective of the solution to this question, the Luzon Suretys YANES, ESTELITA YANES, ANTONIO YANES, ROSARIO YANES, and
claim did state a cause of action, and its dismissal was erroneous. ILUMINADO YANES, respondents.
Wherefore, the order appealed from is reversed, and the records are ordered FERNAN, C.J.:
remanded to the court of origin, with instructions to proceed in accordance
with law. Costs against the Administratrix- Appellee. SO ORDERED. This is a petition for review on certiorari seeking the reversal of: (a) the
decision of the Fourth Civil Cases Division of the Intermediate Appellate Court
dated August 31, 1983 in AC-G.R. CV No. 56626 entitled "Jesus Yanes et al.
v. Dr. Rodolfo Siason et al." affirming the decision dated July 8, 1974 of the
Court of First Instance of Negros Occidental insofar as it ordered the
petitioners to pay jointly and severally the private respondents the sum of
P20,000.00 representing the actual value of Lots Nos. 773-A and 773-B of the
cadastral survey of Murcia, Negros Occidental and reversing the subject
decision insofar as it awarded the sums of P2,000.00, P5,000.00 and
P2,000.00 as actual damages, moral damages and attorney's fees,
respectively and (b) the resolution of said appellate court dated May 30, 1984,
denying the motion for reconsideration of its decision.
The real properties involved are two parcels of land identified as Lot 773-A
and Lot 773-B which were originally known as Lot 773 of the cadastral survey
of Murcia, Negros Occidental. Lot 773, with an area of 156,549 square meters,
was registered in the name of the heirs of Aniceto Yanes under Original
Certificate of Title No. RO-4858 (8804) issued on October 9, 1917 by the
Register of Deeds of Occidental Negros (Exh. A).
Aniceto Yanes was survived by his children, Rufino, Felipe and Teodora.
Herein private respondents, Estelita, Iluminado and Jesus, are the children of
Rufino who died in 1962 while the other private respondents, Antonio and
Rosario Yanes, are children of Felipe. Teodora was survived by her child,
Jovita (Jovito) Alib. 1 It is not clear why the latter is not included as a party in
this case.
Aniceto left his children Lots 773 and 823. Teodora cultivated only three
hectares of Lot 823 as she could not attend to the other portions of the two
lots which had a total area of around twenty-four hectares. The record does
not show whether the children of Felipe also cultivated some portions of the
lots but it is established that Rufino and his children left the province to settle
in other places as a result of the outbreak of World War II. According to
Estelita, from the "Japanese time up to peace time", they did not visit the
parcels of land in question but "after liberation", when her brother went there
to get their share of the sugar produced therein, he was informed that
Fortunato Santiago, Fuentebella (Puentevella) and Alvarez were in
possession of Lot 773. 2
It is on record that on May 19, 1938, Fortunato D. Santiago was issued
Transfer Certificate of Title No. RF 2694 (29797) covering Lot 773-A with an
area of 37,818 square meters. 3 TCT No. RF 2694 describes Lot 773-A as a
portion of Lot 773 of the cadastral survey of Murcia and as originally registered
under OCT No. 8804.
The bigger portion of Lot 773 with an area of 118,831 square meters was also
registered in the name of Fortunato D. Santiago on September 6, 1938 Under
TCT No. RT-2695 (28192 ). 4 Said transfer certificate of title also contains a
certification to the effect that Lot 773-B was originally registered under OCT
No. 8804.
On May 30, 1955, Santiago sold Lots 773-A and 773-B to Monico B.
Fuentebella, Jr. in consideration of the sum of P7,000.00. 5 Consequently, on
February 20, 1956, TCT Nos. T-19291 and T-19292 were issued in
Fuentebella's name. 6
After Fuentebella's death and during the settlement of his estate, the
administratrix thereof (Arsenia R. Vda. de Fuentebella, his wife) filed in Special
Proceedings No. 4373 in the Court of First Instance of Negros Occidental, a
motion requesting authority to sell Lots 773-A and 773-B. 7 By virtue of a court
order granting said motion, 8 on March 24, 1958, Arsenia Vda. de Fuentebella
sold said lots for P6,000.00 to Rosendo Alvarez. 9 Hence, on April 1, 1958
TCT Nos. T-23165 and T-23166 covering Lots 773-A and 773-B were
respectively issued to Rosendo Alvarez. 10
Two years later or on May 26, 1960, Teodora Yanes and the children of her
brother Rufino, namely, Estelita, Iluminado and Jesus, filed in the Court of First
Instance of Negros Occidental a complaint against Fortunato Santiago,
Arsenia Vda. de Fuentebella, Alvarez and the Register of Deeds of Negros
Occidental for the "return" of the ownership and possession of Lots 773 and
823. They also prayed that an accounting of the produce of the land from 1944
up to the filing of the complaint be made by the defendants, that after court
approval of said accounting, the share or money equivalent due the plaintiffs
be delivered to them, and that defendants be ordered to pay plaintiffs P500.00
as damages in the form of attorney's fees. 11
During the pendency in court of said case or on November 13, 1961, Alvarez
sold Lots 773-A, 773-B and another lot for P25,000.00 to Dr. Rodolfo Siason.
12 Accordingly, TCT Nos. 30919 and 30920 were issued to Siason, 13 who
thereafter, declared the two lots in his name for assessment purposes. 14
Meanwhile, on November 6, 1962, Jesus Yanes, in his own behalf and in
behalf of the other plaintiffs, and assisted by their counsel, filed a manifestation
in Civil Case No. 5022 stating that the therein plaintiffs "renounce, forfeit and
quitclaims (sic) any claim, monetary or otherwise, against the defendant
Arsenia Vda. de Fuentebella in connection with the above-entitled case." 15
On October 11, 1963, a decision was rendered by the Court of First Instance
of Negros Occidental in Civil Case No. 5022, the dispositive portion of which
reads:
WHEREFORE, judgment is rendered, ordering the defendant Rosendo
Alvarez to reconvey to the plaintiffs lots Nos. 773 and 823 of the Cadastral
Survey of Murcia, Negros Occidental, now covered by Transfer Certificates of
Title Nos. T-23165 and T-23166 in the name of said defendant, and thereafter
to deliver the possession of said lots to the plaintiffs. No special
pronouncement as to costs.
SO ORDERED. 16
It will be noted that the above-mentioned manifestation of Jesus Yanes was
not mentioned in the aforesaid decision.
However, execution of said decision proved unsuccessful with respect to Lot
773. In his return of service dated October 20, 1965, the sheriff stated that he
discovered that Lot 773 had been subdivided into Lots 773-A and 773-B; that
they were "in the name" of Rodolfo Siason who had purchased them from
Alvarez, and that Lot 773 could not be delivered to the plaintiffs as Siason was
"not a party per writ of execution." 17
The execution of the decision in Civil Case No. 5022 having met a hindrance,
herein private respondents (the Yaneses) filed on July 31, 1965, in the Court
of First Instance of Negros Occidental a petition for the issuance of a new
certificate of title and for a declaration of nullity of TCT Nos. T-23165 and T-
23166 issued to Rosendo Alvarez. 18 Thereafter, the court required Rodolfo
Siason to produce the certificates of title covering Lots 773 and 823.
Expectedly, Siason filed a manifestation stating that he purchased Lots 773-
A, 773-B and 658, not Lots 773 and 823, "in good faith and for a valuable
consideration without any knowledge of any lien or encumbrances against
said properties"; that the decision in the cadastral proceeding 19 could not be
enforced against him as he was not a party thereto; and that the decision in
Civil Case No. 5022 could neither be enforced against him not only because
he was not a party-litigant therein but also because it had long become final
and executory. 20 Finding said manifestation to be well-founded, the cadastral
court, in its order of September 4, 1965, nullified its previous order requiring
Siason to surrender the certificates of title mentioned therein. 21
In 1968, the Yaneses filed an ex-parte motion for the issuance of an alias writ
of execution in Civil Case No. 5022. Siason opposed it. 22 In its order of
September 28, 1968 in Civil Case No. 5022, the lower court, noting that the
Yaneses had instituted another action for the recovery of the land in question,
ruled that at the judgment therein could not be enforced against Siason as he
was not a party in the case. 23
The action filed by the Yaneses on February 21, 1968 was for recovery of real
property with damages. 24 Named defendants therein were Dr. Rodolfo
Siason, Laura Alvarez, Flora Alvarez, Raymundo Alvarez and the Register of
Deeds of Negros Occidental. The Yaneses prayed for the cancellation of TCT
Nos. T-19291 and 19292 issued to Siason (sic) for being null and void; the
issuance of a new certificate of title in the name of the Yaneses "in accordance
with the sheriffs return of service dated October 20, 1965;" Siason's delivery
of possession of Lot 773 to the Yaneses; and if, delivery thereof could not be
effected, or, if the issuance of a new title could not be made, that the Alvarez
and Siason jointly and severally pay the Yaneses the sum of P45,000.00. They
also prayed that Siason render an accounting of the fruits of Lot 773 from
November 13, 1961 until the filing of the complaint; and that the defendants
jointly and severally pay the Yaneses moral damages of P20,000.00 and
exemplary damages of P10,000.00 plus attorney's fees of P4, 000.00. 25
In his answer to the complaint, Siason alleged that the validity of his titles to
Lots 773-A and 773-B, having been passed upon by the court in its order of
September 4, 1965, had become res judicata and the Yaneses were estopped
from questioning said order. 26 On their part, the Alvarez stated in their answer
that the Yaneses' cause of action had been "barred by res judicata, statute of
limitation and estoppel." 27
In its decision of July 8, 1974, the lower court found that Rodolfo Siason, who
purchased the properties in question thru an agent as he was then in Mexico
pursuing further medical studies, was a buyer in good faith for a valuable
consideration. Although the Yaneses were negligent in their failure to place a
notice of lis pendens "before the Register of Deeds of Negros Occidental in
