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1. Estate of Hemady vs. Luzon Surety, 100 Phil. 388.
[G.R. No. L-8437.  November 28, 1956.]
ESTATE OF K. H. HEMADY, deceased, vs. LUZON SURETY CO., INC., claimant-
Appellant.
therewith for counsel or attorney’s 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.

 
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:chanroblesvirtuallawlibrary
“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; chan roblesvirtualawlibraryand 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
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.
x x x                    x x x                    x x x
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.
x x x                    x x x                    x x x
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 counterbonds, 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 Hemady’s estate,
the lower court, by order of September 23, 1953, dismissed the claims of Luzon
Surety Co., on two grounds:chanroblesvirtuallawlibrary (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; chan
roblesvirtualawlibraryand (2) that “whatever losses may occur after Hemady’s 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:chanroblesvirtuallawlibrary
“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 Hemady’s 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
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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:chanroblesvirtuallawlibrary
“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).
x x x                    x x x                    x x x
“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; chan roblesvirtualawlibrarythey 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 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. 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; 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.
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 más allá 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; chan roblesvirtualawlibraryhence, 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 company’s faith and confidence in the financial
stability of the surety, but not that his obligation was strictly personal.
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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; chan roblesvirtualawlibraryand 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:chanroblesvirtuallawlibrary
“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:chanroblesvirtuallawlibrary it is his right, not his duty; chan
roblesvirtualawlibraryhe 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
court’s stand that the requirement of integrity in the guarantor or surety makes the
latter’s 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
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the stipulations of the contracts themselves, nor by provision of law, his eventual Wherefore, the order appealed from is reversed, and the records are ordered
liability thereunder necessarily passed upon his death to his heirs. The contracts, remanded to the court of origin, with instructions to proceed in accordance with law.
therefore, give rise to contingent claims provable against his estate under section 5, Costs against the Administratrix- Appellee. SO ORDERED.
Rule 87 (2 Moran, 1952 ed., p. 437; chan roblesvirtualawlibraryGaskell & 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; chan
roblesvirtualawlibraryGibson vs. Mithell, 16 Pla., 519; chan
roblesvirtualawlibraryMaxey vs. Carter, 10 Yarg. [Tenn.], 521 Reeves vs. Pulliam, 7
Baxt. [Tenn.], 119; chan roblesvirtualawlibraryErnst 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; chan
roblesvirtualawlibraryand 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.
The foregoing ruling is of course without prejudice to the remedies of the
administratrix against the principal debtors under Articles 2071 and 2067 of the New
Civil Code.
Our conclusion is that the solidary guarantor’s liability is not extinguished by his
death, and that in such event, the Luzon Surety Co., had the right to file against the
estate a contingent claim for reimbursement. It becomes unnecessary now to
discuss the estate’s liability for premiums and stamp taxes, because irrespective of
the solution to this question, the Luzon Surety’s claim did state a cause of action,
and its dismissal was erroneous.

2. Sicad vs. CA, 294 SCRA 183.
G.R. No. 125888 August 13, 1998
SPOUSES ERNESTO and EVELYN SICAD, petitioners,
vs.
COURT OF APPEALS, CATALINO VALDERRAMA, JUDY CRISTINA M.
VALDERRAMA and JESUS ANTONIO VALDERRAMA, respondents.
NARVASA, C.J.:
The issue raised in the appeal by certiorari at bar centers on the character of a deed
of donation executed by the late Aurora Virto DA. de Motinola of the City of Iloilo —
as either inter vivos or mortis causa. That deed, entitled "DEED OF DONATION
INTER VIVOS," 1 was executed by Montinola on December 11, 1979. It named as
donees her grandchildren, namely: Catalino Valderrama, Judy Cristina Valderrama
and Jesus Antonio Valderrama: and treated of a parcel of land, Lot 3231 of the
Cadastral Survey of Panay, located at Brgy. Pawa, Panay, Capiz, covered by
Transfer Certificate of Title No. T-16105 in the name of Montinola. The deed also
contained the signatures of the donees in acknowledgment of their acceptance of the
donation.
Montinola's Secretary, Gloria Salvilla, afterwards presented the deed for recording in
the Property Registry, and the Register of Deeds cancelled TCT No. T-16105 (the
donor's title) and, in its place, issued TCT No. T-16622 on February 7, 1980, in the
names of the donees.2 Montinola however retained the owner's duplicate copy of the
new title (No. T-16622), as well as the property itself, until she transferred the same
ten (10) years later, on July 10, 1990, to the spouses, Ernesto and Evelyn Sicad.
On March 12, 1987, Aurora Montinola drew up a deed of revocation of the
donation, 3 and caused it to be annotated as an adverse claim on TCT No. T-16622
(issued, as aforestated, in her grandchildren's names). Then, on August 24, 1990,
5
she filed a petition with the Regional Trial Court in Roxas City for the cancellation of
said TCT No. T-16622 and the reinstatement of TCT No. T- 16105 (in her name), the
case being docketed as Special Proceeding No. 3311. Her petition was founded on
the theory that the donation to her three (3) grandchildren was one mortis
causa which thus had to comply with the formalities of a will; and since it had not, the
donation was void and could not effectively serve as basis for the cancellation of
TCT No. T-16105 and the issuance in its place of TCT No. T-16622.
The donees (Montinola's grandchildren) opposed the petition. In their opposition
dated August 29, 1990, they averred that the donation in their favor was one inter
vivos which, having fully complied with the requirements therefor set out in Article
729 of the Civil Code, was perfectly valid and efficacious. They also expressed doubt
about the sincerity of their grandmother's intention to recover the donated property,
since she had not pursued the matter of its revocation after having it annotated as an
adverse claim.
The case, originally treated as a special proceeding, was subsequently considered
by the lower Court as an ordinary civil action in view of the allegations and issues
raised in the pleadings. Pre-trial was had, followed by trial on the merits which was
concluded with the filing of the parties' memoranda. The Trial Court then rendered
judgment on March 27, 1991, holding that the donation was indeed one inter vivos,
and dismissing Aurora Montinola's petition for lack of merit. 4 The matter of its
revocation was not passed upon.
Montinola elevated the case to the Court of Appeals, her appeal being docketed as
CA-G.R. CV No. 33202. She however died on March 10, 1993, 5 while the appeal
was pending.
Shortly after Montinola's demise, a "Manifestation and Motion" dated March 31, 1993
was filed by Ernesto Sicad and Evelyn Bofill-Sicad, herein petitioners, 6 in which they
(a) alleged that they had become the owners of the property covered by TCT No. T-
16622 in virtue of a "deed of definite sale dated May 25, 1992" accomplished by
Montinola in their favor, which was confirmed by "an affidavit dated November 26,
1997 also executed by the latter, and (b) prayed that they be substituted as
appellants and allowed to prosecute the case in their own behalf.
Another motion was subsequently presented under date of April 7, 1993, this time by
the legal heirs of Aurora Montinola, namely: Ofelia M. de Leon, Estela M. Jaen and
Teresita M. Valderama. They declared that they were not interested in pursuing the

case, and asked that the appeal be withdrawn. Montinola's counsel opposed the
motion.
On June 21, 1993, the Court of Appeals issued a Resolution: (a) ordering the
substitution of the persons above mentioned — Ofelia de Leon, Estela M, Jaen, and
Teresita M. Valderama — as plaintiffs-appellants in place of the late Aurora
Montinola, as well as the joinder of the spouses Ernesto and Evelyn Bofill-Sicad as
additional appellants; 7 and (b) denying the motion for the withdrawal of the appeal.
On June 30, 1995, the Eighth Division of the Court of Appeals promulgated its
Decision on the case affirming the judgment of the Regional Trial Court; 8 and on
July 31, 1996, it denied the separate motions for reconsideration filed by Ofelia M. de
Leon, Estela M. Jaen, and Teresita M. Valderrama, on the one hand, and by the
spouses, Ernest and Evelyn Sicad, on the other. 9
The Sicad Spouses have appealed to this Court; and here, they contend that the
following errors were committed by the Appellate Tribunal, to wit:
1) ** in ruling that the donation was inter vivos and in
not giving due weight to the revocation of the donation;
and
2) ** in not ordering that the case be remanded for
further reception of evidence. 10
The Comment filed for private respondents (the donees) under date of December 19,
1996 deals with what they consider the "principal issue in this case ** (i.e.) whether
the donation is mortis causa or inter vivos," and sets forth the argument that the
"donor clearly intended to effect the immediate transfer of ownership to the donees."
that the prohibition in the deed of donation "against selling the property within ten
(10) years after the death of the donor does not indicate that the donation is mortis
causa," that the donor's "alleged act of physically keeping the title does not suggest
any intention to defer the effectivity of the donation," that the "payment of real
property taxes is consistent with the donor's' reservation of the right of usufruct," that
the donor's intent "is not determined by ** (her) self-serving post-execution
declarations," the "donation was never effectively revoked," and petitioners "have
waived their right to question the proceedings in the trial court." 11
6
The Reply of the Sicad Spouses dated March 14, 1997 reiterates their thesis that the
donation was mortis causa, that "the provisions of the deed of donation indicate that
it was intended to take effect upon the death of the donor," that "the circumstances
surrounding the execution of the deed, and the subsequent actions of the donor
incontrovertibly signify the donor's intent to transfer the property only after her
death," that the donor "did not intend to give effect to the donation," and that the
procedure adopted by the Trial Court in the case was fatally defective. 12 A
"Rejoinder" dated April 3, 1997 was then submitted by the Valderramas, traversing
the assertions of the Reply. 13
Considering the focus of the opposing parties, and their conflicting theories, on the
intention of Aurora Montinola in executing the document entitled "Deed of Donation
Inter Vivos," it is needful to review the circumstances of the signing of that document
by Montinola, as ostensible donor, and her grandchildren, as ostensible donees.
The evidence establishes that on December 11, 1979, when the deed of donation
prepared by Montinola's lawyer (Atty. Treñas) was read and explained by the latter to
the parties, Montinola expressed her wish that the donation take effect only after ten
(10) years from her death, and that the deed include a prohibition on the sale of the
property for such period. Accordingly, a new proviso was inserted in the deed
reading: "however, the donees shall not sell or encumber the properties herein
donated within 10 years after the death of the donor." 14 The actuality of the
subsequent insertion of this new proviso is apparent on the face of the instrument:
the intercalation is easily perceived and identified — it was clearly typed on a
different machine, and is crammed into the space between the penultimate
paragraph of the deed and that immediately preceding it. 15
Not only did Aurora Montinola order the insertion in the deed of that restrictive
proviso, but also, after recordation of the deed of donation, she never stopped
treating the property as her own. She continued, as explicity authorized in the deed
itself, to possess the property, enjoy its fruits and otherwise exercise the rights of
dominion, paying the property taxes as they fell due — all these she did until she
transferred the Property to the Sicad Spouses on July 10, 1990. She did not give the
new certificate of title to the ostensible donees but retained it, too, until she delivered
it to the Sicads on the occasion of the sale of the property to them. In any event, the
delivery of the title to the donees would have served no useful purpose since, as just
stated, they were prohibited to effect any sale or encumbrance thereof for a period of
ten (10) years after the ostensible donor's decease. And consistent with these acts
denoting retention of ownership of the property was Montinola's openly expressed
view that the donation was ineffectual and could not be given effect even after ten

(10) years from her death. For this view she sought to obtain judicial approval. She
brought suit on August 24, 1990 to cancel TCT No. T-16622 (issued to her
grandchildren) premised precisely on the invalidity of the donation for failure to
comply with the requisites of testamentary dispositions. Before that, she attempted to
undo the conveyance to her grandchildren by executing a deed of revocation of the
donation on March 12, 1987, and causing annotation thereof as an adverse claim on
said TCT No. T-16622. She also exercised indisputable acts of ownership over said
property by executing, as just stated, deeds intended to pass title over it to third
parties — petitioners herein. 16
As already intimated, the real nature of a deed is to be ascertained by both its
language and the intention of the parties as demonstrated by the circumstances
attendant upon its execution. In this respect, case law has laid down significant
parameters. Thus, in a decision handed down in 1946, 17 this Court construed a deed
purporting to be a donation inter vivos to be in truth one mortis causa because it
stipulated (like the one now being inquired into) "that all rents, proceeds, fruits, of the
donated properties shall remain for the exclusive benefit and disposal of the donor,
Margarita David, during her lifetime; and that, without the knowledge and consent of
the donor, the donated properties could not be disposed of in any way, whether by
sale, mortgage, barter, or in any other way possible," On these essential premises,
the Court said, such a donation must be deemed one "mortis causa, because the
combined effect of the circumstances surrounding the execution of the deed of
donation and of the above-quoted clauses thereof ** (was that) the most essential
elements of ownership — the right to dispose of the donated properties and the right
to enjoy the products, profits, possession — remained with Margarita David during
her lifetime, and would accrue to the donees only after Margarita David's death." So,
too, in the case at bar, did these rights remain with Aurora Montinola during her
lifetime, and could not pass to the donees until ten (10) years after her death.
In another case decided in 1954 involving a similar issue, Bonsato v. Court of
Appeals, 18 this Court emphasized that the decisive characteristics of a
donation mortis causa, which it had taken into account in David v. Sison, were that
"the donor not only reserved for herself all the fruits of the property allegedly
conveyed, but what is even more important, specially provided that "without the
knowledge and consent of the donor, the donated properties could not be disposed
of in any way,; thereby denying to the transferees the most essential attribute of
ownership, the power to dispose of the properties."
A donation which purports to be one inter vivos but withholds from the donee the
right to dispose of the donated property during the donor's lifetime is in truth
7
one mortis causa. In a donation mortis causa "the right of disposition is not
transferred to the donee while the donor is still alive." 19
In the instant case, nothing of any consequence was transferred by the deed of
donation in question to Montinola's grandchildren, the ostensible donees. They did
not get possession of the property donated. They did not acquire the right to the
fruits thereof, or any other right of dominion over the property. More importantly, they
did not acquire the right to dispose of the property — this would accrue to them only
after ten (10) years from Montinola's death. Indeed, they never even laid hands on
the certificate of title to the same. They were therefore simply "paper owners" of the
donated property. All these circumstances, including, to repeat, the explicit
provisions of the deed of donation — reserving the exercise of rights of ownership to
the donee and prohibiting the sale or encumbrance of the property until ten (10)
years after her death — ineluctably lead to the conclusion that the donation in
question was a donation mortis causa, contemplating a transfer of ownership to the
donees only after the donor's demise.
The case of Alejandro v. Geraldez 20 cited by the Court of Appeals in support of its
challenged judgment is not quite relevant. For in the deed of donation there in issue,
there was a partial relinquishment of the right to dispose of the property, in the event
only that this became necessary "to defray the expenses and support of the donors."
That limited right to dispose of the donated lots, said this Court, "implies that
ownership had passed to ** (the donees) by means of the donation and **, therefore,
the donation was already effective during the donors' lifetime. That is a characteristic
of a donation inter vivos." On the other hand, in the case at bar, the donees were
expressly prohibited to make any disposition of any nature or for any purpose
whatever during the donor's lifetime, and until ten (10) years after her death — a
prohibition which, it may be added, makes inapplicable the ruling in Castro v. Court
of Appeals, 21 where no such prohibition was imposed, and the donor retained only
the usufruct over the property.
The Valderramas' argument that the donation is inter vivos in character and that the
prohibition against their disposition of the donated property is merely a condition
which, if violated, would give cause for its revocation, begs the question. It assumes
that they have the right to make a disposition of the property, which they do not. The
argument also makes no sense, because if they had the right to dispose of the
property and did in fact dispose of it to a third person, the revocation of the donation
they speak of would be of no utility or benefit to the donor, since such a revocation
would not necessarily result in the restoration of the donor's ownership and
enjoyment of the property.
 8

It is also error to suppose that the donation under review should be deemed
one inter vivos simply because founded on considerations of love and affection.
In Alejandro v. Geraldez, supra, 22 this Court also observed that "the fact that the
donation is given in consideration of love and affection ** is not a characteristic of
donations inter vivos (solely) because transfers mortis causa may also be made for
the same reason." Similarly, in Bonsato v. Court of Appeals, supra, this Court opined
that the fact "that the conveyance was due to the affection of the donor for the
donees and the services rendered by the latter, is of no particular significance in
determining whether the deeds, Exhs. "1" and "2," constitute transfers inter vivos or
not, because a legacy may have identical motivation." 23

Finally, it is germane to advert to the legal principle in Article 1378 of the Civil Code
to the effect that in case of doubt relative to a gratuitous contract, the construction
must be that entailing "the least transmission of rights and
interests," 24

The donation in question, though denominated inter vivos, is in truth one mortis

causa; it is void because the essential requisites for its validity have not been
complied with.

