General Provisions (774 To 782)

ANALITA P. INOCENCIO, substituting for RAMON INOCENCIO (Deceased) vs.
HOSPICIO DE SAN JOSE
G.R. No. 201787 September 25, 2013
On 1 March 1946, Hospicio de San Jose (HDSJ) leased a parcel of land located in Pasay City to German
Inocencio (German).4 The lease contract was effective for a period of one year, and was renewed for one-year
periods several times. The last written contract was executed on 31 May 1951. Section 6 of the lease contract
provides:
Este contrato es intransferible, a menos que para ello se obtenga elconsentimiento escrito del
arrendador. (This contract is nontransferable unless prior consent of the lessor is obtained in writing.)
In 1946, German constructed two buildings on the parcel of land which he subleased. He also designated his
son Ramon Inocencio (Ramon) to administer the said property.
On 21 September 1990, German received a letter from HDSJ informing him that the increased rentals shall take
effect in November 1990 instead of August 1990, "to give him ample time to make the necessary rental
adjustments with his sublessees."9
German passed away in 1997. Evidence on record shows that Ramon did not notify HDSJ of German’s death.
After German’s passing, Ramon collected the rentals from the sublessees, and paid the rentals to HDSJ, and
the taxes on the property. On 1 March 2001, HDSJ’s property administrator, Five Star Multi-Services, Inc.,
notified Ramon that HDSJ is terminating the lease contract effective 31 March 2001:
We acknowledge the fact that Hospicio de San Jose has been accepting the payment of your rentals
since the demise of Mr. German Inocencio. Hence, an implied contract of lease between the two of you
exists. However, since there is no stipulation as to the period of the contract and you are paying a
monthly rental to our client, the period for the lease is on a month-to-month basis (Art. 1687). Thus as of
this date, your contract should expire on March 31, 2001.10
Ramon then sent a letter to HDSJ dated 12 March 2001, suggesting that the lease contract be renegotiated for
the welfare of the sublessees occupying the parcel of land. 11 On 3 April 2001, HDSJ notified Ramon that the
lease contract shall not be renewed because Ramon has "continually subleased the subject premises to about
20 families (in addition to a commercial establishment) x x x without the knowledge and consent of the lessor,
[HDSJ]."12 Thereafter, HDSJ refused to accept Ramon’s tender of payment of rentals. 13
On 3 March 2005, HDSJ sent a letter to Ramon:
(1) reiterating its stand that the lease contract was terminated effective 31 March 2001;
(2) demanding payment of ₱756,449.26 as unrealized fruits; and
(3) giving him 30 days to vacate the property.14
The sublessees were given written notices to vacate within 30 days. 15 HDSJ also posted a Patalastas stating
that it is willing to work out an amicable arrangement with the sublessees, although the latter are not considered
as legal occupants or tenants of the property. 16 Because of this, some of the sublessees refused to pay rentals
to Ramon.17
HDSJ also entered into lease contracts with: (1) Harish Chetandas on 25 May 2005; 18 (2) Enrique Negare on 12
April 2005;19 (3) Lamberto Estefa on 25 May 2005; 20 and (4) Sofronio Chavez, Jr. on 21 May 2005.21
On 28 June 2005, HDSJ filed a Complaint before Branch 48 of the Metropolitan Trial Court of Pasay (MeTC-
Pasay) for unlawful detainer against Ramon and his sublessees. 22 The complaint alleged that Ramon and his
sublessees have been illegally occupying the leased premises since 31 March 2001. HDSJ sought the following
damages:
17.1 Actual damages, in the amount of Php552,195.36, equivalent to the reasonable value of the use and
occupation of the premises from the period of 31 March 2001 until the present; and
17.2 Attorney’s fees in the amount of Php50,000.00, for defendants’ refusal to vacate the property and for
compelling plaintiff to incur expenses to protect its interests. Furthermore, it is clear that defendants acted in
gross and evident bad faith in refusing to satisfy plaintiff’s plainly valid, just, and demandable claim. 23
In his Answer dated 1 August 2005,24 Ramon claimed that:
(1) German was the owner of the two buildings constructed on the leased property as evidenced by the
building permits obtained from the government agencies and the tax declarations covering the buildings;
(2) The Spanish lease contract, which was not translated into English or Filipino should not be admitted as
evidence in view of Section 33 of Rule 133 of the Rules on Evidence;
(3) HDSJ is estopped from raising the issue of non-transferability of the lease contract because it admitted
in its letter to Ramon that there is an existing lease agreement between the parties, even after German’s
death:
Your Lease Contract with [HDSJ], which is an implied month-to-month contract, has to be
terminate defective March 31, 2001, because by your own admission, you have continuously
subleased the subject premises to about 20 families including a commercial establishment).This
was done without the knowledge and consent of the lessor, [HDSJ], and is in violation of the Lease
Contract your father signed with them.25 x x x.
(4) There is no prohibition against subleasing in the lease contract. Thus, under Article 1650 of the Civil
Code, Ramon is permitted to sublease the premises; and
(5) The letters sent by HDSJ to the Inocencios sometime in1990 revealed that the former already knew that
the premises were being subleased.
Ramon also claimed that HDSJ interfered with the contractual relations between him and his sublessees. 26
While the case was being tried before the MeTC-Pasay, Ramon passed away. In an Order dated 23 August
2006, the MeTC-Pasay allowed the substitution of Ramon by his wife, Analita. 27
The Ruling of the MeTC-Pasay
The MeTC-Pasay ruled in favor of HDSJ. In its Decision dated 22May 2008, the MeTC-Pasay held that the lease
contract could not be transmitted to Ramon as German’s heir in view of the express stipulation found therein.
Since there was "no lease contract between [HDSJ] and Ramon x x x the latter cannot sublease the
property."28 The dispositive portion of the MeTC-Pasay Decision reads:
Premises considered, judgment is hereby rendered in favor of plaintiff and against defendant as follows:
1. Ordering defendant Ramon Inocencio, substituted by AnalitaP. Inocencio, and Felipe Enar, and all persons claiming
rights under them to immediately vacate the premises located at 61-CSta. Escolastica cor. F.B. Harrison St., Pasay
City and to peacefully turn over the same to plaintiff;
2. Ordering the defendants to pay plaintiff reasonable compensation of ₱552,195.36 for the use and occupation of the
property from 01 April 2001 to 31 March 2005, and the amount of ₱10,512.00 a month from 01 April 2005 up to the
present, plus twelve per cent 12% interest per annum until the premises shall have been vacated;
3. Ordering the defendants to pay plaintiff the amount of ₱50,000.00 as attorney’s fees and costs of suit. 29
Aggrieved, Analita filed an appeal before the RTC-Pasay.
The Ruling of the RTC-Pasay
On 21 January 2009, the RTC-Pasay dismissed Analita’s appeal and affirmed in toto the decision of the MeTC-
Pasay.30 It held that "even before the termination of the contract, [Ramon] had no right to sublease the said
property due to the intransferability clause in the contract." 31
The Ruling of the CA

The CA affirmed the decision of the RTC-Pasay but modified the award for damages.
WHEREFORE, foregoing considered, the assailed Decision dated21 January 2009 of the Regional Trial Court, Branch 119,
Pasay City is AFFIRMED with the MODIFICATION that the award for reasonable compensation in paragraph 2 is pegged at
Five Hundred Four Thousand Five Hundred Seventy Six Pesos (₱504,576.00) representing the accumulated rentals for the
period from 01 April 2001 up to 31 March2005 with six percent (6%) interest per annum, plus the further amount of Ten
Thousand Five Hundred Twelve Pesos (₱10,512.00) per month from 01 April 2005 until possession is restored to
respondent, also with six percent (6%) interest per annum, up to the finality of this Decision. Thereafter, the interest shall be
twelve percent (12%) until the amount is fully paid.33
Issues:
The petition questions the following rulings made by the CA:
(1) The sublease contracts were invalid;

(2) There was no tortious interference on the part of HDSJ;
(3) Ramon did not own the buildings erected on the leased premises;
(4) HDSJ is entitled to reasonable compensation in the amount of ₱504,576.00 and attorney’s fees; and
(5) HDSJ’s action for unlawful detainer was not barred by prescription.
HELD:
Article 1311 of the Civil Code provides:
Art. 1311. Contracts take effect only between the parties, their assigns and heirs, except in case where the rights
and obligations arising from the contract are not transmissible by their nature, or by stipulation or by provision of
law. The heir is not liable beyond the value of the property he received from the decedent.
xxxx
We have previously ruled that lease contracts, by their nature, are not personal. The general rule, therefore, is
lease contracts survive the death of the parties and continue to bind the heirs except if the contract states
otherwise.34 In Sui Man Hui Chan v. Court of Appeals,35 we held that:
A lease contract is not essentially personal in character. Thus, the rights and obligations therein are
transmissible to the heirs. The general rule, therefore, is that heirs are bound by contracts entered into by their
predecessors-in-interest except when the rights and obligations arising therefrom are not transmissible by (1)
their nature, (2) stipulation or (3) provision of law.
In the subject Contract of Lease, not only were there no stipulations prohibiting any transmission of rights, but its
very terms and conditions explicitly provided for the transmission of the rights of the lessor and of the lessee to
their respective heirs and successors. The contract is the law between the parties. The death of a party does not
excuse nonperformance of a contract, which involves a property right, and the rights and obligations thereunder
pass to the successors or representatives of the deceased. Similarly, nonperformance is not excused by the
death of the party when the other party has a property interest in the subject matter of the contract.
Section 6 of the lease contract provides that "this contract is nontransferable unless prior consent of the lessor is
obtained in writing."36 Section 6 refers to transfers inter vivos and not transmissions mortis causa. What
Section 6 seeks to avoid is for the lessee to substitute a third party in place of the lessee without the lessor’s
consent. This merely reiterates what Article 1649 of the Civil Code provides:
Art. 1649. The lessee cannot assign the lease without the consent of the lessor, unless there is a stipulation to
the contrary.
In any case, HDSJ also acknowledged that Ramon is its month-to-month lessee. Thus, the death of
German did not terminate the lease contract executed with HDSJ, but instead continued with Ramon as
the lessee. HDSJ recognized Ramon as its lessee in a letter dated 1 March 2001:
We acknowledge the fact that Hospicio de San Jose has been accepting the payment of your rentals
since the demise of Mr. [German] Inocencio. Hence, an implied contract of lease between the two of you
exists. However, since there is no stipulation as to the period of the contract and you are paying a
monthly rental to our client, the period for the lease is on a month-to-month basis (Art. 1687). Thus as of
this date, your contract should expire on March 31, 2001. 37
Section 6 of the lease contract requires written consent of the lessor before the lease may be assigned or
transferred. In Tamio v. Tecson,38 we explained the nature of an assignment of lease:
In the case of cession or assignment of lease rights on real property, there is a novation by the substitution of
the person of one of the parties — the lessee. The personality of the lessee, who dissociates from the lease,
disappears; only two persons remain in the juridical relation — the lessor and the assignee who is converted into
the new lessee.39
Assignment or transfer of lease, which is covered by Article 1649 of the Civil Code, is different from a sublease
arrangement, which is governed by Article 1650 of the same Code. In a sublease, the lessee becomes in turn a
lessor to a sublessee. The sublessee then becomes liable to pay rentals to the original lessee. However, the
juridical relation between the lessor and lessee is not dissolved. The parties continue to be bound by the original
lease contract. Thus, in a sublease arrangement, there are at least three parties and two distinct juridical
relations.40
Ramon had a right to sublease the premises since the lease contract did not contain any stipulation forbidding
subleasing. Article 1650 of the Civil Code states:
Art. 1650. When in the contract of lease of things there is no express prohibition, the lessee may sublet the thing
leased, in whole or in part, without prejudice to his responsibility for the performance of the contract toward the
lessor.
Therefore, we hold that the sublease contracts executed by Ramon were valid.
We also find that HDSJ did not commit tortious interference. Article1314 of the Civil Code states:
Art. 1314. Any third person who induces another to violate his contract shall be liable for damages to the other
contracting party.
As correctly pointed out by the Inocencios, tortious interference has the following elements:
(1) existence of a valid contract;
(2) knowledge on the part of the third person of the existence of the contract; and
(3) interference of the third person without legal justification or excuse. 41
The facts of the instant case show that there were valid sublease contracts which were known to HDSJ.
However, we find that the third element is lacking in this case.
In So Ping Bun v. Court of Appeals,42 we held that there was no tortious interference if the intrusion was impelled
by purely economic motives. In So Ping Bun, we explained that:
 Authorities debate on whether interference may be justified where the defendant acts for the sole
purpose of furthering his own financial or economic interest. One view is that, as a general rule,
justification for interfering with the business relations of another exists where the actor’s motive is to
benefit himself. Such justification does not exist where his sole motive is to cause harm to the other.
 Added to this, some authorities believe that it is not necessary that the interferer’s interest outweighs that
of the party whose rights are invaded, and that an individual acts under an economic interest that is
substantial, not merely de minimis, such that wrongful and malicious motives are negatived, for he acts
in self- protection. Moreover, justification for protecting one’s financial position should not be made to
depend on a comparison of his economic interest in the subject matter with that of others. It is sufficient if
the impetus of his conduct lies in a proper business interest rather than in wrongful motives. 43
The evidence shows that HDSJ entered into agreements with Ramon’s former sublessees for purely economic
reasons (payment of rentals). HDSJ had a right to collect the rentals from the sublessees upon termination of the
lease contract. It does not appear that HDSJ was motivated by spite or ill will towards the Inocencios.
The Inocencios claim ownership over the buildings since these are separate and distinct from the land on which
they are erected. Thus, as owners of the buildings, they have a right to lease the buildings to third persons, even
after termination of the lease contract with HDSJ.
To bolster their claim of ownership, the Inocencios presented the following evidence:
(1) the building permit;44
(2) the receipt for the payment of the permit fee;45
(3) the Tax Declarations; and (4) the proof of payment of insurance. 46
The Inocencios also claimed that:

 as the Inocencios owned the Subject Buildings, it is respectfully submitted, and it should be clear that
when they entered into lease contracts with tenants for the lease of portions of the said buildings, these
contracts were independent contracts of lease over their own building and not sub-leases of the parcel of
land which they leased from Respondent. It is Respondent’s inaccurate characterization of the leasing by
the Inocencios of portions of their own building that has obfuscated the legal issues in this case and
partially led to the incorrect decisions of the courts a quo. 47
We do not agree. In Duellome v. Gotico48 and Caleon v. Agus Development Corporation, 49

 we held that the lease of a building includes the lease of the lot and consequently, the rentals of
the building include the rentals of the lot.
As correctly pointed out by HDSJ in its Comment: 50

x x x When the Inocencios leased the buildings to third parties, they also "leased" to the third parties the
plot of land on which the buildings stood — either by implied transfer of the lease covering the plot of the land, or
by sublease. Either way, x x x the Inocencios themselves must have a valid lease contract with [HDSJ] over the
land. However, when the lease contract x x x with HDSJ ended on 31March 2001, Ramon lost his status as
lessee of the land, and therefore, had no authority to transfer the lease or sublease the land. x x x. 51
However, we find that the CA erred in not applying Article 1678 of the Civil Code which provides:
Art. 1678. If the lessee makes, in good faith, useful improvements which are suitable to the use for which the
lease is intended, without altering the form or substance of the property leased, the lessor upon the termination
of the lease shall pay the lessee one-half of the value of the improvements at that time. Should the lessor refuse
to reimburse said amount, the lessee may remove the improvements, even though the principal thing may suffer
damage thereby. He shall not, however, cause any more impairment upon the property leased than is
necessary.
With regard to ornamental expenses, the lessee shall not be entitled to any reimbursement, but he may remove
the ornamental objects, provided no damage is caused to the principal thing, and the lessor does not choose to
retain them by paying their value at the time the lease is extinguished.
The foregoing provision applies if the improvements were:

(1) introduced in good faith;
(2) useful; and
(3) suitable to the use for which the lease is intended, without altering the form and substance. 52
We find that the aforementioned requisites are satisfied in this case. The buildings were constructed before
German’s demise, during the subsistence of a valid contract of lease. It does not appear that HDSJ prohibited
German from constructing the buildings. Thus, HDSJ should have reimbursed German (or his estate) half of the
value of the improvements as of 2001. If HDSJ is not willing to reimburse the Inocencios, then the latter should
be allowed to demolish the buildings.
We also find that the action for unlawful detainer was not barred by prescription. Section 1, Rule 70 of the Rules
of Court provides that actions for unlawful detainer must be filed "within one (1) year after such unlawful
deprivation or withholding of possession." In interpreting the foregoing provision, this Court, in Republic v.
Sunvar Realty Development Corporation,53 held that:
The one-year period to file an unlawful detainer case is not counted from the expiration of the lease contract on
31 December 2002. Indeed, the last demand for petitioners to vacate is the reckoning period for determining the
one-year period in an action for unlawful detainer. "Such one year period should be counted from the date of
plaintiff’s last demand on defendant to vacate the real property, because only upon the lapse of that period does
the possession become unlawful." 54
HDSJ’s last demand was made on 3 March 2005, and it filed the complaint for unlawful detainer on 28 June
2005. Thus, the complaint was filed within the period provided under the Rules of Court.
WHEREFORE, the petition is PARTLY GRANTED. The Decision dated 12 January 2012 of the Court of Appeals in CA-G.R.
SP No. 117009 is AFFIRMED with modification. The case is hereby REMANDED to the Metropolitan Trial Court of Pasay,
Branch 48, for determination of the value or the improvements to be paid to the lnocencios, if Hospicio de San Jose desires
to keep the improvements. Otherwise, the Inocencios shall be allowed to demolish the buildings at their expense.
xxxyyyzzz
Heirs of Villeza vs. Aliangan – GR Nos. 244667-69 (December 2, 2020)
G.R. No. 224144, June 28, 2017
LOLITA BAS CAPABLANCA v. HEIRS OF PEDRO BAS, REPRESENTED BY JOSEFINA BAS ESPINOSA
AND REGISTER OF DEEDS OF THE PROVINCE OF CEBU
The subject matter of this case is Lot 2535 of the Talisay-Minglanilla Friar Land's Estate located in "Biasong,
Dumlog, Talisay, Cebu"5 with an area of 6,120 square meters
Andres Bas (Andres) and Pedro Bas (Pedro) acquired Lot 2535, "and Patent No. 1724 was issued in their
names on May 12, 1937."
On November 28, 1939, Pedro sold to Faustina Manreal (Faustina), married to Juan Balorio, his portion of Lot
2535 "with a seeding capacity of four (4) chupas of com." 8 The sale was evidenced by a notarized Deed of Sale
dated November 28, 1939.9
After the death of Faustina and her husband, their heirs executed a notarized Extra-Judicial Declaration of Heirs
and Deed of Absolute Sale dated March 13, 1963.
 Lot 2535 consisting of "1,000 square meters, more or less," was conveyed to one (1) of their heirs,
Alejandra Balorio (Alejandra).10
 Alejandra sold the land through a Deed of Absolute Sale dated June 13, 1967 to Edith N. Deen, who in
turn sold it to Atty. Eddy A. Deen (Atty. Deen) on March 21, 1968. 11
 Upon Atty. Deen's death on December 18, 1978, an extra-judicial settlement of estate, which did not
include Lot 2535, was executed by his heirs.
 Later, or on March 30, 1988, they executed an Additional ExtraJudicial Settlement with Absolute Deed of
Sale, which sold the land for P10,000.00 to Norberto B. Bas (Norberto), who took possession of and built
a house on it.12
On December 15, 1995, Norberto died without a will and was succeeded by his niece and only heir, Lolita
Bas Capablanca (Lolita).13
Subsequently, Lolita learned that a Transfer Certificate of Title (TCT) No. T-96676 dated June 6, 1996 was
issued in the names of Andres and Pedro on the basis of a reconstituted Deed of Conveyance No. 96-00004. 14
In October 1996, Josefina Bas Espinosa (Josefina) represented the Heirs of Pedro Bas to file a complaint for
Clarification of Ownership of Lot 2535 against Lolita before the Lupong Tagapamayapa of Barangay Biasong,
Talisay, Cebu.15 The conflict between the parties was not resolved and resulted to the issuance of a Certification
to file Action.16
On December 16, 1996, a notarized Partition Agreement of Real Property, Quitclaim and Waiver of Rights was
executed between the heirs of Andres and Lolita, representing Norberto, whereby they partitioned Lot 2535
among themselves.17
Lolita sought to register her portion in Lot 2535 but was denied by the Register of Deeds of Cebu, citing the need
for a court order.18 Lolita then learned that TCT No. T-96676 had been partially cancelled and TCT Nos. T-
100181, T-100182, T-100183, and T-100185 had been issued in the name of the Heirs of Pedro Bas,
represented by Josefina, on May 29, 1997.19
On December 16, 1997, Lolita filed a complaint before the Regional Trial Court of Cebu City for the cancellation
of the titles with prayer for moral and exemplary damages, attorney's fees, and litigation expenses. 20
In their Answer, the Heirs of Pedro Bas claimed that "the sale between Pedro Bas and Faustina Manreal [was]
fake, spurious and invalid because [Pedro] who [was] an illiterate never learned how to write his name so that
the signature appearing thereon could not have been made by Pedro Bas." 21 They further claimed that the
cancellation of TCT No. T-96676 was made pursuant to a final judgment in Civil Case No. 840 22 for Partition,
Damages, and Attorney's Fees.23
After trial, Branch 8, Regional Trial Court, Cebu City rendered a Decision 24 on December 26, 2007, in favor of
Lolita. The trial court held that there was substantial evidence to prove that Lolita had been in long possession of
the lot under a claim of ownership as the heir of Norberto and that it was not necessary for her to be first
declared as his heir before filing the complaint.25 It further ruled that to dismiss the case on the ground that Lolita
should first be declared an heir would be too late as the Heirs of Pedro Bas did not raise the issue in a motion to
dismiss or as an affirmative defense in their complaint. 26
On the substantive issues, the trial court upheld the validity of the 1939 Deed of Sale executed by Pedro in favor
of Faustina. It found Josefina's uncorroborated testimony of Pedro's illiteracy as self-serving and unconvincing to
contradict the regularity of the notarized deed. Moreover, her testimony was controverted by the notarized
Assignment of Sale Certificate 195, which bore the same signature of Pedro, and by the Heirs of Pedro Bas'
answers in Civil Case No. R-10602, another case which contained allegations that Pedro sold his share in the lot
to Faustina.27
The trial court further held that the object of the sale was determinate, i.e., Pedro's share in Lot 2535 was
specified by the boundaries indicated in the Deed of Sale. 28 It concluded that Norberto acquired the entire share
of Pedro in Lot 2535, which was found only after survey in 1996, 29 to actually consist of 3,060 square meters and
not 1,000 square meters as insisted by the Heirs of Pedro Bas. The trial court gave credence to Lolita's
testimony that before the survey, Pedro's portion was estimated to be 1,000 square meters; hence, the area
indicated in the successive transfers of the lot from the heirs of Faustina down to Norberto was "1,000 square
meters, more or less."30
Consequently, with Pedro's sale of his share in Lot 2535, his heirs acquired no portion by inheritance and their
titles were null and void and should be cancelled. 31
Finally, the trial court affirmed that the Judgement of the Municipal Trial Court of Talisay in Civil Case No. 840 for
Partition, Damages and Attorney's fees was not binding on Lolita, who was not a party to the case. 32
The fallo of the Decision read:
WHEREFORE, premises considered, a judgment is hereby rendered in favor of the plaintiff and against the defendants,
declaring as null and void and ordering the Register of Deeds of the Province of Cebu to cancel the following transfer
certificates of title:
1) Transfer Certificate of Title No. T-100181, of the Register of Deeds of the Province of Cebu, in the name of Heirs of
Pedro Bas, represented by Josefina Bas, covering Lot 2535-J, Psd-07-037377, being a portion of Lot 2535, Flr-133,
situated in the Barrio of Dumlog, Mun. of Talisay, Prov. of Cebu, Island of Cebu, containing an area of 304 square
meters;
Pedro Bas, represented by Josefina Bas, covering Lot 2535-B, Psd-07-037377, being a portion of Lot 2535, Flr-133,
situated in the Barrio of Dumlog, Mun. of Talisay, Prov. of Cebu, Island of Cebu, containing an area of 1,554 square
meters;
Pedro Bas, represented by Josefina Bas, covering Lot 2535-A, Psd-07-037377, being a portion of Lot 2535, Flr-133,
meters; and
Pedro Bas, represented by Josefina Bas, covering Lot 2535-A Psd-07-037377, being a portion of Lot 2535, Flr-133,
meters.