order to protect their rights over the property in question" in Civil Case No.
5022, equity demanded that they recover the actual value of the land because
the sale thereof executed between Alvarez and Siason was without court
approval. 28 The dispositive portion of the decision states:
IN VIEW OF THE FOREGOING CONSIDERATION, judgment is hereby
rendered in the following manner:
A. The case against the defendant Dr. Rodolfo Siason and the Register
of Deeds are (sic) hereby dismmissed,
B. The defendants, Laura, Flora and Raymundo, all surnamed Alvarez
being the legitimate children of the deceased Rosendo Alvarez are hereby
ordered to pay jointly and severally the plaintiffs the sum of P20,000.00
representing the actual value of Lots Nos. 773-A and 773-B of Murcia
Cadastre, Negros Occidental; the sum of P2,000.00 as actual damages
suffered by the plaintiff; the sum of P5,000.00 representing moral damages
and the sum of P2.000 as attorney's fees, all with legal rate of interest from
date of the filing of this complaint up to final payment.
C. The cross-claim filed by the defendant Dr. Rodolfo Siason against the
defendants, Laura, Flora and Raymundo, all surnamed Alvarez is hereby
dismissed.
D. Defendants, Laura, Flora and Raymundo, all surnamed Alvarez are
hereby ordered to pay the costs of this suit.
SO ORDERED. 29
The Alvarez appealed to the then Intermediate Appellate Court which in its
decision of August 31, 1983 30 affirmed the lower court's decision "insofar as
it ordered defendants-appellants to pay jointly and severally the plaintiffs-
appellees the sum of P20,000.00 representing the actual value of Lots Nos.
773-A and 773-B of the cadastral survey of Murcia, Negros Occidental, and is
reversed insofar as it awarded the sums of P2,000.00, P5,000.00 and
P2,000.00 as actual damages, moral damages and attorney's fees,
respectively." 31 The dispositive portion of said decision reads:
WHEREFORE, the decision appealed from is affirmed insofar as it ordered
defendants-appellants to pay jointly and severally the plaintiffs- appellees the
sum of P20,000.00 representing the actual value of Lots Nos. 773-A and 773-
B of the cadastral survey of Murcia, Negros Occidental, and is reversed insofar
as it awarded the sums of P2,000.00, P5,000.00 and P2,000.00 as actual
damages, moral damages and attorney's fees, respectively. No costs.
SO ORDERED. 32
Finding no cogent reason to grant appellants motion for reconsideration, said
appellate court denied the same.
Hence, the instant petition. ln their memorandum petitioners raised the
following issues:
1. Whethere or not the defense of prescription and estoppel had been
timely and properly invoked and raised by the petitioners in the lower court.
2. Whether or not the cause and/or causes of action of the private
respondents, if ever there are any, as alleged in their complaint dated
February 21, 1968 which has been docketed in the trial court as Civil Case
No. 8474 supra, are forever barred by statute of limitation and/or prescription
of action and estoppel.
3. Whether or not the late Rosendo Alvarez, a defendant in Civil Case
No. 5022, supra and father of the petitioners become a privy and/or party to
the waiver (Exhibit 4-defendant Siason) in Civil Case No. 8474, supra where
the private respondents had unqualifiedly and absolutely waived, renounced
and quitclaimed all their alleged rights and interests, if ever there is any, on
Lots Nos. 773-A and 773-B of Murcia Cadastre as appearing in their written
manifestation dated November 6, 1962 (Exhibits "4" Siason) which had not
been controverted or even impliedly or indirectly denied by them.
4. Whether or not the liability or liabilities of Rosendo Alvarez arising from
the sale of Lots Nos. 773-A and 773-B of Murcia Cadastre to Dr. Rodolfo
Siason, if ever there is any, could be legally passed or transmitted by
operations (sic) of law to the petitioners without violation of law and due
process . 33
The petition is devoid of merit.
As correctly ruled by the Court of Appeals, it is powerless and for that matter
so is the Supreme Court, to review the decision in Civil Case No. 5022
ordering Alvarez to reconvey the lots in dispute to herein private respondents.
Said decision had long become final and executory and with the possible
exception of Dr. Siason, who was not a party to said case, the decision in Civil
Case No. 5022 is the law of the case between the parties thereto. It ended
when Alvarez or his heirs failed to appeal the decision against them. 34
Thus, it is axiomatic that when a right or fact has been judicially tried and
determined by a court of competent jurisdiction, so long as it remains
unreversed, it should be conclusive upon the parties and those in privity with
them in law or estate. 35 As consistently ruled by this Court, every litigation
must come to an end. Access to the court is guaranteed. But there must be a
limit to it. Once a litigant's right has been adjudicated in a valid final judgment
of a competent court, he should not be granted an unbridled license to return
for another try. The prevailing party should not be harassed by subsequent
suits. For, if endless litigation were to be allowed, unscrupulous litigations will
multiply in number to the detriment of the administration of justice. 36
There is no dispute that the rights of the Yaneses to the properties in question
have been finally adjudicated in Civil Case No. 5022. As found by the lower
court, from the uncontroverted evidence presented, the Yaneses have been
illegally deprived of ownership and possession of the lots in question. 37 In
fact, Civil Case No. 8474 now under review, arose from the failure to execute
Civil Case No. 5022, as subject lots can no longer be reconveyed to private
respondents Yaneses, the same having been sold during the pendency of the
case by the petitioners' father to Dr. Siason who did not know about the
controversy, there being no lis pendens annotated on the titles. Hence, it was
also settled beyond question that Dr. Siason is a purchaser in good faith.
Under the circumstances, the trial court did not annul the sale executed by
Alvarez in favor of Dr. Siason on November 11, 1961 but in fact sustained it.
The trial court ordered the heirs of Rosendo Alvarez who lost in Civil Case No.
5022 to pay the plaintiffs (private respondents herein) the amount of
P20,000.00 representing the actual value of the subdivided lots in dispute. It
did not order defendant Siason to pay said amount. 38
As to the propriety of the present case, it has long been established that the
sole remedy of the landowner whose property has been wrongfully or
erroneously registered in another's name is to bring an ordinary action in the
ordinary court of justice for reconveyance or, if the property has passed into
the hands of an innocent purchaser for value, for damages. 39 "It is one thing
to protect an innocent third party; it is entirely a different matter and one devoid
of justification if deceit would be rewarded by allowing the perpetrator to enjoy
the fruits of his nefarious decided As clearly revealed by the undeviating line
of decisions coming from this Court, such an undesirable eventuality is
precisely sought to be guarded against." 40
The issue on the right to the properties in litigation having been finally
adjudicated in Civil Case No. 5022 in favor of private respondents, it cannot
now be reopened in the instant case on the pretext that the defenses of
prescription and estoppel have not been properly considered by the lower
court. Petitioners could have appealed in the former case but they did not.
They have therefore foreclosed their rights, if any, and they cannot now be
heard to complain in another case in order to defeat the enforcement of a
judgment which has longing become final and executory.
Petitioners further contend that the liability arising from the sale of Lots No.
773-A and 773-B made by Rosendo Alvarez to Dr. Rodolfo Siason should be
the sole liability of the late Rosendo Alvarez or of his estate, after his death.
Such contention is untenable for it overlooks the doctrine obtaining in this
jurisdiction on the general transmissibility of the rights and obligations of the
deceased to his legitimate children and heirs. Thus, the pertinent provisions
of the Civil Code state:
Art. 774. Succession is a mode of acquisition by virtue of which the
property, rights and obligations to the extent of the value of the inheritance, of
a person are transmitted through his death to another or others either by his
will or by operation of law.
Art. 776. The inheritance includes all the property, rights and obligations
of a person which are not extinguished by his death.
Art. 1311. Contract stake effect only between the parties, their assigns
and heirs except in case where the rights and obligations arising from the
contract are not transmissible by their nature, or by stipulation or by provision
of law. The heir is not liable beyond the value of the property received from
the decedent.
As explained by this Court through Associate Justice J.B.L. Reyes in the case
of Estate of Hemady vs. Luzon Surety Co., Inc. 41
The binding effect of contracts upon the heirs of the deceased party is not
altered by the provision of our Rules of Court that money debts of a deceased
must be liquidated and paid from his estate before the residue is distributed
among said heirs (Rule 89). The reason is that whatever payment is thus made
from the state is ultimately a payment by the heirs or distributees, since the
amount of the paid claim in fact diminishes or reduces the shares that the heirs
would have been entitled to receive.
equivalent thereof devolved into the mass of their father's hereditary estate,
and we have ruled that the hereditary assets are always liable in their totality
for the payment of the debts of the estate. 42
It must, however, be made clear that petitioners are liable only to the extent of
the value of their inheritance. With this clarification and considering petitioners'
admission that there are other properties left by the deceased which are
sufficient to cover the amount adjudged in favor of private respondents, we
see no cogent reason to disturb the findings and conclusions of the Court of
Appeals.
WHEREFORE, subject to the clarification herein above stated, the assailed
decision of the Court of Appeals is hereby AFFIRMED. Costs against
petitioners.
SO ORDERED.