WHEREFORE, the Decision of the Court of Appeals in CA-G.R. CV No. 33202 dated
June 30, 1995 as well as the Resolution denying reconsideration thereof, and the
Decision of the Regional Trial Court in Special Case No. 3311 are SET ASIDE.
The Deed of Donation Inter Vivos (Exh. "A") executed by Aurora Virto Vda. de
Montinola on December 11, 1979 in favor of Catalino M. Valderrama, Judy Cristina
M. Valderrama and Jesus Antonio M. Valderrama is declared null and void. The
Register of Deeds of Roxas City is directed to cancel Transfer Certificate of Title No.
T-16622, revive and reinstate Transfer Certificate of Title No. T-16105.

SO ORDERED.

3. Uson vs. Del Rosario, 92 Phil. 531.
G.R. No. L-4963             January 29, 1953
MARIA USON, plaintiff-appellee,
vs.
MARIA DEL ROSARIO, CONCEPCION NEBREDA, CONRADO NEBREDA,
DOMINADOR NEBREDA, AND FAUSTINO NEBREDA, Jr., defendants-appellants.
Priscilo Evangelista for appellee.
Brigido G. Estrada for appellant.
BAUTISTA ANGELO, J.:
This is an action for recovery of the ownership and possession of five (5) parcels of
land situated in the Municipality of Labrador, Province of Pangasinan, filed by Maria
Uson against Maria del Rosario and her four children named Concepcion, Conrado,
Dominador, and Faustino, surnamed Nebreda, who are all of minor age, before the
Court of First Instance of Pangasinan.
Maria Uson was the lawful wife of Faustino Nebreda who upon his death in 1945 left
the lands involved in this litigation. Faustino Nebreda left no other heir except his
widow Maria Uson. However, plaintiff claims that when Faustino Nebreda died in
1945, his common-law wife Maria del Rosario took possession illegally of said lands
thus depriving her of their possession and enjoyment.
Defendants in their answer set up as special defense that on February 21, 1931,
Maria Uson and her husband, the late Faustino Nebreda, executed a public
document whereby they agreed to separate as husband and wife and, in
consideration of their separation, Maria Uson was given a parcel of land by way of
9
alimony and in return she renounced her right to inherit any other property that may
be left by her husband upon his death (Exhibit 1).
After trial, at which both parties presented their respective evidence, the court
rendered decision ordering the defendants to restore to the plaintiff the ownership
and possession of the lands in dispute without special pronouncement as to costs.
Defendants interposed the present appeal.
There is no dispute that Maria Uson, plaintiff-appellee, is the lawful wife of Faustino
Nebreda, former owner of the five parcels of lands litigated in the present case.
There is likewise no dispute that Maria del Rosario, one of the defendants-
appellants, was merely a common-law wife of the late Faustino Nebreda with whom
she had four illegitimate children, her now co-defendants. It likewise appears that
Faustino Nebreda died in 1945 much prior to the effectivity of the new Civil Code.
With this background, it is evident that when Faustino Nebreda died in 1945 the five
parcels of land he was seized of at the time passed from the moment of his death to
his only heir, his widow Maria Uson (Article 657, old Civil Code).As this Court aptly
said, "The property belongs to the heirs at the moment of the death of the ancestor
as completely as if the ancestor had executed and delivered to them a deed for the
same before his death" (Ilustre vs. Alaras Frondosa, 17 Phil., 321). From that
moment, therefore, the rights of inheritance of Maria Uson over the lands in question
became vested.
The claim of the defendants that Maria Uson had relinquished her right over the
lands in question because she expressly renounced to inherit any future property
that her husband may acquire and leave upon his death in the deed of separation
they had entered into on February 21, 1931, cannot be entertained for the simple
reason that future inheritance cannot be the subject of a contract nor can it be
renounced (1 Manresa, 123, sixth edition; Tolentino on Civil Code, p. 12; Osorio vs.
Osorio and Ynchausti Steamship Co., 41 Phil., 531).
But defendants contend that, while it is true that the four minor defendants are
illegitimate children of the late Faustino Nebreda and under the old Civil Code are
not entitled to any successional rights, however, under the new Civil Code which
became in force in June, 1950, they are given the status and rights of natural
children and are entitled to the successional rights which the law accords to the latter
(article 2264 and article 287, new Civil Code), and because these successional rights
were declared for the first time in the new code, they shall be given retroactive effect
even though the event which gave rise to them may have occurred under the prior
legislation (Article 2253, new Civil Code).
 10

There is no merit in this claim. Article 2253 above referred to provides indeed that
rights which are declared for the first time shall have retroactive effect even though
the event which gave rise to them may have occurred under the former legislation,
but this is so only when the new rights do not prejudice any vested or acquired right
of the same origin. Thus, said article provides that "if a right should be declared for
the first time in this Code, it shall be effective at once, even though the act or event
which gives rise thereto may have been done or may have occurred under the prior
legislation, provided said new right does not prejudice or impair any vested or
acquired right, of the same origin." As already stated in the early part of this decision,
the right of ownership of Maria Uson over the lands in question became vested in
1945 upon the death of her late husband and this is so because of the imperative
provision of the law which commands that the rights to succession are transmitted
from the moment of death (Article 657, old Civil Code). The new right recognized by
the new Civil Code in favor of the illegitimate children of the deceased cannot,
therefore, be asserted to the impairment of the vested right of Maria Uson over the
lands in dispute.

As regards the claim that Maria Uson, while her deceased husband was lying in
state, in a gesture of pity or compassion, agreed to assign the lands in question to
the minor children for the reason that they were acquired while the deceased was
living with their mother and Maria Uson wanted to assuage somewhat the wrong she
has done to them, this much can be said; apart from the fact that this claim is
disputed, we are of the opinion that said assignment, if any, partakes of the nature of
a donation of real property, inasmuch as it involves no material consideration, and in
order that it may be valid it shall be made in a public document and must be
accepted either in the same document or in a separate one (Article 633, old Civil
Code). Inasmuch as this essential formality has not been followed, it results that the
alleged assignment or donation has no valid effect.

WHEREFORE, the decision appealed from is affirmed, without costs.

 11

Andres Matias for appellee Cayetano de Borja.

Sevilla & Aquino for appellant.

L-28568

Sevilla & Aquino for special administratrix-appellee.

4. De Borja vs. Vda. De Borja, 46 SCRA 577.
Pelaez, Jalandoni & Jamir for oppositor-appellant.
G.R. No. L-28040 August 18, 1972
L-28611
TESTATE ESTATE OF JOSEFA TANGCO, JOSE DE BORJA, administrator-
appellee; JOSE DE BORJA, as administrator, CAYETANO DE BORJA,
Sevilla & Aquino for plaintiff-appellee.
MATILDE DE BORJA and CRISANTO DE BORJA (deceased) as Children of
Josefa Tangco, appellees,
vs. Pelaez, Jalandoni & Jamir and David Gueverra for defendant-appellant.
TASIANA VDA. DE DE BORJA, Special Administratrix of the Testate Estate of
Francisco de Borja, appellant. .

G.R. No L-28568 August 18, 1972 REYES, J.B.L., J.:p

TESTATE ESTATE OF THE LATE FRANCISCO DE BORJA, TASIANA O. VDA. Of these cases, the first, numbered L-28040 is an appeal by Tasiana Ongsingco
DE DE BORJA, special Administratrix appellee, Vda. de de Borja, special administratrix of the testate estate of Francisco de
vs. Borja,1 from the approval of a compromise agreement by the Court of First Instance
JOSE DE BORJA, oppositor-appellant. of Rizal, Branch I, in its Special Proceeding No. R-7866, entitled, "Testate Estate of
Josefa Tangco, Jose de Borja, Administrator".
G.R. No. L-28611 August 18, 1972
Case No. L-28568 is an appeal by administrator Jose Borja from the disapproval of
TASIANA 0. VDA. DE BORJA, as Administratrix of the Testate Estate of the late the same compromise agreement by the Court of First Instance of Nueva Ecija,
Francisco de Borja, plaintiff-appellee, Branch II, in its Special Proceeding No. 832, entitled, "Testate Estate of Francisco de
vs. Borja, Tasiana O. Vda. de de Borja, Special Administratrix".
JOSE DE BORJA, as Administrator of the Testate Estate of the late Josefa
Tangco, defendant-appellant. 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
L-28040 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
Pelaez, Jalandoni & Jamir for administrator-appellee.
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
Quiogue & Quiogue for appellee Matilde de Borja. 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
12
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
13
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
14
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
15
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
16
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
17
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.
 18

The following shall be the exclusive property of each spouse: 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
xxx xxx xxx settlement of the estates of the deceased, the same requires no pro announcement
from this Court.
(4) That which is purchased with exclusive money of the wife or of the
husband. 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-
We find the conclusions of the lower court to be untenable. In the first place, witness 28568 and L-28611 are reversed and set aside. Costs against the appellant Tasiana
Gregorio de Borja's testimony as to the source of the money paid by Francisco for Ongsingco Vda. de Borja in all three (3) cases.
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.

5. Bonilla vs. Barcena, 71 SCRA 490.
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.
Federico Paredes for petitioners.
Demetrio V. Pre for private 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
19
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."
 20

This duty was complied with by the counsel for the deceased plaintiff when he appointment of a legal representative of the deceased because her counsel has not
manifested before the respondent Court that Fortunata Barcena died on July 9, 1975 only asked that the minor children be substituted for her but also suggested that their
and asked for the proper substitution of parties in the case. The respondent Court, uncle be appointed as guardian ad litem for them because their father is busy in
however, instead of allowing the substitution, dismissed the complaint on the ground Manila earning a living for the family. But the respondent Court refused the request
that a dead person has no legal personality to sue. This is a grave error. Article 777 for substitution on the ground that the children were still minors and cannot sue in
of the Civil Code provides "that the rights to the succession are transmitted from the court. This is another grave error because the respondent Court ought to have
moment of the death of the decedent." From the moment of the death of the known that under the same Section 17, Rule 3 of the Rules of Court, the court is
decedent, the heirs become the absolute owners of his property, subject to the rights directed to appoint a guardian ad litem for the minor heirs. Precisely in the instant
and obligations of the decedent, and they cannot be deprived of their rights thereto case, the counsel for the deceased plaintiff has suggested to the respondent Court
except by the methods provided for by law. 3 The moment of death is the determining that the uncle of the minors be appointed to act as guardian ad litem for them.
factor when the heirs acquire a definite right to the inheritance whether such right be Unquestionably, the respondent Court has gravely abused its discretion in not
pure or contingent. 4 The right of the heirs to the property of the deceased vests in complying with the clear provision of the Rules of Court in dismissing the complaint
them even before judicial declaration of their being heirs in the testate or intestate of the plaintiff in Civil Case No. 856 and refusing the substitution of parties in the
proceedings. 5 When Fortunata Barcena, therefore, died her claim or right to the case.
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 IN VIEW OF THE FOREGOING, the order of the respondent Court dismissing the
interest in the properties in litigation and became parties in interest in the case. complaint in Civil Case No. 856 of the Court of First Instance of Abra and the
There is, therefore, no reason for the respondent Court not to allow their substitution motions for reconsideration of the order of dismissal of said complaint are set aside
as parties in interest for the deceased plaintiff. 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
Under Section 17, Rule 3 of the Rules of Court "after a party dies and the claim is not qualified person as guardian ad litem for them. Without pronouncement as to costs.
thereby extinguished, the court shall order, upon proper notice, the legal
representative of the deceased to appear and be substituted for the deceased, within SO ORDERED.
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

6. Go Ong vs. CA, 154 SCRA 270.
G.R. No. 75884 September 24, 1987
JULITA GO ONG, FOR HERSELF AND AS JUDICIAL GUARDIAN OF STEVEN
GO ONG, petitioners,
vs.
THE HON. COURT OF APPEALS, ALLIED BANKING CORPORATION and the
CITY SHERIFF OF QUEZON CITY, respondents.
PARAS, J.:
This is a petition for review on certiorari of the March 21, 1986 Decision * of the
Court of Appeals in AC-G.R. CV No. 02635, "Julita Ong etc. vs. Allied Banking Corp.
et al." affirming, with modification, the January 5, 1984 Decision of the Regional Trial
Court of Quezon City in Civil Case No. Q-35230.
The uncontroverted facts of this case, as found by the Court of Appeals, are as
follows:
...: Two (2) parcels of land in Quezon City Identified as Lot No. 12,
Block 407, Psd 37326 with an area of 1960.6 sq. m. and Lot No. 1,
Psd 15021, with an area of 3,660.8 sq. m. are covered by Transfer
Certificate of Title No. 188705 in the name of "Alfredo Ong Bio Hong
married to Julita Go Ong "(Exh. D). Alfredo Ong Bio Hong died on
January 18, 1975 and Julita Go Ong was appointed administratrix of
her husband's estate in Civil Case No. 107089. The letters of
administration was registered on TCT No. 188705 on October 23,
1979. Thereafter, Julita Go Ong sold Lot No. 12 to Lim Che Boon, and
TCT No. 188705 was partially cancelled and TCT No. 262852 was
21
issued in favor of Lim Che Boon covering Lot No. 12 (Exh. D-4). On
June 8, 1981 Julita Go Ong through her attorney-in-fact Jovita K. Yeo
(Exh. 1) mortgaged Lot No. 1 to the Allied Banking Corporation to
secure a loan of P900,000.00 obtained by JK Exports, Inc. The
mortgage was registered on TCT No. 188705 on the same date with
the following notation: "... mortgagee's consent necessary in case of
subsequent alienation or encumbrance of the property other
conditions set forth in Doc. No. 340, Page No. 69, Book No. XIX, of
the Not. Public of Felixberto Abad". On the loan there was due the
sum of P828,000.00 and Allied Banking Corporation tried to collect it
from Julita Go Ong, (Exh. E). Hence, the complaint alleging nullity of
the contract for lack of judicial approval which the bank had allegedly
promised to secure from the court. In response thereto, the bank
averred that it was plaintiff Julita Go Ong who promised to secure the
court's approval, adding that Julita Go Ong informed the defendant
that she was processed the sum of P300,000.00 by the JK Exports,
Inc. which will also take charge of the interest of the loan.
Concluding, the trial court ruled:
Absent (of) any evidence that the property in question
is the capital of the deceased husband brought into the
marriage, said property should be presumed as
acquired during the marriage and, therefore, conjugal
property,
After the dissolution of the marriage with the death of
plaintiff's husband, the plaintiff acquired, by law, her
conjugal share, together with the hereditary rights
thereon. (Margate vs. Rabacal, L-14302, April 30,
1963). Consequently, the mortgage constituted on said
property, upon express authority of plaintiff,
notwithstanding the lack of judicial approval, is valid,
with respect to her conjugal share thereon, together
with her hereditary rights.
On appeal by petitioner, respondent Court of Appeals affirmed, with modification, the
appealed decision (Record, pp. 19-22). The dispositive portion of the appellate
court's decision reads:

WHEREFORE, with the modification that the extrajudicial foreclosure
proceedings instituted by defendant against plaintiff shall be held in
abeyance to await the final result of Civil Case No. 107089 of the
Court of First Instance of Manila, 6th Judicial District Branch XXXII,
entitled "IN THE MATTER OF THE INTESTATE ESTATE OF THE
LATE ALFREDO ONG BIO: JULITA GO ONG, ADMINISTRATRIX". In
pursuance with which the restraining order of the lower court in this
case restraining the sale of the properties levied upon is hereby
ordered to continue in full force and effect coterminous with the final
result of Civil Case No. 107089, the decision appealed from is hereby
affirmed. Costs against plaintiff-appellant.
SO ORDERED.
On April 8, 1986, petitioner moved for the reconsideration of the said decision (Ibid.,
pp. 24-29), but in a Resolution dated September 11, 1986, respondent court denied
the motion for lack of merit (Ibid., p. 23). Hence, the instant petition (Ibid., pp. 6-17).
The Second Division of this Court, in a Resolution dated November 19, 1986 (Rollo,
p. 30), without giving due course to the petition, resolved to require private
respondent to comment thereon and it did on February 19, 1987 (Ibid., pp. 37-42).
Thereafter, in a Resolution dated April 6, 1987, the petition was given due course
and the parties were required to file their respective memoranda (Ibid., p. 43).
Petitioner filed her Memorandum on May 13, 1987 (Ibid., pp. 45-56), while private
respondent filed its Memorandum on May 20, 1987 (Ibid., pp. 62-68).
The sole issue in this case is —
WHETHER OR NOT THE MORTGAGE CONSTITUTED OVER THE PARCEL OF
LAND UNDER PETITIONER'S ADMINISTRATION IS NULL AND VOID FOR WANT
OF JUDICIAL APPROVAL.
The instant petition is devoid of merit.
The well-settled rule that the findings of fact of the trial court are entitled to great
respect, carries even more weight when affirmed by the Court of Appeals as in the
case at bar.
22
In brief, the lower court found: (1) that the property under the administration of
petitioner — the wife of the deceased, is a community property and not the separate
property of the latter; (2) that the mortgage was constituted in the wife's personal
capacity and not in her capacity as administratrix; and (3) that the mortgage affects
the wife's share in the community property and her inheritance in the estate of her
husband.
Petitioner, asserting that the mortgage is void for want of judicial approval, quoted
Section 7 of Rule 89 of the Rules of Court and cited several cases wherein this Court
ruled that the regulations provided in the said section are mandatory.
While petitioner's assertion may have merit insofar as the rest of the estate of her
husband is concerned the same is not true as regards her conjugal share and her
hereditary rights in the estate. The records show that petitioner willingly and
voluntarily mortgaged the property in question because she was processed by JK
Exports, Inc. the sum of P300,000.00 from the proceeds of the loan; and that at the
time she executed the real estate mortgage, there was no court order authorizing the
mortgage, so she took it upon herself, to secure an order.
Thus, in confirming the findings of the lower court, as supported by law and the
evidence, the Court of Appeals aptly ruled that Section 7 of Rule 89 of the Rules of
Court is not applicable, since the mortgage was constituted in her personal capacity
and not in her capacity as administratrix of the estate of her husband.
Nevertheless, petitioner, citing the cases of Picardal, et al. vs. Lladas (21 SCRA
1483) and Fernandez, et al. vs. Maravilla (10 SCRA 589), further argues that in the
settlement proceedings of the estate of the deceased spouse, the entire conjugal
partnership property of the marriage is under administration. While such may be in a
sense true, that fact alone is not sufficient to invalidate the whole mortgage, willingly
and voluntarily entered into by the petitioner. An opposite view would result in an
injustice. Under similar circumstances, this Court applied the provisions of Article 493
of the Civil Code, where the heirs as co-owners shall each have the full ownership of
his part and the fruits and benefits pertaining thereto, and he may therefore alienate,
assign or mortgage it, and even effect of the alienation or mortgage, with respect to
the co-owners, shall be limited to the portion which may be allotted to him in the
division upon the termination of the co-ownership (Philippine National Bank vs. Court
of Appeals, 98 SCRA 207 [1980]).
Consequently, in the case at bar, the trial court and the Court of Appeals cannot be
faulted in ruling that the questioned mortgage constituted on the property under

administration, by authority of the petitioner, is valid, notwithstanding the lack of
judicial approval, with respect to her conjugal share and to her hereditary rights. The
fact that what had been mortgaged was in custodia legis is immaterial, insofar as her
conjugal share and hereditary share in the property is concerned for after all, she
was the ABSOLUTE OWNER thereof. This ownership by hers is not disputed, nor is
there any claim that the rights of the government (with reference to taxes) nor the
rights of any heir or anybody else have been prejudiced for impaired. As stated by
Associate Justice (later Chief Justice) Manuel Moran in Jakosalem vs. Rafols, et
al., 73 Phil. 618 —
The land in question, described in the appealed decision, originally
belonged to Juan Melgar. The latter died and the judicial
administration of his estate was commenced in 1915 and came to a
close on December 2, 1924, only. During the pendency of the said
administration, that is, on July 5, 1917, Susana Melgar, daughter of
the deceased Juan Melgar, sold the land with the right of repurchase
to Pedro Cui, subject to the stipulation that during the period for the
repurchase she would continue in possession of the land as lessee of
the purchase. On December 12, 1920, the partition of the estate left
by the deceased Juan Melgar was made, and the land in question
was adjudicated to Susana Melgar. In 1921, she conveyed, in
payment of professional fees, one-half of the land in favor of the
defendant-appellee Nicolas Rafols, who entered upon the portion thus
conveyed and has been in possession thereof up to the present. On
July 23, 1921, Pedro Cui brought an action to recover said half of the
land from Nicolas Rafols and the other half from the other defendants,
and while that case was pending, or about August 4, 1925, Pedro Cui
donated the whole land in question to Generosa Teves, the herein
plaintiff-appellant, after trial, the lower court rendered a decision
absolving Nicolas Rafols as to the one-half of the land conveyed to
him by Susana Melgar, and declaring the plaintiff owner of the other
half by express acknowledgment of the other defendants. The plaintiff
appealed from that part of the judgment which is favorable to Nicolas
Rafols.
The lower court absolved Nicolas Rafols upon the theory that Susana
Melgar could not have sold anything to Pedro Cui because the land
was then in custodia legis, that is, under judicial administration. This
is error. That the land could not ordinary be levied upon while
in custodia legis, does not mean that one of the heirs may not sell the
23
right, interest or participation which he has or might have in the lands
under administration. The ordinary execution of property in custodia
legis is prohibited in order to avoid interference with the possession by
the court. But the sale made by an heir of his share in an inheritance,
subject to the result of the pending administration, in no wise stands in
the way of such administration.
The reference to judicial approval in Sec. 7, Rule 89 of the Rules of Court cannot
adversely affect the substantive rights of private respondent to dispose of her Ideal
[not inchoate, for the conjugal partnership ended with her husband's death, and her
hereditary rights accrued from the moment of the death of the decedent (Art. 777,
Civil Code) share in the co-heirship and/or co-ownership formed between her and
the other heirs/co-owners (See Art. 493, Civil Code, supra.). Sec. 7, Art. 89 of the
Civil Code applies in a case where judicial approval has to be sought in connection
with, for instance, the sale or mortgage of property under administration for the
payment, say of a conjugal debt, and even here, the conjugal and hereditary shares
of the wife are excluded from the requisite judicial approval for the reason already
adverted to hereinabove, provided of course no prejudice is caused others, including
the government.
Moreover, petitioner is already estopped from questioning the mortgage. An estoppel
may arise from the making of a promise even though without consideration, if it was
intended that the promise should be relied upon and in fact it was relied upon, and if
a refusal to enforce it would be virtually to sanction the perpetration of fraud or would
result in other injustice (Gonzalo Sy Trading vs. Central Bank, 70 SCRA 570).
PREMISES CONSIDERED, the instant petition is hereby DENIED and the assailed
decision of the Court of Appeals is hereby AFFIRMED.
SO ORDERED.

7. Butte vs. Manuel Uy & Sons, Inc. 4 SCRA 562.
G.R. No. L-15499             February 28, 1962
ANGELA M. BUTTE, plaintiff-appellant,
vs.
MANUEL UY and SONS, INC., defendant-appellee.
Delgado, Flores and Macapagal for plaintiff-appellant.
Pelaez and Jalandoni for defendant-appellee.
REYES, J.B.L., J.:
Appeal from a decision of the Court of First instance of Manila dismissing the action
for legal redemption filed by plaintiff-appellant.
It appears that Jose V. Ramirez, during his lifetime, was a co-owner of a house and
lot located at Sta. Cruz, Manila, as shown by Transfer Certificate of Title No. 52789,
issued in the name of the following co-owners: Marie Garnier Vda. de Ramirez, 1/6;
Jose V. Ramirez, 1/6; Jose E. Ramirez, 1/6; Rita de Ramirez, 1/6; and Jose Ma.
Ramirez, 1/6.
On October 20, 1951, Jose V. Ramirez died. Subsequently, Special Proceeding No.
15026 was instituted to settle his estate, that included the one-sixth (1/6) undivided
share in the aforementioned property. And although his last will and testament,
wherein he bequeathed his estate to his children and grandchildren and one-third
(1/3) of the free portion to Mrs. Angela M. Butte, hereinafter referred to as plaintiff-
appellant, has been admitted to probate, the estate proceedings are still pending up
to the present on account of the claims of creditors which exceed the assets of the
deceased. The Bank of the Philippine Islands was appointed judicial administrator.
24
Meanwhile, on December 9, 1958, Mrs. Marie Garnier Vda. de Ramirez, one of the
co-owners of the late Jose V. Ramirez in the Sta. Cruz property, sold her undivided
1/6 share to Manuel Uy & Sons, Inc. defendant-appellant herein, for the sum of
P500,000.00. After the execution by her attorney-in-fact, Mrs. Elsa R. Chambers, of
an affidavit to the effect that formal notices of the sale had been sent to all possible
redemptioners, the deed of sale was duly registered and Transfer Certificate of Title
No. 52789 was cancelled in lieu of which a new one was issued in the name of the
vendee and the other-co-owners.
On the same day (December 9, 1958), Manuel Uy & Sons, Inc. sent a letter to the
Bank of the Philippine Islands as judicial administrator of the estate of the late Jose
V. Ramirez informing it of the above-mentioned sale. This letter, together with that of
the bank, was forwarded by the latter to Mrs. Butte c/o her counsel Delgado, Flores
& Macapagal, Escolta, Manila, and having received the same on December 10,
1958, said law office delivered them to plaintiff-appellant's son, Mr. Miguel Papa,
who in turn personally handed the letters to his mother, Mrs. Butte, on December 11
and 12, 1958. Aside from this letter of defendant-appellant, the vendor, thru her
attorney-in-fact Mrs. Chambers, wrote said bank on December 11, 1958 confirming
vendee's letter regarding the sale of her 1/6 share in the Sta. Cruz property for the
sum of P500,000.00. Said letter was received by the bank on December 15, 1958
and having endorsed it to Mrs. Butte's counsel, the latter received the same on
December 16, 1958. Appellant received the letter on December 19, 1958.
On January 15, 1959, Mrs. Angela M. Butte, thru Atty. Resplandor Sobretodo, sent a
letter and a Philippine National Bank cashier's check in the amount of P500,000.00
to Manuel Uy & Sons, Inc. offering to redeem the 1/6 share sold by Mrs. Marie
Garnier Vda. de Ramirez. This tender having been refused, plaintiff on the same day
consigned the amount in court and filed the corresponding action for legal
redemption. Without prejudice to the determination by the court of the reasonable
and fair market value of the property sold which she alleged to be grossly excessive,
plaintiff prayed for conveyance of the property, and for actual, moral and exemplary
damages.
After the filing by defendant of its answer containing a counterclaim, and plaintiff's
reply thereto, trial was held, after which the court rendered decision on May 13,
1959, dismissing plaintiff's complaint on the grounds that she has no right to redeem
the property and that, if ever she had any, she exercised the same beyond the
statutory 30-day period for legal redemptions provided by the Civil Code. The
counterclaim of defendant for damages was likewise dismissed for not being
sufficiently established. Both parties appealed directly to this Court.

Based on the foregoing facts, the main issues posed in this appeal are: (1) whether
or not plaintiff-appellant, having been bequeathed 1/3 of the free portion of the estate
of Jose V. Ramirez, can exercise the right of legal redemption over the 1/6 share
sold by Mrs. Marie Garnier Vda. de Ramirez despite the presence of the judicial
administrator and pending the final distribution of her share in the testate
proceedings; and (2) whether or not she exercised the right of legal redemption
within the period prescribed by law.
The applicable law involved in the present case is contained in Articles 1620, p. 1,
and 1623 of the Civil Code of the Philippines, which read as follows:
ART. 1620. A co-owner of a thing may exercise the right of redemption in
case the shares of all the other-co-owners or of any of them, are sold to a
third person. If the price of the alienation is grossly excessive, the
redemptioner shall pay only a reasonable one.
Should two or more co-owners desire to exercise the right of redemption,
they may only do so in proportion to the share they may respectively have in
the thing owned in common. (1522a)
ART. 1623. The right of legal predemption or redemption shall not be
exercised except within thirty days from the notice in writing by the respective
vendor, or by the vendor, as the case may be. The deed of sale shall not be
accorded in the Registry of Property, unless accompanied by an affidavit of
the vendor that he has given written notice thereof at all possible
redemptioners.
The right of redemption of co-owners excludes that of adjoining owners.
(1524a)
That the appellant Angela M. Butte is entitled to exercise the right of legal
redemption is clear. As testamentary heir of the estate of J.V. Ramirez, she and her
co-heirs acquired an interest in the undivided one-sixth (1/6) share owned by her
predecessor (causante) in the Santa Cruz property, from the moment of the death of
the aforesaid co-owner, J.V. Ramirez. By law, the rights to the succession of a
deceased persons are transmitted to his heirs from the moment of his death, and the
right of succession includes all property rights and obligations that survive the
decedent.
25
ART. 776. The inheritance includes all the property, rights and obligations of
a person which are not extinguished by his death. (659)
ART. 777. The rights to the succession are transmitted from the moment of
the death of the decedent. (657a)
ART. 947. The legatee or devisee acquires a right to the pure and simple
legacies or devisees from the death of the testator, and transmits it to his
heirs. (881a)
The principle of transmission as of the time of the predecessor's death is basic in our
Civil Code, and is supported by other related articles. Thus, the capacity of the heir is
determined as of the time the decedent died (Art. 1034); the legitime is to be
computed as of the same moment(Art. 908), and so is the in officiousness of the
donation inter vivos (Art. 771). Similarly, the legacies of credit and remission are
valid only in the amount due and outstanding at the death of the testator (Art.
935),and the fruits accruing after that instant are deemed to pertain to the legatee
(Art. 948).
As a consequence of this fundamental rule of succession, the heirs of Jose V.
Ramirez acquired his undivided share in the Sta. Cruz property from the moment of
his death, and from that instant, they became co-owners in the aforesaid property,
together with the original surviving co-owners of their decedent (causante). A co-
owner of an undivided share is necessarily a co-owner of the whole. Wherefore, any
one of the Ramirez heirs, as such co-owner, became entitled to exercise the right of
legal redemption (retracto de comuneros) as soon as another co-owner (Maria
Garnier Vda. de Ramirez) had sold her undivided share to a stranger, Manuel Uy &
Sons, Inc. This right of redemption vested exclusively in consideration of the
redemptioner's share which the law nowhere takes into account.
The situation is in no wise altered by the existence of a judicial administrator of the
estate of Jose V. Ramirez while under the Rules of Court the administrator has the
right to the possession of the real and personal estate of the deceased, so far as
needed for the payment of the decedent's debts and the expenses of administration
(sec. 3, Rule 85), and the administrator may bring or defend actions for the recovery
or protection of the property or rights of the deceased (sec. 2, Rule 88), such rights
of possession and administration do not include the right of legal redemption of the
undivided share sold to Uy & Company by Mrs. Garnier Ramirez. The reason is
obvious: this right of legal redemption only came into existence when the sale to Uy
& Sons, Inc. was perfected, eight (8) years after the death of Jose V. Ramirez, and