The Regional Trial Court subsequently denied the Heirs of Pedro Bas' motion for reconsideration. Hence, the
Heirs of Pedro Bas appealed to the Court of Appeals, making the following lone assignment of error:
The trial court seriously erred in not dismissing the case for plaintiffs lack of cause of action pursuant to (the)
doctrinal jurisprudential case of Guido and Isabel Yaptinchay vs. Del Rosario (304 SCRA 18) considering that
plaintiff in her complaint alleged, she is the sole heir of Norberto Bas.35
The Court of Appeals reversed the Regional Trial Court Decision and dismissed the complaint. 36 According to
the Court of Appeals, Lolita must first be declared as the sole heir to the estate ofNorberto in a proper special
proceeding. Thus:
WHEREFORE, premises considered, the Decision dated December 26, 2007, of the Regional Trial Court, 7 th Judicial
Region, Branch 8, Cebu City in Civil Case No. CEB-21348 for Ownership, Nullity of Deeds, Cancellation of TCT Nos. T-
100181, T-100182, TM100183[,] and T-100185, covering portions of Lot No. 2535, damages, etc., ordering the cancellation
of Transfer Certificates of Title Nos. T-100181, T-100182, T-100183[,] and T-100185 is hereby REVERSED and SET
ASIDE.
The complaint of plaintiff-appellee is hereby DISMISSED, without prejudice to any subsequent proceeding to determine the
lawful heirs of the late Norberto Bas and the rights concomitant therewith. 37
Lolita sought reconsideration but was denied in the Court of Appeals Resolution dated March 15, 2016.
Hence, Lolita filed this Petition principally contending that the Court of Appeals committed a reversible error in
reversing the Regional Trial Court Decision and dismissing the complaint.
Petitioner argues that the 1999 case of the Heirs of Yaptinchay v. Del Rosario 38 cited in the Court of Appeals
Decision does not apply to this case because the factual circumstances are different. 39 In that case, the claims of
the opposing parties were anchored on their alleged status as heirs of the original owner. 40 "Hence there may
have been the need for a previous judicial declaration of heirship in a special proceeding." 41 Here, petitioner
does not claim to be an heir of Pedro, the original owner. Rather, her interest over the property is derived from a
series of transactions starting from the sale executed by Pedro. 42
Petitioner further contends that respondents neither raised the ground "lack of cause of action" as an affirmative
defense nor filed a motion to dismiss before the court a quo. Instead, they allowed the trial to proceed with their
full participation all throughout. Petitioner asserts that respondents' action or inaction should be constituted a
waiver.43 Otherwise, respondents' "failure to properly act on its perceived defect" in the complaint hampers the
speedy disposition of the action "and would only promote multiplicity of suits." 44
In their two (2)-page Comment, 45 respondents contend that the findings of the Court of Appeals were duly
supported by evidence and jurisprudence.
ISSUE:
HELD:
This Court grants the petition.
Contrary to the erroneous conclusion of the Court of Appeals, this Court finds no need for a separate proceeding
for a declaration of heirship in order to resolve petitioner's action for cancellation of titles of the property.
The dispute in this case is not about the heirship of petitioner to Norberto but the validity of the sale of the
property in 1939 from Pedro to Faustina, from which followed a series of transfer transactions that culminated in
the sale of the property to Norberto. For with Pedro's sale of the property in 1939, it follows that there would be
no more ownership or right to property that would have been transmitted to his heirs.
Petitioner's claim is anchored on a sale of the property to her predecessor-in-interest and not on any filiation with
the original owner. What petitioner is pursuing is Norberta's right of ownership over the property which was
passed to her upon the latter's death.46
This Court has stated that no judicial declaration of heirship is necessary in order that an heir may assert his or
her right to the property of the deceased. 47 In Marabilles v. Quito:48
The right to assert a cause of action as an heir, although he has not been judicially declared to be so, if duly
proven, is well settled in this jurisdiction. This is upon the theory that the property of a deceased person, both
real and personal, becomes the property of the heir by the mere fact of death of his predecessor in interest, and
as such he can deal with it in precisely the same way in which the deceased could have dealt, subject only to
the limitations which by law or by contract may be imposed upon the deceased himself.
Thus, it has been held that "[t]here is no legal precept or established rule which imposes the necessity of a
previous legal declaration regarding their status as heirs to an intestate on those who, being of age and with
legal capacity, consider themselves the legal heirs of a person, in order that they may maintain an action arising
out of a right which belonged to their ancestor" ... A recent case wherein this principle was maintained is
Cabuyao vs. [C]aagbay.
The Court of Appeals' reliance on the ruling in Heirs of Yaptinchay v. Del Rosario 50 was misplaced. In that case,
the motion to dismiss was filed immediately after the second Amended Complaint was filed. 51 The trial court
granted the motion to dismiss, holding that the Heirs of Yaptinchay "have not shown any proof or even a
semblance of it-except the allegations that they are the legal heirs of the above-named Yaptinchays-that they
have been declared the legal heirs of the deceased couple." 52
Here, respondents never raised their objection to petitioner's capacity to sue either as an affirmative defense or
in a motion to dismiss.53 Rule 9, Section 1 of the Rules of Court states, "[d]efenses and objections not pleaded
either in a motion to dismiss or in the answer are deemed waived." Thus, it was erroneous for the Court of
Appeals to dismiss the complaint on the ground that there was no prior judicial declaration of petitioner's heirship
to Norberto.54
Moreover, the pronouncement in the Heirs of Yaptinchay that a declaration of heirship must be made only in a
special proceeding and not in an ordinary civil action for reconveyance of property was based on Litam, etc., et
al. v. Rivera55 and Solivio v. Court of Appeals,56 which involved different factual milieus.
The facts of the case in Litam, etc., et al. v. Rivera57 show that during the pendency of the special proceedings
for the settlement of the intestate estate of the deceased Rafael Litam, the plaintiffs-appellants filed a civil action.
They claimed that as the children of the deceased by a previous marriage to a Chinese woman, they were
entitled to inherit his one-half (1/2) share of the conjugal properties acquired during his marriage to Marcosa
Rivera (Marcosa).58 The trial court in the civil case declared, among others, that the plaintiffs-appellants were not
children of the deceased and that Marcosa was his only heir. 59 On appeal, this Court ruled that such declaration-
that Marcosa was the only heir of the decedent-was improper because the determination of the issue was within
the exclusive competence of the court in the special proceedings. 60
In Solivio v. Court of Appeals, the deceased Esteban Javellana, Jr. was survived by Celedonia Solivio
(Celedonia), his maternal aunt, and Concordia Javellana-Villanueva (Concordia), his paternal aunt. Celedonia
filed the intestate proceedings and had herself declared as sole heir and administratrix of the estate of the
decedent to facilitate the implementation of the latter's wish to place his estate in a foundation named after his
mother. While the probate proceeding was pending, Concordia filed a separate civil action where she sought to
be declared as co-heir and for partition of the estate. 64 This Court held that the "separate action was improperly
filed for it is the probate court that has exclusive jurisdiction to make a just and legal distribution of the
estate." This Court further held that "in the interest of orderly procedure and to avoid confusing and conflicting
dispositions of a decedent's estate, a court should not interfere with probate proceedings pending in a co-equal
court."
In Litam and Solivio, the adverse parties were putative heirs to a decedent's estate or parties to the special
proceedings for an estate's settlement. Hence, this Court ruled that questions on the status and right of the
contending parties must be properly ventilated in the appropriate special proceeding, not in an ordinary civil
action.
Here, as stated, the main issue is the annulment of title to property, which ultimately hinges on the validity of the
sale from Pedro to Faustina. Petitioner does not claim any filiation with Pedro or seek to establish her right as his
heir as against the respondents. Rather, petitioner seeks to enforce her right over the property which has been
allegedly violated by the fraudulent acts of respondents.
Furthermore, as found by the Regional Trial Court:
The plaintiff [Lolita] has sufficient interest to protect in the subject portion of Lot 2535. She had been there for
around thirty (30) years, and had been in possession thereof under a claim of ownership as an alleged heir of
Norberto Bas after the latter's death on December 15, 1993, that is: long before the issuance of TCT Nos. T-
100181, T-100182, T-100183[,] and T-100185 in 1997, and even TCT No. T-96676 in 1996. Moreover, it is
annotated on TCT No. T-96676 (Exhibit "G") that she, together with the heirs of Osmundo Bas, executed a
declaration of heirs with partition, quitclaim, etc., dated December 16, 1996, registered on March 3, 1997 ...
wherein they adjudicated unto themselves and partitioned Lot No. 2535 ... She also executed on June 14, 1997
an Affidavit of Adjudication by Sole Heir, declaring herself as the sole heir of Norberta Bas and adjudicated unto
herselfthe subject portion pursuant to Section 1, Rule 74 of the 1997 Revised Rules of Civil Procedure.
The existence of the questioned certificates of title, and other related documents, constitute clouds on said
interest. There seems, therefore, to be no necessity that the plaintiff should have been declared first as an heir
of Norberta Bas as a prerequisite to this action. Her possession of the subject lot under a claim of ownership is a
sufficient interest to entitle her to bring this suit.
This case has gone a long way since the complaint was filed in 1997. A full-blown trial had taken place and
judgment was rendered by the Regional Trial Court where it thoroughly discussed, evaluated, and weighed all
the pieces of documentary evidence and testimonies of the witnesses of both parties. At this point, to dismiss the
case and require petitioner to institute a special proceeding to determine her status as heir of the late Norberta
would hamper, instead of serve, justice.
In Portugal v. Portugal-Beltran,68 where the contending parties insisted to be the legal heirs of the decedent, this
Court dispensed with the need to institute a separate special proceeding to determine their heirship since the
parties had voluntarily submitted the issue to the trial court and already presented their evidence. It held:
It appearing, however, that in the present case the only property of the intestate estate of Portugal is the
Caloocan parcel of land, to still subject it, under the circumstances of the case, to a special proceeding which
could be long, hence, not expeditious, just to establish the status of petitioners as heirs is not only impractical; it
is burdensome to the estate with the costs and expenses of an administration proceeding. And it is superfluous
in light of the fact that the parties to the civil case - subject of the present case, could and had already in fact
presented evidence before the trial court which assumed jurisdiction over the case upon the issues it defined
during pre-trial.
In fine, under the circumstances of the present case, there being no compelling reason to still subject Portugal's
estate to administration proceedings since a determination of petitioners' status as heirs could be achieved in
the civil case filed by petitioners, the trial court should proceed to evaluate the evidence presented by the parties
during the trial and render a decision thereon[.]69 (Citation omitted)
In this case, there is no necessity for a separate special proceeding and to require it would be superfluous
considering that petitioner had already presented evidence to establish her filiation and heirship to Norberto,
which respondents never disputed.
WHEREFORE, the Petition is GRANTED. The Court of Appeals Decision dated March 12, 2014 and Resolution dated
March 15, 2016 are VACATED and SET ASIDE. The Decision dated December 26, 2007 of Branch 8, Regional Trial Court,
Cebu City is REINSTATED.
[G.R. No. 113899. October 13, 1999.]
GREAT PACIFIC LIFE ASSURANCE CORP. v. COURT OF APPEALS AND MEDARDA V. LEUTERIO
This petition for review, under Rule 45 of the Rules of Court, assails the Decision 1 dated May 17, 1993, of the
Court of Appeals and its Resolution 2 dated January 4, 1994 in CA-G.R. CV No. 18341. The appellate court
affirmed in toto the judgment of the Misamis Oriental Regional Trial Court, Branch 18, in an insurance claim filed
by private respondent against Great Pacific Life Assurance Co. The dispositive portion of the trial court’s
decision reads:
"WHEREFORE, judgment is rendered adjudging the defendant GREAT PACIFIC LIFE ASSURANCE CORPORATION as
insurer under its Group policy No. G-1907, in relation to Certification B-18558 liable and ordered to pay to the
DEVELOPMENT BANK OF THE PHILIPPINES as creditor of the insured Dr. Wilfredo Leuterio, the amount of EIGHTY SIX
THOUSAND TWO HUNDRED PESOS (P86,200.00); dismissing the claims for damages, attorney’s fees and litigation
expenses in the complaint and counterclaim, with costs against the defendant and dismissing the complaint in respect to the
plaintiffs, other than the widow-beneficiary, for lack of cause of action."
FACTS:
A contract of group life insurance was executed between petitioner Great Pacific Life Assurance Corporation
(hereinafter Grepalife) and Development Bank of the Philippines (hereinafter DBP). Grepalife agreed to insure
the lives of eligible housing loan mortgagors of DBP.
On November 11, 1983, Dr. Wilfredo Leuterio, a physician and a housing debtor of DBP applied for membership
in the group life insurance plan. In an application form, Dr. Leuterio answered questions concerning his health
condition as follows:
"7. Have you ever had, or consulted, a physician for a heart condition, high blood pressure, cancer,
diabetes, lung, kidney or stomach disorder or any other physical impairment?
Answer: No. If so give details ___________.
8. Are you now, to the best of your knowledge, in good health?
Answer: [ x ] Yes [ ] No."
On November 15, 1983, Grepalife issued Certificate No. B-18558, as insurance coverage of Dr. Leuterio, to the
extent of his DBP mortgage indebtedness amounting to eighty-six thousand, two hundred (P86,200.00) pesos.
On August 6, 1984, Dr. Leuterio died due to "massive cerebral hemorrhage." Consequently, DBP submitted a
death claim to Grepalife. Grepalife denied the claim alleging that Dr. Leuterio was not physically healthy when he
applied for an insurance coverage on November 15, 1983. Grepalife insisted that Dr. Leuterio did not disclose he
had been suffering from hypertension, which caused his death. Allegedly, such non-disclosure constituted
concealment that justified the denial of the claim.
On October 20, 1986, the widow of the late Dr. Leuterio, respondent Medarda V. Leuterio, filed a complaint with
the Regional Trial Court of Misamis Oriental, Branch 18, against Grepalife for "Specific Performance with
Damages." 5 During the trial, Dr. Hernando Mejia, who issued the death certificate, was called to testify. Dr.
Mejia’s findings, based partly from the information given by the respondent widow, stated that Dr. Leuterio
complained of headaches presumably due to high blood pressure. The inference was not conclusive because
Dr. Leuterio was not autopsied, hence, other causes were not ruled out.
On February 22, 1988, the trial court rendered a decision in favor of respondent widow and against Grepalife.
On May 17, 1993, the Court of Appeals sustained the trial court’s decision. Hence, the present petition.
Petitioners interposed the following assigned errors:
"1. THE LOWER COURT ERRED IN HOLDING DEFENDANT-APPELLANT LIABLE TO THE DEVELOPMENT BANK OF
THE PHILIPPINES (DBP) WHICH IS NOT A PARTY TO THE CASE FOR PAYMENT OF THE PROCEEDS OF A
MORTGAGE REDEMPTION INSURANCE ON THE LIFE OF PLAINTIFF’S HUSBAND WILFREDO LEUTERIO ONE OF
ITS LOAN BORROWERS, INSTEAD OF DISMISSING THE CASE AGAINST DEFENDANT-APPELLANT [Petitioner
Grepalife] FOR LACK OF CAUSE OF ACTION.
2. THE LOWER COURT ERRED IN NOT DISMISSING THE CASE FOR WANT OF JURISDICTION OVER THE SUBJECT
OR NATURE OF THE ACTION AND OVER THE PERSON OF THE DEFENDANT.
3. THE LOWER COURT ERRED IN ORDERING DEFENDANT-APPELLANT TO PAY TO DBP THE AMOUNT OF
P86,200.00 IN THE ABSENCE OF ANY EVIDENCE TO SHOW HOW MUCH WAS THE ACTUAL AMOUNT PAYABLE TO
DBP IN ACCORDANCE WITH ITS GROUP INSURANCE CONTRACT WITH DEFENDANT-APPELLANT.
4. THE LOWER COURT ERRED IN - HOLDING THAT THERE WAS NO CONCEALMENT OF MATERIAL INFORMATION
ON THE PART OF WILFREDO LEUTERIO IN HIS APPLICATION FOR MEMBERSHIP IN THE GROUP LIFE INSURANCE
PLAN BETWEEN DEFENDANT-APPELLANT OF THE INSURANCE CLAIM ARISING FROM THE DEATH OF WILFREDO
LEUTERIO."
Synthesized below are the assigned errors for our resolution:
1. Whether the Court of Appeals erred in holding petitioner liable to DBP as beneficiary in a group life
insurance contract from a complaint filed by the widow of the decedent/mortgagor?
2. Whether the Court of Appeals erred in not finding that Dr. Leuterio concealed that he had hypertension,
which would vitiate the insurance contract?
3. Whether the Court of Appeals erred in holding Grepalife liable in the amount of eighty six thousand, two
hundred (P86,200.00) pesos without proof of the actual outstanding mortgage payable by the mortgagor
to DBP.
Petitioner alleges that the complaint was instituted by the widow of Dr. Leuterio, not the real party in interest,
hence the trial court acquired no jurisdiction over the case. It argues that when the Court of Appeals affirmed the
trial court’s judgment, Grepalife was held liable to pay the proceeds of insurance contract in favor of DBP, the
indispensable party who was not joined in the suit.
To resolve the issue, we must consider the insurable interest in mortgaged properties and the parties to this type
of contract. The rationale of a group insurance policy of mortgagors, otherwise known as the "mortgage
redemption insurance," is a device for the protection of both the mortgagee and the mortgagor. On the part of
the mortgagee, it has to enter into such form of contract so that in the event of the unexpected demise of the
mortgagor during the subsistence of the mortgage contract, the proceeds from such insurance will be applied to
the payment of the mortgage debt, thereby relieving the heirs of the mortgagor from paying the obligation. 7 In a
similar vein, ample protection is given to the mortgagor under such a concept so that in the event of death; the
mortgage obligation will be extinguished by the application of the insurance proceeds to the mortgage
indebtedness. 8 Consequently, where the mortgagor pays the insurance premium under the group insurance
policy, making the loss payable to the mortgagee, the insurance is on the mortgagor’s interest, and the
mortgagor continues to be a party to the contract. In this type of policy insurance, the mortgagee is simply an
appointee of the insurance fund, such loss-payable clause does not make the mortgagee a party to the contract.
Section 8 of the Insurance Code provides:
"Unless the policy provides, where a mortgagor of property effects insurance in his own name providing that the
loss shall be payable to the mortgagee, or assigns a policy of insurance to a mortgagee, the insurance is
deemed to be upon the interest of the mortgagor, who does not cease to be a party to the original contract, and
any act of his, prior to the loss, which would otherwise avoid the insurance, will have the same effect, although
the property is in the hands of the mortgagee, but any act which, under the contract of insurance, is to be
performed by the mortgagor, may be performed by the mortgagee therein named, with the same effect as if it
had been performed by the mortgagor."
The insured private respondent did not cede to the mortgagee all his rights or interests in the insurance, the
policy stating that: "In the event of the debtor’s death before his indebtedness with the Creditor [DBP] shall have
been fully paid, an amount to pay the outstanding indebtedness shall first be paid to the creditor and the balance
of sum assured, if there is any, shall then be paid to the beneficiary/ies designated by the debtor." 10 When DBP
submitted the insurance claim against petitioner, the latter denied payment thereof, interposing the defense of
concealment committed by the insured. Thereafter, DBP collected the debt from the mortgagor and took the
necessary action of foreclosure on the residential lot of private Respondent.
In Gonzales La O v. Yek Tong Lin Fire & Marine Ins. Co. we held:
"Insured, being the person with whom the contract was made, is primarily the proper person to bring suit
thereon. . . . Subject to some exceptions, insured may thus sue, although the policy is taken wholly or in part for
the benefit of another person named or unnamed, and although it is expressly made payable to another as his
interest may appear or otherwise. . . . Although a policy issued to a mortgagor is taken out for the benefit of the
mortgagee and is made payable to him, yet the mortgagor may sue thereon in his own name, especially where
the mortgagee’s interest is less than the full amount recoverable under the policy, . . . .’