Under our law, therefore. the general rule is that a party's contractual rights
and obligations are transmissible to the successors.

The rule is a consequence of the progressive "depersonalization" of

patrimonial rights and duties that, as observed by Victorio Polacco has
characterized the history of these institutions. From the Roman concept of a
relation from person to person, the obligation has evolved into a relation from
patrimony to patrimony with the persons occupying only a representative
position, barring those rare cases where the obligation is strictly personal, i.e.,
is contracted intuitu personae, in consideration of its performance by a specific
person and by no other.

xxx xxx xxx

Petitioners being the heirs of the late Rosendo Alvarez, they cannot escape
the legal consequences of their father's transaction, which gave rise to the
present claim for damages. That petitioners did not inherit the property
involved herein is of no moment because by legal fiction, the monetary
G.R. No. L-28040 August 18, 1972

TESTATE ESTATE OF JOSEFA TANGCO, JOSE DE BORJA,

administrator-appellee; JOSE DE BORJA, as administrator, CAYETANO
DE BORJA, MATILDE DE BORJA and CRISANTO DE BORJA (deceased)
as Children of Josefa Tangco, appellees,

vs.

TASIANA VDA. DE DE BORJA, Special Administratrix of the Testate

Estate of Francisco de Borja, appellant. .

G.R. No L-28568 August 18, 1972

TESTATE ESTATE OF THE LATE FRANCISCO DE BORJA, TASIANA O.

VDA. DE DE BORJA, special Administratrix appellee,

vs.

JOSE DE BORJA, oppositor-appellant.

G.R. No. L-28611 August 18, 1972

TASIANA 0. VDA. DE BORJA, as Administratrix of the Testate Estate of

the late Francisco de Borja, plaintiff-appellee,

vs.

JOSE DE BORJA, as Administrator of the Testate Estate of the late

Josefa Tangco, defendant-appellant.

L-28040

Pelaez, Jalandoni & Jamir for administrator-appellee.

Quiogue & Quiogue for appellee Matilde de Borja.

Andres Matias for appellee Cayetano de Borja.

Sevilla & Aquino for appellant.