formed no part of his estate. The redemption right vested in the heirs originally, in
their individual capacity, they did not derivatively acquire it from their decedent, for
when Jose V. Ramirez died, none of the other co-owners of the Sta. Cruz property
had as yet sold his undivided share to a stranger. Hence, there was nothing to
redeem and no right of redemption; and if the late Ramirez had no such right at his
death, he could not transmit it to his own heirs. Much less could Ramirez acquire
such right of redemption eight years after his death, when the sale to Uy & Sons, Inc.
was made; because death extinguishes civil personality, and, therefore, all further
juridical capacity to acquire or transmit rights and obligations of any kind (Civil Code
of the Phil., Art. 42).
It is argued that the actual share of appellant Mrs. Butte in the estate of Jose V.
Ramirez has not been specifically determined as yet, that it is still contingent; and
that the liquidation of estate of Jose V. Ramirez may require the alienation of the
decedent's undivided portion in the Sta. Cruz property, in which event Mrs. Butte
would have no interest in said undivided portion. Even if it were true, the fact would
remain that so long as that undivided share remains in the estate, the heirs of Jose
V. Ramirez own it, as the deceased did own it before his demise, so that his heirs
are now as much co-owners of the Sta. Cruz property as Jose V. Ramirez was
himself a co-owner thereof during his lifetime. As co-owners of the property, the heirs
of Jose V. Ramirez, or any one of them, became personally vested with right of legal
redemption as soon as Mrs. Garnier sold her own pro-indiviso interest to Uy & Sons.
Even if subsequently, the undivided share of Ramirez (and of his heirs) should
eventually be sold to satisfy the creditors of the estate, it would not destroy their
ownership of it before the sale, but would only convey or transfer it as in turn sold (of
it actually is sold) to pay his creditors. Hence, the right of any of the Ramirez heirs to
redeem the Garnier share will not be retroactively affected. All that the law requires is
that the legal redemptioner should be a co-owner at the time the undivided share of
another co-owner is sold to a stranger. Whether or not the redemptioner will continue
being a co-owner after exercising the legal redemptioner is irrelevant for the
purposes of law.
Nor it can be argued that if the original share of Ramirez is sold by the administrator,
his heirs would stand in law as never having acquired that share. This would only be
true if the inheritance is repudiated or the heir's quality as such is voided. But where
the heirship is undisputed, the purchaser of hereditary property is not deemed to
have acquired the title directly from the deceased Ramirez, because a dead man can
not convey title, nor from the administrator who owns no part of the estate; the
purchaser can only derive his title from the Ramirez heirs, represented by the
administrator, as their trustee or legal representative.
26
The right of appellant Angela M. Butte to make the redemption being established, the
next point of inquiry is whether she had made or tendered the redemption price
within the 30 days from notices as prescribed by law. This period, be it noted, is
peremptory, because the policy of the law is not to leave the purchaser's title in
uncertainty beyond the established 30-day period. In considering whether or not the
offer to redeem was timely, we think that the notice given by the vendee (buyer)
should not be taken into account. The text of Article 1623 clearly and expressly
prescribes that the thirty days for making the redemption are to be counted from
notice in writing by the vendor. Under the old law (Civ. Code of 1889, Art. 1524), it
was immaterial who gave the notice; so long as the redeeming co-owner learned of
the alienation in favor of the stranger, the redemption period began to run. It is thus
apparent that the Philippine legislature in Article 1623 deliberately selected a
particular method of giving notice, and that method must be deemed exclusive (39
Am. Jur., 237; Payne vs. State, 12 S.W. [2d] 528). As ruled in Wampler vs.
Lecompte, 150 Atl. 458 (affd. in 75 Law Ed. [U.S.] 275) —
Why these provisions were inserted in the statute we are not informed, but
we may assume until the contrary is shown, that a state of facts in respect
thereto existed, which warranted the legislature in so legislating.
The reasons for requiring that the notice should be given by the seller, and not by the
buyer, are easily divined. The seller of an undivided interest is in the best position to
know who are his co-owners that under the law must be notified of the sale. Also, the
notice by the seller removes all doubts as to the fact of the sale, its perfection; and its
validity, the notice being a reaffirmation thereof, so that the party need not entertain
doubt that the seller may still contest the alienation. This assurance would not exist if
the notice should be given by the buyer.
The notice which became operative is that given by Mrs. Chambers, in her capacity
as attorney-in-fact of the vendor Marie Garnier Vda. de Ramirez. Under date of
December 11, 1958, she wrote the Administrator Bank of the Philippine Islands that
her principal's one-sixth (1/6) share in the Sta. Cruz property had been sold to
Manuel Uy & Sons, Inc. for P500,000.00. The Bank received this notice on
December 15, 1958, and on the same day endorsed it to Mrs. Butte, care of
Delgado, Flores and Macapagal (her attorneys), who received the same on
December 16, 1958. Mrs. Butte tendered redemption and upon the vendee's refusal,
judicially consigned the price of P500,000.00 on January 15, 1959. The latter date
was the last one of the thirty days allowed by the Code for the redemption, counted
by excluding December 16, 1958 and including January 15, 1959, pursuant to Article
13 of the Civil Code. Therefore, the redemption was made in due time.
 27

The date of receipt of the vendor's notice by the Administrator Bank (December 15)
can not be counted as determining the start of thirty days; for the Administrator of the
estate was not a proper redemptioner, since, as previously shown, the right to
redeem the share of Marie Garnier did not form part of the estate of Jose V.
Ramirez.

We find no jurisdiction for appellant's claim that the P500,000,00. paid by Uy & Sons,
Inc. for the Garnier share is grossly excessive. Gross excess cannot be predicated
on mere individual estimates of market price by a single realtor.

The redemption and consignation having been properly made, the Uy counterclaim
for damages and attorney's fees predicated on the assumption that plaintiff's action
was clearly unfounded, becomes untenable.

PREMISES CONSIDERED, the judgment appealed from is hereby reversed and set
aside, and another one entered:

(a) Declaring the consignation of P500,000,00 made by appellant Angela M.

Butte duly and properly made;

(b) Declaring that said appellant properly exercised in due time the legal
redemption of the one-sixth (1/6) undivided portion of the land covered by
Certificate of Title No. 59363 of the Office of the Register of Deeds of the City
of Manila, sold on December 9, 1958 by Marie Garnier Vda. de Ramirez to
appellant Manuel Uy & Sons, Inc.

(c) Ordering appellant Manuel Uy & Sons, Inc. to accept the consigned price
and to convey to Angela M. Butte the undivided portion above referred to,
within 30 days from the time our decision becomes final, and subsequently to
account for the rentals and fruits of the redeemed share from and after
January 15, 1958, until its conveyance; and.

(d) Ordering the return of the records to the court of origin for further
proceedings conformable to this opinion.

Without finding as to costs.


8. Reganon vs. Imperial, 22 SCRA 80.
G.R. No. L-24434           January 17, 1968
HEIRS OF PEDRO REGANON, JOVENCIA REGANON, MENCIA REGANON,
JOSEFA REGANON, VIOLETA REGANON, and FLORA REGANON, plaintiffs-
appellees,
vs.
RUFINO IMPERIAL, defendant-appellant.
Torcuato L. Galon for plaintiffs-appellees.
V. Lacaya for defendant-appellant.
BENGZON, J.P., J.:
This is an appeal from the orders dated June 9, 1964, July 14, 1964 and August 11,
1964, respectively, of the Court of First Instance of Zamboanga del Norte (Dipolog,
Branch II).
The facts of the case are admitted by both parties.
On February 22, 1963, the heirs of Pedro Reganon filed a complaint for recovery of
ownership and possession of about one-hectare portion of a parcel of land (Lot No. 1
or Lot No. 4952, situated at Miasi, Polanco, Zamboanga del Norte, covered by
O.T.C. No. 1447, with an area of 7.9954 hectares), with damages, against Rufino
Imperial.
Defendant not having filed an answer within the reglementary period, the plaintiffs on
April 8, 1963 filed a motion to declare the former in default. The trial court granted
the motion in its order dated April 10, 1963.
On April 23, 1963, the plaintiffs presented their evidence ex parte before the Clerk of
Court acting as Commissioner. The court a quo on May 6, 1963, rendered a decision
declaring the plaintiffs lawful owners of the land in question and entitled to its
peaceful possession and enjoyment; ordering defendant immediately to vacate the
28
portion occupied by him and to restore the peaceful possession thereof to plaintiffs;
and sentencing defendant to pay plaintiffs the amount of P1,929.20 and the costs.
On November 29, 1963, the plaintiffs filed a motion for issuance of a writ of
execution. This was granted by the trial court in its order of December 9, 1963.
The Deputy Provincial Sheriff submitted on February 8, 1964 a sheriff's return of
proceedings reporting the garnishment and sale of a carabao and goat belonging to
defendant for P153.00, and the attachment and sale of defendant's parcel of land
covered by Tax Declaration No. 4694, situated in Sicet, Polanco, Zamboanga del
Norte, for P500.00 — both sales having been made to the only bidder, plaintiffs'
counsel Atty. Vic T. Lacaya.
On March 13, 1964, the Philippine National Bank deposited in the Philippine National
Bank-Dipolog Branch the residuary estate of its former ward, Eulogio Imperial, in the
sum of P10,303.80, pursuant to an order of Branch I of the Court of First Instance of
Zamboanga del Norte in Sp. Proc. No. R-145.
On May 25, 1964, the heirs of said Eulogio Imperial, one of whom is defendant,
executed a Deed of Extrajudicial Partition of the residuary estate, wherein was
apportioned P1,471.97 as defendant Rufino Imperial's share.
Informed of this development, the plaintiffs filed on June 5, 1964 an ex parte motion
for issuance of an alias writ of execution and of an order directing the manager, or
the representative, of the Philippine National Bank-Dipolog Branch, to hold the share
of defendant and deliver the same to the provincial sheriff of the province to be
applied to the satisfaction of the balance of the money judgment. This was granted
by the trial court (Branch II) in its order dated June 9, 1964.
On June 17, 1964, the Deputy Provincial Sheriff issued a sheriffs notification for levy
addressed to defendant, giving notice of the garnishment of the rights, interests,
shares and participation that defendant may have over the residuary estate of the
late Eulogio Imperial, consisting of the money deposited in the Philippine National
Bank-Dipolog Branch.
Defendant, through counsel, appearing for the first time before the trial court, on
June 24, 1964 filed a motion for reconsideration of the order dated June 9, 1964, and
to quash the alias writ of execution issued pursuant to it, to which plaintiffs filed their

opposition on July 6, 1964. On July 14, 1964, the trial court denied defendant's
aforesaid motion.
Defendant's second motion for reconsideration likewise having denied by the trial
court in its order of August 11, 1964, defendant appealed to Us, raising the following
issues:
(1) Upon the death of a ward, is the money accumulated in his guardianship
proceedings and deposited in a bank, still considered in custodia legis and
therefore cannot be attached?
(2) Is the residuary estate of a U.S. veteran, which consists in the aggregate
accumulated sum from the monthly allowances given him by the United
States Veterans Administration (USVA) during his lifetime, exempt from
execution?
Defendant-appellant argues that the property of an incompetent under guardianship
is in custodia legis and therefore can not be attached.
It is true that in a former case 1 it was held that property under custodia legis can not
be attached. But this was under the old Rules of Court. The new Rules of Court 2 now
specifically provides for the procedure to be followed in case what is attached is
in custodia legis. 3 The clear import of this new provision is that property
under custodia legis is now attachable, subject to the mode set forth in said rule.
Besides, the ward having died, the guardianship proceedings no longer subsist:
The death of the ward necessarily terminates the guardianship, and
thereupon all powers and duties of the guardian cease, except the duty,
which remains, to make a proper accounting and settlement in the probate
court. 4
As a matter of fact, the guardianship proceedings was ordered conditionally closed
by Branch I of the Court of First Instance of Zamboanga del Norte in which it was
pending, in its order of February 8, 1964, where it stated —
In the meantime, the guardian Philippine National Bank is hereby directed to
deposit the residuary estate of said ward with its bank agency in Dipolog, this
province, in the name of the estate of the deceased ward Eulogio Imperial,
29
preparatory to the eventual distribution of the same to the heirs when the
latter shall be known, and upon proof of deposit of said residuary estate, the
guardian Philippine National Bank shall forthwith be relieved from any
responsibility as such, and this proceeding shall be considered closed and
terminated. 5
And the condition has long been fulfilled, because on March 13, 1964 the Philippine
National Bank-Manila deposited the residuary estate of the ward with the Philippine
National Bank-Dipolog Branch, evidenced by a receipt attached to the records in Sp.
Proc. No. R-145. 6
When Eulogio Imperial died on September 13, 1962, the rights to his succession —
from the moment of his death — were transmitted to his heirs, one of whom is his
son and heir, defendant-appellant herein. 7 This automatic transmission can not but
proceed with greater ease and certainty than in this case where the parties agree
that the residuary estate is not burdened with any debt. For,
The rights to the succession of a person are transmitted from the moment of
death, and where, as in this case, the heir is of legal age and the estate is not
burdened with any debts, said heir immediately succeeds, by force of law, to
the dominion, ownership, and possession of the properties of his predecessor
and consequently stands legally in the shoes of the latter. 8
That the interest of an heir in the estate of a deceased person may be attached for
purposes of execution, even if the estate is in the process of settlement before the
courts, is already a settled matter in this jurisdiction. 9
It is admitted that the heirs of Eulogio Imperial, including herein defendant-appellant,
have on May 25, 1964 executed a Deed of Extrajudicial Partition. This instrument
suffices to settle the entire estate of the decedent — provided all the requisites for its
validity are fulfilled 10 — even without the approval of the court. Therefore, the estate
for all practical purposes have been settled. The heirs are at full liberty to withdraw
the residuary estate from the Philippine National Bank-Dipolog Branch and divide it
among themselves. The only reason they have not done so is because of the alleged
illegal withdrawal from said estate of the amount of P1,080.00 by one Gloria Gomez
by authority of Branch I of the Court of First Instance of Zamboanga del Norte, which
incident is now on appeal before the Court of Appeals. This appeal, however, does
not detract any from the fact that the guardianship proceedings is closed and
terminated and the residuary estate no longer under custodia legis.
 30

Finally, it is defendant-appellant's position that the residuary estate of Eulogio

Imperial, a former U.S. veteran, having been set aside from the monthly allowances
given him by the United States Veterans Administration (USVA) during his lifetime, is
exempt from execution.

Any pension, annuity, or gratuity granted by a Government to its officers or

employees in recognition of past services rendered, is primordially aimed at tiding
them over during their old age and/or disability. This is therefore a
right personalissima, purely personal because founded on necessity. It requires no
argument to show that where the recipient dies, the necessity motivating or
underlying its grant necessarily ceases to be. Even more so in this case where the
law 11 providing for the exemption is calculated to benefit U.S. veterans residing here,
and is therefore merely a manifestation of comity.