And in volume 33, page 82, of the same work, we read the following:
‘Insured may be regarded as the real party in interest, although he has assigned the policy for the purpose of
collection, or has assigned as collateral security any judgment he may obtain."
And since a policy of insurance upon life or health may pass by transfer, will or succession to any person,
whether he has an insurable interest or not, and such person may recover it whatever the insured might have
recovered, the widow of the decedent Dr. Leuterio may file the suit against the insurer, Grepalife.
The second assigned error refers to an alleged concealment that the petitioner interposed as its defense to
annul the insurance contract. Petitioner contends that Dr. Leuterio failed to disclose that he had hypertension,
which might have caused his death. Concealment exists where the assured had knowledge of a fact material to
the risk, and honesty, good faith, and fair dealing requires that he should communicate it to the assured, but he
designedly and intentionally withholds the same.
Petitioner merely relied on the testimony of the attending physician, Dr. Hernando Mejia, as supported by the
information given by the widow of the decedent. Grepalife asserts that Dr. Mejia’s technical diagnosis of the
cause of death of Dr. Leuterio was a duly documented hospital record, and that the widow’s declaration that her
husband had "possible hypertension several years ago" should not be considered as hearsay, but as part of res
gestae.
On the contrary the medical findings were not conclusive because Dr. Mejia did not conduct an autopsy on the
body of the decedent. As the attending physician, Dr. Mejia stated that he had no knowledge of Dr. Leuterio’s
any previous hospital confinement. 16 Dr. Leuterio’s death certificate stated that hypertension was only "the
possible cause of death." The private respondent’s statement, as to the medical history of her husband, was due
to her unreliable recollection of events. Hence, the statement of the physician was properly considered by the
trial court as hearsay.
The question of whether there was concealment was aptly answered by the appellate court, thus:
"The insured, Dr. Leuterio, had answered in his insurance application that he was in good health and that he had
not consulted a doctor or any of the enumerated ailments, including hypertension; when he died the attending
physician had certified in the death certificate that the former died of cerebral hemorrhage, probably secondary
to hypertension. From this report, the appellant insurance company refused to pay the insurance claim.
Appellant alleged that the insured had concealed the fact that he had hypertension.
Contrary to appellant’s allegations, there was no sufficient proof that the insured had suffered from hypertension.
Aside from the statement of the insured’s widow who was not even sure if the medicines taken by Dr. Leuterio
were for hypertension, the appellant had not proven nor produced any witness who could attest to Dr. Leuterio’s
medical history. . .x x x
Appellant insurance company had failed to establish that there was concealment made by the insured, hence, it
cannot refuse payment of the claim."
The fraudulent intent on the part of the insured must be established to entitle the insurer to rescind the contract.
Misrepresentation as a defense of the insurer to avoid liability is an affirmative defense and the duty to establish
such defense by satisfactory and convincing evidence rests upon the insurer. 19 In the case at bar, the petitioner
failed to clearly and satisfactorily establish its defense, and is therefore liable to pay the proceeds of the
insurance.
And that brings us to the last point in the review of the case at bar. Petitioner claims that there was no evidence
as to the amount of Dr. Leuterio’s outstanding indebtedness to DBP at the time of the mortgagor’s death. Hence,
for private respondent’s failure to establish the same, the action for specific performance should be dismissed.
Petitioner’s claim is without merit. A life insurance policy is a valued policy. 20 Unless the interest of a person
insured is susceptible of exact pecuniary measurement, the measure of indemnity under a policy of insurance
upon life or health is the sum fixed in the policy. 21 The mortgagor paid the premium according to the coverage
of his insurance, which states that:
"The policy states that upon receipt of due proof of the Debtor’s death during the terms of this insurance, a death
benefit in the amount of P86,200.00 shall be paid.
In the event of the debtor’s death before his indebtedness with the creditor shall have been fully paid, an amount
to pay the outstanding indebtedness shall first be paid to the Creditor and the balance of the Sum Assured, if
there is any shall then be paid to the beneficiary/ies designated by the debtor."
However, we noted that the Court of Appeals’ decision was promulgated on May 17, 1993. In private
respondent’s memorandum, she states that DBP foreclosed in 1995 their residential lot, in satisfaction of
mortgagor’s outstanding loan. Considering this supervening event, the insurance proceeds shall inure to the
benefit of the heirs of the deceased person or his beneficiaries. Equity dictates that DBP should not unjustly
enrich itself at the expense of another (Nemo cum alterius detrimenio protest). Hence, it cannot collect the
insurance proceeds, after it already foreclosed on the mortgage. The proceeds now rightly belong to Dr.
Leuterio’s heirs represented by his widow, herein private respondent Medarda Leuterio.
WHEREFORE, the petition is hereby DENIED. The Decision and Resolution of the Court of Appeals in CA-G.R. CV 18341 is
AFFIRMED with MODIFICATION that the petitioner is ORDERED to pay the insurance proceeds amounting to Eighty-six
thousand, two hundred (P86,200.00) pesos to the heirs of the insured, Dr. Wilfredo Leuterio (deceased), upon presentation
of proof of prior settlement of mortgagor’s indebtedness to Development Bank of the Philippines. Costs against petitioner.
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 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
On March 31, 1975 Fortunata Barcena, mother of minors Rosalio Bonilla and Salvacion Bonilla and wife of
Ponciano Bonilla, instituted a civil action in the Court of First Instance of Abra, to quiet title over certain parcels
of land located in Abra.
On May 9, 1975, defendants filed a written motion to dismiss the complaint, but before the hearing of the motion
to dismiss, the counsel for the plaintiff moved to amend the complaint in order to include certain allegations
therein. The motion to amend the complaint was granted and on July 17, 1975, plaintiffs filed their amended
complaint.
On August 4, 1975, the defendants filed another motion to dismiss the complaint on the ground that Fortunata
Barcena is dead and, therefore, has no legal capacity to sue. Said motion to dismiss was heard on August 14,
1975. In said hearing, counsel for the plaintiff confirmed the death of Fortunata Barcena, and asked for
substitution by her minor children and her husband, the petitioners herein; but the court after the hearing
immediately dismissed the case on the ground that a dead person cannot be a real party in interest and has no
legal personality to sue.
On August 19, 1975, counsel for the plaintiff received a copy of the order dismissing the complaint and on
August 23, 1975, he moved to set aside the order of the dismissal pursuant to Sections 16 and 17 of Rule 3 of
the Rules of Court. 2
On August 28, 1975, the court denied the motion for reconsideration filed by counsel for the plaintiff for lack of
merit. On September 1, 1975, counsel for deceased plaintiff filed a written manifestation praying that the minors
Rosalio Bonilla and Salvacion Bonilla be allowed to substitute their deceased mother, but the court denied the
counsel's prayer for lack of merit. From the order, counsel for the deceased plaintiff filed a second motion for
reconsideration of the order dismissing the complaint claiming that the same is in violation of Sections 16 and 17
of Rule 3 of the Rules of Court but the same was denied.
Hence, this petition for review.
The Court reverses the respondent Court and sets aside its order dismissing the complaint in Civil Case No. 856
and its orders denying the motion for reconsideration of said order of dismissal. While it is true that a person who
is dead cannot sue in court, yet he can be substituted by his heirs in pursuing the case up to its completion.
The records of this case show that the death of Fortunata Barcena took place on July 9, 1975 while the
complaint was filed on March 31, 1975. This means that when the complaint was filed on March 31, 1975,
Fortunata Barcena was still alive, and therefore, the court had acquired jurisdiction over her person. If thereafter
she died, the Rules of Court prescribes the procedure whereby a party who died during the pendency of the
proceeding can be substituted. Under Section 16, Rule 3 of the Rules of Court "whenever a party to a pending
case dies ... it shall be the duty of his attorney to inform the court promptly of such death ... and to give the name
and residence of his executor, administrator, guardian or other legal representatives." This duty was complied
with by the counsel for the deceased plaintiff when he manifested before the respondent Court that Fortunata
Barcena died on July 9, 1975 and asked for the proper substitution of parties in the case. The respondent Court,
however, instead of allowing the substitution, dismissed the complaint on the ground that a dead person has no
legal personality to sue. This is a grave error.
Article 777 of the Civil Code provides "that the rights to the succession are transmitted from the moment of the
death of the decedent." From the moment of the death of the decedent, the heirs become the absolute owners of
his property, subject to the rights and obligations of the decedent, and they cannot be deprived of their rights
thereto except by the methods provided for by law.
The moment of death is the determining factor when the heirs acquire a definite right to the inheritance whether
such right be pure or contingent. The right of the heirs to the property of the deceased vests in them even before
judicial declaration of their being heirs in the testate or intestate proceedings.
When Fortunata Barcena, therefore, died her claim or right to the parcels of land in litigation in Civil Case No.
856, was not extinguished by her death but was transmitted to her heirs upon her death. Her heirs have thus
acquired interest in the properties in litigation and became parties in interest in the case. There is, therefore, no
reason for the respondent Court not to allow their substitution as parties in interest for the deceased plaintiff.
Under Section 17, Rule 3 of the Rules of Court "after a party dies and the claim is not thereby extinguished, the
court shall order, upon proper notice, the legal representative of the deceased to appear and be substituted for
the deceased, within such time as may be granted ... ."
The question as to whether an action survives or not depends on the nature of the action and the damage sued
for. 6 In the causes of action which survive the wrong complained affects primarily and principally property and
property rights, the injuries to the person being merely incidental, while in the causes of action which do not
survive the injury complained of is to the person, the property and rights of property affected being incidental.
Following the foregoing criterion the claim of the deceased plaintiff which is an action to quiet title over the
parcels of land in litigation affects primarily and principally property and property rights and therefore is one that
survives even after her death. It is, therefore, the duty of the respondent Court to order the legal representative
of the deceased plaintiff to appear and to be substituted for her. But what the respondent Court did, upon being
informed by the counsel for the deceased plaintiff that the latter was dead, was to dismiss the complaint. This
should not have been done for under the same Section 17, Rule 3 of the Rules of Court, it is even the duty of the
court, if the legal representative fails to appear, to order the opposing party to procure the appointment of a legal
representative of the deceased.
In the instant case the respondent Court did not have to bother ordering the opposing party to procure the
appointment of a legal representative of the deceased because her counsel has not only asked that the minor
children be substituted for her but also suggested that their uncle be appointed as guardian ad litem for them
because their father is busy in Manila earning a living for the family. But the respondent Court refused the
request for substitution on the ground that the children were still minors and cannot sue in court. This is another
grave error because the respondent Court ought to have known that under the same Section 17, Rule 3 of the
Rules of Court, the court is directed to appoint a guardian ad litem for the minor heirs.
Precisely in the instant case, the counsel for the deceased plaintiff has suggested to the respondent Court that
the uncle of the minors be appointed to act as guardian ad litem for them. Unquestionably, the respondent Court
has gravely abused its discretion in not complying with the clear provision of the Rules of Court in dismissing the
complaint of the plaintiff in Civil Case No. 856 and refusing the substitution of parties in the case.
IN VIEW OF THE FOREGOING, the order of the respondent Court dismissing the complaint in Civil Case No. 856 of the
Court of First Instance of Abra and the motions for reconsideration of the order of dismissal of said complaint are set aside
and the respondent Court is hereby directed to allow the substitution of the minor children, who are the petitioners therein for
the deceased plaintiff and to appoint a qualified person as guardian ad litem for them. Without pronouncement as to costs.
[ G.R. No. 232579, September 08, 2020 ]
DR. NIXON L. TREYES vs. ANTONIO L. LARLAR, REV. FR. EMILIO L. LARLAR, HEDDY L. LARLAR, et al.
Under the Civil Code, when the brothers and sisters of a deceased married sister survive with her widower, the
latter shall be entitled by law to one-half of the inheritance and the brothers and sisters to the other half. The
Civil Code likewise states that this successional right of the legal heirs is vested in them from the very moment of
the decedent's death.
Given that successional rights are conferred by the Civil Code, a substantive law, the question to be resolved
here by the Court is whether a prior determination of the status as a legal or compulsory heir in a separate
special proceeding is a prerequisite to an ordinary civil action seeking for the protection and enforcement of
ownership rights given by the law of succession. The Court now definitively settles this question once and for all.
Before the Court is a petition for review on certiorari (Petition) under Rule 45 of the Rules of Court (Rules) filed by petitioner
Dr. Nixon L. Treyes (petitioner Treyes) assailing the Decision dated August 18, 2016 (assailed Decision) and
Resolution dated June 1, 2017 (assailed Resolution) promulgated by the Court of Appeals, Cebu City (CA) in CA-G.R. SP
Case No. 08813, which affirmed the Resolution dated July 15, 2014 and Order dated August 27, 2014 issued by public
respondent Hon. Kathrine A. Go (Go), in her capacity as presiding judge of the Regional Trial Court of San Carlos City,
Branch 59 (RTC) in favor of private respondents Antonio L. Larlar (Antonio), Rev. Fr. Emilio L. Larlar (Emilio), Heddy L.
Larlar (Heddy), Rene L. Larlar (Rene), Celeste L. Larlar (Celeste), Judy L. Larlar (Judy), and Yvonne L. Larlar (Yvonne)
(collectively, the private respondents).
FACTS:
On May 1, 2008, Rosie Larlar Treyes (Rosie), the wife of petitioner Treyes, passed away. Rosie, who did not
bear any children with petitioner Treyes, died without any will. Rosie also left behind seven siblings, i.e., the
private respondents Antonio, Emilio, Heddy, Rene, Celeste, Judy, and Yvonne.
At the time of her death, Rosie left behind 14 real estate properties, situated in various locations in the
Philippines, which she owned together with petitioner Treyes as their conjugal properties (subject properties).
Subsequently, petitioner Treyes executed two Affidavits of Self- Adjudication dated September 2, 2008 and May
19, 2011. The first Affidavit of Self-Adjudication was registered by petitioner Treyes with the Register of Deeds
(RD) of Marikina City on March 24, 2011, while the second Affidavit of Self-Adjudication was registered with the
RD of San Carlos City, Negros Occidental on June 5, 2011. In these two Affidavits of Self-Adjudication,
petitioner Treyes transferred the estate of Rosie unto himself, claiming that he was the sole heir of his deceased
spouse, Rosie.
As alleged by the private respondents, they sent a letter dated February 13, 2012 to petitioner Treyes requesting
for a conference to discuss the settlement of the estate of their deceased sister, Rosie. The private respondents
maintain that they never heard from petitioner Treyes regarding their request. Undaunted, the private
respondents again wrote to petitioner Treyes on April 3, 2012, requesting for the settlement of their sister's
estate, but this request fell on deaf ears.16
The private respondents then alleged that sometime during the latter part of 2012, they discovered to their shock
and dismay that the TCTs previously registered in the name of their sister and petitioner Treyes had already
been cancelled, except TCT No. M-43623 situated in Tanay, Rizal and TCT No. T-627723 situated in Cabuyao,
Laguna. New titles had been issued in the name of petitioner Treyes on the basis of the two Affidavits of Self-
Adjudication.
Hence, the private respondents filed before the RTC a Complaint18 dated July 12, 2013 (Complaint) for
annulment of the Affidavits of Self-Adjudication, cancellation of TCTs, reconveyance of ownership and
possession, partition, and damages against petitioner Treyes, the RD of Marikina, the RD of the Province of
Rizal, and the RD of the City of San Carlos, Negros Occidental. The case was docketed as Civil Case No. RTC-
1226.
In their Complaint, the private respondents alleged that petitioner Treyes fraudulently caused the transfer of the
subject properties to himself by executing the two Affidavits of Self-Adjudication and refused to reconvey the
shares of the private respondents who, being the brothers and sisters of Rosie, are legal heirs of the deceased.
Aside from asking for the declaration of the nullity of the Affidavits of Self-Adjudication, the private respondents
also prayed for the cancellation of all the TCTs issued in favor of petitioner Treyes, the reconveyance to the
private respondents of their successional share in the estate of Rosie, the partition of the estate of Rosie, as well
as moral damages, exemplary damages, attorney's fees, and other litigation expenses.
As alleged by petitioner Treyes, his household helper, Elizabeth Barientos (Barientos), was supposedly
aggressively approached on October 18, 2013 by two persons who demanded that she receive a letter for and
on behalf of petitioner Treyes. Barientos refused. As it turned out, the said letter was the summons issued by the
RTC addressed to petitioner Treyes in relation to the Complaint filed by the private respondents.
Petitioner Treyes, through counsel, then filed an Entry of Special Appearance and Motion to Dismiss dated
October 25, 2013 (first Motion to Dismiss), asking for the dismissal of the Complaint due to lack of jurisdiction
over the person of petitioner Treyes.21 Eventually, however, a re-service of summons was ordered by the RTC
in its Order dated May 12, 2014. On June 5, 2014, petitioner Treyes was personally served with another
Summons dated May 12, 2014 together with a copy of the Complaint.
Petitioner Treyes then filed another Motion to Dismiss25 dated June 20, 2014 (second Motion to Dismiss),
arguing that the private respondents' Complaint should be dismissed on the following grounds: (1) improper
venue; (2) prescription; and (3) lack of jurisdiction over the subject matter.
In its Resolution26 dated July 15, 2014, the RTC denied for lack of merit petitioner Treyes' second Motion to
Dismiss. Nevertheless, the RTC held that it did not acquire jurisdiction over the Complaint's third cause of
action, i.e., partition:
x x x A perusal of the Complaint shows that the causes of action are 1) the Annulment of the Affidavit of Self
Adjudication; 2) Reconveyance (3) Partition; and 4) Damages. Hence, the Court has jurisdiction over the first,
second and fourth causes of action but no jurisdiction over the third cause of action of Partition and the said
cause of action should be dropped from the case.
Unsatisfied with the aforesaid Resolution of the RTC, petitioner Treyes filed an Omnibus Motion28 dated July
28, 2014 (1) to reconsider the Resolution dated August 15, 2014 and (2) to defer filing of Answer.
In response, private respondents filed their Opposition dated August 19, 2014 to the Omnibus Motion of
petitioner Treyes dated July 28, 2014, to which petitioner Treyes responded with his Reply with leave dated
August 27, 2014. In its Order31 dated August 27, 2014, the RTC denied the Omnibus Motion and directed
petitioner Treyes to file his responsive pleading within 15 days from receipt of the Order.
Petitioner Treyes then filed before the CA a petition for certiorari dated October 28, 2014 under Rule 65 with
urgent prayer for the immediate issuance of a temporary restraining order and/or writ of preliminary injunction,
asserting that the RTC's denial of his second Motion to Dismiss was committed with grave abuse of discretion
amounting to lack or excess of jurisdiction.
In its assailed Decision, the CA denied petitioner Treyes' petition for certiorari. WHEREFORE, the petition is DENIED. The
Order dated dated (sic) August 27, 2014, and the Resolution dated July 15, 2014 are AFFIRMED.
The CA held that the RTC did not commit grave abuse of discretion in denying petitioner Treyes' second Motion
to Dismiss. Since the Complaint primarily seeks to annul petitioner Treyes' Affidavits of Self-Adjudication, which
partakes the nature of an ordinary civil action, the CA found that the RTC had jurisdiction to hear and decide the
private respondents' Complaint. Further, the CA held that since the case was an ordinary civil action, the proper
venue is San Carlos City, Negros Occidental. Lastly, the CA held that the action of the private respondents is not
barred by prescription.
Petitioner Treyes filed a Motion for Reconsideration dated September 26, 2016, which was subsequently denied
by the CA in its assailed Resolution.
ISSUE:
Whether or not the CA was correct in ruling that the RTC did not commit grave abuse of discretion amounting to
lack or excess of jurisdiction when it denied petitioner Treyes' second Motion to Dismiss.
HELD:
In the instant case, petitioner Treyes maintains that the RTC committed grave abuse of discretion amounting to
lack or excess of jurisdiction in denying its second Motion to Dismiss, arguing, in the main, that the RTC should
have dismissed the private respondents' Complaint on the basis of three grounds: a) improper venue, b)
prescription, and c) lack of jurisdiction over the subject matter and, corrolarily, lack of real parties in interest. The
Court discusses these grounds ad seriatim.
I. Improper Venue
Citing Rule 73, Section 1 of the Rules,38 petitioner Treyes posits that the correct venue for the settlement of a
decedent's estate is the residence of the decedent at the time of her death, which was at No. 1-C, Guatemala
Street, Loyola Grand Villas, Loyola Heights, Katipunan Avenue, Quezon City. Hence, petitioner Treyes
maintains that the settlement of her estate should have been filed with the RTC of Quezon City, and not at San
Carlos City, Negros Occidental.
The Court finds and holds that the Complaint cannot be dismissed on the ground of improper venue on the basis
of Rule 73 because such Rule refers exclusively to the special proceeding of settlement of estates and NOT to
ordinary civil actions. Invoking Rule 73 to allege improper venue is entirely inconsistent with petitioner Treyes'
assertion in the instant Petition39 that the Complaint is not a special proceeding but an ordinary civil action.
Moreover, the Court finds that improper venue as a ground for the dismissal of the Complaint was already
deemed waived in accordance with the Omnibus Motion Rule.
According to Rule 9, Section 1 of the Rules, defenses and objections not pleaded either in a motion to dismiss or
in the answer are deemed waived, except with respect to the grounds of (1) lack of jurisdiction over the subject
matter; (2) litis pendentia (3) res judicata; and (4) prescription of the action. In turn, Rule 15, Section 8 states that
a motion attacking a pleading, order, judgment, or proceeding shall include all objections then available, and all
objections not so included shall be deemed waived.
Hence, under the Omnibus Motion Rule, when the grounds for the dismissal of a Complaint under Rule 16,
Section l40 are not raised in a motion to dismiss, such grounds, except the grounds of lack of jurisdiction over
the subject matter, litis pendentia, res judicata, and prescription, are deemed waived.