L-28568
Sevilla & Aquino for special administratrix-appellee.
Pelaez, Jalandoni & Jamir for oppositor-appellant.
L-28611
Sevilla & Aquino for plaintiff-appellee.
Pelaez, Jalandoni & Jamir and David Gueverra for defendant-appellant.
REYES, J.B.L., J.:p
Of these cases, the first, numbered L-28040 is an appeal by Tasiana
Ongsingco Vda. de de Borja, special administratrix of the testate estate of
Francisco de Borja,1 from the approval of a compromise agreement by the
Court of First Instance of Rizal, Branch I, in its Special Proceeding No. R-7866,
entitled, "Testate Estate of Josefa Tangco, Jose de Borja, Administrator".
Case No. L-28568 is an appeal by administrator Jose Borja from the
disapproval of the same compromise agreement by the Court of First Instance
of Nueva Ecija, Branch II, in its Special Proceeding No. 832, entitled, "Testate
Estate of Francisco de Borja, Tasiana O. Vda. de de Borja, Special
Administratrix".
And Case No. L-28611 is an appeal by administrator Jose de Borja from the
decision of the Court of First Instance of Rizal, Branch X, in its Civil Case No.
7452, declaring the Hacienda Jalajala Poblacion, which is the main object of
the aforesaid compromise agreement, as the separate and exclusive property
of the late Francisco de Borja and not a conjugal asset of the community with
his first wife, Josefa Tangco, and that said hacienda pertains exclusively to his
testate estate, which is under administrator in Special Proceeding No. 832 of
the Court of First Instance of Nueva Ecija, Branch II.
It is uncontested that Francisco de Borja, upon the death of his wife Josefa
Tangco on 6 October 1940, filed a petition for the probate of her will which was
docketed as Special Proceeding No. R-7866 of the Court of First Instance of
Rizal, Branch I. The will was probated on 2 April 1941. In 1946, Francisco de
Borja was appointed executor and administrator: in 1952, their son, Jose de
Borja, was appointed co-administrator. When Francisco died, on 14 April
1954, Jose became the sole administrator of the testate estate of his mother,
Josefa Tangco. While a widower Francisco de Borja allegedly took unto
himself a second wife, Tasiana Ongsingco. Upon Francisco's death, Tasiana
instituted testate proceedings in the Court of First Instance of Nueva Ecija,
where, in 1955, she was appointed special administratrix. The validity of
Tasiana's marriage to Francisco was questioned in said proceeding.
The relationship between the children of the first marriage and Tasiana
Ongsingco has been plagued with several court suits and counter-suits;
including the three cases at bar, some eighteen (18) cases remain pending
determination in the courts. The testate estate of Josefa Tangco alone has
been unsettled for more than a quarter of a century. In order to put an end to
all these litigations, a compromise agreement was entered into on 12 October
1963,2 by and between "[T]he heir and son of Francisco de Borja by his first
marriage, namely, Jose de Borja personally and as administrator of the
Testate Estate of Josefa Tangco," and "[T]he heir and surviving spouse of
Francisco de Borja by his second marriage, Tasiana Ongsingco Vda. de Borja,
assisted by her lawyer, Atty. Luis Panaguiton Jr." The terms and conditions of
the compromise agreement are as follows:
AGREEMENT
THIS AGREEMENT made and entered into by and between
The heir and son of Francisco de Borja by his first marriage, namely, Jose de
Borja personally and as administrator of the Testate Estate of Josefa Tangco,
AND
The heir and surviving spouse of Francisco de Borja by his second marriage,
Tasiana Ongsingco Vda. de Borja, assisted by her lawyer, Atty. Luis
Panaguiton Jr.
WITNESSETH
THAT it is the mutual desire of all the parties herein terminate and settle, with
finality, the various court litigations, controversies, claims, counterclaims, etc.,
between them in connection with the administration, settlement, partition,
adjudication and distribution of the assets as well as liabilities of the estates of
Francisco de Borja and Josefa Tangco, first spouse of Francisco de Borja.
THAT with this end in view, the parties herein have agreed voluntarily and
without any reservations to enter into and execute this agreement under the
following terms and conditions:
1. That the parties agree to sell the Poblacion portion of the Jalajala
properties situated in Jalajala, Rizal, presently under administration in the
Testate Estate of Josefa Tangco (Sp. Proc. No. 7866, Rizal), more specifically
described as follows:
Linda al Norte con el Rio Puwang que la separa de la jurisdiccion del Municipio
de Pililla de la Provincia de Rizal, y con el pico del Monte Zambrano; al Oeste
con Laguna de Bay; por el Sur con los herederos de Marcelo de Borja; y por
el Este con los terrenos de la Familia Maronilla
with a segregated area of approximately 1,313 hectares at the amount of
P0.30 per square meter.
2. That Jose de Borja agrees and obligates himself to pay Tasiana
Ongsingco Vda. de de Borja the total amount of Eight Hundred Thousand
Pesos (P800,000) Philippine Currency, in cash, which represent P200,000 as
his share in the payment and P600,000 as pro-rata shares of the heirs
Crisanto, Cayetano and Matilde, all surnamed de Borja and this shall be
considered as full and complete payment and settlement of her hereditary
share in the estate of the late Francisco de Borja as well as the estate of Josefa
Tangco, Sp. Proc. No. 832-Nueva Ecija and Sp. Proc. No. 7866-Rizal,
respectively, and to any properties bequeathed or devised in her favor by the
late Francisco de Borja by Last Will and Testament or by Donation Inter Vivos
or Mortis Causa or purportedly conveyed to her for consideration or otherwise.
The funds for this payment shall be taken from and shall depend upon the
receipt of full payment of the proceeds of the sale of Jalajala, "Poblacion."
3. That Tasiana Ongsingco Vda. de de Borja hereby assumes payment
of that particular obligation incurred by the late Francisco de Borja in favor of
the Rehabilitation Finance Corporation, now Development Bank of the
Philippines, amounting to approximately P30,000.00 and also assumes
payment of her 1/5 share of the Estate and Inheritance taxes on the Estate of
the late Francisco de Borja or the sum of P3,500.00, more or less, which shall
be deducted by the buyer of Jalajala, "Poblacion" from the payment to be
made to Tasiana Ongsingco Vda. de Borja under paragraph 2 of this
Agreement and paid directly to the Development Bank of the Philippines and
the heirs-children of Francisco de Borja.
4. Thereafter, the buyer of Jalajala "Poblacion" is hereby authorized to
pay directly to Tasiana Ongsingco Vda. de de Borja the balance of the
payment due her under paragraph 2 of this Agreement (approximately
P766,500.00) and issue in the name of Tasiana Ongsingco Vda. de de Borja,
corresponding certified checks/treasury warrants, who, in turn, will issue the
corresponding receipt to Jose de Borja.
5. In consideration of above payment to Tasiana Ongsingco Vda. de de
Borja, Jose de Borja personally and as administrator of the Testate Estate of