Besides, as earlier stated, the heirs of Eulogio Imperial, one of whom is appellant,
have already executed a Deed of Extrajudicial Partition — the end result of which is
that the property is no longer the property of the estate but of the individual heirs.
And it is settled that:

When the heirs by mutual agreement have divided the estate among
themselves, one of the heirs can not therefore secure the appointment of an
administrator to take charge of and administer the estate or a part
thereof. The property is no longer the property of the estate, but of the
individual heirs, whether it remains undivided or not. 12

WHEREFORE, the orders appealed from are hereby affirmed, with costs against
defendant-appellant. So ordered.1äwp

9. Ramirez vs. Baltazar, 24 SCRA 918.
G.R. No. L-25049           August 30, 1968
FILEMON RAMIREZ, MONICA RAMIREZ, and JOSE EGUARAS, plaintiffs-
appellants,
vs.
ARTEMIO BALTAZAR, ET AL., defendants-appellees.
Eduardo M. Peralta for plaintiffs-appellants.
Tomas P. Anonuevo for defendants-appellees Artemio Baltazar and Susana Flores.
Tirso Caballero for defendant-appellee Artemio Diawan.
ANGELES, J.:
On appeal from an order dismissing the complaint, on motion to dismiss, in Civil
Case No. SC-319 of the Court of First Instance of Laguna.
It appears that on 6 January 1959, Victoriana Eguaras single, made and executed a
real estate mortgage over a parcel of land, owned by her in fee simple, as security
for a loan of P2,170.00 in favor of the spouses Artemio Baltazar and Susana Flores.
Upon the demise of the mortgagor, the mortgagees, as creditors of the deceased, on
16 September 1960 filed a petition for the intestate proceedings of her estate, in the
Court of First Instance of Laguna, docketed as Civil Case No. SC-99 wherein said
mortgages, as petitioners, alleged that Filemon Ramirez and Monica Ramirez are the
heirs of the deceased. Filemon Ramirez was appointed administrator of the estate;
however, having failed to qualify, on 16 January 1961, the court appointed Artemio
Diawan, then a deputy clerk of court, administrator of the estate who, in due time,
qualified for the office.
On 19 April 1961, the mortgagees, Artemio Baltazar and Susana Flores, filed a
complaint for foreclosure of the aforesaid mortgage, against Artemio Diawan, in his
capacity as administrator of the estate, docketed as Civil Case No. SC-292 of the
Court of First Instance of Laguna. The defendant-administrator was duly served with
summons but he failed to answer, whereupon, on petition of the plaintiffs said
defendant was declared in default. The case was referred to a commissioner to
31
receive the evidence for the plaintiffs, and defendant-administrator, as deputy clerk
of court, acted as such hearing commissioner. 1äwphï1.ñët
On 16 August 1961, decision was rendered decreeing the foreclosure of the
mortgaged property and the sale thereof, if, within ninety days from finality of the
decision, the obligation was not fully paid. The judgment not having been satisfied, a
writ of execution was issued for the sale of the mortgaged property, and after
compliance with the requirements of the law regarding the sending, posting and
publication of the notice of sale, the Sheriff sold the property at public auction to the
highest bidder, who happened to be the plaintiffs themselves, for the sum of
P2,888.50 covering the amount of the judgment, plus the expenses of the sale and
the Sheriff's fees. On petition of the plaintiffs, the sale was confirmed by the court on
26 January 1962.
On 6 February 1962, Filemon Ramirez, Monica Ramirez and Jose Eguaras, the first
two being the heirs named in the petition for intestate proceedings, filed a complaint
designated "For the Annulment of all Proceedings in said Civil Case No. SC-292 for
the Foreclosure of the Mortgage", against the spouses Artemio Baltazar and Susana
Flores, and Artemio Diawan, in his capacity as administrator of the estate of
Victoriana Eguaras, deceased, and Silverio Talabis, in his capacity as deputy
provincial sheriff of Laguna, docketed as Civil Case No. SC-319 of the Court of First
Instance of Laguna.
The facts hereinabove narrated are, succinctly, contained in the complaint in said
Civil Case No. SC-319, with the additional averments that the defendant Diawan, the
deputy clerk of court appointed as administrator of the intestate estate of the
deceased, acted in collusion with the other defendants Artemio Baltazar and Susana
Flores, deliberately and in fraud of the plaintiffs: (a) in allowing the reglementary
period within which to file an answer to lapse without notifying and/or informing the
said plaintiffs of the complaint for foreclosure, as a result of which he was declared in
default to the prejudice of the estate which he represents; (b) that had the plaintiffs
(Monica and Filemon) been notified of the pendency of the case, the defendant
administrator could have interposed a counterclaim because payment in the sum of
P1,548.52 had been made and received by the mortgagees on account of the debt;
(c) in presiding as hearing officer in the ex parte hearing in Civil Case No. 292, to
receive evidence for plaintiffs therein, notwithstanding the fact that there was another
deputy clerk of court available who could have acted in his stead, as a result of which
an anomalous situation was created whereby he was a defendant and at the same
time a commissioner receiving evidence against himself as administrator; (d) in
allowing judgment to become final without notifying the plaintiffs; (e) in deliberately,

allowing the 90-day period within which to make payment to expire without notifying
the heirs, as a result of which the said heirs were not afforded an opportunity to
make payments ordered by the Court in its decision; and (f) in refusing to help the
heirs seek postponement of the auction sale. It is also alleged that it was only when
the property foreclosed was published for sale at public auction that the heirs came
to know about the foreclosure proceedings.
The defendants spouses, Artemio Baltazar and Susana Flores, filed a motion to
dismiss the complaint on the ground that the plaintiffs have no legal capacity to sue;
defendant Diawan likewise moved to dismiss on two grounds: that plaintiffs have no
legal capacity to sue and that the complaint states no cause of action. 1äwphï1.ñët
Despite vigorous opposition interposed by the plaintiffs against the aforesaid motions
to dismiss, the court, on 13 March 1962, dismissed the complaint with costs against
the plaintiffs, reasoning thus: that "upon consideration of the evidence, said
defendant could not have offered any evidence to avoid the foreclosure of the
mortgage which the Court found to be in order. Under the circumstances and with
the apparent disinterestedness of Filemon and Rolando to qualify as administrator
when appointed, there could not have been any connivance and/or collusion
between plaintiffs in this case and Artemio Diawan as administrator"; and that
plaintiffs have no legal capacity to sue since their status as legal heirs of the
deceased has yet to be determined precisely in Special Proceeding No. SC-99, and
until such status is so fixed by the Court, they have no cause of action against
defendants.
In that order of 13 March 1962, the court also denied plaintiffs' petition for the
issuance of a writ of preliminary injunction to enjoin defendants from entering and
taking physical possession of the land in question on the ground "that possession
thereof was effected and delivered by the Provincial Sheriff to Artemio Baltazar and
Susana Flores on February, 1962."
Reconsideration of the aforesaid order having been denied, the plaintiffs took the
present appeal where they assigned the following errors: (1) in holding that plaintiffs-
appellants have no legal capacity to sue until their status as legal heirs of the
deceased is determined in Special Proceeding No. SC-99; (2) in ruling that there was
no collusion or connivance among the defendants-appellees, despite the fact that the
issue in the motion to dismiss is purely legal, not factual; and (3) in denying the
petition for a writ of preliminary injunction.
32
At the outset, let it be remembered that the defendants-appellees, in availing
themselves of the defense that the plaintiffs-appellants had not been declared to be
the heirs of the deceased Victoriana Eguaras, have overlooked the fact that the
(defendants-appellees) themselves in their petition for intestate proceedings (Case
SC-99) have alleged that Filemon Ramirez and Monica Ramirez, two of herein
plaintiffs-appellants, are the heirs of the deceased. Insofar as defendants-appellees
are concerned, it is our opinion that they are estopped from questioning the heirship
of these two named persons to the estate of the deceased.
There is no question that the rights to succession are automatically transmitted to the
heirs from the moment of the death of the decedent.1 While, as a rule, the formal
declaration or recognition to such successional rights needs judicial confirmation, this
Court has, under special circumstances, protected these rights from encroachments
made or attempted before the judicial declaration.2 In Pascual vs. Pascual,3 it was
ruled that although heirs have no legal standing in court upon the commencement of
testate or intestate proceedings, this rule admits of an exception as "when the
administrator fails or refuses to act in which event the heirs may act in his place."
A similar situation obtains in the case at bar. The administrator is being charged to
have been in collusion and connivance with the mortgagees of a property of the
deceased, allowing its foreclosure without notifying the heirs, to the prejudice of the
latter. Since the ground for the present action to annul the aforesaid foreclosure
proceedings is the fraud resulting from such insidious machinations and collusion in
which the administrator has allegedly participated, it would be farfetched to expect
the said administrator himself to file the action in behalf of the estate. And who else
but the heirs, who have an interest to assert and to protect, would bring the action?
Inevitably, this case should fall under the exception, rather than the general rule that
pending proceedings for the settlement of the estate, the heirs have no right to
commence an action arising out of the rights belonging to the deceased.
On the second point raised, We fully agree with the plaintiffs-appellants that the
lower court had gone too far in practically adjudicating the case on the merits when it
made the observation that "there could not have been any connivance and/or
collusion between plaintiffs in this case and Artemio Diawan as administrator." A
thorough scrutiny of the allegations in the motions to dismiss filed by defendants-
appellees does not indicate that that question was ever put at issue therein. On the
other hand, the controversy — on the existence or inexistence of collusion between
the parties as a result of which judgment was rendered against the estate — is the
very core of the complaint that was dismissed. Undoubtedly, the cause of action is
based on Section 30, Rule 132 of the Rules of Court.
 33

We are not, however, in accord with the third assigned error — the denial of the
motion for the issuance of preliminary injunction — for it puts at issue the factual
finding made by the lower court that the defendants had already been placed in
possession of the property. At this stage of the proceeding, and considering the
nature of the case before Us, such a question is, at this time, beyond the
competence of the Court.

PREMISES CONSIDERED, the order appealed from is hereby set aside insofar as it
dismissed the complaint in Civil Case No. SC-319, and the records be remanded to
the lower court for further proceedings. Costs against defendants-appellees. The
Clerk of Court is directed to furnish a copy of this decision to the Department of
Justice for its information.

10. Noceda vs. CA, 313 SCRA 504.
G.R. No. 178495               July 26, 2010
SPOUSES RODOLFO A. NOCEDA and ERNA T. NOCEDA, Petitioners,
vs.
AURORA ARBIZO-DIRECTO, Respondent.
DECISION
NACHURA, J.:
Assailed in the instant petition is the Decision1 of the Court of Appeals (CA),
dismissing the appeal on the ground of res judicata.
On September 16, 1986, respondent Aurora Arbizo-Directo filed a complaint against
her nephew, herein petitioner Rodolfo Noceda, for "Recovery of Possession and
Ownership and Rescission/Annulment of Donation" with the Regional Trial Court
(RTC) of Iba, Zambales, Branch 71, docketed as Civil Case No. RTC-354-I.
Respondent alleged that she and her co-heirs have extra-judicially settled the
property they inherited from their late father on August 19, 1981, consisting of a
parcel of land, described as Lot No. 1121, situated in Bitoong, San Isidro, Cabangan,
Zambales. She donated a portion of her hereditary share to her nephew, but the
latter occupied a bigger area, claiming ownership thereof since September 1985.
Judgment was rendered in favor of respondent on November 6, 1991, where the
RTC (a) declared the Extra-Judicial Settlement-Partition dated August 19, 1981 valid;
(b) declared the Deed of Donation dated June 1, 1981 revoked; (c) ordered
defendant to vacate and reconvey that donated portion of Lot 2, Lot 1121 subject of
the Deed of Donation dated June 1, 1981 to the plaintiff or her heirs or assigns; (d)
ordered the defendant to remove the house built inside the donated portion at the
defendant’s expense or pay a monthly rental of ₱300.00 Philippine Currency; and (e)
ordered the defendant to pay attorney’s fees in the amount of ₱5,000.00.2 The
decision was appealed to the CA, docketed as CA-G.R. CV No. 38126.
34
On January 5, 1995, spouses Rodolfo Dahipon and Cecilia Obispo- Dahipon filed a
complaint for recovery of ownership and possession, and annulment of sale and
damages against spouses Antonio and Dominga Arbizo, spouses Rodolfo and Erna
Noceda, and Aurora Arbizo-Directo with the RTC, Iba, Zambales, Branch 70. This
was docketed as Civil Case No. RTC-1106-I. In the complaint, spouses Dahipon
alleged that they were the registered owners of a parcel of land, consisting of
127,298 square meters, situated in Barangay San Isidro, Cabangan, Zambales,
designated as Lot 1121-A. The Original Certificate of Title No. P-9036 over the land
was issued in the name of Cecilia Obispo-Dahipon, pursuant to Free Patent No.
548781. Spouses Dahipon claimed that the defendants therein purchased portions of
the land from them without paying the full amount. Except for Aurora, a compromise
agreement was entered into by the parties, as a result of which, a deed of absolute
sale was executed, and TCT No. T-50730 was issued in the name of spouses
Noceda for their portion of the land. For her part, Aurora questioned Dahipon’s
alleged ownership over the same parcel of land by filing an adverse claim.
In the meantime, a decision was rendered in CA-G.R. CV No. 38126 on March 31,
1995 with the following fallo:
WHEREFORE, judgment is hereby rendered, ORDERING defendant Rodolfo
Noceda to VACATE the portion known as Lot "C" of Lot 1121 per Exhibit E, which
was allotted to plaintiff Aurora Arbizo-Directo. Except for this modification, the
Decision dated November 6, 1991 of the RTC, Iba, Zambales, Branch 71, in Civil
Case No. RTC-354-I, is hereby AFFIRMED in all other respects. Costs against
defendant Rodolfo Noceda.3
Undaunted, petitioners filed a petition for review with this Court, which was docketed
as G.R. No. 119730. The Court found no reversible error, much less grave abuse of
discretion, with the factual findings of the two courts below, and thus denied the
petition on September 2, 1999.4 The decision became final and executory, and a writ
of execution was duly issued by the RTC on March 6, 2001 in Civil Case No. RTC-
354-I.
On December 4, 2003, petitioners instituted an action for quieting of title against
respondent, docketed as Civil Case No. 2108-I. In the complaint, petitioners admitted
that Civil Case No. RTC-354-I was decided in favor of respondent and a writ of
execution had been issued, ordering them to vacate the property. However,
petitioners claimed that the land, which was the subject matter of Civil Case No.
RTC-354-I, was the same parcel of land owned by spouses Dahipon from whom they
purchased a portion; and that a title (TCT No. T-37468) was, in fact, issued in their

name. Petitioners prayed for the issuance of a writ of preliminary injunction to enjoin
the implementation of the Writ of Execution dated March 6, 2001 in Civil Case No.
RTC-354-I, and that "a declaration be made that the property bought, occupied and
now titled in the name of [petitioners] was formerly part and subdivision of Lot No.
1121 Pls-468-D, covered by OCT No. P-9036 in the name of Cecilia Obispo-
Dahipon."5
Respondent filed a Motion to Dismiss on the ground of res judicata. Respondent
averred that petitioners, aware of their defeat in Civil Case No. RTC-354-I,
surreptitiously negotiated with Cecilia Obispo-Dahipon for the sale of the land and
filed the present suit in order to subvert the execution thereof.
The trial court denied the motion, holding that there was no identity of causes of
action.
Trial thereafter ensued. On January 25, 2006, after petitioners presented their
evidence, respondent filed a Demurrer to Evidence, stating that the claim of
ownership and possession of petitioners on the basis of the title emanating from that
of Cecilia Obispo-Dahipon was already raised in the previous case (Civil Case No.
RTC-354-I).
On February 22, 2006, the trial court issued a resolution granting the demurrer to
evidence.
The CA affirmed. Hence, petitioners now come to this Court, raising the following
issues:
WHETHER OR NOT THE PRINCIPLE OF RES JUDICATA OR DOCTRINE OF
CONCLUSIVENESS OF JUDGMENT IS APPLICABLE UNDER THE FACTS
OBTAINING IN THE PRESENT CASE[;]
WHETHER OR NOT THE RESPONDENT HAS A BETTER TITLE THAN THE
PETITIONERS[; and]
WHETHER OR NOT THE RULING ON PURCHASERS IN BAD FAITH IS
APPLICABLE IN THE PRESENT CASE[.]6
35
Petitioners assert that res judicata7 does not apply, considering that the essential
requisites as to the identity of parties, subject matter, and causes of action are not
present.
The petition is bereft of merit.
The doctrine of res judicata is set forth in Section 47 of Rule 39 of the Rules of Court,
as follows:
Sec. 47. Effect of judgments or final orders. - The effect of a judgment or final order
rendered by a court of the Philippines, having jurisdiction to pronounce the judgment
or final order, may be as follows:
xxxx
(b) In other cases, the judgment or final order is, with respect to the matter
directly adjudged or as to any other matter that could have been raised in
relation thereto, conclusive between the parties and their successors in
interest by title subsequent to the commencement of the action or special
proceeding, litigating for the same thing and under the same title and in the
same capacity; and
(c) In any other litigation between the same parties or their successors in
interest, that only is deemed to have been adjudged in a former judgment or
final order which appears upon its face to have been so adjudged, or which
actually and necessarily included therein or necessary thereto.
The principle of res judicata lays down two main rules, namely: (1) the judgment or
decree of a court of competent jurisdiction on the merits concludes the litigation
between the parties and their privies and constitutes a bar to a new action or suit
involving the same cause of action either before the same or any other tribunal; and
(2) any right, fact, or matter in issue directly adjudicated or necessarily involved in
the determination of an action before a competent court in which a judgment or
decree is rendered on the merits is conclusively settled by the judgment therein and
cannot again be litigated between the parties and their privies whether or not the
claims or demands, purposes, or subject matters of the two suits are the same.
These two main rules mark the distinction between the principles governing the two
typical cases in which a judgment may operate as evidence.8] The first general rule
above stated, and which corresponds to the afore-quoted paragraph (b) of Section