In the instant case, prior to the filing of the second Motion to Dismiss, the first Motion to Dismiss was already
filed by petitioner Treyes asking for the dismissal of the Complaint solely on the ground of lack of jurisdiction
over the person of petitioner Treyes.41 The defense of improper venue was already very much available to
petitioner Treyes at the time of the filing of the first Motion to Dismiss. Under the Rules, raising the ground of
improper venue would not have been prejudicial to petitioner Treyes' cause as raising such defense could not
have been deemed a voluntary appearance.42 Hence, there was no valid reason to justify the failure to invoke
the ground of improper venue in the first Motion to Dismiss. Stated differently, as the issue of improper venue
was not raised in the first Motion to Dismiss, then this ground is deemed already waived and could no longer be
raised in the second Motion to Dismiss.43
II. Prescription
Petitioner Treyes also argues that the RTC committed grave abuse of discretion in not dismissing the Complaint
since the period for the filing of the Complaint had already supposedly prescribed.
The Court likewise finds this argument to be without merit.
The basis of petitioner Treyes in arguing that the Complaint is already barred by prescription is Rule 74, Section
4 of the Rules, which states that an heir or other persons unduly deprived of lawful participation in the estate
may compel the settlement of the estate in the courts at any time within two years after the settlement and
distribution of an estate.
The Court stresses that Rule 74 pertains exclusively to the settlement of estates, which is a special proceeding
and NOT an ordinary civil action.
As well, this argument of petitioner Treyes invoking prescription on the basis of Rule 74 is again wholly
inconsistent with his main theory that the instant Complaint is not a special proceeding but an ordinary civil
action for annulment of the Affidavits of Self-Adjudication, cancellation of TCTs, reconveyance of ownership and
possession, and damages.
Moreover, as clarified by the Court in Sampilo, et al. v. Court of Appeals, et al.,47 the provisions of Rule 74,
Section 4 barring distributees or heirs from objecting to an extrajudicial partition after the expiration of two years
from such extrajudicial partition is applicable only:
(1) to persons who have participated or taken part or had notice of the extrajudicial partition, and
(2) when the provisions of Section 1 of Rule 74 have been strictly complied with, i.e., that all the persons or
heirs of the decedent have taken part in the extrajudicial settlement or are represented by themselves or
through guardians.
Both requirements are absent here as it is evident that not all the legal heirs of Rosie participated in the
extrajudicial settlement of her estate as indeed, it was only petitioner Treyes who executed the Affidavits of Self-
Adjudication.
In this regard, it is well to note that it is the prescriptive period pertaining to constructive trusts which finds
application in the instant case.
To digress, the Civil Code identifies two kinds of trusts, i.e., express and implied. Express trusts are created by
the intention of the trustor or of the parties while implied trusts come into being by operation of law. As explained
by recognized Civil Law Commentator, former CA Justice Eduardo P. Caguioa, "[e]xpress and implied trusts
differ chiefly in that express trusts are created by the acts of the parties, while implied trusts are raised by
operation of law, either to carry a presumed intention of the parties or to satisfy the demands of justice or protect
against fraud."
An implied trust is further divided into two types, i.e., resulting and constructive trusts. A resulting trust exists
when a person makes or causes to be made a disposition of property under circumstances which raise an
inference that he/she does not intend that the person taking or holding the property should have the beneficial
interest in the property.
On the other hand, a constructive trust exists when a person holding title to property is subject to an equitable
duty to convey it to another on the ground that he/she would be unjustly enriched if he/she were permitted to
retain it. The duty to convey the property arises because it was acquired through fraud, duress, undue influence,
mistake, through a breach of a fiduciary duty, or through the wrongful disposition of another's property.
An example of a constructive trust is found in Article 1456 of the Civil Code, which states that "[i]f 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 Marquez v. Court of Appeals, the Court
held that in a situation where an heir misrepresents in an affidavit of self-adjudication that he is the sole heir of
his wife when in fact there are other legal heirs, and thereafter manages to secure a certificate of title under his
name, then "a constructive trust under Article 1456 [i]s established. Constructive trusts are created in equity in
order to prevent unjust enrichment." This is precisely the situation in the instant case.
In this situation, it has been settled in a long line of cases that "an action for reconveyance based on an implied
or constructive trust prescribes in 10 years from the issuance of the Torrens title [in the name of the trustee] over
the property." The 10-year prescriptive period finds basis in Article 1144 of the Civil Code, which states that an
action involving an obligation created by law must be brought within 10 years from the time the right of action
accrues.
In cases wherein fraud was alleged to have been attendant in the trustee's registration of the subject property in
his/her own name, the prescriptive period is 10 years reckoned from the date of the issuance of the original
certificate of title or TCT since such issuance operates as a constructive notice to the whole world, the discovery
of the fraud being deemed to have taken place at that time.
Accordingly, it is clear here that prescription has not set in as the private respondents still have until 2021 to file
an action for reconveyance, given that the certificates of title were issued in the name of petitioner Treyes only in
2011.
Therefore, considering the foregoing discussion, the ground of prescription raised by petitioner Treyes is
unmeritorious.
III. The Necessity of a Prior
 Determination of Heirship in a Separate Special Proceeding
The Court now proceeds to discuss the centerpiece of petitioner Treyes' Petition – that the RTC has no
jurisdiction to hear, try, and decide the subject matter of the private respondents' Complaint because the
determination of the status of the legal heirs in a separate special proceeding is a prerequisite to an ordinary suit
for recovery of ownership and possession of property instituted by the legal heirs.
Jurisdiction over the subject matter of a case is conferred by law and determined by the allegations in the
complaint which comprise a concise statement of the ultimate facts constituting the plaintiffs cause of action.59
In the instant case, it is readily apparent from the allegations in the Complaint filed by the private respondents
that the action was not instituted for the determination of their status as heirs, as it was their position that their
status as heirs was already established ipso jure without the need of any judicial confirmation. Instead, what the
Complaint alleges is that the private respondents' rights over the subject properties, by virtue of their being
siblings of the deceased, must be enforced by annulling the Affidavits of Self-Adjudication and ordering the
reconveyance of the subject properties.
Hence, as correctly held by the RTC in its Resolution60 dated July 15, 2014, the RTC has jurisdiction over the
subject matter of the Complaint, considering that the law confers upon the RTC jurisdiction over civil actions
which involve the title to, or possession of, real property, or any interest therein, where the assessed value of the
property involved exceeds P20,000.00 for civil actions outside Metro Manila, or where the assessed value
exceeds P50,000.00 for civil actions in Metro Manila.
 The Case of Heirs of Magdaleno Ypon v. Ricaforte, et al. and Preceding Cases
Petitioner Treyes cited Heirs of Magdaleno Ypon v. Ricaforte, et al. (Ypon), as well as the cases that preceded
it, i.e., Heirs of Guido and Isabel Yaptinchay v. Del Rosario (Yaptinchay), Portugal v. Portugal-Beltran (Portugal),
and Reyes v. Enriquez (Reyes) to buttress his main argument that since the private respondents have yet to
establish in a special proceeding their status as legal heirs of Rosie, then the ordinary civil action they instituted
must be dismissed for lack of jurisdiction.
In Ypon, which contains analogous factual circumstances as the instant case, the therein petitioners filed a
complaint for Cancellation of Title and Reconveyance with Damages against the therein respondent. The therein
petitioners alleged that, with the decedent having died intestate and childless, and with the existence of other
legal heirs, the therein respondent invalidly executed an Affidavit of Self-Adjudication and caused the transfer of
the certificates of title covering the properties of the decedent to himself. The RTC dismissed the complaint
holding that it failed to state a cause of action since the therein petitioners had yet to establish their status as
heirs.
In sustaining the RTC's dismissal of the complaint, the Court in Ypon held that:
As stated in the subject complaint, petitioners, who were among the plaintiffs therein, alleged that they are the
lawful heirs of Magdaleno and based on the same, prayed that the Affidavit of Self-Adjudication executed by
Gaudioso be declared null and void and that the transfer certificates of title issued in the latter's favor be
cancelled. While the foregoing allegations, if admitted to be true, would consequently warrant the reliefs sought
for in the said complaint, the rule that the determination of a decedent's lawful heirs should be made in the
corresponding special proceeding precludes the RTC, in an ordinary action for cancellation of title and
reconveyance, from granting the same. In the case of Heirs of Teofilo Gabatan v. CA, the Court, citing several
other precedents, held that the determination of who are the decedent's lawful heirs must be made in the proper
special proceeding for such purpose, and not in an ordinary suit for recovery of ownership and/or possession, as
in this case:
Jurisprudence dictates that the determination of who are the legal heirs of the deceased must be made
in the proper special proceedings in court, and not in an ordinary suit for recovery of ownership and
possession of property. This must take precedence over the action for recovery of possession and ownership.
The Court has consistently ruled that the trial court cannot make a declaration of heirship in the civil action for
the reason that such a declaration can only be made in a special proceeding.
Under Section 3, Rule 1 of the 1997 Revised Rules of Court, a civil action is defined as one by which a party
sues another for the enforcement or protection of a right, or the prevention or redress of a wrong while a special
proceeding is a remedy by which a party seeks to establish a status, a right, or a particular fact. It is then
decisively clear that the declaration of heirship can be made only in a special proceeding inasmuch as the
petitioners here are seeking the establishment of a status or right.
In the early case of Litam, et al. v. Rivera, this Court ruled that the declaration of heirship must be made in a
special proceeding, and not in an independent civil action. This doctrine was reiterated in Solivio v. Court of
Appeals x x x[.]
In the more recent case of Milagros Joaquino v. Lourdes Reyes, the Court reiterated its ruling that matters
relating to the rights of filiation and heirship must be ventilated in the proper probate court in a special
proceeding instituted precisely for the purpose of determining such rights. Citing the case of Agapay v. Palang,
this Court held that the status of an illegitimate child who claimed to be an heir to a decedent's estate could not
be adjudicated in an ordinary civil action which, as in this case, was for the recovery of property.
Nevertheless, the Court likewise added in Ypon that there are circumstances wherein a determination of heirship
in a special proceeding is not a precondition for the institution of an ordinary civil action for the sake of
practicality, i.e.,
(1) when the parties in the civil case had voluntarily submitted the issue to the trial court and already
presented their evidence regarding the issue of heirship, and
(2) when a special proceeding had been instituted but had been finally terminated and cannot be re-opened:
By way of exception, the need to institute a separate special proceeding for the determination of heirship may be
dispensed with for the sake of practicality, as when the parties in the civil case had voluntarily submitted the
issue to the trial court and already presented their evidence regarding the issue of heirship, and the RTC had
consequently rendered judgment thereon, or when a special proceeding had been instituted but had been finally
closed and terminated, and hence, cannot be re-opened.
 Ordinary Civil Actions vis-à-vis Special Proceedings
In the main, Ypon, citing certain earlier jurisprudence, held that the determination of a decedent's lawful heirs
should be made in the corresponding special proceeding, precluding the RTC in an ordinary action for
cancellation of title and reconveyance from making the same.
According to Rule 1, Section 3(c) of the Rules, the purpose of a special proceeding is to establish a status, right,
or particular fact. As held early on in Hagans v. Wislizenus,68 a "special proceeding" may be defined as "an
application or proceeding to establish the status or right of a party, or a particular fact."69 In special proceedings,
the remedy is granted generally upon an application or motion.70
In Pacific Banking Corp. Employees Organization v. Court of Appeals,71 the Court made the crucial distinction
between an ordinary action and a special proceeding:
Action is the act by which one sues another in a court of justice for the enforcement or protection of a right, or
the prevention or redress of a wrong while special proceeding is the act by which one seeks to establish the
status or right of a party, or a particular fact. Hence, action is distinguished from special proceeding in that the
former is a formal demand of a right by one against another, while the latter is but a petition for a declaration of a
status, right or fact. Where a party-litigant seeks to recover property from another, his remedy is to file an action.
Where his purpose is to seek the appointment of a guardian for an insane, his remedy is a special proceeding to
establish the fact or status of insanity calling for an appointment of guardianship.72
Hence, the main point of differentiation between a civil action and a special proceeding is that in the former, a
party sues another for the enforcement or protection of a right which the party claims he/she is entitled
to,73 such as when a party-litigant seeks to recover property from another,74 while in the latter, a party merely
seeks to have a right established in his/her favor.
Applying the foregoing to ordinary civil actions for the cancellation of a deed or instrument and reconveyance of
property on the basis of relationship with the decedent, i.e., compulsory or intestate succession, the plaintiff does
not really seek to establish his/her right as an heir. In truth, the plaintiff seeks the enforcement of his/her right
brought about by his/her being an heir by operation of law.
Restated, the party does not seek to establish his/her right as an heir because the law itself already establishes
that status. What he/she aims to do is to merely call for the nullification of a deed, instrument, or conveyance as
an enforcement or protection of that right which he/she already possesses by virtue of law.
Moreover, it is likewise noted that ordinary civil actions for declaration of nullity of a document, nullity of title,
recovery of ownership of real property, or reconveyance are actions in personam.75 And thus, they only bind
particular individuals although they concern rights to tangible things.76 Any judgment therein is binding only
upon the parties properly impleaded.77 Hence, any decision in the private respondents' ordinary civil action
would not prejudice non-parties.
To emphasize, any holding by the trial court in the ordinary civil action initiated by the private respondents shall
only be in relation to the cause of action, i.e., the annulment of the Affidavits of Self-Adjudication executed by
petitioner Treyes and reconveyance of the subject properties, and shall only be binding among the parties
therein.
At this juncture, the Court now deems it proper and opportune to revisit existing jurisprudence on the requisite of
establishing one's heirship in a prior special proceeding before invoking such heirship in an ordinary civil action.
Transmission of the Rights of Heirs at the Precise Moment of Death of the Decedent under the Civil
Code
That the private respondents do not really seek in their Complaint the establishment of their rights as intestate
heirs but, rather, the enforcement of their rights already granted by law as intestate heirs finds basis in Article
777 of the Civil Code, which states that the rights of succession are transmitted from the moment of the death of
the decedent.
The operation of Article 777 occurs at the very moment of the decedent's death – the transmission by
succession occurs at the precise moment of death and, therefore, the heir is legally deemed to have acquired
ownership of his/her share in the inheritance at that very moment, "and not at the time of declaration of heirs, or
partition, or distribution."78
Hence, the Court has held that the "[t]itle or rights to a deceased person's property are immediately passed to
his or her heirs upon death. The heirs' rights become vested without need for them to be declared 'heirs.'"79
In Bonilla, et al. v. Barcena, et al., the Court held that:
"[F]rom the moment of the death of the decedent, the heirs become the absolute owners of his property, subject
to the rights and obligations of the decedent, x x x [t]he right of the heirs to the property of the deceased vests in
them even before judicial declaration of their being heirs in the testate or intestate proceedings."
In fact, in partition cases, even before the property is judicially partitioned, the heirs are already deemed co-
owners of the property. Thus, in partition cases, the heirs are deemed real parties in interest without a prior
separate judicial determination of their heirship. Similarly, in the summary settlement of estates, the heirs may
undertake the extrajudicial settlement of the estate of the decedent amongst themselves through the execution
of a public instrument even without a prior declaration in a separate judicial proceeding that they are the heirs of
the decedent. If there is only one legal heir, the document usually executed is an affidavit of self-adjudication
even without a prior judicial declaration of heirship.
The Civil Code identifies certain relatives who are deemed compulsory heirs and intestate heirs. They refer to
relatives that become heirs by virtue of compulsory succession or intestate succession, as the case may be, by
operation of law.
In the instant case, Article 1001 states that brothers and sisters, or their children, who survive with the widow or
widower, shall be entitled to one-half of the inheritance, while the surviving spouse shall be entitled to the other
half:
Art. 1001. Should brothers and sisters or their children survive with the widow or widower, the latter shall be
entitled to one-half of the inheritance and the brothers and sisters or their children to the other half. (953-837a).
Hence, subject to the required proof, without any need of prior judicial determination, the private respondents
siblings of Rosie, by operation of law, are entitled to one-half of the inheritance of the decedent. Thus, in filing
their Complaint, they do not seek to have their right as intestate heirs established, for the simple reason that it is
the law that already establishes that right. What they seek is the enforcement and protection of the right granted
to them under Article 1001 in relation to Article 777 of the Civil Code by asking for the nullification of the
Affidavits of Self-Adjudication that disregard and violate their right as intestate heirs.
As correctly explained by Senior Associate Justice Estela M. Perlas-Bernabe (Justice Bernabe) in her Separate
Opinion, "a prior declaration of heirship in a special proceeding should not be required before an heir may assert
successional rights in an ordinary civil action aimed only to protect his or her interests in the estate. Indeed, the
legal heirs of a decedent should not be rendered helpless to rightfully protect their interests in the estate while
there is yet no special proceeding."84
To stress once more, the successional rights of the legal heirs of Rosie are not merely contingent or expectant
— they vest upon the death of the decedent. By being legal heirs, they are entitled to institute an action to
protect their ownership rights acquired by virtue of succession and are thus real parties in interest in the instant
case. To delay the enforcement of such rights until heirship is determined with finality in a separate special
proceeding would run counter to Article 777 of the Civil Code which recognizes the vesting of such rights
immediately — without a moment's interruption — upon the death of the decedent.
The Originating Case of Litam, et al. v. Espiritu, et al.
The doctrine relied upon by petitioner Treyes, laid down in Ypon, Yaptinchay, Portugal, and Reyes, traces its
origin to the 1956 case of Litam, et al. v. Espiritu, et al.85 (Litam).
It then behooves the Court to closely examine this originating case to see whether the development of
jurisprudence, finding its current reincarnation in Ypon, is faithful to the Court's ruling in Litam.
In Litam, a special proceeding, i.e., Special Proceeding No. 1537, for the settlement of the Intestate Estate of the
deceased Rafael Litam (Rafael), was instituted by one of the supposed sons of the latter, i.e., Gregorio Dy Tam
(Gregorio). It was alleged that the children of Rafael, Gregorio and his siblings, were begotten "by a marriage
celebrated in China in 1911 with Sia Khin [(Khin)], now deceased" and that Rafael "contracted in 1922 in the
Philippines another marriage with Marcosa Rivera [(Marcosa)], Filipino citizen." In Special Proceeding No. 1537,
Marcosa denied the alleged marriage of Rafael to Khin and the alleged filiation of Gregorio and his siblings, and
prayed that her nephew, Arminio Rivera (Arminio), be appointed administrator of the intestate estate of Rafael.
In due course, the court issued the letters of administration to Arminio, who assumed his duties as such, and,
later, submitted an inventory of the alleged estate of Rafael.
During the subsistence of the special proceeding, Gregorio and his siblings filed an ordinary civil action
complaint, i.e., Civil Case No. 2071, against Marcosa and Arminio in the same court hearing the special
proceeding for the settlement of the intestate estate of the decedent, praying for the delivery of the decedent's
properties possessed by Marcosa and Arminio to the administrator of the estate of Rafael, as well as damages.
After trial, the Court of First Instance (CFI) issued its judgment dismissing Civil Case No. 2071 and declaring the
properties in question to be the exclusive, separate and paraphernal properties of Marcosa. The CFI further
declared that Gregorio and his siblings "are not the children of the deceased Rafael Litam, and that his only heir
is his surviving wife, Marcosa Rivera."86
It must be noted that the Court, in upholding the aforementioned judgment of the CFI, did not call for the
dismissal of Civil Case No. 2071 because it corollarily involved the issue of heirship in an ordinary civil
action. The CFI did not hold whatsoever that Gregorio and his siblings were not real parties in interest and that
their complaint failed to state a cause of action because their complaint invoked the issue of heirship.
In fact, it must be noted that the Court even affirmed the CFI's judgment in the ordinary civil action, and
discussed at length and pronounced its findings as to the status of Gregorio and his siblings as heirs, holding
that they "have utterly failed to prove their alleged status as children of Rafael Litam by a marriage with Sia
Khin." In plain terms, the Court, in upholding the CFI Decision, affirmed the dismissal of the ordinary civil action,
not because it touched upon the issue of heirship, but because the petitioners failed to present sufficient
evidence proving their heirship and that the evidence on record actually proved that they were not heirs of
Rafael.
The Court found issue with the CFI's Decision only insofar as it made a categorical pronouncement in its
dispositive portion that Marcosa was the "only" heir of the decedent, ordering a slight modification in the CFI's
Decision:
Likewise, we are of the opinion that the lower court should not have declared, in the decision appealed from, that
Marcosa Rivera is the only heir of the decedent, for such declaration is improper in Civil Case No. 2071, it being
within the exclusive competence of the court in Special Proceeding No. 1537, in which it is not as yet, in issue,
and, will not be, ordinarily, in issue until the presentation of the project of partition.87
What is thus apparent from the Court's Decision in Litam is that the CFI was not found to be at fault in
appreciating evidence and examining the issue of the alleged heirship of the petitioners in resolving the ordinary
civil action. To reiterate, the Court even concurred with the CFI's appreciation of evidence on the heirship of the
petitioners therein that were presented during trial. The Court made no pronouncement whatsoever that since
Gregorio and his siblings had not previously obtained a declaration of heirship in a special proceeding, then they
should not be considered real parties in interest. The Court could not have made such pronouncement because
Gregorio and his siblings had utterly failed to prove that they were the heirs of Rafael.
What the Court only held was that it was improper for the CFI to have included in the dispositive portion of its
Decision a definite and categorical judgment as to Marcosa's status as being the "only" heir as it was not the
object and purpose of the ordinary civil action, which prayed in the main for the reconveyance of the subject
properties therein, and wherein a separate special proceeding, i.e., Special Proceeding No. 1537, was already
pending that focused precisely on the contentious issue of whether or not there was an earlier marriage of
Rafael to Khin, and whether Gregorio, et al. were the issue of said marriage.
Thus, the Court's ruling in Litam was that in an ordinary civil action for reconveyance of property, the invocation
of the status of the parties as heirs in the complaint does not preclude the determination of the merits of the said
ordinary civil action despite the pendency of the special proceeding for the settlement of the intestate estate of
Rafael. What was held to be improper by the Court in Litam was the making by the RTC of a conclusive, definite,
and categorical declaration in the ordinary civil action regarding Marcosa being the "only" heir of the
decedent when there was already pending before it a special proceeding tackling the contending issues of
heirship posed by Gregorio, et al.
Hence, a closer look at Litam reveals that the underlying foundation of the doctrine invoked by the petitioners is
inapt.
Jurisprudential Support on the Institution of an Ordinary Civil Action by Legal Heirs arising out of a
Right based on Succession without the Necessity of a Previous Judicial Declaration of Heirship
To be sure, even prior to the promulgation of Litam which, as already explained, does not actually support the
doctrine that a determination of heirship in a prior special proceeding is a prerequisite for the resolution of an
ordinary civil action, the Court had already pronounced that the legal heirs may commence an ordinary civil
action arising out of a right based on succession without the necessity of a previous and separate judicial
declaration of their status as such.