Josefa Tangco, and Tasiana Ongsingco Vda. de de Borja, for themselves and
for their heirs, successors, executors, administrators, and assigns, hereby
forever mutually renounce, withdraw, waive, remise, release and discharge
any and all manner of action or actions, cause or causes of action, suits, debts,
sum or sums of money, accounts, damages, claims and demands whatsoever,
in law or in equity, which they ever had, or now have or may have against each
other, more specifically Sp. Proceedings Nos. 7866 and 1955, CFI-Rizal, and
Sp. Proc. No. 832-Nueva Ecija, Civil Case No. 3033, CFI Nueva Ecija and Civil
Case No. 7452-CFI, Rizal, as well as the case filed against Manuel Quijal for
perjury with the Provincial Fiscal of Rizal, the intention being to completely,
absolutely and finally release each other, their heirs, successors, and assigns,
from any and all liability, arising wholly or partially, directly or indirectly, from
the administration, settlement, and distribution of the assets as well as
liabilities of the estates of Francisco de Borja and Josefa Tangco, first spouse
of Francisco de Borja, and lastly, Tasiana Ongsingco Vda. de de Borja
expressly and specifically renounce absolutely her rights as heir over any
hereditary share in the estate of Francisco de Borja.
6. That Tasiana Ongsingco Vda. de de Borja, upon receipt of the payment
under paragraph 4 hereof, shall deliver to the heir Jose de Borja all the papers,
titles and documents belonging to Francisco de Borja which are in her
possession and said heir Jose de Borja shall issue in turn the corresponding
receive thereof.
7. That this agreement shall take effect only upon the fulfillment of the
sale of the properties mentioned under paragraph 1 of this agreement and
upon receipt of the total and full payment of the proceeds of the sale of the
Jalajala property "Poblacion", otherwise, the non-fulfillment of the said sale will
render this instrument NULL AND VOID AND WITHOUT EFFECT
THEREAFTER.
IN WITNESS WHEREOF, the parties hereto have her unto set their hands in
the City of Manila, Philippines, the 12th of October, 1963.
On 16 May 1966, Jose de Borja submitted for Court approval the agreement
of 12 October 1963 to the Court of First Instance of Rizal, in Special
Proceeding No. R-7866; and again, on 8 August 1966, to the Court of First
Instance of Nueva Ecija, in Special Proceeding No. 832. Tasiana Ongsingco
Vda. de de Borja opposed in both instances. The Rizal court approved the
compromise agreement, but the Nueva Ecija court declared it void and
unenforceable. Special administratrix Tasiana Ongsingco Vda. de de Borja
appealed the Rizal Court's order of approval (now Supreme Court G.R. case
No. L-28040), while administrator Jose de Borja appealed the order of
disapproval (G.R. case No. L-28568) by the Court of First Instance of Nueva
Ecija.
The genuineness and due execution of the compromised agreement of 12
October 1963 is not disputed, but its validity is, nevertheless, attacked by
Tasiana Ongsingco on the ground that: (1) the heirs cannot enter into such
kind of agreement without first probating the will of Francisco de Borja; (2) that
the same involves a compromise on the validity of the marriage between
Francisco de Borja and Tasiana Ongsingco; and (3) that even if it were valid,
it has ceased to have force and effect.
In assailing the validity of the agreement of 12 October 1963, Tasiana
Ongsingco and the Probate Court of Nueva Ecija rely on this Court's decision
in Guevara vs. Guevara. 74 Phil. 479, wherein the Court's majority held the
view that the presentation of a will for probate is mandatory and that the
settlement and distribution of an estate on the basis of intestacy when the
decedent left a will, is against the law and public policy. It is likewise pointed
out by appellant Tasiana Ongsingco that Section 1 of Rule 74 of the Revised
Rules explicitly conditions the validity of an extrajudicial settlement of a
decedent's estate by agreement between heirs, upon the facts that "(if) the
decedent left no will and no debts, and the heirs are all of age, or the minors
are represented by their judicial and legal representatives ..." The will of
Francisco de Borja having been submitted to the Nueva Ecija Court and still
pending probate when the 1963 agreement was made, those circumstances,
it is argued, bar the validity of the agreement.
Upon the other hand, in claiming the validity of the compromise agreement,
Jose de Borja stresses that at the time it was entered into, on 12 October
1963, the governing provision was Section 1, Rule 74 of the original Rules of
Court of 1940, which allowed the extrajudicial settlement of the estate of a
deceased person regardless of whether he left a will or not. He also relies on
the dissenting opinion of Justice Moran, in Guevara vs. Guevara, 74 Phil. 479,
wherein was expressed the view that if the parties have already divided the
estate in accordance with a decedent's will, the probate of the will is a useless
ceremony; and if they have divided the estate in a different manner, the
probate of the will is worse than useless.
The doctrine of Guevara vs. Guevara, ante, is not applicable to the case at
bar. This is apparent from an examination of the terms of the agreement
between Jose de Borja and Tasiana Ongsingco. Paragraph 2 of said
agreement specifically stipulates that the sum of P800,000 payable to Tasiana
Ongsingco
shall be considered as full complete payment settlement of her
hereditary share in the estate of the late Francisco de Borja as well as the
estate of Josefa Tangco, ... and to any properties bequeathed or devised in
her favor by the late Francisco de Borja by Last Will and Testament or by
Donation Inter Vivos or Mortis Causa or purportedly conveyed to her for
consideration or otherwise.
This provision evidences beyond doubt that the ruling in the Guevara case is
not applicable to the cases at bar. There was here no attempt to settle or
distribute the estate of Francisco de Borja among the heirs thereto before the
probate of his will. The clear object of the contract was merely the conveyance
by Tasiana Ongsingco of any and all her individual share and interest, actual
or eventual in the estate of Francisco de Borja and Josefa Tangco. There is
no stipulation as to any other claimant, creditor or legatee. And as a hereditary
share in a decedent's estate is transmitted or vested immediately from the
moment of the death of such causante or predecessor in interest (Civil Code
of the Philippines, Art. 777)3 there is no legal bar to a successor (with requisite
contracting capacity) disposing of her or his hereditary share immediately after
such death, even if the actual extent of such share is not determined until the
subsequent liquidation of the estate.4 Of course, the effect of such alienation
is to be deemed limited to what is ultimately adjudicated to the vendor heir.
However, the aleatory character of the contract does not affect the validity of
the transaction; neither does the coetaneous agreement that the numerous
litigations between the parties (the approving order of the Rizal Court
enumerates fourteen of them, Rec. App. pp. 79-82) are to be considered