47, Rule 39 of the Rules of Court, is referred to as "bar by former judgment"; while
the second general rule, which is embodied in paragraph (c) of the same section and
rule, is known as "conclusiveness of judgment."9
The Court in Calalang v. Register of Deeds of Quezon City10 explained the second
concept which we reiterate herein, to wit:
The second concept — conclusiveness of judgment — states that a fact or question
which was in issue in a former suit and was there judicially passed upon and
determined by a court of competent jurisdiction, is conclusively settled by the
judgment therein as far as the parties to that action and persons in privity with them
are concerned and cannot be again litigated in any future action between such
parties or their privies, in the same court or any other court of concurrent jurisdiction
on either the same or different cause of action, while the judgment remains
unreversed by proper authority. It has been held that in order that a judgment in one
action can be conclusive as to a particular matter in another action between the
same parties or their privies, it is essential that the issue be identical. If a particular
point or question is in issue in the second action, and the judgment will depend on
the determination of that particular point or question, a former judgment between the
same parties or their privies will be final and conclusive in the second if that same
point or question was in issue and adjudicated in the first suit (Nabus v. Court of
Appeals, 193 SCRA 732 [1991]). Identity of cause of action is not required but
merely identity of issue.
Justice Feliciano, in Smith Bell & Company (Phils.), Inc. v. Court of Appeals (197
SCRA 201, 210 [1991]), reiterated Lopez v. Reyes (76 SCRA 179 [1977]) in regard
to the distinction between bar by former judgment which bars the prosecution of a
second action upon the same claim, demand, or cause of action, and conclusiveness
of judgment which bars the relitigation of particular facts or issues in another litigation
between the same parties on a different claim or cause of action.
The general rule precluding the relitigation of material facts or questions which were
in issue and adjudicated in former action are commonly applied to all matters
essentially connected with the subject matter of the litigation. Thus, it extends to
questions necessarily implied in the final judgment, although no specific finding may
have been made in reference thereto and although such matters were directly
referred to in the pleadings and were not actually or formally presented. Under this
rule, if the record of the former trial shows that the judgment could not have been
rendered without deciding the particular matter, it will be considered as having
settled that matter as to all future actions between the parties and if a judgment
36
necessarily presupposes certain premises, they are as conclusive as the judgment
itself.11
The foregoing disquisition finds application in the case at bar. Undeniably, the
present case is closely related to the previous case (Civil Case No. RTC-354-I),
where petitioners raised the issue of ownership and possession of Lot No. 1121 and
the annulment of the donation of said lot to them. The RTC found for respondent,
declaring the deed of donation she executed in favor of petitioners revoked; and
ordered petitioners to vacate and reconvey the donated portion to respondent. The
decision of the RTC was affirmed by the CA, and became final with the denial of the
petition for review by this Court in G.R. No. 119730. In that case, the Court noted the
established fact "that petitioner Noceda occupied not only the portion donated to him
by respondent Aurora Arbizo-Directo, but he also fenced the whole area of Lot C
which belongs to private respondent Directo, thus, petitioner’s act of occupying the
portion pertaining to private respondent Directo without the latter’s knowledge and
consent is an act of usurpation which is an offense against the property of the donor
and considered as an act of ingratitude of a donee against the donor."12 Clearly,
therefore, petitioners have no right of ownership or possession over the land in
question.1avvph!1
Under the principle of conclusiveness of judgment, such material fact becomes
binding and conclusive on the parties. When a right or fact has been judicially tried
and determined by a court of competent jurisdiction, or when an opportunity for such
trial has been given, the judgment of the court, as long as it remains unreversed,
should be conclusive upon the parties and those in privity with them.13 Thus,
petitioners can no longer question respondent’s ownership over Lot No. 1121 in the
instant suit for quieting of title. Simply put, conclusiveness of judgment bars the
relitigation of particular facts or issues in another litigation between the same parties
on a different claim or cause of action.14
Furthermore, we agree that petitioners instituted the instant action with unclean
hands. Aware of their defeat in the previous case, they attempted to thwart execution
and assert their alleged ownership over the land through their purported purchase of
a lot from Cecilia Obispo-Dahipon. This later transaction appears to be suspect. A
perusal of G.R. No. 119730 reveals that the Court was not unaware of Dahipon’s
alleged claim over the same parcel of land. It noted that Dahipon did not even bother
to appear in court to present her free patent upon respondent’s request, or to
intervene in the case, if she really had any legitimate interest over the land in
question.15 In any event, petitioners’ assertion of alleged good title over the land
 37

cannot stand considering that they purchased the piece of land from Dahipon
knowing fully well that the same was in the adverse possession of another.

Thus, we find no reversible error in the appellate court’s ruling that petitioners are in
fact buyers in bad faith. We quote:

With appellants’ actual knowledge of facts that would impel a reasonable man to
inquire further on [a] possible defect in the title of Obispo, considering that she was
found not to have been in actual occupation of the land in CA-G.R. CV No. 38126,
they cannot simply invoke protection of the law as purchasers in good faith and for
value. In a suit to quiet title, defendant may set up equitable as well as legal
defenses, including acquisition of title by adverse possession and a prior adjudication
on the question under the rule on res judicata. Appellants’ status as holders in bad
faith of a certificate of title, taken together with the preclusive effect of the right of
possession and ownership over the disputed portion, which was adjudged in favor of
appellee in Civil Case No. RTC-354-I, thus provide ample justification for the court a
quo to grant the demurrer to evidence and dismiss their suit for quieting of title filed
against the said appellee.16

WHEREFORE, the Decision of the Court of Appeals in CA-G.R. CV No. 87026 is

AFFIRMED in toto.

SO ORDERED.

11. Nufable vs. Nufable, 309 SCRA 692.
369 Phil. 135
GONZAGA-REYES, J.:
This petition for review on certiorari seeks to reverse and set aside the Decision
dated November 25, 1995 of the Fifth Division[1] of the Court of Appeals for allegedly
being contrary to law.
The following facts as found by the Court of Appeals are undisputed:
"Edras Nufable owned an untitled parcel of land located at Poblacion, Manjuyod,
Negros Oriental, consisting of 948 square meters, more or less. He died on August
9, 1965 and was survived by his children, namely: Angel Custodio, Generosa, Vilfor
and Marcelo, all surnamed Nufable. Upon petition for probate filed by said heirs and
after due publication and hearing, the then Court of First Instance of Negros Oriental
(Branch II) issued an Order dated March 30, 1966 admitting to probate the last will
and testament executed by the deceased Edras Nufable (Exhs. B, C and C-1).
On June 6, 1966, the same court issued an Order approving the Settlement of Estate
submitted by the heirs of the late Esdras Nufable, portions of which read:
`KNOW ALL MEN BY THESE PRESENTS:
We, ANGEL CUSTODIO NUFABLE, GENEROSA NUFABLE, VILFOR NUFABLE,
and MARCELO NUFABLE, all of legal ages (sic), Filipinos, and with residence and
postal address at Manjuyod, Negros Oriental, Philippines,
`- HEREBY DECLARE AND MAKE MANIFEST -
38
`1. That on August 9, 1965, Rev. Fr. Esdras Nufable died leaving (a) Last Will and
Testament (marked Exh. G) disposing (of) his properties or estate in favor of his four
legitimate children, namely: Angel Custodio Nufable, Generosa Nufable, Vilfor
Nufable and Marcelo Nufable;
`2. That on March 30, 1966, the said Last Will and Testament was probated by the
Honorable Court, Court of First Instance of Negros Oriental, and is embodied in the
same order appointing an Administratrix, Generosa Nufable, but to qualify only if she
put up a necessary bond of P1,000.00;
`3. That herein legitimate children prefer not to appoint an Administratrix, as agreed
upon (by) all the heirs, because they have no objection as to the manner of
disposition of their share made by the testator, the expenses of the proceedings and
that they have already taken possession of their respective shares in accordance
with the will;
`4. That the herein heirs agreed, as they hereby agree to settle the estate in
accordance with the terms and condition of the will in the following manner, to wit:
`a) That the parcel of land situated in Poblacion Manjuyod, Negros Oriental remains
undivided for community ownership but respecting conditions imposed therein (sic) in
the will;
`xxx xxx xxx.'
(Exhs. "E" and "E-1")
Two months earlier, or on March 15, 1966, spouses Angel Custodio and Aquilina
Nufable mortgaged the entire property located at Manjuyod to the Development Bank
of the Philippines [DBP] (Pre-trial Order, dated January 7, 1992, p. 103, Original
Records). Said mortgagors became delinquent for which reason the mortgaged
property was foreclosed by DBP on February 26, 1973 (id.).
On January 11, 1980, Nelson Nufable, the son of Angel Custodio Nufable (who died
on August 29, 1978 [TSN, Testimony of Nelson Nufable, Hearing of August 18, 1992,
p. 17]), purchased said property from DBP (Exh. `1').
Generosa, Vilfor and Marcelo, all surnamed Nufable filed with the lower court a
complaint dated July 25, 1985 `To Annul Fraudulent Transactions, to Quiet Title and
To Recover Damages' against Nelson Nufable, and wife, Silnor Nufable and his

mother Aquilina Nufable. Plaintiffs pray:
`WHEREFORE, plaintiffs pray this Honorable Court that after trial judgment be
rendered ordering:
`(a) That the said Deed of Sale (Annex `C') executed by the Development Bank of
the Philippines in favor of the defendants be declared null and void as far as the
three fourths (¾) rights which belongs (sic) to the plaintiffs are concerned;
'(b) That the said three fourths (¾) rights over the above parcel in question be
declared as belonging to the plaintiffs at one fourth right to each of them;
`(c) To order the defendants to pay jointly and severally to the plaintiffs by way of
actual and moral damages the amount of P10,000.00 and another P5,000.00 as
Attorney's fees, and to pay the costs.
`(d) Plus any other amount which this Court may deem just and equitable.' (p. 6,
Original Records)
In their Answer, defendants contend:
`4. Paragraph 4 is denied, the truth being that the late Angel Nufable was the
exclusive owner of said property, that as such owner he mortgaged the same to the
Development Bank of the Philippines on March 15, 1966, that said mortgage was
foreclosed and the DBP became the successful bidder at the auction sale, that
ownership was consolidated in the name of the DBP, and that defendant Nelson
Nufable bought said property from the DBP thereafter. During this period, the
plaintiffs never questioned the transactions which were public, never filed any third
party claim nor attempted to redeem said property as redemptioners, and that said
Deed of Sale, Annex `B' to the complaint, is fictitious, not being supported by any
consideration;' (pp. 20-21, id.)
The Deed of Sale (Annex `B'), referred to by the parties is a notarized Deed of Sale,
dated July 12, 1966 (marked as Exhibit `H') by virtue of which, spouses Angel and
Aquilina Nufable, as vendors, sold ¾ portion of the subject property to herein
plaintiffs for and in consideration of P1,000.00 (Exh. `5')."[2]
On November 29, 1995, the Court of Appeals rendered judgment, the dispositive
portion[3] of which reads:
39
"WHEREFORE, the appealed decision of the lower court is REVERSED and SET
ASIDE. A new judgment is hereby entered declaring plaintiffs-appellants as the
rightful co-owners of the subject property and entitled to possession of ¾ southern
portion thereof; and defendant-appellee Nelson Nufable to ¼ portion.
No award on damages.
No costs."
Defendants-appellees' Motion for Reconsideration was denied for lack of merit in the
Resolution of the Court of Appeals[4] dated October 2, 1996.
Hence, the present petition. Petitioners raise the following grounds for the petition:
"1. The Honorable Court of Appeals erred in considering as controlling the probate of
the Last Will and Testament of Esdras Nufable, the probate thereof not being an
issue in this case;
2. The Honorable Court of Appeals erred in not considering the fact that the
Development Bank of the Philippines became the absolute, exclusive, legal, and
rightful owner of the land in question, from whom petitioner Nelson Nufable acquired
the same by purchase and that, therefore, no award can be made in favor of private
respondents unless and until the Development Bank of the Philippines' title thereto is
first declared null and void by the court."
The Court of Appeals, in its decision, stated that the trial court failed to take into
consideration the probated will of the late Esdras Nufable bequeathing the subject
property to all his four children.[5] In the present petition, petitioners present the issue
of whether or not the Last Will and Testament of Esdras Nufable and its subsequent
probate are pertinent and material to the question of the right of ownership of
petitioner Nelson Nufable who purchased the land in question from, and as acquired
property of, the Development Bank of the Philippines (DBP, for short). They contend
that the probate of the Last Will and Testament of Esdras Nufable did not determine
the ownership of the land in question as against third parties.
As a general rule, courts in probate proceedings are limited only to passing upon the
extrinsic validity of the will sought to be probated, the due execution thereof, the
testator's testamentary capacity and the compliance with the requisites or
solemnities prescribed by law. Said court at this stage of the proceedings is not
called upon to rule on the intrinsic validity or efficacy of the provision of the will.[6] The
question of the intrinsic validity of a will normally comes only after the court has