As early as 1939, the Court En Banc, in De Vera, et al. v. Galauran88 (De Vera), held that:
Arsenio de Vera, as surviving spouse of the deceased Isabel Domingo, acting for himself and as guardian ad
litem of six minors heirs, instituted an action against Cleotilde Galauran in the Court of First Instance of Rizal for
the annulment of a deed of sale of a registered parcel of land. It is alleged in the complaint that Arsenio de Vera
and his wife Isabel Domingo, now deceased, have mortgaged their property to the defendant to secure a loan
received from him, but said defendant illegally made them sign a deed which they then believed to be of
mortgage and which turned out later to be of pacto de retro sale; and that the six minor children named in the
complaint are the legitimate children and legitimate heirs of the deceased Isabel Domingo. A demurrer was
interposed by the defendant alleging that the plaintiffs have no cause of action, for they have not been declared
legal heirs in a special proceeding. The demurrer was sustained, and, on failure of plaintiffs to amend, the action
was dismissed. Wherefore, this appeal.
Unless there is pending a special proceeding for the settlement of the estate of a deceased person, the legal
heirs may commence an ordinary action arising out of a right belonging to the ancestor, without the necessity of
a previous and separate judicial declaration of their status as such.89
It must be noted that the Court's pronouncement in De Vera, citing Hernandez, et al. v. Padua, et al.,90 Uy
Coque, et al. v. Sioca, et al.,91 Mendoza Vda. de Bonnevie v. Cecilio Vda. de Pardo,92 and Government of the
Philippine Islands v. Serafica,93 is a decision of the Court En Banc which cannot be overturned by a ruling of a
Division of the Court. The Constitution provides that no doctrine or principle of law laid down by the Court in a
decision rendered En Banc may be modified or reversed except by the Court sitting En Banc.94
Subsequently, in 1954, the Court En Banc promulgated its Decision in Cabuyao v. Caagbay, et al.95 (Cabuyao).
In the said case, the lower court dismissed a case filed by an alleged lone compulsory heir of the decedent for
quieting of title covering the property inherited by the plaintiff from the decedent. The lower court dismissed the
aforesaid complaint because "'no action can be maintained until a judicial declaration of heirship has been
legally secured.'"96
In reversing the order of the lower court, the Court En Banc noted that "as early as 1904, this Court entertained,
in the case of [Mijares v. Nery] (3 Phil., 195), the action of an acknowledged natural child to recover property
belonging to his deceased father — who had not been survived by any legitimate descendant — notwithstanding
the absence of a previous declaration of heirship in favor of the plaintiff x x x"97 and held that "[t]he right to
assert a cause of action as an alleged heir, although he has not been judicially declared to be so, has been
acknowledged in a number of subsequent cases."98
In 1955, the Court En Banc reiterated the foregoing holding in Atun, et al. v. Nuñez, et al.,99 (Atun) holding that
"[t]he rule is settled that the legal heirs of a deceased may file an action arising out of a right belonging to their
ancestor, without a separate judicial declaration of their status as such[.]"100
Similarly, in Marabilles, et al. v. Sps. Quito101 (Marabilles) which was also decided by the Court En Banc a
month before Litam and involves a factual milieu comparable to the instant case, the petitioners therein filed an
ordinary civil action for the recovery of a parcel of land on the basis of their being heirs. The lower court
dismissed the action on the ground that the petitioners therein did not have legal capacity to sue because
"judicial declaration of heirship is necessary in order that an heir may have legal capacity to bring the action to
recover a property belonging to the deceased."102
The Court En Banc reversed the lower court's dismissal of the action and unequivocally held that as an heir may
assert his right to the property of a deceased, no previous judicial declaration of heirship is necessary:
Another ground on which the dismissal is predicted is that the complaint states no cause of action because while
it appears in the complaint that the land was transferred to one Guadalupe Saralde, deceased wife of Defendant
Alejandro Quito, there is no allegation that said Alejandro Quito and his daughter Aida, a co-Defendant, had
been [judicially] declared heirs or administrators of the estate of the deceased. Because of this legal deficiency,
the court has concluded that Plaintiffs have no cause of action against Defendants because there is no legal
bond by which the latter may be linked with the property.
This conclusion is also erroneous. The rule is that, to determine the sufficiency of a cause of action on a motion
to dismiss, only the facts alleged in the complaint should be considered, and considering the facts herein
alleged, there is enough ground to proceed with the case. Thus, it appears in the complaint that Guadalupe
Saralde is the wife of Alejandro Quito, the Defendant, and as said Guadalupe has already died, under the law,
the husband and his daughter Aida are the legal heirs. We have already said that in order that an heir may
assert his right to the property of a deceased, no previous judicial declaration of heirship is necessary. It was
therefore a mistake to dismiss the complaint on this ground.103
To reiterate, once again, the Court's holdings in Cabuyao and Marabilles that an heir may assert his/her right to
the property of the decedent without the necessity of a previous judicial declaration of heirship are decisions of
the Court En Banc that cannot be reversed by a ruling of a Division of the Court. Ypon, Yaptinchay,
Portugal, and Reyes, which are all decisions of the Court's Divisions, in so far as they hold that a prior special
proceeding for declaration of heirship is a prerequisite for the assertion by an heir of his/her ownership rights
acquired by virtue of succession in an ordinary civil action, did not, as they could not, overturn the Court En
Banc's holdings in De Vera, Cabuyao, Atun, and Marabilles that heirs should be able to assert their successional
rights without the necessity of a previous judicial declaration of heirship.
Similarly, in Morales, et al. v. Yañez,104 which involved an ordinary civil action for the recovery of certain
parcels of land, the Court held that the enforcement or protection of rights of heirs from encroachments made or
attempted may be undertaken even before their judicial declaration as heirs is made in a special proceeding:
Appellants contend, however, that for Defendant to acquire a vested right to Eugeniano's property, he must first
commence proceedings to settle Eugeniano's estate — which he had not done, There is no merit to the
contention. This Court has repeatedly held that the right of heirs to the property of the deceased is vested from
the moment of death. Of course the formal declaration or recognition or enforcement of such right needs judicial
confirmation in proper proceedings. But we have often enforced or protected such rights from encroachments
made or attempted before the judicial declaration. Which can only mean that the heir acquired hereditary rights
even before judicial declaration in testate or intestate proceedings.105
In Gayon v. Gayon,106 in denying the argument posed by the defendants therein that they cannot be made
defendants in a suit filed against the decedent because "heirs cannot represent the dead defendant, unless
there is a declaration of heirship,"107 the Court held that the heirs may be sued even without a prior declaration
of heirship made in a special proceeding:
Inasmuch, however, as succession takes place, by operation of law, "from the moment of the death of the
decedent" and "(t)he inheritance includes all the property, rights and obligations of a person which are not
extinguished by his death," it follows that if his heirs were included as defendants in this case, they would be
sued, not as "representatives" of the decedent, but as owners of an aliquot interest in the property in question,
even if the precise extent of their interest may still be undetermined and they have derived it from the decent.
Hence, they may be sued without a previous declaration of heirship x x x.
In Bonilla, et al. v. Barcena, et al.,109 an ordinary civil action was instituted by a surviving spouse to quiet title
over certain parcels of land. When the surviving spouse passed away during the pendency of the action, the
lower court 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. The Court reversed the lower court's ruling, holding that the right of the heirs
to the property of the deceased vests in them even before judicial declaration of heirship in a special
proceeding. Thus, the lower court should have allowed the substitution by the heirs of the deceased even
without any prior judicial determination of their status as heirs:
The respondent Court, however, instead of allowing the substitution, dismissed the complaint on the ground that
a dead person has no legal personality to sue. This is a grave error. Article 777 of the Civil Code provides "that
the rights to the succession are transmitted from the moment of the death of the decedent." From the moment of
the death of the decedent, the heirs become the absolute owners of his property, subject to the rights and
obligations of the decedent, and they cannot be deprived of their rights thereto except by the methods provided
for by law. The moment of death is the determining factor when the heirs acquire a definite right to the
inheritance whether such right be pure or contingent. The right of the heirs to the property of the deceased vests
in them even before judicial declaration of their being heirs in the testate or intestate proceedings. When
Fortunata Barcena, therefore, died her claim or right to the parcels of land in litigation in Civil Case No. 856, was
not extinguished by her death but was transmitted to her heirs upon her death. Her heirs have thus acquired
interest in the properties in litigation and became parties in interest in the case. There is, therefore, no reason for
the respondent Court not to allow their substitution as parties in interest for the deceased plaintiff.
Subsequently, the Court dealt with the same issue in Baranda, et al. v. Baranda, et al.,111 wherein the therein
petitioners, claiming to be the legitimate heirs of the decedent, filed a complaint against the therein respondents
for the annulment of the sale and the reconveyance of the subject lots. While the lower court initially ruled in
favor of the therein petitioners, the appellate court reversed the lower court's ruling because, among other
reasons, the therein petitioners are not real parties in interest, having failed to establish in a prior special
proceeding their status as heirs.
The Court reversed the appellate court's ruling and held that the legal heirs of a decedent are the parties in
interest to commence ordinary actions arising out of the rights belonging to the deceased, without separate
judicial declaration as to their being heirs of said decedent, provided only that there is no pending special
proceeding for the settlement of the decedent's estate:
There is also the issue of the capacity to sue of the petitioners who, it is claimed by the private respondents, are
not the proper parties to question the validity of the deed of sale. The reason given is that they are not the
legitimate and compulsory heirs of Paulina Baranda nor were they parties to the challenged transactions.
It is not disputed that Paulina Baranda died intestate without leaving any direct descendants or ascendants, or
compulsory heirs. She was survived, however, by two brothers, namely, Pedro and Teodoro, and several
nephews and nieces, including the private respondents, as well as petitioners Flocerfina Baranda, Salvacion
Baranda, and Alipio Baranda Villarte, children of two deceased brothers and a sister. The above-named
persons, together with Pedro Baranda, who was not joined as a petitioner because he is the father of the private
respondents, and the children of another deceased sister, are the legitimate intestate heirs of Paulina Baranda.
The applicable provisions of the Civil Code are the following:
 Art. 1003. If there are no descendants, ascendants, illegitimate children, or a surviving spouse, the
collateral relatives shall succeed to the entire estate of the deceased in accordance with the following
articles.
 Art. 1005. Should brothers and sisters survive together with nephews and nieces, who are the children of
the descendant's brothers and sisters of the full blood, the former shall inherit per capita, and the latter
per stirpes
 Art. 972. The right of representation takes place in the direct descending line, but never in the ascending.
In the collateral line it takes place only in favor of the children or brothers or sisters, whether they be of
the full or half blood.
As heirs, the petitioners have legal standing to challenge the deeds of sale purportedly signed by Paulina
Baranda for otherwise property claimed to belong to her estate will be excluded therefrom to their
prejudice. Their claims are not merely contingent or expectant, as argued by the private respondents, but are
deemed to have vested in them upon Paulina Baranda's death in 1982, as, under Article 777 of the Civil Code,
"the rights to the succession are transmitted from the moment of the death of the decedent." While they are not
compulsory heirs, they are nonetheless legitimate heirs and so, since they "stand to be benefited or injured by
the judgment or suit," are entitled to protect their share of successional rights.
This Court has repeatedly held that "the legal heirs of a decedent are the parties in interest to commence
ordinary actions arising out of the rights belonging to the deceased, without separate judicial declaration as to
their being heirs of said decedent, provided that there is no pending special proceeding for the settlement of the
decedent's estate."
In Marquez v. Court of Appeals, the therein petitioners filed a complaint for reconveyance and partition with
damages, alleging that both the Affidavit of Adjudication and Deed of Donation Inter Vivos executed by the
therein private respondents were invalid as the other heirs of the decedent were excluded in the execution of the
said instruments. While the issue on real party in interest was not made an issue in the said case, the ruling of
the lower court was upheld by the Court, declaring that both the Affidavit of Adjudication and the Donation Inter
Vivos did not produce any legal effect and did not confer any right whatsoever despite the lack of any
determination in a special proceeding as to the heirship of the therein petitioners.
In the 2013 case of Pacaña-Contreras and Pacaña v. Rovila Water Supply, Inc., et al., which was decided
around five months after Ypon, the therein petitioner heirs filed an action for accounting and damages against
the therein respondents. The latter filed a motion to dismiss, alleging that the therein petitioners are not real
parties in interest to institute and prosecute the case, just as what is alleged in the instant case. While the lower
court denied the motion to dismiss, the appellate court, citing Litam and Yaptinchay, reversed the lower court
and dismissed the case because "the (therein) petitioners should first be declared as heirs before they can be
considered as the real parties in interest. This cannot be done in the present ordinary civil case but in a special
proceeding for that purpose." Arguing that their declaration as heirs in a special proceeding is not necessary
pursuant to the Court's ruling in Marabilles, the therein petitioners' petition was granted by the Court which
reversed and set aside the appellate court's ruling.
In 2014, the Court, through Senior Associate Justice Marvic M. V. F. Leonen (Justice Leonen), promulgated its
Decision in Heirs of Gregorio Lopez v. Development Bank of the Philippines,116 wherein the therein petitioners
discovered that one of the heirs executed an affidavit of self-adjudication declaring himself to be the decedent's
only surviving heir. The therein petitioners instituted an ordinary civil action for the nullification of the affidavit of
self-adjudication. In upholding the nullification of the affidavit of self-adjudication, the Court held that the rights to
a deceased person's property are immediately passed to his or her heirs upon death. The heirs' rights become
vested without need for them to be declared "heirs":
Title or rights to a deceased person's property are immediately passed to his or her heirs upon death. The heirs'
rights become vested without need for them to be declared "heirs". Before the property is partitioned, the heirs
are co-owners of the property.
In this case, the rights to Gregoria Lopez's property were automatically passed to her sons — Teodoro,
Francisco, and Carlos — when she died in 1922. Since only Teodoro was survived by children, the rights to the
property ultimately passed to them when Gregoria Lopez's sons died. The children entitled to the property were
Gregorio, Simplicio, Severino, and Enrique.
Gregorio, Simplicio, Severino, and Enrique became co-owners of the property, with each of them entitled to an
undivided portion of only a quarter of the property. Upon their deaths, their children became the co-owners of the
property, who were entitled to their respective shares, such that the heirs of Gregorio became entitled to
Gregorio's one-fourth share, and Simplicio's and Severino's respective heirs became entitled to their
corresponding one-fourth shares in the property. The heirs cannot alienate the shares that do not belong to
them.
In 2017, the Court promulgated Capablanca v. Heirs of Pedro Bas, et al. In the said case, the decedent Norberto
Bas (Norberto) purchased a piece of land and took possession. Similar to the instant case, Norberto died without
a will and was succeeded by a collateral relative, i.e., his niece and only heir, Lolita Bas Capablanca (Lolita).
Subsequently, Lolita learned that a TCT had been issued in the names of the therein respondents on the basis
of a reconstituted Deed of Conveyance. Hence, just as in the instant case, a collateral relative, i.e., Lolita, filed a
complaint before the RTC of Cebu City for the cancellation of the titles covering the property once owned by the
decedent. While the RTC ruled in favor of Lolita, the appellate court reversed the RTC's ruling. The appellate
court, citing the case of Yaptinchay, held that there is a need for a separate proceeding for a declaration of
heirship in order to resolve petitioner's action for cancellation of titles of the property.
In reversing the ruling of the appellate court, the Court, again through Justice Leonen, emphatically held that no
judicial declaration of heirship is necessary in order that an heir may assert his or her right to the property of the
deceased:
The dispute in this case is not about the heirship of petitioner to Norberto but the validity of the sale of the
property in 1939 from Pedro to Faustina, from which followed a series of transfer transactions that culminated in
the sale of the property to Norberto. For with Pedro's sale of the property in 1939, it follows that there would be
no more ownership or right to property that would have been transmitted to his heirs.
x x x What petitioner is pursuing is Norberto's right of ownership over the property which was passed to her upon
the latter's death.
This Court has stated that no judicial declaration of heirship is necessary in order that an heir may assert his or
her right to the property of the deceased. In Marabilles v. Quito:
The right to assert a cause of action as an heir, although he has not been judicially declared to be so, if duly
proven, is well settled in this jurisdiction. This is upon the theory that the property of a deceased person, both
real and personal, becomes the property of the heir by the mere fact of death of his predecessor in interest, and
as such he can deal with it in precisely the same way in which the deceased could have dealt, subject only to the
limitations which by law or by contract may be imposed upon the deceased himself. Thus, it has been held that
"[t]here is no legal precept or established rule which imposes the necessity of a previous legal declaration
regarding their status as heirs to an intestate on those who, being of age and with legal capacity, consider
themselves the legal heirs of a person, in order that they may maintain an action arising out of a right which
belonged to their ancestor" [x x x] A recent case wherein this principle was maintained is Cabuyao vs.
[C]aagbay.
Similar to the above-stated case, the private respondents in the instant case did not file their Complaint to
establish their filiation with Rosie or apply for the determination of their right as intestate heirs, considering that
the law already vested in them, as siblings of the decedent, their status as intestate heirs of Rosie. Rather, the
private respondents sought to enforce their already established right over the property which had been allegedly
violated by the fraudulent acts of petitioner Treyes.
In the instant Petition, petitioner Treyes argues that the cases of Marquez v. Court of Appeals, Baranda, et al. v.
Baranda, et al., and Heirs of Gregorio Lopez v. Development Bank of the Philippines find no application in the
instant case because the parties in the aforesaid cases were able to present evidence as to their status as heirs
and that the determination of their status as heirs was not contested.
This argument is not well taken.
In the instant case, the Court notes that in substantiating the fact that the private respondents are siblings of
Rosie, and thus intestate heirs of the latter by operation of law, they attached their respective birth certificates
proving that they are indeed siblings of Rosie.
Rule 132, Section 23 of the Rules states that documents consisting of entries in public records made in the
performance of a duty by a public officer are prima facie evidence of the facts therein stated.
The Court has held that a birth certificate, being a public document, offers prima facie evidence of filiation and a
high degree of proof is needed to overthrow the presumption of truth contained in such public document. This is
pursuant to the rule that entries in official records made in the performance of his duty by a public officer
are prima facie evidence of the facts therein stated.
To be sure, upon meticulous perusal of the petitioner Treyes' pleadings, it is clear that the status of the private
respondents as siblings of Rosie was not even seriously refuted by him. He also does not make any allegation
that the birth certificates of the private respondents are fake, spurious, or manufactured. All he says is that there
must first be a declaration of the private respondents' heirship in a special proceeding. Clearly, therefore, it
cannot be said in the instant case that the private respondents were not able to present evidence as to their
status as heirs and that the determination of their status as heirs was seriously contested by petitioner Treyes.
In relation to the foregoing, considering that the private respondents' action is founded on their birth certificates,
the genuineness and due execution of the birth certificates shall be deemed admitted unless the adverse party,
under oath, specifically denies them, and sets forth what he claims to be the facts.122 In the instant case, the
records show that there was no specific denial under oath on the part of petitioner Treyes contesting the birth
certificates. Therefore, the genuineness and due execution of the subject birth certificates are deemed admitted.
Hence, despite the promulgation of Ypon, Yaptinchay, Portugal, Reyes, and other cases upholding the rule that
a prior determination of heirship in a special proceeding is a prerequisite to an ordinary civil action involving
heirs, such rule has not been consistently upheld and is far from being considered a doctrine. To the contrary, a
plurality of decisions promulgated by both the Court En Banc and its Divisions firmly hold that the legal heirs of a
decedent are the parties in interest to commence ordinary civil actions arising out of their rights of
succession, without the need for a separate prior judicial declaration of their heirship, provided only that there is
no pending special proceeding for the settlement of the decedent's estate.
As similarly viewed by Justice Bernabe, the "more recent strand of jurisprudence correctly recognize the legal
effects of Article 777 of the Civil Code, and thus, adequately provide for remedies for the heirs to protect their
successional rights over the estate of the decedent even prior to the institution of a special proceeding for its
settlement"
By this Decision now, the Court so holds, and firmly clarifies, that the latter formulation is the doctrine which is
more in line with substantive law, i.e., Article 777 of the Civil Code is clear and unmistakable in stating that the
rights of the succession are transmitted from the moment of the death of the decedent even prior to any judicial
determination of heirship. As a substantive law, its breadth and coverage cannot be restricted or diminished by a
simple rule in the Rules.
To be sure, the Court stresses anew that rules of procedure must always yield to substantive law.126 The Rules
are not meant to subvert or override substantive law. On the contrary, procedural rules are meant to
operationalize and effectuate substantive law.
Hence, even assuming arguendo that the Rules strictly provide that a separate judicial determination of heirship
in a special proceeding is a precondition in an ordinary civil action wherein heirship is already established by
compulsory succession or intestacy and is only sought to be enforced, which, as already discussed at length, is
not the case, the Rules must still yield to the specific provisions of the Civil Code that certain relatives of the
decedent attain their status as either compulsory or intestate heirs and that their successional rights are
transmitted and enforceable at the very moment of death without the need of such separate judicial
determination.
Indeed, the Rules shall always be construed in order to promote their objective of securing a just, speedy, and
inexpensive disposition of every action and proceeding.
Hence, it would be highly inimical to the very purpose of the Rules to dispose of matters without the unnecessary
and circuitous procedures created by a misreading of the requirements of said Rules, i.e, they still require a
separate and lengthy special proceeding for the solitary purpose of establishing the private respondents' status
as legal heirs of Rosie, when their heirship has already been deemed established by virtue of civil law, with
petitioner Treyes not seriously and substantially refuting that the private respondents are siblings of the
decedent. If the Court will subscribe to petitioner Treyes' arguments and grant the instant Petition, it would
sanction superfluity and redundancy in procedure. To accept petitioner Treyes' stance will necessarily mean
that, moving forward, heirs will not even be able to extra-judicially and summarily settle the estate of a decedent
without a prior judicial declaration of heirship in a special proceeding. Ironically, even petitioner Treyes' Affidavits
of Self-Adjudication would be legally baseless as he himself has not previously established in a prior special
proceeding his status as the husband and heir of Rosie.
