ESTATE OF K. H. HEMADY, vs. LUZON SURETY CO.

G.R. No. L-8437.  

November 28, 1956

WILL: No mention

IS THERE ASSUMPTION OF LIABILITIES: YES

1. The nature of the obligation of the surety or guarantor is not in such a way that
his peculiar individual qualities are contemplated as a principal inducement
for the contract. What the creditor Luzon Surety Co. expect of K. H. Hemady
when it accepted the latter as surety in the counterbonds is 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; chan roblesvirtualawlibraryand to the Luzon Surety Co., it
was indifferent that the reimbursement should be made by Hemady himself or
by some one else in his behalf, so long as the money was paid to it.

2.  The text of the agreements sued upon nowhere indicate that they are non-
transferable.

CAN THEY BE HELD LIABLE: YES

1. 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.”

2. “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.”

3. “ART. 776. —
The inheritance includes all the property, rights and obligations of a person which
are not extinguished by his death.”
 UNION BANK OF THE PHILIPPINES vs.
EDMUND SANTIBAÑEZ
G.R. No. 149926            
February 23, 2005

WILL: YES

In February 1981, Efraim died, leaving a holographic will.

IS THERE ASSUMPTION OF LIABILITIES: None

The filing of a money claim against the decedent’s estate in the probate court is
mandatory.

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.

CAN THEY BE HELD LIABLE: NO

In addition to the failure to file the money claim with the probate court, 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 there can be no valid
partition before the will is probated before the court, 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.
 SPS. VIRGILIO F. SANTOS & ESPERANZA LATI SANTOS, vs.
SPS. JOSE LUMBAO
G.R. No. 169129            
March 28, 2007

WILL: No mention

IS THERE ASSUMPTION OF LIABILITIES: YES

1. Both "Bilihan ng Lupa" documents dated 17 August 1979 and 9 January 1981 were
duly notarized before a notary public. It is well-settled that a document acknowledged
before a notary public is a public document25 that enjoys the presumption of
regularity. It is a prima facie evidence of the truth of the facts stated therein and a
conclusive presumption of its existence and due execution.26 To overcome this
presumption, there must be presented evidence that is clear and convincing. Absent
such evidence, the presumption must be upheld.

2. The fact that the entire property owned by Maria, the mother of Rita, was not yet
divided among her and her co-heirs does not make the contract of sale between Rita
and respondents Spouses Lumbao invalid because both the law and jurisprudence
have categorically held that even while an estate remains undivided, co-owners have
each full ownership of their respective aliquots or undivided shares and may therefore
alienate, assign or mortgage them.

CAN THEY BE HELD LIABLE: YES

The general rule that heirs are bound by contracts entered into by their predecessors-in-
interest applies in the present case. Article 1311 of the NCC is the basis of this rule. It is clear
from the said provision that whatever rights and obligations the decedent have over the property
were transmitted to the heirs by way of succession, a mode of acquiring the property, rights and
obligations of the decedent to the extent of the value of the inheritance of the heirs.

The heirs cannot escape the legal consequence of a transaction entered into by their
predecessor-in-interest because they have inherited the property subject to the liability affecting
their common ancestor. Being heirs, there is privity of interest between them and their deceased
mother. They only succeed to what rights their mother had and what is valid and binding against
her is also valid and binding as against them. The death of a party does not excuse
nonperformance of a contract which involves a property right and the rights and obligations
thereunder pass to the personal representatives of the deceased. Similarly, nonperformance is not
excused by the death of the party when the other party has a property interest in the subject
matter of the contract