declared that the will has been duly authenticated.
The records show that upon petition for probate filed by the heirs of the late Esdras
Nufable, an Order dated March 30, 1966 was issued by then Court of First Instance
of Negros Oriental, Branch II, admitting to probate the last will and testament
executed by the decedent.[7] Thereafter, on June 6, 1966, the same court approved
the Settlement of Estate submitted by the heirs of the late Esdras Nufable wherein
they agreed "(T)hat the parcel land situated in Poblacion Manjuyod, Negros Oriental
remains undivided for community ownership but respecting conditions imposed
therein (sic) in the will."[8] In paragraph 3 thereof, they stated that "they have no
objection as to the manner of disposition of their share made by the testator, the
expenses of the proceeding and that they have already taken possession of their
respective shares in accordance with the will." Verily, it was the heirs of the late
Esdras Nufable who agreed among themselves on the disposition of their shares.
The probate court simply approved the agreement among the heirs which approval
was necessary for the validity of any disposition of the decedent's estate.[9]
It should likewise be noted that the late Esdras Nufable died on August 9, 1965.
When the entire property located at Manjuyod was mortgaged on March 15, 1966 by
his son Angel Custodio with DBP, the other heirs of Esdras - namely: Generosa,
Vilfor and Marcelo - had already acquired successional rights over the said property.
This is so because of the principle contained in Article 777 of the Civil Code to the
effect that the rights to the succession are transmitted from the moment of death of
the decedent. Accordingly, for the purpose of transmission of rights, it does not
matter whether the Last Will and Testament of the late Esdras Nufable was admitted
on March 30, 1966 or thereafter or that the Settlement of Estate was approved on
June 6, 1966 or months later. It is to be noted that the probated will of the late
Esdras Nufable specifically referred to the subject property in stating that "the land
situated in the Poblacion, Manjuyod, Negros Oriental, should not be divided because
this must remain in common for them, but it is necessary to allow anyone of them
brothers and sisters to construct a house therein."[10] It was therefor the will of the
decedent that the subject property should remain undivided, although the restriction
should not exceed twenty (20) years pursuant to Article 870[11] of the Civil Code.
Thus, when Angel Nufable and his spouse mortgaged the subject property to DBP
on March 15, 1966, they had no right to mortgage the entire property. Angel's right
over the subject property was limited only to ¼ pro indiviso share. As co-owner of the
subject property, Angel's right to sell, assign or mortgage is limited to that portion
that may be allotted to him upon termination of the co-ownership. Well-entrenched is
the rule that a co-owner can only alienate his pro indiviso share in the co-owned
40
property.[12]
The Court of Appeals did not err in ruling that Angel Custodio Nufable "had no right
to mortgage the subject property in its entirety. His right to encumber said property
was limited only to ¼ pro indiviso share of the property in question."[13] Article 493 of
the Civil Code spells out the rights of co-owners over a co-owned property. Pursuant
to said Article, a co-owner shall have full ownership of his part and of the fruits and
benefits pertaining thereto. He has the right to alienate, assign or mortgage it, and
even substitute another person in its enjoyment. As a mere part owner, he cannot
alienate the shares of the other co-owners. The prohibition is premised on the
elementary rule that "no one can give what he does not have."[14]
Moreover, respondents stipulated that they were not aware of the mortgage by
petitioners of the subject property.[15] This being the case, a co-owner does not lose
his part ownership of a co-owned property when his share is mortgaged by another
co-owner without the former's knowledge and consent[16] as in the case at bar. It has
likewise been ruled that the mortgage of the inherited property is not binding against
co-heirs who never benefitted.[17]
Furthermore, the Deed of Sale dated June 17, 1966 marked as Exhibit "H" executed
by spouses Angel and Aquilina Nufable in favor of respondents Generosa, Vilfor and
Marcelo wherein the former sold, ceded and transferred back to the latter the ¾
portion of the subject property bolsters respondents' claim that there was co-
ownership. Petitioner Nelson himself claimed that he was aware of the aforesaid
Deed of Sale.[18]
Anent the second ground of the petition, petitioners allege that the Development
Bank of the Philippines acquired ownership of the land in question through
foreclosure, purchase and consolidation of ownership. Petitioners argue that if
petitioner Nelson Nufable had not bought said land from the DBP, private
respondents, in order to acquire said property, must sue said bank for the recovery
thereof, and in so doing, must allege grounds for the annulment of documents
evidencing the bank's ownership thereof. Petitioners contend that since petitioner
Nelson Nufable simply bought the whole land from the bank, they cannot be deprived
of the ownership of ¾ without making any pronouncement as to the legality or
illegality of the bank's ownership of said land. It is argued that there was no evidence
to warrant declaration of nullity of the bank's acquisition of said land; and that neither
was there a finding by the court that the bank illegally acquired the said property.
As adverted to above, when the subject property was mortgaged by Angel Custodio,

he had no right to mortgage the entire property but only with respect to his ¼ pro
indiviso share as the property was subject to the successional rights of the other
heirs of the late Esdras. Moreover, in case of foreclosure, a sale would result in the
transmission of title to the buyer which is feasible only if the seller can be in a
position to convey ownership of the things sold.[19] And in one case,[20] it was held that
a foreclosure would be ineffective unless the mortgagor has title to the property to be
foreclosed. Therefore, as regards the remaining ¾ pro indiviso share, the same was
held in trust for the party rightfully entitled thereto,[21] who are the private respondents
herein.
Pursuant to Article 1451 of the Civil Code, when land passes by succession to any
person and he causes the legal title to be put in the name of another, a trust is
established by implication of law for the benefit of the true owner. Likewise, under
Article 1456 of the same Code, if property is acquired through mistake or fraud, the
person obtaining it is, by force of law, considered a trustee of an implied trust for the
benefit of the person from whom the property comes. In the case of Noel vs. Court of
Appeals,[22] this Court held that "a buyer of a parcel of land at a public auction to
satisfy a judgment against a widow acquired only one-half interest on the land
corresponding to the share of the widow and the other half belonging to the heirs of
her husband became impressed with a constructive trust in behalf of said heirs."
Neither does the fact that DBP succeeded in consolidating ownership over the
subject property in its name terminate the existing co-ownership. Registration of
property is not a means of acquiring ownership.[23] When the subject property was
sold to and consolidated in the name of DBP, it being the winning bidder in the public
auction, DBP merely held the ¾ portion in trust for the private respondents. When
petitioner Nelson purchased the said property, he merely stepped into the shoes of
DBP and acquired whatever rights and obligations appertain thereto.
This brings us to the issue of whether or not the DBP should have been impleaded
as party-defendant in the case at bar. Petitioners contend that DBP was never
impleaded and that due process requires that DBP be impleaded so that it can
defend its sale to petitioner Nelson Nufable; and that it was the duty of private
respondents, and not of petitioner Nelson, to implead the bank and ask for the
annulment of documents evidencing the bank's ownership of the disputed land.
In the Rejoinder to the Reply, private respondents that the non-inclusion of DBP as a
"necessary party" was not questioned by petitioners from the time the Complaint was
filed until the case was "finished." It was only after the adverse decision by the
respondent Court of Appeals that petitioners raised the issue.
41
At the outset, it should be stated that petitioners never raised this issue in their
Answer and pursuant to Section 2, Rule 9 of the Rules of Court, defenses and
objections not pleaded either in a motion to dismiss or in the answer are deemed
waived.
Nonetheless, the rule is that indispensable parties, i.e., parties in interest without
whom no final determination can be had of an action, shall be joined either as
plaintiffs or defendants; the inclusion as a party being compulsory.[24] On the other
hand, in case of proper or necessary parties, i.e., persons who are not indispensable
but ought to be parties if complete relief is to be accorded as between those already
parties, the court may, in its discretion, proceed in the action without making such
persons parties, and the judgment rendered therein shall be without prejudice to the
rights of such persons.[25] Proper parties, therefore, have been described as parties
whose presence is necessary in order to adjudicate the whole controversy, but
whose interests are so far separable that a final decree can be made in their
absence without affecting them.[26] Any claim against a party may be severed and
proceeded with separately.[27]
The pivotal issue to be determined is whether DBP is an indispensable party in this
case.
Private respondents do not question the legality of the foreclosure of the mortgaged
property and the subsequent sale of the same to DBP. The subject property was
already purchased by petitioner Nelson from DBP and the latter, by such sale,
transferred its rights and obligations to the former. Clearly, petitioners' interest in the
controversy is distinct and separable from the interest of DBP and a final
determination can be had of the action despite the non-inclusion of DBP as party-
defendant. Hence, DBP, not being an indispensable party, did not have to be
impleaded in this case.
WHEREFORE, there being no reversible error in the decision appealed from, the
petition for review on certiorari is hereby DENIED.
SO ORDERED.

12. Blas vs. Santos, 1 SCRA 899.
G.R. No. L-14070             March 29, 1961
MARIA GERVACIO BLAS, MANUEL GERVACIO BLAS, LEONCIO GERVACIO
BLAS and LODA GERVACIO BLAS, plaintiffs-appellants,
vs.
ROSALINA SANTOS, in her capacity as Special Administratrix of the Estate of
the deceased MAXIMA SANTOS VDA. DE BLAS, in Sp. Proc. No. 2524, Court of
First Instance of Rizal, defendants-appellants. MARTA GERVACIO BLAS and
DR. JOSE CHIVI, defendants-appellants.
Teofilo Sison and Nicanor Sison for plaintiffs-appellants.
De los Santos, Caluag, Pascal and Felizardo for defendants-appellees.
LABRADOR, J.:
This action was instituted by plaintiffs against the administration of the estate of
Maxima Santos, to secure a judicial declaration that one-half of the properties left by
Maxima Santos Vda. de Blas, the greater bulk of which are set forth and described in
the project of partition presented in the proceedings for the administration of the
estate of the deceased Simeon Blas, had been promised by the deceased Maxima
Santos to be delivered upon her death and in her will to the plaintiffs, and requesting
that the said properties so promised be adjudicated to the plaintiffs. The complaint
also prays for actual damages in the amount of P50,000. (Record on Appeal, pp. 1-
65.) The alleged promise of the deceased Maxima Santos is contained in a
document executed by Maxima Santos on December 26, 1936 attached to the
complaint as Annex "H" and introduced at the trial as Exhibit "A". (Ibid., pp. 258-259.)
The complaint also alleges that the plaintiffs are entitled to inherit certain properties
enumerated in paragraph 3 thereof, situated in Malabon, Rizal and Obando,
Bulacan, but which properties have already been in included in the inventory of the
42
estate of the deceased Simeon Blas and evidently partitioned and conveyed to his
heirs in the proceedings for the administration of his (Simeon Blas) estate.
Defendant, who is the administratrix of the estate of the deceased Maxima Santos
Vda. de Blas, filed an answer with a counterclaim, and later, an amended answer
and a counterclaim. The said amended answer admits the allegations of the
complaint as to her capacity as administratrix the death of Simeon Blas on January
3, 1937; the fact that Simeon Blas and Marta Cruz begot three children only one of
whom, namely, Eulalio Blas, left legitimate descendants; that Simeon Blas
contracted a second marriage with Maxima Santos on June 28, 1898. She denies for
lack of sufficient information and belief, knowledge edge of the first marriage of
Simeon Blas to Marta Cruz, the averment that Simeon Blas and Marta Cruz acquired
properties situated in Obando, Bulacan, that said properties were utilized as capital,
etc. As special defenses, she alleges that the properties of the spouses Blas and
Santos had been settled and liquidated in the project of partition of the estate of said
Simeon Blas; that pursuant to the project of partition, plaintiffs and some defendants
had already received the respective properties adjudicated to them; that the plaintiffs
and the defendants Marta Geracio and Jose Chivi are estopped from impugning the
validity of the project of partition of the estate of the deceased Simeon Blas and from
questioning the ownership in the properties conveyed in the project of partition to
Maxima Santos as her own exclusive property; that the testament executed by
Maxima Santos is valid, the plain plaintiffs having no right to recover any portion of
Maxima Santos' estate now under administration by the court. A counterclaim for the
amount of P50,000 as damages is also included in the complaint, as also a cross-
claim against Marta Gervacio Blas and Jose Chivi.
Trial of the case was Conducted and, thereafter, the court, Hon. Gustave Victoriano,
presiding, rendered judgment dismissing the complaint, with costs against plaintiff,
and dismissing also the counterclaim and cross-claim decision ,the plaintiffs filed by
the defendants. From this district have appealed to this Court.
The facts essential to an understanding of the issues involved in the case may be
briefly summarized as follows: Simeon Blas contracted a first marriage with Marta
Cruz sometime before 1898. They had three children, only one of whom, Eulalio, left
children, namely, Maria Gervacio Blas, one of the plaintiffs, Marta Gervacio Blas, one
of the defendants, and Lazaro Gervacio Blas. Lazaro died in 1950, and is survived
by three legitimate children who are plaintiffs herein, namely, Manuel Gervacio Blas,
Leoncio Gervacio Blas and Loida Gervacio Blas. Marta Cruz died in 1898, and the
following year, Simeon Blas contracted a second marriage with Maxima Santos. At
the time of this second marriage, no liquidation of the properties required by Simeon

Blas and Marta Cruz was made. Three of the properties left are fishponds located in
Obando, Bulacan. Maxima Santos does not appear to have apported properties to
her marriage with Simeon Blas.
On December 26, 1936, only over a week before over a week before his death on
January 9, 1937, Simeon Blas executed a last will and testament. In the said
testament Simeon Blas makes the following declarations:
I
2. Sa panahon ng aking pangalawang asawa, MAXIMA SANTOS DE BLAS,
ay nagkaroon ako at nakatipon ng mga kayamanan (bienes) at pag-aari
(propriedades) na ang lahat ng lupa, palaisdaan at iba pang pag-aari ay
umaabot sa halagang ANIM NA RAAN PITONG PU'T WALONG DAAN LIBO
WALONG DAAN WALONG PUNG PISO (678,880-00) sang-ayon sa mga
halaga sa amillarimento (valor Amillarado.)
II
1. Ang kalahati ng lahat ng aming pag-aari, matapos mabayaran ang lahat ng
aking o aming pag-kakautang na mag-asawa, kung mayroon man, yayamang
ang lahat ng ito ay kita sa loob ng matrimonio (bienes ganaciales) ay bahagi
ng para sa aking asawa, MAXIMA SANTOS DE BLAS, sang-ayon sa batas.
(Record on Appeal, pp. 250-251.)
The above testamentary provisions may be translated as follows:
I Simeon Blas.
2. During my second marriage with Maxima Santos de Blas, I possessed and
acquired wealth and properties, consisting of lands, fishponds and other
kinds of properties, the total assessed value of which reached the amount
P678,880.00.
II
1. One-half of our properties, after the payment of my and our indebtedness,
all these properties having been acquired during marriage (conjugal
43
properties), constitutes the share of my wife Maxima Santos de Blas,
according to the law.
At the time of the execution of said will, Andres Pascual a son-in-law of the testator,
and Avelina Pascual and others, were present. Andres Pascual had married a
descendant by the first marriage. The will was prepared by Andres Pascual, with the
help of his nephew Avelino Pascual. The testator asked Andres Pascual to prepare a
document which was presented in court as Exhibit "A", thus:
Q — Was there anybody who asked you to prepare this document?
A — Don Simeon Blas asked me to prepare this document (referring to
Exhibit "A"), (t.s.n., Sarmiento to, P. 24).
The reason why the testator ordered the preparation of Exhibit "A" was because the
properties that the testator had acquired during his first marriage with Marta Cruz
had not been liquidated and were not separated from those acquired during the
second marriage. Pascual's testimony is as follows:
Q — To whom do you refer with the word "they"?
A — Simeon Blas and his first wife, Marta Cruz. When Marta Cruz died they
had not made a liquidation of their conjugal properties and so all those
properties were included all in the assets of the second marriage, and that is
the reason why this document was prepared. (t.s.n., Sarmiento, p. 36.)
The above testimony is fully corroborated by that of Leoncio Gervacio, son-in-law of
Q — Please state to the Court?
A — My children were claiming from their grandfather Simeon Blas the
properties left by their grandmother Marta Cruz in the year 1936.
Q — And what happened with that claim of your children against Simeon Blas
regarding the assets or properties of the first marriage that were left after the
death of Marta Cruz in 1936?