Recapitulation
Given the clear dictates of the Civil Code that the rights of the heirs to the inheritance vest immediately at the
precise moment of the decedent's death even without judicial declaration of heirship, and the various Court En
Banc and Division decisions holding that no prior judicial declaration of heirship is necessary before an heir can
file an ordinary civil action to enforce ownership rights acquired by virtue of succession through the nullification
of deeds divesting property or properties forming part of the estate and reconveyance thereof to the estate or for
the common benefit of the heirs of the decedent, the Court hereby resolves to clarify the prevailing doctrine.
Accordingly, the rule laid down in Ypon, Yaptinchay, Portugal, Reyes, Heirs of Gabatan v. Court of Appeals, and
other similar cases, which requires a prior determination of heirship in a separate special proceeding as a
prerequisite before one can file an ordinary civil action to enforce ownership rights acquired by virtue of
succession, is abandoned.
Henceforth, the rule is: unless there is a pending special proceeding for the settlement of the decedent's estate
or for the determination of heirship, the compulsory or intestate heirs may commence an ordinary civil action to
declare the nullity of a deed or instrument, and for recovery of property, or any other action in the enforcement of
their ownership rights acquired by virtue of succession, without the necessity of a prior and separate judicial
declaration of their status as such. The ruling of the trial court shall only be in relation to the cause of action of
the ordinary civil action, i.e., the nullification of a deed or instrument, and recovery or reconveyance of property,
which ruling is binding only between and among the parties.
Therefore, the Court is in total agreement with the CA that the RTC did not commit grave abuse of discretion
amounting to lack or excess of jurisdiction in denying petitioner Treyes' second Motion to Dismiss.
WHEREFORE, premises considered, the instant Petition for Review on Certiorari under Rule 45 is hereby DENIED. The
Decision dated August 18, 2016 and Resolution dated June 1, 2017 promulgated by the Court of Appeals, Cebu City,
Nineteenth Division in CA-G.R. SP Case No. 08813 are hereby AFFIRMED.
G.R. No. 168970 January 15, 2010
CELESTINO BALUS vs. SATURNINO BALUS and LEONARDA BALUS VDA. DE CALUNOD
Herein petitioner and respondents are the children of the spouses Rufo and Sebastiana Balus. Sebastiana died
on September 6, 1978, while Rufo died on July 6, 1984.
On January 3, 1979, Rufo mortgaged a parcel of land, which he owns, as security for a loan he obtained from
the Rural Bank of Maigo, Lanao del Norte (Bank). The said property was originally covered by Original
Certificate of Title No. P-439(788) and more particularly described as follows:
A parcel of land with all the improvements thereon, containing an area of 3.0740 hectares, more or less, situated
in the Barrio of Lagundang, Bunawan, Iligan City, and bounded as follows: Bounded on the NE., along line 1-2,
by Lot 5122, Csd-292; along line 2-12, by Dodiongan River; along line 12-13 by Lot 4649, Csd-292; and along
line 12-1, by Lot 4661, Csd-292. x x x 2
Rufo failed to pay his loan. As a result, the mortgaged property was foreclosed and was subsequently sold to the
Bank as the sole bidder at a public auction held for that purpose. On November 20, 1981, a Certificate of
Sale3 was executed by the sheriff in favor of the Bank. The property was not redeemed within the period allowed
by law. More than two years after the auction, or on January 25, 1984, the sheriff executed a Definite Deed of
Sale4 in the Bank's favor. Thereafter, a new title was issued in the name of the Bank.
On October 10, 1989, herein petitioner and respondents executed an Extrajudicial Settlement of
Estate5 adjudicating to each of them a specific one-third portion of the subject property consisting of 10,246
square meters. The Extrajudicial Settlement also contained provisions wherein the parties admitted knowledge
of the fact that their father mortgaged the subject property to the Bank and that they intended to redeem the
same at the soonest possible time.
Three years after the execution of the Extrajudicial Settlement, herein respondents bought the subject property
from the Bank. On October 12, 1992, a Deed of Sale of Registered Land 6 was executed by the Bank in favor of
respondents. Subsequently, Transfer Certificate of Title (TCT) No. T-39,484(a.f.) 7 was issued in the name of
respondents. Meanwhile, petitioner continued possession of the subject lot.
On June 27, 1995, respondents filed a Complaint 8 for Recovery of Possession and Damages against petitioner,
contending that they had already informed petitioner of the fact that they were the new owners of the disputed
property, but the petitioner still refused to surrender possession of the same to them. Respondents claimed that
they had exhausted all remedies for the amicable settlement of the case, but to no avail.
On February 7, 1997, the RTC rendered a Decision9 disposing as follows:
WHEREFORE, judgment is hereby rendered, ordering the plaintiffs to execute a Deed of Sale in favor of the defendant, the
one-third share of the property in question, presently possessed by him, and described in the deed of partition, as follows:
A one-third portion of Transfer Certificate of Title No. T-39,484 (a.f.), formerly Original Certificate of Title No. P-788, now in
the name of Saturnino Balus and Leonarda B. Vda. de Calunod, situated at Lagundang, Bunawan, Iligan City, bounded on
the North by Lot 5122; East by shares of Saturnino Balus and Leonarda Balus-Calunod; South by Lot 4649, Dodiongan
River; West by Lot 4661, consisting of 10,246 square meters, including improvements thereon.
and dismissing all other claims of the parties.
The amount of ₱6,733.33 consigned by the defendant with the Clerk of Court is hereby ordered delivered to the plaintiffs, as
purchase price of the one-third portion of the land in question.
Plaintiffs are ordered to pay the costs.
The RTC held that the right of petitioner to purchase from the respondents his share in the disputed property
was recognized by the provisions of the Extrajudicial Settlement of Estate, which the parties had executed
before the respondents bought the subject lot from the Bank.
Aggrieved by the Decision of the RTC, herein respondents filed an appeal with the CA.
On May 31, 2005, the CA promulgated the presently assailed Decision, reversing and setting aside the Decision
of the RTC and ordering petitioner to immediately surrender possession of the subject property to the
respondents. The CA ruled that when petitioner and respondents did not redeem the subject property within the
redemption period and allowed the consolidation of ownership and the issuance of a new title in the name of the
Bank, their co-ownership was extinguished.
Hence, the instant petition raising a sole issue, to wit:
WHETHER OR NOT CO-OWNERSHIP AMONG THE PETITIONER AND THE RESPONDENTS OVER THE
PROPERTY PERSISTED/CONTINUED TO EXIST (EVEN AFTER THE TRANSFER OF TITLE TO THE BANK)
BY VIRTUE OF THE PARTIES' AGREEMENT PRIOR TO THE REPURCHASE THEREOF BY THE
RESPONDENTS; THUS, WARRANTING THE PETITIONER'S ACT OF ENFORCING THE AGREEMENT BY
REIMBURSING THE RESPONDENTS OF HIS (PETITIONER'S) JUST SHARE OF THE REPURCHASE
PRICE.11
The main issue raised by petitioner is whether co-ownership by him and respondents over the subject property
persisted even after the lot was purchased by the Bank and title thereto transferred to its name, and even after it
was eventually bought back by the respondents from the Bank.
Petitioner insists that despite respondents' full knowledge of the fact that the title over the disputed property was
already in the name of the Bank, they still proceeded to execute the subject Extrajudicial Settlement, having in
mind the intention of purchasing back the property together with petitioner and of continuing their co-ownership
thereof.
Petitioner posits that the subject Extrajudicial Settlement is, in and by itself, a contract between him and
respondents, because it contains a provision whereby the parties agreed to continue their co-ownership of the
subject property by "redeeming" or "repurchasing" the same from the Bank. This agreement, petitioner contends,
is the law between the parties and, as such, binds the respondents. As a result, petitioner asserts that
respondents' act of buying the disputed property from the Bank without notifying him inures to his benefit as to
give him the right to claim his rightful portion of the property, comprising 1/3 thereof, by reimbursing respondents
the equivalent 1/3 of the sum they paid to the Bank.
HELD:
The Court is not persuaded.
Petitioner and respondents are arguing on the wrong premise that, at the time of the execution of the
Extrajudicial Settlement, the subject property formed part of the estate of their deceased father to which they
may lay claim as his heirs.
At the outset, it bears to emphasize that there is no dispute with respect to the fact that the subject property was
exclusively owned by petitioner and respondents' father, Rufo, at the time that it was mortgaged in 1979. This
was stipulated by the parties during the hearing conducted by the trial court on October 28, 1996. 12 Evidence
shows that a Definite Deed of Sale 13 was issued in favor of the Bank on January 25, 1984, after the period of
redemption expired. There is neither any dispute that a new title was issued in the Bank's name before Rufo
died on July 6, 1984. Hence, there is no question that the Bank acquired exclusive ownership of the contested
lot during the lifetime of Rufo.
The rights to a person's succession are transmitted from the moment of his death. 14 In addition, the inheritance
of a person consists of the property and transmissible rights and obligations existing at the time of his death, as
well as those which have accrued thereto since the opening of the succession. 15 In the present case, since Rufo
lost ownership of the subject property during his lifetime, it only follows that at the time of his death, the disputed
parcel of land no longer formed part of his estate to which his heirs may lay claim. Stated differently, petitioner
and respondents never inherited the subject lot from their father.
Petitioner and respondents, therefore, were wrong in assuming that they became co-owners of the subject lot.
Thus, any issue arising from the supposed right of petitioner as co-owner of the contested parcel of land is
negated by the fact that, in the eyes of the law, the disputed lot did not pass into the hands of petitioner and
respondents as compulsory heirs of Rufo at any given point in time.
The foregoing notwithstanding, the Court finds a necessity for a complete determination of the issues raised in
the instant case to look into petitioner's argument that the Extrajudicial Settlement is an independent contract
which gives him the right to enforce his right to claim a portion of the disputed lot bought by
respondents.1avvphi1
It is true that under Article 1315 of the Civil Code of the Philippines, contracts are perfected by mere consent;
and from that moment, the parties are bound not only to the fulfillment of what has been expressly stipulated but
also to all the consequences which, according to their nature, may be in keeping with good faith, usage and law.
Article 1306 of the same Code also provides that the contracting parties may establish such stipulations,
clauses, terms and conditions as they may deem convenient, provided these are not contrary to law, morals,
good customs, public order or public policy.
In the present case, however, there is nothing in the subject Extrajudicial Settlement to indicate any express
stipulation for petitioner and respondents to continue with their supposed co-ownership of the contested lot.
On the contrary, a plain reading of the provisions of the Extrajudicial Settlement would not, in any way, support
petitioner's contention that it was his and his sibling's intention to buy the subject property from the Bank and
continue what they believed to be co-ownership thereof. It is a cardinal rule in the interpretation of contracts that
the intention of the parties shall be accorded primordial consideration. 16 It is the duty of the courts to place a
practical and realistic construction upon it, giving due consideration to the context in which it is negotiated and
the purpose which it is intended to serve. 17 Such intention is determined from the express terms of their
agreement, as well as their contemporaneous and subsequent acts. 18 Absurd and illogical interpretations should
also be avoided.19
For petitioner to claim that the Extrajudicial Settlement is an agreement between him and his siblings to continue
what they thought was their ownership of the subject property, even after the same had been bought by the
Bank, is stretching the interpretation of the said Extrajudicial Settlement too far.
In the first place, as earlier discussed, there is no co-ownership to talk about and no property to partition, as the
disputed lot never formed part of the estate of their deceased father.
Moreover, petitioner's asseveration of his and respondents' intention of continuing with their supposed co-
ownership is negated by no less than his assertions in the present petition that on several occasions he had the
chance to purchase the subject property back, but he refused to do so. In fact, he claims that after the Bank
acquired the disputed lot, it offered to re-sell the same to him but he ignored such offer. How then can petitioner
now claim that it was also his intention to purchase the subject property from the Bank, when he admitted that he
refused the Bank's offer to re-sell the subject property to him?
In addition, it appears from the recitals in the Extrajudicial Settlement that, at the time of the execution thereof,
the parties were not yet aware that the subject property was already exclusively owned by the Bank.
Nonetheless, the lack of knowledge on the part of petitioner and respondents that the mortgage was already
foreclosed and title to the property was already transferred to the Bank does not give them the right or the
authority to unilaterally declare themselves as co-owners of the disputed property; otherwise, the disposition of
the case would be made to depend on the belief and conviction of the party-litigants and not on the evidence
adduced and the law and jurisprudence applicable thereto.
Furthermore, petitioner's contention that he and his siblings intended to continue their supposed co-ownership of
the subject property contradicts the provisions of the subject Extrajudicial Settlement where they clearly
manifested their intention of having the subject property divided or partitioned by assigning to each of the
petitioner and respondents a specific 1/3 portion of the same. Partition calls for the segregation and
conveyance of a determinate portion of the property owned in common. It seeks a severance of the
individual interests of each co-owner, vesting in each of them a sole estate in a specific property and
giving each one a right to enjoy his estate without supervision or interference from the other. In other
words, the purpose of partition is to put an end to co-ownership, an objective which negates petitioner's claims in
the present case.
WHEREFORE, the instant petition is DENIED. The assailed Decision of the Court of Appeals, dated May 31, 2005 in CA-
G.R. CV No. 58041, is AFFIRMED.
G.R. No. 145982 September 13, 2004
FRANK N. LIU, deceased, substituted by his surviving spouse Diana Liu, and children, namely: Walter,
Milton, Frank, Jr., Henry and Jockson, all surnamed Liu, Rebecca Liu Shui and Pearl Liu Rodriguez vs.
ALFREDO LOY, JR., TERESITA A. LOY and ESTATE OF JOSE VAÑO
RESOLUTION
The Loys seek a reconsideration of the Decision dated 3 July 2003 of this Court declaring void the deeds of sale
of Lot Nos. 5 and 6 executed by Teodoro Vaño in favor of Alfredo Loy, Jr. and Teresita Loy. We held that Lot
Nos. 5 and 6 belong to Frank Liu since the probate court approved his deeds of sale in accordance with Section
8, Rule 89 of the Rules of Court. The deeds of sale of the Loys lacked a valid probate court approval. As a
result, we ordered the Estate of Jose Vaño to reimburse the Loys the amounts they paid for Lot Nos. 5 and 6,
with interest at 6% annually from 4 June 1976, the date of filing of the complaint, until finality of the decision, and
12% annually thereafter until full payment.
The Court heard the parties on oral arguments on 10 March 2004 and granted them time to submit their
memoranda. Frank Liu filed his memorandum on 29 March 2004 while the Loys filed their memorandum on 25
March 2004 by registered mail.
The issues that the Loys raise in their motion for reconsideration are not new. The Court already considered and discussed
extensively these issues in the assailed Decision. We find no compelling reason to reconsider the assailed Decision.
The Loys insist that the transaction between Teodoro Vaño and Benito Liu, the predecessor-in-interest of Frank
Liu, is a contract to sell. In contrast, the transactions between Teodoro Vaño and Alfredo Loy, Jr. and Teresita A.
Loy were contracts of sale. According to the Loys, the contract to sell did not transfer ownership of Lot Nos. 5
and 6 to Benito Liu or Frank Liu because it was only a promise to sell subject to the full payment of the
consideration. On the other hand, the contracts of sale in favor of the Loys transferred ownership, as the
conveyances were absolute.
As we held in our Decision, a prior contract to sell made by the decedent during his lifetime prevails over a
subsequent contract of sale made by the administrator without probate court approval. It is immaterial if the prior
contract is a mere contract to sell and does not immediately convey ownership. Frank Liu’s contract to sell
became valid and effective upon its execution and bound the estate to convey the property upon full payment of
the consideration.
It is apparent from Teodoro Vaño’s letter 4 dated 16 October 1954 that the reason why Frank Liu stopped further
payments on the lots, leaving a balance of ₱1,000, was because Teodoro Vaño could not yet transfer the titles
to Benito Liu, the predecessor-in-interest of Frank Liu. It would appear that Frank Liu and Teodoro Vaño lost
contact with each other thereafter and it was only on 25 January 1964 that Frank Liu wrote Teodoro Vaño
informing the latter that he was ready to pay the balance of the purchase price of the lots. Teodoro Vaño did not
reply to Frank Liu’s letter.
On 22 April 1966, Benito Liu sold to Frank Liu the lots, including Lot Nos. 5 and 6, which Benito Liu purchased
from Teodoro Vaño on 13 January 1950. Frank Liu sent three letters dated 21 March 1968, 7 June 1968 and 29
July 1968 to Teodoro Vaño reiterating his request for the execution of the deed of sale covering the lots in his
favor but to no avail.
On 19 August 1968, Teodoro Vaño sold Lot No. 6 to Teresita Loy and on 16 December 1969, he sold Lot No. 5
to Alfredo Loy, Jr. The sales to the Loys were made after Frank Liu offered to pay the balance of the purchase
price of the lots and after he repeatedly requested for the execution of the deeds of sale in his favor.
The sale of the lots by Teodoro Vaño to Benito Liu was valid. The sale was made by Teodoro Vaño on 13
January 1950 in his capacity as attorney-in-fact of Jose Vaño. The sale to Benito Liu was made during the
lifetime of Jose Vaño, not after the death of Jose Vaño who died on 28 January 1950. 5 The power of attorney
executed by Jose Vaño in favor of Teodoro Vaño remained valid during the lifetime of Jose Vaño. In his letter
dated 16 October 1954, Teodoro Vaño stated that on 30 June 1954, the Supreme Court allowed the probate of
the will of Jose Vaño. Teodoro Vaño likewise mentioned in the letter that in July 1954, the Supreme Court held
that all the sales made by Teodoro Vaño of the properties of his father were legal. 6 Thus, Benito Liu’s deed of
sale in favor of Frank Liu covering the lots sold to him by Teodoro Vaño constitutes a valid charge or claim
against the estate of Jose Vaño.
The Loys reiterate their contention that Teodoro Vaño, as administrator and sole heir to the properties, can sell
the lots to them since the rights of an heir are transmitted from the moment of death of the testator. Although a
property under estate proceedings cannot be sold without judicial approval, the Loys allege that in their case, the
probate court later approved the sales to them, thereby ratifying the sales. 7
Well-settled is the rule that an administrator needs court approval to sell estate property, otherwise the
sale is void. Court approval of the sale of estate property is clearly required under Rule 89 of the Rules of
Court, which enumerates the instances when the court may allow the sale or encumbrance of estate property.
Section 7 of Rule 89 of the Rules of Court even provides for the regulations for granting authority to sell,
mortgage or otherwise encumber estate property.
More importantly, Section 91 of Act No. 496 (Land Registration Act) and Section 88 11 of Presidential Decree No.
1529 (Property Registration Decree) specifically require court approval for any sale of registered land by an
executor or administrator.
The laws, Rules of Court, jurisprudence and regulations explicitly require court approval before any sale of
estate property by an executor or administrator can take effect. The purpose of requiring court approval is to
protect creditors. In this case, Frank Liu is a creditor, and he is the person the law seeks to protect.
The orders of the probate court dated 19 and 23 March 1976 approving the contracts of the Loys are void. The
orders did not ratify the sales because there was already a prior order of the probate court dated 24 February
1976 approving the sale of Lot Nos. 5 and 6 to Frank Liu. Hence, the probate court had already lost jurisdiction
over Lot Nos. 5 and 6 since the lots no longer formed part of the Estate of Jose Vaño. In fact, the administratrix
of the estate filed a motion for reconsideration of the orders of the probate court approving the contracts of the
Loys because she already executed a deed of sale covering Lot Nos. 5 and 6 in favor of Frank Liu.
The Loys impliedly admitted that their contracts of sale dated 19 August 1968 and 16 December 1969 were
ineffective when they belatedly asked in 1976 for court approval of the sales. If the Loys believed that their
deeds of sale in 1968 and 1969 were valid, they would not have asked for court approval in 1976. By asking for
court approval, they necessarily admitted that without court approval, the sale to them was ineffectual.
The Loys are not buyers and registrants in good faith considering that they bought from a seller who was not a
registered owner. Teodoro Vaño signed both contracts of sale but the titles to the lots sold were in the name of
"Estate of Jose Vaño." And since the titles to Lot Nos. 5 and 6 were in name of "Estate of Jose Vaño," the Loys
were on notice that court approval was needed for the sale of estate property. The ex-parte motion for the court
approval of the sales filed by the Loys some seven or eight years after the sales transaction reveals a less than
honest actuation, prompting the administratrix to object to the court’s approval.
WHEREFORE, we DENY the motion for reconsideration.

[G.R. No. 4275. March 23, 1909.]
PAULA CONDE v. ROMAN ABAYA
1. ESTATES: ACTION AGAINST EXECUTION OR ADMINISTRATIONS. — While an estate is in the

course of settlement in a special proceeding, no ordinary action can be maintained by a person claiming
to be an heir, against the executor or administrator, for the purpose of having his rights in the estate
determined. (Pimentel v. Palanca, 5 Phil. Rep., 436.)
2. DISTINCTION BETWEEN RIGHTS OF ACTION BY LEGITIMATE AND BY NATURAL CHILDREN TO

COMPEL RECOGNITION. — As a general rule, the right of action of a child to enforce recognition of its
legitimacy lasts during the lifetime of such child, but the right of a natural child to compel
acknowledgment of its status continues only during the life of the alleged parents. The right of action for
a declaration of legitimacy is transmitted to the heirs of the child only when the latter dies during minority
or while insane, or in case the action has already been instituted. Action by a natural child can only be
brought against the heirs of the parents in the event of the death of the parents during the minority of the
child, or upon the discovery of a document, after the death of the parents, expressly acknowledging such
child. This right of action which the law concedes to this natural child is not transmitted to his ascendants
or descendants. (Arts. 18 and 137, Civil Code.)
Per Torres, J., dissenting:
3. NATURAL CHILDREN; SUCCESSION AND TRANSMISSION OF RIGHTS TO DEMAND

RECOGNITION. — Although article 137 of the Civil Code contains no disposition authorizing the
transfer, in favor of the natural mother in her capacity of heir of her natural child, of the right to judicially
demand the recognition of her child by the heirs of his late natural father; yet there is no express
provision therein that prohibits such transfer or that declares such right to be nontransferable.
4. ID.; ID. — The relation of paternity and filiation between natural parents and children is also of a natural
character, and therefore, reciprocal intestate succession between them is exclusively governed by
articles 944 and 945 of the Civil Code.