settled and should be dismissed, although such stipulation, as noted by the
Rizal Court, gives the contract the character of a compromise that the law
favors, for obvious reasons, if only because it serves to avoid a multiplicity of
suits.
It is likewise worthy of note in this connection that as the surviving spouse of
Francisco de Borja, Tasiana Ongsingco was his compulsory heir under article
995 et seq. of the present Civil Code. Wherefore, barring unworthiness or valid
disinheritance, her successional interest existed independent of Francisco de
Borja's last will and testament and would exist even if such will were not
probated at all. Thus, the prerequisite of a previous probate of the will, as
established in the Guevara and analogous cases, can not apply to the case of
Tasiana Ongsingco Vda. de de Borja.
Since the compromise contract Annex A was entered into by and between
"Jose de Borja personally and as administrator of the Testate Estate of Josefa
Tangco" on the one hand, and on the other, "the heir and surviving spouse of
Francisco de Borja by his second marriage, Tasiana Ongsingco Vda. de de
Borja", it is clear that the transaction was binding on both in their individual
capacities, upon the perfection of the contract, even without previous authority
of the Court to enter into the same. The only difference between an
extrajudicial compromise and one that is submitted and approved by the Court,
is that the latter can be enforced by execution proceedings. Art. 2037 of the
Civil Code is explicit on the point:
8. Art. 2037. A compromise has upon the parties the effect and authority
of res judicata; but there shall be no execution except in compliance with a
judicial compromise.
It is argued by Tasiana Ongsingco that while the agreement Annex A
expressed no definite period for its performance, the same was intended to
have a resolutory period of 60 days for its effectiveness. In support of such
contention, it is averred that such a limit was expressly stipulated in an
agreement in similar terms entered into by said Ongsingco with the brothers
and sister of Jose de Borja, to wit, Crisanto, Matilde and Cayetano, all
surnamed de Borja, except that the consideration was fixed at P600,000
(Opposition, Annex/Rec. of Appeal, L-28040, pp. 39- 46) and which contained
the following clause:
III. That this agreement shall take 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 owner heirs-children of
Francisco de Borja, namely, Crisanto, Cayetano and Matilde, all surnamed de
Borja; Provided that if no sale of the said property mentioned herein is
consummated, or the non-receipt of the purchase price thereof by the said
owners within the period of sixty (60) days from the date hereof, this
agreement will become null and void and of no further effect.
Ongsingco's argument loses validity when it is considered that Jose de Borja
was not a party to this particular contract (Annex 1), and that the same appears
not to have been finalized, since it bears no date, the day being left blank "this
 day of October 1963"; and while signed by the parties, it was not notarized,
although plainly intended to be so done, since it carries a proposed notarial
ratification clause. Furthermore, the compromise contract with Jose de Borja
(Annex A), provides in its par. 2 heretofore transcribed that of the total
consideration of P800, 000 to be paid to Ongsingco, P600,000 represent the
"prorata share of the heirs Crisanto, Cayetano and Matilde all surnamed de
Borja" which corresponds to the consideration of P600,000 recited in Annex
1, and that circumstance is proof that the duly notarized contract entered into
wit Jose de Borja under date 12 October 1963 (Annex A), was designed to
absorb and supersede the separate unformalize agreement with the other
three Borja heirs. Hence, the 60 days resolutory term in the contract with the
latter (Annex 1) not being repeated in Annex A, can not apply to the formal
compromise with Jose de Borja. It is moreover manifest that the stipulation
that the sale of the Hacienda de Jalajala was to be made within sixty days
from the date of the agreement with Jose de Borja's co-heirs (Annex 1) was
plainly omitted in Annex A as improper and ineffective, since the Hacienda de
Jalajala (Poblacion) that was to be sold to raise the P800,000 to be paid to
Ongsingco for her share formed part of the estate of Francisco de Borja and
could not be sold until authorized by the Probate Court. The Court of First
Instance of Rizal so understood it, and in approving the compromise it fixed a
term of 120 days counted from the finality of the order now under appeal, for
the carrying out by the parties for the terms of the contract.
This brings us to the plea that the Court of First Instance of Rizal had no
jurisdiction to approve the compromise with Jose de Borja (Annex A) because
Tasiana Ongsingco was not an heir in the estate of Josefa Tangco pending
settlement in the Rizal Court, but she was an heir of Francisco de Borja, whose
estate was the object of Special Proceeding No. 832 of the Court of First
Instance of Nueva Ecija. This circumstance is irrelevant, since what was sold
by Tasiana Ongsingco was only her eventual share in the estate of her late
husband, not the estate itself; and as already shown, that eventual share she
owned from the time of Francisco's death and the Court of Nueva Ecija could
not bar her selling it. As owner of her undivided hereditary share, Tasiana
could dispose of it in favor of whomsoever she chose. Such alienation is
expressly recognized and provided for by article 1088 of the present Civil
Code:
Art. 1088. Should any of the heirs sell his hereditary rights to a stranger before
the partition, any or all of the co-heirs may be subrogated to the rights of the
purchaser by reimbursing him for the price of the sale, provided they do so
within the period of one month from the time they were notified in writing of the
sale of the vendor.
If a sale of a hereditary right can be made to a stranger, then a fortiori sale
thereof to a coheir could not be forbidden.
Tasiana Ongsingco further argues that her contract with Jose de Borja (Annex
"A") is void because it amounts to a compromise as to her status and marriage
with the late Francisco de Borja. The point is without merit, for the very opening
paragraph of the agreement with Jose de Borja (Annex "A") describes her as
"the heir and surviving spouse of Francisco de Borja by his second marriage,
Tasiana Ongsingco Vda. de de Borja", which is in itself definite admission of
her civil status. There is nothing in the text of the agreement that would show
that this recognition of Ongsingco's status as the surviving spouse of
Francisco de Borja was only made in consideration of the cession of her
hereditary rights.
It is finally charged by appellant Ongsingco, as well as by the Court of First
Instance of Nueva Ecija in its order of 21 September 1964, in Special
Proceedings No. 832 (Amended Record on Appeal in L-28568, page 157),
that the compromise agreement of 13 October 1963 (Annex "A") had been
abandoned, as shown by the fact that, after its execution, the Court of First