A — The claim was not pushed through because they reached into an
agreement whereby the parties Simeon Blas Maxima Santos, Maria Gervacio
Bias, Marta Gervacio Blas and Lazaro Gervacio Blas agreed that Simeon
Blas and Maxima Blas will give one-half of the estate of Simeon Blas. (t.s.n.,
Sarmiento, pp. 143-144).
The document which was thus prepared and which is marked as Exhibit "A" reads in
Tagalog, thus:
MAUNAWA NG SINO MANG MAKABABASA:
Na akong si MAXIMA SANTOS DE BLAS, nasa hustong gulang, kasal kay
SIMEON BLAS, taga bayan ng Malabon, Rizal, Philippines, sa pamamagitan
ng kasulatang ito ay malaya kong ipinahahayag:
Na aking nabasa at naunawa ang testamento at huling kalooban na
nilagdaan ng aking asawa, SIMEON BLAS, at ipinahahayag ko sa ilalim ng
aking karangalan at sa harap ng aking asawa na igagalang at pagpipitaganan
ang lahat at bawa't isang bahagi ng nabanggit na testamento at
ipinangangako ko pa sa pamamagitan ng kasulatang ito na ang lahat ng
maiiwang pag-aari at kayamanan naming mag-asawa, na nauukol at
bahaging para sa akin sa paggawa ko naman ng aking testamento ay
ipagkakaloob ko ang kalahati (½) sa mga herederos at legatarios o
pinamamanahan ng aking nabanggit na asawa, SIMEON BLAS, sa kaniyang
testamento, na ako'y makapipili o makahihirang na kahit kangino sa kanila ng
aking pagbibigyan at pamamanahan sang-ayon sa paggalang, paglilingkod,
at pakikisama ng gagawin sa akin.
SA KATUNAYAN NG LAHAT NG ITO ay nilagdaan ko ang kasulatang ito
ngayon ika 26 ng Diciembre ng taong 1936, dito sa San Francisco del Monte,
San Juan, Rizal, Philippines. (Exh. "A", pp. 29-30 — Appellant's brief).
(Fdo.) MAXIMA SANTOS DE BLAS
and which, translated into English, reads as follows:
KNOW ALL MEN BY THESE PRESENTS:
44
That I MAXIMA SANTOS DE BLAS, of legal age, married to SIMEON BLAS,
resident of Malabon, Rizal, Philippines, voluntarily state:
That I have read and knew the contents of the will signed by my husband,
SIMEON BLAS, (2) and I promise on my word of honor in the presence of my
husband that I will respect and obey all and every disposition of said will (3)
and furthermore, I promise in this document that all the properties my
husband and I will leave, the portion and share corresponding to me when I
make my will, I will give one-half (½) to the heirs and legatees or the
beneficiaries named in the will of my husband, (4) and that I can select or
choose any of them, to whom I will give depending upon the respect, service
and treatment accorded to me.
IN WITNESS WHEREOF, I signed this document this 26th day of December,
1936 at San Francisco del Monte, San Juan, Rizal, Philippines. (Exh. "A", pp.
30-31, Appellant's brief).
(Sgd.) MAXIMA SANTOS DE BLAS
The court below held that said Exhibit "A" has not created any right in favor of
plaintiffs which can serve as basis for the complaint; that neither can it be considered
as a valid and enforceable contract for lack of consideration and because it deals
with future inheritance. The court also declared that Exhibit "A" is not a will because
it does not comply with the requisites for the execution of a will; nor could it be
considered as a donation, etc.
Both the court below in its decision and the appellees in their brief before us, argue
vehemently that the heirs of Simeon Blas and his wife Marta Cruz can no longer
make any claim for the unliquidated conjugal properties acquired during said first
marriage, because the same were already included in the mass of properties
constituting the estate of the deceased Simeon Blas and in the adjudications made
by virtue of his will, and that the action to recover the same has prescribed. This
contention is correct. The descendants of Marta Cruz can no longer claim the
conjugal properties that she and her husband may have required during their
marriage although no liquidation of such properties and delivery thereof to the heirs
of Marta Cruz have been made, no action to recover said propertied having been
presented in the proceedings for the settlement of the estate of Simeon Blas.

But the principal basis for the plaintiffs' action in the case at bar is the document
Exhibit "A". It is not disputed that this document was prepared at the instance of
Simeon Blas for the reason that the conjugal properties of me on Blas for the reason
his first marriage had not been liquidated; that it was prepared at the same time as
the will of Simeon Blas on December 26, 1936, at the instance of the latter himself. It
is also not disputed that the document was signed by Maxima Santos and one copy
thereof, which was presented in court as Exhibit "A", was kept by plaintiffs' witness
Andres Pascual.
Plaintiffs-appellants argue before us that Exhibit "A" is both a trust agreement and a
contract in the nature of a compromise to avoid litigation. Defendants-appellees, in
answer, claim that it is neither a trust agreement nor a compromise a agreement.
Considering that the properties of the first marriage of Simeon Blas had not been
liquidated when Simeon Blas executed his will on December 26, 1936', and the
further fact such properties where actually , and the further fact that included as
conjugal properties acquired during the second marriage, we find, as contended by
plaintiffs-appellants that the preparation and execution of Exhibit "A" was ordered by
Simeon Blas evidently to prevent his heirs by his first marriage from contesting his
will and demanding liquidation of the conjugal properties acquired during the first
marriage, and an accounting of the fruits and proceeds thereof from the time of the
death of his first wife.
Exhibit "A", therefore, appears to be the compromise defined in Article 1809 of the
Civil Code of Spain, in force at the time of the execution of Exhibit "A", which
provides as follows:
Compromise is a contract by which each of the parties in interest, by
giving, promising, or retaining something avoids the provocation of a suitor
terminates one which has already the provocation been instituted. (Emphasis
supplied.)
Exhibit "A" states that the maker (Maxima Santos) had read and knew the contents
of the will of her husband read and knew the contents of the will Simeon Blas — she
was evidently referring to the declaration in the will(of Simeon Blas) that his
properties are conjugal properties and one-half thereof belongs to her (Maxima
Santos) as her share of the conjugal assets under the law. The agreement or
promise that Maxima Santos makes in Exhibit "A" is to hold one-half of her said
share in the conjugal assets in trust for the heirs and legatees of her husband in his
will, with the obligation of conveying the same to such of his heirs or legatees as she
may choose in her last will and testament. It is to be noted that the conjugal
45
properties referred to are those that were actually existing at that time, December 26,
1936. Simeon Blas died on January 9, 1937. On June 2, 1937, an inventory of the
properties left by him, all considered conjugal, was submitted by Maxima Santos
herself as administratrix of his estate. A list of said properties is found in Annex "E",
the complete inventory submitted by Maxima Santos Vda. de Blas, is administratrix
of the estate of her husband, dated March 10, 1939. The properties which were
given to Maxima Santos as her share in the conjugal properties are also specified in
the project of partition submitted by said Maxima Santos herself on March 14, 1939.
(Record on Appeal, pp. 195-241.) Under Exhibit "A", therefore, Maxima Santos
contracted the obligation and promised to give one-half of the above indicated
properties to the heirs and legatees of Simeon Blas.
Counsel for the defendant-appellee claims Exhibit "A" is a worthless piece of paper
because it is not a will nor a donation mortis causa nor a contract. As we have in
indicated above, it is a compromise and at the same time a contract with a sufficient
cause or consideration. It is also contended that it deals with future inheritance. We
do not think that Exhibit "A" is a contract on future inheritance. it is an obligation or
promise made by the maker to transmit one-half of her share in the conjugal
properties acquired with her husband, which properties are stated or declared to be
conjugal properties in the will of the husband. The conjugal properties were in
existence at the time of the execution of Exhibit "A" on December 26, 1936. As a
matter of fact, Maxima Santos included these properties in her inventory of her
husband's estate of June 2, 1937. The promise does not refer to any properties that
the maker would inherit upon the death of her husband, because it is her share in the
conjugal assets. That the kind of agreement or promise contained in Exhibit "A" is
not void under Article 1271 of the old Civil Code, has been decided by the Supreme
Court of Spain in its decision of October 8, 19154, thus:
Que si bien el art. 1271 del Codigo civil dispone que sobre la herenciafutura
no se podra celebrar otros contratos que aquellos cuyo objecto seapracticar
entre vivos la division de un caudal, conforme al articulo 1056, esta
prohibicion noes aplicable al caso, porque la obligacion que contrajoel recurr
en contrato privado de otorgar testamento e instituir heredera a su subrina
de los bienes que adquirio en virtud de herencia, procedentes desu finada
consorte que le quedasen sobrantes despues de pagar las deudas, y del
ganacial que se expresa, asi como de reconocer, ademas, con alguna cosaa
otros sobrinos, se refiere a bienes conocidos y determinados existentes
cuando tal compromisi se otorgo, y no a la universalidad de una herencia
que, sequn el art. 659 del citado Codigo civil, as determina a muerte,
 46

constituyendola todos los bienes, derechos y obligaciones que por ella no Neither can the claim of prescription be considered in favor of the defendants. The
sehayan extinguido: ..." (Emphasis supplied.) right of action arose at the time of the death of Maxima Santos on October 5,1956,
when she failed to comply with the promise made by her in Exhibit "A". The plaintiffs-
It will be noted that what is prohibited to be the subject matter of a contract under appellants immediately presented this action on December 27, 1956, upon learning
Article 1271 of the Civil Code is " future inheritance." To us future inheritance is any of such failure on the part of Maxima Santos to comply with said promise. This
property or right not in existence or capable of determination at the time of the defense is, therefore, also without merit.
contract, that a person may in the future acquire by succession. The properties
subject of the contract Exhibit "A" are well defined properties, existing at the time of It is next contended by the defendant-appellee that Maxima Santos complied with
the agreement, which Simeon Blas declares in his statement as belonging to his wife her above-mentioned promise, — that Andres Pascual, Tomasa Avelino, Justo
as her share in the conjugal partnership. Certainly his wife's actual share in the Garcia, Ludovico Pimpin and Marta Gervacio Blas were given substancial legacies in
conjugal properties may not be considered as future inheritance because they were the will and testament of Maxima Santos. To determine whether she had actually
actually in existence at the time Exhibit "A" was executed. complied with the promise made in Exhibit "A", there is herein set forth a list only of
the fishponds and their respective areas as contained in the list of properties she
The trial court held that the plaintiffs-appellants in the case at bar are concluded by acquired as her share in the conjugal partnership, which list includes, besides many
the judgement rendered in the proceedings for the settlement of the estate of ricelands as well as residential lots, thus:
Simeon Blas for the reason that the properties left by him belonged to himself and
his wife Maxima Santos; that the project of partition in the said case, adjudicating to 31. Paco, Obando, Bulacan 5.8396 has.
Maxima Santos one-half as her share in the conjugal properties, is a bar to another
32. Pangjolo, Obando 3.5857    "    
action on the same subject matter, Maxima Santos having become absolute owner
of the said properties adjudicated in her favor. As already adverted to above, these 34. Batang Pirasuan, Lubao,
contentions would be correct if applied to the claim of the plaintiffs-appellants that Pampanga 11.9515    "    
said properties were acquired with the first wife of Simeon Blas, Marta Cruz. But the 35. Calangian, Lubao, Pampanga 30.2059    "    
main ground upon which plaintiffs base their present action is the document Exhibit
"A", already fully considered above. As this private document contains the express 38. Bakuling, Lubao, Pampanga 215.4325    "    
promise made by Maxima Santos to convey in her testament, upon her death, one- 39. Bakuling, Lubao, Pampanga 8.3763    "    
half of the conjugal properties she would receive as her share in the conjugal 40. Bangkal, Sinubli 23.0730    "    
properties, the action to enforce the said promise did not arise until and after her
death when it was found that she did not comply with her above-mentioned promise. 41. Tagulod, 6.8692    "    
(Art. 1969, old Civil Code.) The argument that the failure of the plaintiffs-appellants (a
herein to oppose the project of partition in the settlement of the estate of Simeon 44. Bangkal Pugad ) 34.2779    "    
Blas, especially that portion of the project which assigned to Maxima Santos one-half (b
of all the conjugal properties bars their present action, is, therefore, devoid of merit. It ) 51.7919    "    
may be added that plaintiffs-appellants did not question the validity of the project of
partition precisely because of the promise made by Maxima Santos in the (c) 2.5202    "    
compromise Exhibit "A"; they acquised in the approval of said project of partition 45. Magtapat Bangkal, Lubao, (a
because they were relying on the promise made by Maxima Santos in Exhibit "A", Pampanga ) 18.0024    "    
that she would transmit one-half of the conjugal properties that she was going to
(b
receive as her share in the conjugal partnership upon her death and in her will, to the
) 7.3265    "    
heirs and legatees of her husband Simeon Blas.
(c) 53.5180    "    

46. Pinanganakan, Lubao, Pampanga
47. Emigdio Lingid, Lubao, Pampanga
48. Propios, Lubao, Pampanga
49. Batang Mabuanbuan, Sexmoan,
Pampanga
50. Binatang Mabuanbuan, Sexmoan,
Pampanga
51. Sapang Magtua, Sexmoan,
Pampanga
52. Kay Limpin, Sexmoan, Pampanga
53. Calise Mabalumbum, Sexmoan,
Pampanga
54. Messapinit Kineke, Sexmoan,
Pampanga
55. Dalang, Banga, Sexmoan,
Pampanga
62. Alaminos, Pangasinan
80. Mangasu Sexmoan, Pampanga
81. Don Tomas, Sexmoan, Pampanga
47
159.0078    "     82. Matikling, Lubao, Pampanga       16.0000    "    
34.5229    "               Total area ............................... 1045.7863    "    
80.5382    "                         (See Record on Record,
pp. 195-241.)
43.3350    "    
In her will, Maxima Santos devised to Marta Gervacio Blas the 80-hectare fishpond
3.5069    "     situated in Lubao, Pampanga. The fishpond devised is evidently that designated as
"Propios" in Lubao, Pampanga, item No. 8 in the list of properties adjudicated to her
in the project of partition. (Record on Appeal, p. 215.) Considering that the total area
56,8242    "     of the fishponds amount to 1045.7863 hectares, the 80 hectares devised to Marta
5.0130    "     Gervacio Blas is not even one-tenth of the total area of the fishponds. Add to this the
fact that in the will she imposed upon Marta Gervacio Blas de Chivi an existing
obligation on said fishponds, namely, its lease in 1957 and the duty to pay out of the
23.8935    "    
rentals thereof an obligation to the Rehabilitation Finance Corporation RFC (Ibid., pp.
(a 262-263.) Angelina Blas was given only a lot of 150 square meters in Hulong Duhat,
) 5.2972     "     Malabon, Rizal, and Leony Blas, the sum of P300.00 (Ibid., p. 264.)
(b
) 5.9230    "     It is evident from a consideration of the above figures and facts that Maxima Santos
did not comply with her obligation to devise one-half of her conjugal properties to the
(c) 1.4638    "    
heirs and legatees of her husband. She does not state that she had complied with
(d such obligation in her will. If she intended to comply therewith by giving some of the
) 1.4638    "     heirs of Simeon Blas the properties mentioned above, the most that can be
(e considered in her favor is to deduct the value of said properties from the total amount
) 2.8316    "     of properties which she had undertaken to convey upon her death.
(f) 10.4412    "    
All the issues in the pleadings of the parties and in their respective briefs, have now
(g been fully discussed and considered. Reiterating what we have stated above, we
) 3.9033    "     declare that by Exhibit "A", a compromise to avoid litigation, Maxima Santos
(h promised to devise to the heirs and legatees of her husband Simeon Blas, one-half
) 11.9263    "     of the properties she received as her share in the conjugal partnership of herself and
her husband, which share is specified in the project of partition submitted by herself
(i) 6.0574    "    
on March 14, 1939 in the settlement of the estate of her husband, and which is found
on pages 195 to 240 of the record on appeal and on pages 27 to 46 of the project of
23.3989    "     partition, submitted by Maxima Santos herself before the Court of First Instance of
147.1242    "     Rizal in Civil Case No. 6707, entitled "Testamentaria del Finado Don Simeon Blas,
Maxima Santos Vda. de Bias, Administradora"; and that she failed to comply with her
10.000    "    
aforementioned obligation. (Exhibit "A")
21.6435    "    
 48

WHEREFORE, the judgment appealed from is hereby reversed and the defendant-
appellee, administratrix of the estate of Maxima Santos, is ordered to convey and
deliver one-half of the properties adjudicated o Maxima Santos as her share in the
conjugal properties in said Civil Case No. 6707, entitled "Testamentaria del Finado
Don Simeon Blas, Maxima Santos Vda. de Blas, Administradora", to the heirs and
the legatees of her husband Simeon Blas. Considering that all said heirs and
legatees, designated in the will of Simeon Blas as the persons for whose benefit
Exhibit "A" had been executed, have not appeared in these proceedings, the record
is hereby remanded to the court below, with instructions that, after the conveyance of
the properties hereinabove ordered had been effected, the said heirs and legatees
(of Simeon Blas) file adversary pleadings to determine the participation of each and
every one of them in said properties. Costs against the defendant- appellee Rosalina
Santos.