5. ID.; ID. — If the right of succession granted by the law to the natural children corresponds reciprocally to
the natural father or mother in the same cases, and if the estate includes all property, rights and
obligations of a person which do not expire at the latter’s death, it is certain that, among the rights
transferred to the natural mother by inheritance, at the time of the death of her natural child, is the right
held by such child during his lifetime to demand his recognition as such by his natural father, should the
latter still live, or by his heirs.
6. ID.; ID. — There is no legal provision that declares the said right to demand the recognition of a natural
child to be nontransferable to the latter’s heirs, and specially to his natural mother, nor is there any rule
declaring such right extinguished at the death of the natural child.
7. ID.; ID. — In the intestate succession of a natural child who dies during his minority, recognized by the
law in favor of his father or mother who have acknowledged him, no limitation has been established
excluding the said right from transferable rights, nor has it been expressly declared that the above-
mentioned right to demand the recognition of the natural child is extinguished at the latter’s death,
wherefore it is necessary to admit that the mother inherits from the natural child at his death, and that
she is entitled to institute the corresponding action.
FACTS:
From the hearing of the appeal interposed by Roman Abaya in the special proceedings brought in the Court of
First Instance of La Laguna for the settlement of the intestate estate and the distribution of the property of
Casiano Abaya it appears:
I. As antecedents: that Casiano Abaya, unmarried, the son of Romualdo Abaya and Sabina Labadia, died on the
6th of April 1899; that Paula Conde, as the mother of the natural children Jose and Teopista Conde, whom she
states she had by Casiano Abaya, on the 6th of November, 1905, moved the settlement of the said intestate
succession; that an administrator having been appointed for the said estate on the 25th of November, 1905,
Roman Abaya, a son of the said Romualdo Abaya and Sabina Labadia, the parents of the late Casiano Abaya,
came forward and opposed said appointment and claimed it for himself as being the nearest relative of the
deceased; that this was granted by the court below on the 9th of January, 1906; that on the 17th of November,
1906, Roman Abaya moved that, after due process of law, the court declare him to be the sole heir of Casiano
Abaya, to the exclusion of all other persons, especially of Paula Conde, and to be therefore entitled to take
possession of all the property of said estate, and that it be adjudicated to him; and that on November 22, 1906,
the court ordered the publication of notices for the declaration of heirs and distribution of the property of the
estate.
II. That on the 28th of November, 1906, Paula Conde, in reply to the foregoing motion of Roman Abaya, filed a
petition wherein she stated that she acknowledged the relationship alleged by Roman Abaya, but that she
considered that her right was superior to his and moved for a hearing of the matter, and, in consequence of the
evidence that she intended to present she prayed that she be declared to have preferential rights to the property
left by Casiano Abaya, and that the same be adjudicated to her together with the corresponding products
thereof.
III. That the trial was held, both parties presenting documentary and oral evidence, and the court below entered
the following judgment:
"That the administrator of the estate of Casiana Abaya should recognize Teopista and Jose Conde as being
natural children of Casiano Abaya; that the petitioner Paula Conde should succeed to the hereditary rights of her
children with respect to the inheritance of their deceased natural father Casiano Abaya; and therefore, it is
hereby declared that she is the only heir to the property of the said intestate estate, to the exclusion of the
administrator, Roman Abaya."
IV. That Roman Abaya excepted to the foregoing judgment, appealed to this court, and presented the following
statement of errors:
1. The fact that the court below found that an ordinary action for the acknowledgment of natural children
under articles 135 and 137 of the Civil Code, might be brought in special probate proceedings.
2. The finding that after the death of a person claimed to be an unacknowledged natural child, the mother
of such presumed natural child, as heir to the latter, may bring an action to enforce the acknowledgment
of her deceased child in accordance with articles 135 and 137 of the Civil Code.
3. The finding in the judgment that the alleged continuous possession of the deceased children of Paula
Conde of the status of natural children of the late Casiano Abaya, has been fully proven in these
proceedings; and
4. On the hypothesis that it was proper to adjudicate the property of this intestate estate to Paula Conde, as
improperly found by the court below, the court erred in not having declared that said property should be
reserved in favor of relatives of Casiano Abaya to the third degree, and in not having previously
demanded securities from Paula Conde to guarantee the transmission of the property to those who
might fall within the reservation.
As to the first error assigned, the question is set up as to whether in special proceedings for the administration
and distribution of an intestate estate, an action might be brought to enforce the acknowledgment of the natural
child of the person from whom the inheritance is derived, that is to say, whether one might appear as heir on the
ground that he is a recognized natural child of the deceased, not having been so recognized by the deceased
either voluntarily or compulsory by reason of a preexisting judicial decision, but asking at the same time that, in
the special proceeding itself, he be recognized by the presumed legitimate heirs of the deceased who claim to
be entitled to the succession opened in the special proceeding.
According to section 782 of the Code of Civil Procedure —
"If there shall be a controversy before the Court of First Instance as to who the lawful heirs of the deceased
person are, or as to the distributive share to which each person is entitled under the law, the testimony as to
such controversy shall be taken in writing by the judge, under oath and signed by witness. Any party in interest
whose distributive share is affected by the determination of such controversy, may appeal from the judgment of
the Court of First Instance determining such controversy to the Supreme Court, within the time and in the
manner provided in the last preceding section."
This court has decided the present question in the manner shown in the case of Juana Pimental v. Engracio
Palanca (5 Phil. Rep. 436.)
The main question with regard to the second error assigned, is whether or not the mother of a natural child now
deceased, but who survived the person who, it is claimed, was his natural father, also deceased, may bring an
action for the acknowledgment of the natural filiation in favor of such child in order to appear in his behalf to
receive the inheritance from the person who is supposed to be his natural father.
In order to decide in the affirmative the court below has assigned the following as the only foundation:
"In resolving a similar question Manresa says: ’An acknowledgment can only be demanded by the natural child
and his descendants whom it shall benefit, and should they be minors or otherwise incapacitated, such person
as legally represents them; the mother may ask it in behalf of her child so long as he is under her authority.’ On
this point no positive declaration has been made, undoubtedly because it was not considered necessary. A
private action is in question and the general rule must be followed. Elsewhere the same author adds: ’It may so
happen that the child dies before four years have expired after attaining majority, or that the document
supporting his petition for acknowledgment is discovered after his death, such death perhaps occurring after his
parents had died, as is supposed by article 137, or during their lifetime. In any case such right of action shall
pertain to the descendants of the child whom the acknowledgment may interest.’ (See Commentaries to arts.
135 and 137, Civil Code. Vol. I.) ’
The above doctrine, advanced by one of the most eminent commentators of the Civil Code, lacks legal and
doctrinal foundation. The power to transmit the right of such action by the natural child to his descendants can
not be sustained under the law, and still less to his mother.
It is without any support in law because the rule laid down in the code is most positive, limiting in form, when
establishing the exception for the exercise of such right of action after the death of the presumed parents, as is
shown hereafter. It is not supported by any doctrine, because up to the present time no argument has been
presented, upon which even an approximate conclusion could be based.
Although the Civil Code considerably improved the condition of recognized natural children, granting them rights
and actions that they did not possess under the former laws, they were not, however, placed upon the same
plane as legitimate ones. The difference that separates these two classes of children is still great, as proven by
so many articles dealing with the rights of the family and with succession in relation to the members thereof. It
may be laid down as a legal maxim, that whatever the code does not grant to the legitimate children, or in
connection with their rights, must still less be understood as granted to recognized natural children or in
connection with their rights. There is not a single exception in its provisions.
If legitimacy is the attribute that constitutes the basis of the absolute family rights of the child, the
acknowledgment of the natural child is, among illegitimate ones, that which unites him to the family of the father
or the mother who recognizes him, and affords him a participation in the rights of the family, relatively
advantageous according to whether they are alone or whether they concur with other individuals of the family of
his purely natural father or mother.
Thus, in order to consider the spirit of the Civil Code nothing is more logical than to establish a comparison
between an action to claim the legitimacy, and one to enforce acknowledgment.
"Art. 118. The action to claim its legitimacy may be brought by the child at any time of its lifetime and shall be
transmitted to its heirs, should it die during minority or in a state of insanity. In such cases the heirs shall be
allowed a period of five years in which to institute the action.
"The action already instituted by the child is transmitted by its death to the heirs, if it has not lapsed before then.
"Art. 137. The actions for the acknowledgment of natural children can be instituted only during the life of the
presumed parents, except in the following cases:
"1. If the father or mother died during the minority of the child, in which case the latter may institute the action
before the expiration of the first four years of its majority.
"2. If, after the death of the father or mother, some instrument, before unknown, should be discovered in which
the child is expressly acknowledged.
"In this case the action must be instituted within the six months following the discovery of such instrument."
On this supposition the first difference that results between one action and the other consists in that the right of
action for legitimacy lasts during the whole lifetime of the child, that is, it can always be brought against the
presumed parents or their heirs by the child itself, while the right of action for the acknowledgment of a natural
child does not last his whole lifetime, and, as a general rule, it can not be instituted against the heirs of the
presumed parents, inasmuch as it can be exercised only during the life of the presumed parents.
With regard to the question at issue, that is, the transmission to the heirs of the presumed parents of the
obligation to admit the legitimate filiation, or to recognize the natural filiation, there exists the most radical
difference in that the former continues during the life of the child who claims to be legitimate, and he may
demand it either directly and primarily from the said presumed parents, or indirectly and secondarily from the
heirs of the latter; while the second does not endure for life; as a general rule, it only lasts during the life of the
presumed parents. Hence the other difference, derived as a consequence, that an action for legitimacy is always
brought against the heirs of the presumed parents in case of the death of the latter, while the action for
acknowledgment is not brought against the heirs of such parents, with the exception of the two cases prescribed
by article 137 transcribed above.
So much for the passive transmission of the obligation to admit the legitimate filiation, or to acknowledge the
natural filiation.
As to the transmission to the heirs of the child of the latter’s action to claim his legitimacy, or to obtain the
acknowledgment of his natural filiation, it is seen that the code grants it in the first case, but not the second. It
contains provisions for the transmission of the right of action which, for the purpose of claiming his legitimacy
inheres in the child, but it does not say a word with regard to the transmission of the right to obtain the
acknowledgment of the natural filiation.
Therefore, the respective corollary of each of the two above-cited articles is:
(1) That the right of action which devolves upon the child to claim his legitimacy under article 118, may be
transmitted to his heirs in certain cases designated in the said article;
(2) That the right of action for the acknowledgment of natural children to which article 137 refers, can never
be transmitted, for the reason that the code makes no mention of it in any case, not even as an
exception.
It is most illogical and contrary to every rule of correct interpretation, that the right of action to secure
acknowledgment by the natural child should be presumed to be transmitted, independently, as a rule, to his
heirs, while the right of action to claim legitimacy from his predecessor is not expressly, independently, or, as a
general rule, conceded to the heirs of the legitimate child, but only relatively and as an exception.
Consequently, the pretension that the right of action on the part of the child to obtain the
acknowledgment of his natural filiation is transmitted to his descendants is altogether unfounded. No
legal provision exists to sustain such pretension, nor can an argument of presumption be based on the lesser
claim when there is no basis for the greater one, and when it is only given as an exception in well-defined cases.
It is placing the heirs of the natural child on a better footing than the heirs of the legitimate one, when, as a
matter of fact, the position of a natural child is no better than, nor even equal to, that of a legitimate child.
From the express and precise precepts of the code the following conclusions are derived:
The right of action that devolves upon the child to claim his legitimacy lasts during his whole life, while the right
to claim the acknowledgment of a natural child lasts only during the life of his presumed parents.
Inasmuch as the right of action accruing to the child to claim his legitimacy lasts during his whole life, he may
exercise it either against the presumed parents, or their heirs; while the right of action to secure the
acknowledgment of a natural child, since it does not last during his whole life, but depends on that of the
presumed parents, as a general rule can only be exercised against the latter.
Usually the right of action for legitimacy devolving upon the child is of a personal character and pertains
exclusively to him, only the child may exercise it at any time during his lifetime. As an exception, and in three
cases only, it may be transmitted to the heirs of the child, to wit, if he died during his minority, or while insane, or
after action had been already instituted.
An action for the acknowledgment of a natural child may, as an exception, be exercised against the heirs of the
presumed parents in two cases: first, in the event of the death of the latter during the minority of the child, and
second, upon the discovery of some instrument of express acknowledgment of the child, executed by the father
or mother, the existence of which was unknown during the life of the latter.
But as such action for the acknowledgment of a natural child can only be exercised by him. It can not be
transmitted to his descendants, or to his ascendants.
In support of the foregoing the following authorities may be cited:
Sanchez Roman, in his Treatise on Civil Law, propounds the question as to whether said action should be
considered transmissive to the heirs or descendants of the natural child, whether he had or had not exercised it
up to the time of his death, and decides it as follows;
"There is an entire absence of legal provisions, and at most, it might be deemed admissible as a solution, that
the right of action to claim the acknowledgment of a natural child is transmitted by analogy to his heirs on the
same conditions and terms that it is transmitted to the descendants of a legitimate child, to claim his legitimacy,
under article 118, but nothing more; because on this point nothing warrants placing the heirs of a natural child on
a better footing than those of the legitimate child, and even to compare them would not fail to be a strained and
questionable matter, and one of great difficulty for decision by the courts, for the simple reason that for the heirs
of the legitimate child, the said article 118 exists, while for those of the natural child, as we have said, there is no
provision in the code authorizing the same, although on the other hand there is none that prohibits it." (Vol. V.)
Diaz Guijarro and Martinez Ruiz in their work on "The Civil Code as construed by the supreme court of Spain,"
commenting upon article 137, say:
"Article 118, taking into account the privileges due to the legitimacy of children, grants them the right to claim
said legitimacy during their lifetime, and even authorizes the transmission of said right for the space of five years
to the heirs thereof, if the child die during his minority or in a state of insanity. But as article 137 is based on the
consideration that in the case of a natural child, ties are less strong and sacred in the eyes of the law, it does not
fix such a long and indefinite period for the exercise of the action; it limits it to the life of the parents, excepting in
the two cases mentioned in said article; and it does not allow, as does article 118, the action to pass on to the
heirs, inasmuch as, although it does not prohibit it, and for that reason it might be deemed on general principles
of law to consent to it, such a supposition is inadmissible for the reason that a comparison of both articles shows
that the silence of the law in the latter case is not, nor can it be, an omission, but a deliberate intent to establish
a wide difference between the advantages granted to a legitimate child and to a natural one."
(Ibid., Vol. II, 171.)
Navarro Amandi (Cuestionario del Codigo Civil) raises the question: "Can the heirs of a natural child claim the
acknowledgment in those cases wherein the father or mother are under obligation to acknowledge" ? And says:
"Opinions are widely divergent. The court of Rennes held (on April 13, 1844) that the right of investigation forms
a part of the estate of the child, and along with his patrimony is transmitted to his heirs. The affirmation is
altogether too categorical to be admissible. If it were correct the same thing would happen as when the
legitimacy of a child is claimed, and as already seen, the right of action to demand the legitimacy is not
transmitted to the heirs in every case and as an absolute right, but under certain limitations and circumstances.
Now, were we to admit the doctrine of the court of Rennes, the result would be that the claim for natural filiation
would be more favored than one for legitimate filiation. This would be absurd, because it can not be conceived
that the legislator should have granted a right of action to the heirs of the natural child, which is only granted
under great limitations and in very few cases to those of a legitimate one. Some persons insist that the same
rules that govern legitimate filiation apply by analogy to natural filiation, and that in this conception the heirs of
the natural child are entitled to claim it in the cases prescribed by article 118. The majority, however, are inclined
to consider the right to claim acknowledgment as a personal right, and consequently, not transmissive to the
heirs. Really there are not legal grounds to warrant the transmission." (Vol. 2, 229.)
In a decision like the present one it is impossible to bring forward the argument of analogy for the purpose of
considering that the heirs of the natural child are entitled to the right of action which article 118 concedes to the
heirs of the legitimate child. The existence of a provision for the one case and the absence thereof for the other
is a conclusive argument that inclusio unius est exclusio alterius, and it can not be understood that the provision
of law should be the same when the same reason does not hold in the one case as in the other.
The theory of the law of transmission is also entirely inapplicable in this case. This theory, which in the Roman
Law expressed the general rule that an heir who did not accept an inheritance during his lifetime was
incapacitated from transmitting it to his own heirs, included at the same time the idea that if the inheritance was
not transmitted because the heir did not possess it, there were, however, certain things which the heir held and
could transmit. Such was the law and the right to accept the inheritance, for the existing reason that all rights,
both real and personal, shall pass to the heir; quia haeres representat defunctum in omnibus et per omnia.
According to article 659 of the Civil Code, "the inheritance includes all the property, rights, and obligations of a
person, which are not extinguished by his death." If the mother is the heir of her natural child, and the latter,
among other rights during his lifetime was entitled to exercise an action for his acknowledgment against his
father, during the life of the latter, or after his death in some of the excepting cases of article 137, such right,
which is a portion of his inheritance, is transmitted to his mother as being his heir, and it was so understood by
the court of Rennes when it considered the right in question, not as a personal and exclusive right of the child
which is extinguished by his death, but as any other right which might be transmitted after his death. This right of
supposed transmission is even less tenable than that sought to be sustained by the argument of analogy.
The right of action pertaining to the child to claim his legitimacy is in all respects superior to that of the child who
claims acknowledgment as a natural child. And it is evident that the right of action to claim his legitimacy is not
one of those rights which the legitimate child may transmit by inheritance to his heirs; it forms no part of the
component rights of his inheritance. If it were so, there would have been no necessity to establish its
transmissibility to heirs as an exception in the terms and conditions of article 118 of the code. So that, in order
that it may constitute a portion of the child’s inheritance, it is necessary that the conditions and the terms
contained in article 118 shall be present, since without them, the right that the child held during his lifetime, being
personal and exclusive in principle, and therefore, as a general rule not susceptible of transmission, would and
should have been extinguished by his death. Therefore, where no express provision like that of article 118
exists, the right of action for the acknowledgment of a natural child is, in principle and without exception,
extinguished by his death, and can not be transmitted as a portion of the inheritance of the deceased child.
On the other hand, it said right of action formed a part of the child’s inheritance, it would be necessary to
establish the doctrine that the right to claim such an acknowledgment from the presumed natural father and from
his heirs is an absolute right of the heirs of the child, not limited by certain circumstances as in the case of the
heirs of a legitimate child; and if it is unreasonable to compare a natural child with a legitimate one to place the
heirs of a natural child and his inheritance on a better footing than those of a legitimate child would not only be
unreasonable, but, as stated in one of the above citations, most absurd and illegal in the present state of the law
and in accordance with the general principles thereof.
For all of the foregoing reasons we hereby reverse the judgment appealed from in all its parts, without any
special ruling as to the costs of this instance.
[G.R. No. L-33187. March 31, 1980.]
CORNELIO PAMPLONA alias GEMINIANO PAMPLONA and APOLONIA ONTE vs. VIVENCIO MORETO,
VICTOR MORETO, ELIGIO MORETO, MARCELO MORETO, PAULINA MORETO, ROSARIO MORETO,
MARTA MORETO, SEVERINA MENDOZA, PABLO MENDOZA, LAZARO MENDOZA, VICTORIA TUIZA,
JOSEFINA MORETO, LEANDRO MORETO and LORENZO MENDOZA
Flaviano Moreto and Monica Maniega were husband and wife. During their marriage, they acquired adjacent lots
Nos. 1495, 4545, and 1496 of the Calamba Friar Land Estate, situated in Calamba, Laguna, containing 781-544
and 1,021 square meters respectively, and covered by certificates of title issued in the name of "Flaviano
Moreto, married to Monica Maniega."
"The spouses Flaviano Moreto and Monica Maniega begot during their marriage six (6) children, namely, Ursulo,
Marta, La Paz, Alipio, Pablo, and Leandro, all surnamed Moreto.
"Ursulo Moreto died intestate on May 24, 1959 leaving as his heirs herein plaintiffs Vivencio, Marcelo, Rosario,
Victor, Paulina, Marta and Eligio, all surnamed Moreto.
"Marta Moreto died also intestate on April 30, 1938 leaving as her heir plaintiff Victoria Tuiza.
"La Paz Moreto died intestate on July 17, 1954 leaving the following heirs, namely, herein plaintiffs Pablo,
Severina, Lazaro, and Lorenzo, all surnamed Mendoza.
"Alipio Moreto died intestate on June 30, 1943 leaving as his heir herein plaintiff Josefina Moreto.
"Pablo Moreto died intestate on April 25, 1942 leaving no issue and as his heirs his brother plaintiff Leandro
Moreto and the other plaintiffs herein.
On May 6, 1946, Monica Maniega died intestate in Calamba, Laguna.
On July 30, 1952, or more than six (6) years after the death of his wife Monica Maniega, Flaviano Moreto,
without the consent of the heirs of his said deceased wife Monica, and before any liquidation of the conjugal
partnership of Monica and Flaviano could be effected, executed in favor of Geminiano Pamplona, married to
defendant Apolonia Onte, the deed of absolute sale (Exh. "1") covering lot No. 1495 for P900.00. The deed of
sale (Exh. "1") contained a description of lot No. 1495 as having an area of 781 square meters and covered by
transfer certificate of title No. 14570 issued in the name of Flaviano Moreto, married to Monica Maniega,
although the lot was acquired during their marriage. As a result of the sale, the said certificate of title was
cancelled and a new transfer certificate of title No. T-5671 was issued in the name of Geminiano Pamplona
married to Apolonia Onte (Exh. "A").
After the execution of the above-mentioned deed of sale (Exh. "1"), the spouses Geminiano Pamplona and
Apolonia Onte constructed their house on the eastern part of lot 1496 as Flaviano Moreto, at the time of the sale,
pointed to it as the land which he sold to Geminiano Pamplona. Shortly thereafter, Rafael Pamplona, son of the
spouses Geminiano Pamplona and Apolonia Onte, also built his house within lot 1496 about one meter from its
boundary with the adjoining lot. The vendor Flaviano Moreto and the vendee Geminiano Pamplona thought all
the time that the portion of 781 square meters which was the subject matter of their sale transaction was No.