Instance of Nueva Ecija, in its order of 21 September 1964, had declared that
"no amicable settlement had been arrived at by the parties", and that Jose de
Borja himself, in a motion of 17 June 1964, had stated that the proposed
amicable settlement "had failed to materialize".
It is difficult to believe, however, that the amicable settlement referred to in the
order and motion above-mentioned was the compromise agreement of 13
October 1963, which already had been formally signed and executed by the
parties and duly notarized. What the record discloses is that some time after
its formalization, Ongsingco had unilaterally attempted to back out from the
compromise agreement, pleading various reasons restated in the opposition
to the Court's approval of Annex "A" (Record on Appeal, L-20840, page 23):
that the same was invalid because of the lapse of the allegedly intended
resolutory period of 60 days and because the contract was not preceded by
the probate of Francisco de Borja's will, as required by this Court's Guevarra
vs. Guevara ruling; that Annex "A" involved a compromise affecting
Ongsingco's status as wife and widow of Francisco de Borja, etc., all of which
objections have been already discussed. It was natural that in view of the
widow's attitude, Jose de Borja should attempt to reach a new settlement or
novatory agreement before seeking judicial sanction and enforcement of
Annex "A", since the latter step might ultimately entail a longer delay in
attaining final remedy. That the attempt to reach another settlement failed is
apparent from the letter of Ongsingco's counsel to Jose de Borja quoted in
pages 35-36 of the brief for appellant Ongsingco in G.R. No. 28040; and it is
more than probable that the order of 21 September 1964 and the motion of 17
June 1964 referred to the failure of the parties' quest for a more satisfactory
compromise. But the inability to reach a novatory accord can not invalidate the
original compromise (Annex "A") and justifies the act of Jose de Borja in finally
seeking a court order for its approval and enforcement from the Court of First
Instance of Rizal, which, as heretofore described, decreed that the agreement
be ultimately performed within 120 days from the finality of the order, now
under appeal.
We conclude that in so doing, the Rizal court acted in accordance with law,
and, therefore, its order should be upheld, while the contrary resolution of the
Court of First Instance of Nueva Ecija should be, and is, reversed.
In her brief, Tasiana Ongsingco also pleads that the time elapsed in the appeal
has affected her unfavorably, in that while the purchasing power of the agreed
price of P800,000 has diminished, the value of the Jalajala property has
increased. But the fact is that her delay in receiving the payment of the agreed
price for her hereditary interest was primarily due to her attempts to nullify the
agreement (Annex "A") she had formally entered into with the advice of her
counsel, Attorney Panaguiton. And as to the devaluation de facto of our
currency, what We said in Dizon Rivera vs. Dizon, L-24561, 30 June 1970, 33
SCRA 554, that "estates would never be settled if there were to be a
revaluation with every subsequent fluctuation in the values of currency and
properties of the estate", is particularly opposite in the present case.
Coming now to Case G.R. No. L-28611, the issue is whether the Hacienda de
Jalajala (Poblacion), concededly acquired by Francisco de Borja during his
marriage to his first wife, Josefa Tangco, is the husband's private property (as
contended by his second spouse, Tasiana Ongsingco), or whether it forms
part of the conjugal (ganancial) partnership with Josefa Tangco. The Court of
First Instance of Rizal (Judge Herminio Mariano, presiding) declared that there
was adequate evidence to overcome the presumption in favor of its conjugal
character established by Article 160 of the Civil Code.
We are of the opinion that this question as between Tasiana Ongsingco and
Jose de Borja has become moot and academic, in view of the conclusion
reached by this Court in the two preceding cases (G.R. No. L-28568),
upholding as valid the cession of Tasiana Ongsingco's eventual share in the
estate of her late husband, Francisco de Borja, for the sum of P800,000 with
the accompanying reciprocal quit-claims between the parties. But as the
question may affect the rights of possible creditors and legatees, its resolution
is still imperative.
It is undisputed that the Hacienda Jalajala, of around 4,363 hectares, had been
originally acquired jointly by Francisco de Borja, Bernardo de Borja and
Marcelo de Borja and their title thereto was duly registered in their names as
co-owners in Land Registration Case No. 528 of the province of Rizal,
G.L.R.O. Rec. No. 26403 (De Barjo vs. Jugo, 54 Phil. 465). Subsequently, in
1931, the Hacienda was partitioned among the co-owners: the Punta section
went to Marcelo de Borja; the Bagombong section to Bernardo de Borja, and
the part in Jalajala proper (Poblacion) corresponded to Francisco de Borja (V.
De Borja vs. De Borja 101 Phil. 911, 932).
The lot allotted to Francisco was described as
Una Parcela de terreno en Poblacion, Jalajala: N. Puang River; E. Hermogena
Romero; S. Heirs of Marcelo de Borja O. Laguna de Bay; containing an area
of 13,488,870 sq. m. more or less, assessed at P297,410. (Record on Appeal,
pages 7 and 105)
On 20 November 1962, Tasiana O. Vda. de Borja, as Administratrix of the
Testate Estate of Francisco de Borja, instituted a complaint in the Court of
First Instance of Rizal (Civil Case No. 7452) against Jose de Borja, in his
capacity as Administrator of Josefa Tangco (Francisco de Borja's first wife),
seeking to have the Hacienda above described declared exclusive private
property of Francisco, while in his answer defendant (now appellant) Jose de
Borja claimed that it was conjugal property of his parents (Francisco de Borja
and Josefa Tangco), conformably to the presumption established by Article
160 of the Philippine Civil Code (reproducing Article 1407 of the Civil Code of
1889), to the effect that:
Art. 160. All property of the marriage is presumed to belong to the conjugal
partnership, unless it be proved that it pertains exclusively to the husband or
to the wife.
Defendant Jose de Borja further counterclaimed for damages, compensatory,
moral and exemplary, as well as for attorney's fees.
After trial, the Court of First Instance of Rizal, per Judge Herminio Mariano,
held that the plaintiff had adduced sufficient evidence to rebut the
presumption, and declared the Hacienda de Jalajala (Poblacion) to be the
exclusive private property of the late Francisco de Borja, and his
Administratrix, Tasiana Ongsingco Vda. de Borja, to be entitled to its
possession. Defendant Jose de Borja then appealed to this Court.
The evidence reveals, and the appealed order admits, that the character of
the Hacienda in question as owned by the conjugal partnership De Borja-
Tangco was solemnly admitted by the late Francisco de Borja no less than two
times: first, in the Reamended Inventory that, as executor of the estate of his
deceased wife Josefa Tangco, he filed in the Special Proceedings No. 7866
of the Court of First Instance of Rizal on 23 July 1953 (Exhibit "2"); and again,
in the Reamended Accounting of the same date, also filed in the proceedings
aforesaid (Exhibit "7"). Similarly, the plaintiff Tasiana O. Vda. de Borja, herself,
as oppositor in the Estate of Josefa Tangco, submitted therein an inventory
dated 7 September 1954 (Exhibit "3") listing the Jalajala property among the
"Conjugal Properties of the Spouses Francisco de Borja and Josefa Tangco".
And once more, Tasiana Ongsingco, as administratrix of the Estate of
Francisco de Borja, in Special Proceedings No. 832 of the Court of First
Instance of Nueva Ecija, submitted therein in December, 1955, an inventory
wherein she listed the Jalajala Hacienda under the heading "Conjugal
Property of the Deceased Spouses Francisco de Borja and Josefa Tangco,
which are in the possession of the Administrator of the Testate Estate of the
Deceased Josefa Tangco in Special Proceedings No. 7866 of the Court of
First Instance of Rizal" (Exhibit "4").
Notwithstanding the four statements aforesaid, and the fact that they are plain
admissions against interest made by both Francisco de Borja and the
Administratrix of his estate, in the course of judicial proceedings in the Rizal
and Nueva Ecija Courts, supporting the legal presumption in favor of the
conjugal community, the Court below declared that the Hacienda de Jalajala
(Poblacion) was not conjugal property, but the private exclusive property of
the late Francisco de Borja. It did so on the strength of the following evidences:
(a) the sworn statement by Francis de Borja on 6 August 1951 (Exhibit "F")
that
He tomado possession del pedazo de terreno ya delimitado (equivalente a 1/4
parte, 337 hectareas) adjunto a mi terreno personal y exclusivo (Poblacion de
Jalajala, Rizal).
and (b) the testimony of Gregorio de Borja, son of Bernardo de Borja, that the
entire Hacienda had been bought at a foreclosure sale for P40,100.00, of
which amount P25,100 was contributed by Bernardo de Borja and P15,000.
by Marcelo de Borja; that upon receipt of a subsequent demand from the
provincial treasurer for realty taxes the sum of P17,000, Marcelo told his
brother Bernardo that Francisco (son of Marcelo) wanted also to be a co-
owner, and upon Bernardo's assent to the proposal, Marcelo issue a check for
P17,000.00 to pay the back taxes and said that the amount would represent
Francisco's contribution in the purchase of the Hacienda. The witness further
testified that
Marcelo de Borja said that that money was entrusted to him by Francisco de
Borja when he was still a bachelor and which he derived from his business
transactions. (Hearing, 2 February 1965, t.s.n., pages 13-15) (Emphasis
supplied)
The Court below, reasoning that not only Francisco's sworn statement
overweighed the admissions in the inventories relied upon by defendant-
appellant Jose de Borja since probate courts can not finally determine
questions of ownership of inventoried property, but that the testimony of
Gregorio de Borja showed that Francisco de Borja acquired his share of the
original Hacienda with his private funds, for which reason that share can not
be regarded as conjugal partnership property, but as exclusive property of the
buyer, pursuant to Article 1396(4) of Civil Code of 1889 and Article 148(4) of
the Civil Code of the Philippines.
The following shall be the exclusive property of each spouse:
xxx xxx xxx
(4) That which is purchased with exclusive money of the wife or of the
husband.
We find the conclusions of the lower court to be untenable. In the first place,
witness Gregorio de Borja's testimony as to the source of the money paid by
Francisco for his share was plain hearsay, hence inadmissible and of no
probative value, since he was merely repeating what Marcelo de Borja had
told him (Gregorio). There is no way of ascertaining the truth of the statement,
since both Marcelo and Francisco de Borja were already dead when Gregorio
testified. In addition, the statement itself is improbable, since there was no
need or occasion for Marcelo de Borja to explain to Gregorio how and when
Francisco de Borja had earned the P17,000.00 entrusted to Marcelo. A ring of
artificiality is clearly discernible in this portion of Gregorio's testimony.
As to Francisco de Borja's affidavit, Exhibit "F", the quoted portion thereof
(ante, page 14) does not clearly demonstrate that the "mi terreno personal y
exclusivo (Poblacion de Jalajala, Rizal) " refers precisely to the Hacienda in
question. The inventories (Exhibits 3 and 4) disclose that there were two real
properties in Jalajala owned by Francisco de Borja, one of 72.038 sq. m.,
assessed at P44,600, and a much bigger one of 1,357.260.70 sq. m., which
is evidently the Hacienda de Jalajala (Poblacion). To which of these lands did
the affidavit of Francisco de Borja (Exhibit "F") refer to? In addition, Francisco's
characterization of the land as "mi terreno personal y exclusivo" is plainly self-
serving, and not admissible in the absence of cross examination.
It may be true that the inventories relied upon by defendant-appellant (Exhibits
"2", "3", "4" and "7") are not conclusive on the conjugal character of the
property in question; but as already noted, they are clear admissions against
the pecuniary interest of the declarants, Francisco de Borja and his executor-
widow, Tasiana Ongsingco, and as such of much greater probative weight
than the self-serving statement of Francisco (Exhibit "F"). Plainly, the legal
presumption in favor of the conjugal character of the Hacienda de Jalajala
(Poblacion) now in dispute has not been rebutted but actually confirmed by
proof. Hence, the appealed order should be reversed and the Hacienda de
Jalajala (Poblacion) declared property of the conjugal partnership of Francisco
de Borja and Josefa Tangco.
No error having been assigned against the ruling of the lower court that claims
for damages should be ventilated in the corresponding special proceedings
for the settlement of the estates of the deceased, the same requires no pro
announcement from this Court.
IN VIEW OF THE FOREGOING, the appealed order of the Court of First
Instance of Rizal in Case No. L-28040 is hereby affirmed; while those involved
in Cases Nos. L-28568 and L-28611 are reversed and set aside. Costs against
the appellant Tasiana Ongsingco Vda. de Borja in all three (3) cases.

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.
LEON BARCENA, MAXIMA ARIAS BALLENA, ESPERANZA BARCENA,
MANUEL BARCENA, AGUSTINA NERI, widow of JULIAN TAMAYO and
HON. LEOPOLDO GIRONELLA of the Court of First Instance of Abra,
respondents.
MARTIN, J:
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.
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.
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 not 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 in dismissing the
complaint of the plaintiff in Civil Case No. 856 and refusing the substitution of
parties in the case.

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.