1495 and so lot No. 1495 appears to be the subject matter in the deed of sale (Exh. "1") although the fact is that
the said portion sold thought of by the parties to be lot No. 1495 is a part of lot No. 1496.
From 1956 to 1960, the spouses Geminiano Pamplona and Apolonio Onte enlarged their house and they even
constructed a piggery corral at the back of their said house about one and one-half meters from the eastern
boundary of lot 1496.
On August 12, 1956, Flaviano Moreto died intestate. In 1961, the plaintiffs demanded on the defendants to
vacate the premises where they had their house and piggery on the ground that Flaviano Moreto had no right to
sell the lot which he sold to Geminiano Pamplona as the same belongs to the conjugal partnership of Flaviano
and his deceased wife and the latter was already dead when the sale was executed without the consent of the
plaintiffs who are the heirs of Monica.
The spouses Geminiano Pamplona and Apolonia Onte refused to vacate the premises occupied by them and
hence, this suit was instituted by the heirs of Monica Maniega seeking for the declaration of the nullity of the
deed of sale of July 30, 1952 above-mentioned as regards one half of the property subject matter of said deed;
to declare the plaintiffs as the rightful owners of the other half of said lot; to allow the plaintiffs to redeem the
one-half portion thereof sold to the defendants ‘After payment of the other half of the purchase price’; to order
the defendants to vacate the portions occupied by them; to order the defendants to pay actual and moral
damages and attorney’s fees to the plaintiffs; to order the defendants to pay plaintiffs P120.00 a year from
August 1958 until they have vacated the premises occupied by them for the use and occupancy of the same.
The defendants claim that the sale made by Flaviano Moreto in their favor is valid as the lot sold is registered in
the name of Flaviano Moreto and they are purchasers believing in good faith that the vendor was the sole owner
of the lot sold.
After a relocation of lots 1495, 1496 and 4545 made by agreement of the parties, it was found out that there was
mutual error between Flaviano Moreto and the defendants in the execution of the deed of sale because while the
said deed recited that the lot sold is lot No. 1495, the real intention of the parties is that it was a portion
consisting of 781 square meters of lot No. 1496 which was the subject matter of their sale transaction.
‘WHEREFORE, judgment is hereby rendered for the plaintiffs declaring the deed of absolute sale dated July 30, 1952
pertaining to the eastern portion of Lot 1496 covering an area of 781 square meters null and void as regards the 390.5
square meters of which plaintiffs are hereby declared the rightful owners and entitled to its possession.
‘The sale is ordered valid with respect to the eastern one-half (1/2) of 1781 square meters of Lot 1496 measuring 390.5
square meters of which defendants are declared lawful owners and entitled to its possession.
After proper survey segregating the eastern one-half portion with an area of 390.5 square meters of Lot 1496, the
defendants shall be entitled to s certificate of title covering said portion and Transfer Certificate of Title No. 9843 of the office
of the Register of Deeds of Laguna shall be cancelled accordingly and new titles issued to the plaintiffs and to the
defendants covering their respective portions.
‘Transfer Certificate of Title No. 5671 of the office of the Register of Deeds of Laguna covering Lot No. 1495 and registered
in the name of Cornelio Pamplona, married to Apolonia Onte, is by virtue of this decision ordered cancelled. The defendants
are ordered to surrender to the office of the Register of Deeds of Laguna the owner’s duplicate of Transfer Certificate of Title
No. 5671 within thirty (30) days after this decision shall have become final for cancellation in accordance with this decision.
The defendants-appellants, not being satisfied with said judgment, appealed to the Court of Appeals, which
affirmed the judgment, hence they now come to this Court.
The fundamental and crucial issue in the case at bar is whether under the facts and circumstances duly
established by the evidence, petitioners are entitled to the full ownership of the property in litigation, or only one-
half of the same.
There is no question that when the petitioners purchased the property on July 30, 1952 from Flaviano Moreto for
the price of P900.00, his wife Monica Maniega had already been dead six years before, Monica having died on
May 6, 1946. Hence, the conjugal partnership of the spouses Flaviano Moreto and Monica Maniega had already
been dissolved. (Article 175, (1) New Civil Code; Article 1417, Old Civil Code).
The records show that the conjugal estate had not been inventoried, liquidated, settled and divided by the heirs
thereto in accordance with law. The necessary proceedings for the liquidation of the conjugal partnership were
not instituted by the heirs either in the testate or intestate proceedings of the deceased spouse pursuant to Act
3176 amending Section 685 of Act 190. Neither was there an extra-judicial partition between the surviving
spouse and the heirs of the deceased spouse nor was an ordinary action for partition brought for the purpose.
Accordingly, the estate became the property of a community between the surviving husband, Flaviano
Moreto, and his children with the deceased Monica Maniega in the concept of a co-ownership.
"The community property of the marriage, at the dissolution of this bond by the death of one of the spouses,
ceases to belong to the legal partnership and becomes the property of a community, by operation of law,
between the surviving spouse and the heirs of the deceased spouse, or the exclusive property of the widower or
the widow, if he or she be the heir of the deceased spouse. Every co-owner shall have full ownership of his part
and in the fruits and benefits derived therefrom, and he therefore may alienate, assign or mortgage it and even
substitute another person in its enjoyment, unless personal rights are in question." (Marigsa v. Macabuntoc, 17
Phil. 107)
In Borja v. Addision, 44 Phil. 895, 906, the Supreme Court said that" (t)here is no reason in law why the heirs of
the deceased wife may not form a partnership with the surviving husband for the management and control of the
community property of the marriage and conceivably such a partnership, or rather community of property,
between the heirs and the surviving husband might be formed without a written agreement." In Prades v.
Tecson, 49 Phil. 230, the Supreme Court held that" (a)lthough, when the wife dies, the surviving husband, as
administrator of the community property, has authority to sell the property without the concurrence of the
children of the marriage, nevertheless this power can be waived in favor of the children, with the result of
bringing about a conventional ownership in common between the father and children as to such property; and
any one purchasing with knowledge of the changed status of the property will acquire only the undivided interest
of those members of the family who join in the act of conveyance."
It is also not disputed that immediately after the execution of the sale in 1952, the vendees constructed their
house on the eastern part of Lot 1496 which the vendor pointed out to them as the area sold, and two weeks
thereafter, Rafael who is a son of the vendees, also built his house within Lot 1496. Subsequently, a cemented
piggery coral was constructed by the vendees at the back of their house about one and one-half meters from the
eastern boundary of Lot 1496. Both vendor and vendees believed all the time that the area of 781 sq. meters
subject of the sale was Lot No. 1495 which according to its title (T.C.T. No. 14570) contains an area of 781 sq.
meters so that the deed of sale between the parties identified and described the land sold as Lot 1495. But
actually, as verified later by a surveyor upon agreement of the parties during the proceedings of the case below,
the area sold was within Lot 1496.
Again, there is no dispute that the houses of the spouses Cornelio Pamplona and Apolonia Onte as well as that
of their son Rafael Pamplona, including the concrete piggery coral adjacent thereto, stood on the land from 1952
up to the filing of the complaint by the private respondents on July 25, 1961, or a period of over nine (9) years.
And during said period, the private respondents who are the heirs of Monica Maniega as well as of Flaviano
Moreto who also died intestate on August 12, 1956, lived as neighbors to the petitioners-vendees, yet lifted no
finger to question the occupation, possession and ownership of the land purchased by the Pamplonas, so that
We are persuaded and convinced to rule that private respondents are in estoppel by laches to claim half of the
property in dispute as null and void. Estoppel by laches is a rule of equity which bars a claimant from presenting
his claim when, by reason of abandonment and negligence, he allowed a long time to elapse without presenting
the same. (International Banking Corporation v. Yared, 59 Phil. 92)
We have ruled that at the time of the sale in 1952, the conjugal partnership was already dissolved six years
before and therefore, the estate became a co-ownership between Flaviano Moreto, the surviving husband, and
the heirs of his deceased wife, Monica Maniega. Article 493 of the New Civil Code is applicable, and it provides
as follows:
"Art. 493. Each co-owner shall have the full ownership of his part and of the fruits and benefits pertaining
thereto, and he may therefore alienate, assign or mortgage it, and even substitute another person in its
enjoyment, except when personal rights are involved. But the effect of the alienation or the 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."
We agree with the petitioner that there was a partial partition of the co-ownership when at the time of the sale
Flaviano Moreto pointed out the area and location of the 781 sq. meters sold by him to the petitioners-vendees
on which the latter built their house and also that whereon Rafael, the son of petitioners likewise erected his
house and an adjacent coral for piggery.
Petitioners point to the fact that spouses Flaviano Moreto and Monica Maniega owned three parcels of land
denominated as Lot 1495 having an area of 781 sq. meters, Lot 1496 with an area of 1,021 sq. meters, and Lot
4545 with an area of 544 sq. meters. The three lots have a total area of 2,346 sq. meters. These three parcels of
lots are contiguous with one another as each is bounded on one side by the other, thus: Lot 4545 is bounded on
the northeast by Lot 1495 and on the southeast by Lot 1496. Lot 1495 is bounded on the west by Lot 4545. Lot
1496 is bounded on the west by Lot 4545. It is therefore, clear that the three lots constitute one big land. They
are not separate properties located in different places but they abut each other. This is not disputed by
private respondents.
Hence, at the time of the sale, the co-ownership constituted or covered these three lots adjacent to each
other. And since Flaviano Moreto was entitled to one-half pro-indiviso of the entire land area or 1,173 sq.
meters as his share, he had a perfect legal and lawful right to dispose of 781 sq. meters of his share to
the Pamplona spouses. Indeed, there was still a remainder of some 392 sq. meters belonging to him at
the time of the sale.
We reject respondent Court’s ruling that the sale was valid as to one-half and invalid as to the other half for the
very simple reason that Flaviano Moreto, the vendor, had the legal right to more than 781 sq. meters of the
communal estate, a title which he could dispose, alienate in favor of the vendees-petitioners. The title may be
pro-indiviso or inchoate but the moment the co-owner as vendor pointed out its location and even
indicated the boundaries over which the fences were to be erected without objection, protest or
complaint by the other co-owners, on the contrary they acquiesced and tolerated such alienation,
occupation and possession, We rule that a factual partition or termination of the co-ownership, although
partial, was created, and barred not only the vendor, Flaviano Moreto, but also his heirs, the private
respondents herein from asserting as against the vendees-petitioners any right or title in derogation of
the deed of sale executed by said vendor Flaviano Moreto.
Equity commands that the private respondents, the successors of both the deceased spouses, Flaviano Moreto
and Monica Maniega be not allowed to impugn the sale executed by Flaviano Moreto who indisputably received
the consideration of P900.00 and which he, including his children, benefited from the same.
Moreover, as the heirs of both Monica Maniega and Flaviano Moreto, private respondents are duty-bound to
comply with the provisions of Articles 1458 and 1495, Civil Code, which is the obligation of the vendor of the
property of delivering and transferring the ownership of the whole property sold, which is transmitted on his
death to his heirs, the herein private respondents. The articles cited provide, thus:
"Art. 1458. By the contract of sale one of the contracting parties obligates himself to transfer the ownership of
and to deliver a determinate thing, and the other party to pay therefor a price certain in money or its equivalent.
A contract of sale may be absolute or conditional."
"Art. 1495. The vendor is bound to transfer the ownership of and deliver, as well as warrant the thing which is the
object of the sale."
Under Article 776, New Civil Code, the inheritance which private respondents received from their deceased
parents and/or predecessors-in-interest included all the property rights and obligations which were not
extinguished by their parents’ death. And under Art. 1311, paragraph 1, New Civil Code, the contract of sale
executed by the deceased Flaviano Moreto took effect between the parties, their assigns and heirs, who are the
private respondents herein. Accordingly, to the private respondents is transmitted the obligation to deliver in full
ownership the whole area of 781 sq. meters to the petitioners (which was the original obligation of their
predecessor Flaviano Moreto) and not only one-half thereof. Private respondents must comply with said
obligation.
The records reveal that the area of 781 sq. meters sold to and occupied by petitioners for more than 9 years
already as of the filing of the complaint in 1961 had been re-surveyed by private land surveyor Daniel Aranas.
Petitioners are entitled to a segregation of the area from Transfer Certificate of Title No. T-9843 covering Lot
1496 and they are also entitled to the issuance of a new Transfer Certificate of Title in their name based on the
relocation survey.
WHEREFORE, IN VIEW OF THE FOREGOING, the judgment appealed from is hereby AFFIRMED with modification in the
sense that the sale made and executed by Flaviano Moreto in favor of the petitioners-vendees is hereby declared legal and
valid in its entirely.
Petitioners are hereby declared owners in full ownership of the 781 sq. meters at the eastern portion of Lot 1496 now
occupied by said petitioners and whereon their houses and piggery coral stand.
The Register of Deeds of Laguna is hereby ordered to segregate the area of 781 sq. meters from Certificate of Title No.
9843 and to issue a new Transfer Certificate of Title to the petitioners covering the segregated area of 781 sq. meters.
G.R. No. L-68053 May 7, 1990
LAURA ALVAREZ, FLORA ALVAREZ and RAYMUNDO ALVAREZ vs.

THE HONORABLE INTERMEDIATE APELLATE COURT and JESUS YANES, ESTELITA YANES, ANTONIO
YANES, ROSARIO YANES, and ILUMINADO YANES
The real properties involved are two parcels of land identified as Lot 773-A and Lot 773-B which were originally
known as Lot 773 of the cadastral survey of Murcia, Negros Occidental. Lot 773, with an area of 156,549 square
meters, was registered in the name of the heirs of Aniceto Yanes under Original Certificate of Title No. RO-4858
(8804) issued on October 9, 1917 by the Register of Deeds of Occidental Negros (Exh. A).
Aniceto Yanes was survived by his children, Rufino, Felipe and Teodora. Herein private respondents, Estelita,
Iluminado and Jesus, are the children of Rufino who died in 1962 while the other private respondents, Antonio
and Rosario Yanes, are children of Felipe. Teodora was survived by her child, Jovita (Jovito) Alib. 1 It is not clear
why the latter is not included as a party in this case.
Aniceto left his children Lots 773 and 823. Teodora cultivated only three hectares of Lot 823 as she could not
attend to the other portions of the two lots which had a total area of around twenty-four hectares. The record
does not show whether the children of Felipe also cultivated some portions of the lots but it is established that
Rufino and his children left the province to settle in other places as a result of the outbreak of World War II.
According to Estelita, from the "Japanese time up to peace time", they did not visit the parcels of land in question
but "after liberation", when her brother went there to get their share of the sugar produced therein, he was
informed that Fortunato Santiago, Fuentebella (Puentevella) and Alvarez were in possession of Lot 773. 2
It is on record that on May 19, 1938, Fortunato D. Santiago was issued Transfer Certificate of Title No. RF 2694
(29797) covering Lot 773-A with an area of 37,818 square meters. 3 TCT No. RF 2694 describes Lot 773-A as a
portion of Lot 773 of the cadastral survey of Murcia and as originally registered under OCT No. 8804.
The bigger portion of Lot 773 with an area of 118,831 square meters was also registered in the name of
Fortunato D. Santiago on September 6, 1938 Under TCT No. RT-2695 (28192 ). 4 Said transfer certificate of title
also contains a certification to the effect that Lot 773-B was originally registered under OCT No. 8804.
On May 30, 1955, Santiago sold Lots 773-A and 773-B to Monico B. Fuentebella, Jr. in consideration of the sum
of P7,000.00. Consequently, on February 20, 1956, TCT Nos. T-19291 and T-19292 were issued in
Fuentebella's name.
After Fuentebella's death and during the settlement of his estate, the administratrix thereof (Arsenia R. Vda. de
Fuentebella, his wife) filed in Special Proceedings No. 4373 in the Court of First Instance of Negros Occidental,
a motion requesting authority to sell Lots 773-A and 773-B. 7 By virtue of a court order granting said motion, on
March 24, 1958, Arsenia Vda. de Fuentebella sold said lots for P6,000.00 to Rosendo Alvarez. Hence, on April
1, 1958 TCT Nos. T-23165 and T-23166 covering Lots 773-A and 773-B were respectively issued to Rosendo
Alvarez.
Two years later or on May 26, 1960, Teodora Yanes and the children of her brother Rufino, namely, Estelita,
Iluminado and Jesus, filed in the Court of First Instance of Negros Occidental a complaint against Fortunato
Santiago, Arsenia Vda. de Fuentebella, Alvarez and the Register of Deeds of Negros Occidental for the "return"
of the ownership and possession of Lots 773 and 823. They also prayed that an accounting of the produce of the
land from 1944 up to the filing of the complaint be made by the defendants, that after court approval of said
accounting, the share or money equivalent due the plaintiffs be delivered to them, and that defendants be
ordered to pay plaintiffs P500.00 as damages in the form of attorney's fees.
During the pendency in court of said case or on November 13, 1961, Alvarez sold Lots 773-A, 773-B and
another lot for P25,000.00 to Dr. Rodolfo Siason. Accordingly, TCT Nos. 30919 and 30920 were issued to
Siason, who thereafter, declared the two lots in his name for assessment purposes.
Meanwhile, on November 6, 1962, Jesus Yanes, in his own behalf and in behalf of the other plaintiffs, and
assisted by their counsel, filed a manifestation in Civil Case No. 5022 stating that the therein plaintiffs "renounce,
forfeit and quitclaims (sic) any claim, monetary or otherwise, against the defendant Arsenia Vda. de Fuentebella
in connection with the above-entitled case."
On October 11, 1963, a decision was rendered by the Court of First Instance of Negros Occidental in Civil Case
No. 5022, the dispositive portion of which reads:
WHEREFORE, judgment is rendered, ordering the defendant Rosendo Alvarez to reconvey to the plaintiffs lots Nos.
773 and 823 of the Cadastral Survey of Murcia, Negros Occidental, now covered by Transfer Certificates of Title Nos.
T-23165 and T-23166 in the name of said defendant, and thereafter to deliver the possession of said lots to the
plaintiffs. No special pronouncement as to costs.
It will be noted that the above-mentioned manifestation of Jesus Yanes was not mentioned in the aforesaid
decision.
However, execution of said decision proved unsuccessful with respect to Lot 773. In his return of service dated
October 20, 1965, the sheriff stated that he discovered that Lot 773 had been subdivided into Lots 773-A and
773-B; that they were "in the name" of Rodolfo Siason who had purchased them from Alvarez, and that Lot 773
could not be delivered to the plaintiffs as Siason was "not a party per writ of execution."
The execution of the decision in Civil Case No. 5022 having met a hindrance, herein private respondents (the
Yaneses) filed on July 31, 1965, in the Court of First Instance of Negros Occidental a petition for the issuance of
a new certificate of title and for a declaration of nullity of TCT Nos. T-23165 and T-23166 issued to Rosendo
Alvarez. Thereafter, the court required Rodolfo Siason to produce the certificates of title covering Lots 773 and
823.
Expectedly, Siason filed a manifestation stating that he purchased Lots 773-A, 773-B and 658, not Lots 773 and
823, "in good faith and for a valuable consideration without any knowledge of any lien or encumbrances against
said properties"; that the decision in the cadastral proceeding 19 could not be enforced against him as he was not
a party thereto; and that the decision in Civil Case No. 5022 could neither be enforced against him not only
because he was not a party-litigant therein but also because it had long become final and executory. 20 Finding
said manifestation to be well-founded, the cadastral court, in its order of September 4, 1965, nullified its previous
order requiring Siason to surrender the certificates of title mentioned therein. 21
In 1968, the Yaneses filed an ex-parte motion for the issuance of an alias writ of execution in Civil Case No.
5022. Siason opposed it. 22 In its order of September 28, 1968 in Civil Case No. 5022, the lower court, noting
that the Yaneses had instituted another action for the recovery of the land in question, ruled that at the judgment
therein could not be enforced against Siason as he was not a party in the case. 23
The action filed by the Yaneses on February 21, 1968 was for recovery of real property with damages. 24 Named
defendants therein were Dr. Rodolfo Siason, Laura Alvarez, Flora Alvarez, Raymundo Alvarez and the Register
of Deeds of Negros Occidental. The Yaneses prayed for the cancellation of TCT Nos. T-19291 and 19292
issued to Siason (sic) for being null and void; the issuance of a new certificate of title in the name of the Yaneses
"in accordance with the sheriffs return of service dated October 20, 1965;" Siason's delivery of possession of Lot
773 to the Yaneses; and if, delivery thereof could not be effected, or, if the issuance of a new title could not be
made, that the Alvarez and Siason jointly and severally pay the Yaneses the sum of P45,000.00. They also
prayed that Siason render an accounting of the fruits of Lot 773 from November 13, 1961 until the filing of the
complaint; and that the defendants jointly and severally pay the Yaneses moral damages of P20,000.00 and
exemplary damages of P10,000.00 plus attorney's fees of P4, 000.00. 25
In his answer to the complaint, Siason alleged that the validity of his titles to Lots 773-A and 773-B, having been
passed upon by the court in its order of September 4, 1965, had become res judicata and the Yaneses were
estopped from questioning said order. 26 On their part, the Alvarez stated in their answer that the Yaneses' cause
of action had been "barred by res judicata, statute of limitation and estoppel." 27
In its decision of July 8, 1974, the lower court found that Rodolfo Siason, who purchased the properties in
question thru an agent as he was then in Mexico pursuing further medical studies, was a buyer in good faith for
a valuable consideration. Although the Yaneses were negligent in their failure to place a notice of lis
pendens "before the Register of Deeds of Negros Occidental in order to protect their rights over the property in
question" in Civil Case No. 5022, equity demanded that they recover the actual value of the land because the
sale thereof executed between Alvarez and Siason was without court approval. 28 The dispositive portion of the
decision states:
IN VIEW OF THE FOREGOING CONSIDERATION, judgment is hereby rendered in the following manner:
A. The case against the defendant Dr. Rodolfo Siason and the Register of Deeds are (sic) hereby dismmissed,
B. The defendants, Laura, Flora and Raymundo, all surnamed Alvarez being the legitimate children of the
deceased Rosendo Alvarez are hereby ordered to pay jointly and severally the plaintiffs the sum of P20,000.00
representing the actual value of Lots Nos. 773-A and 773-B of Murcia Cadastre, Negros Occidental; the sum of
P2,000.00 as actual damages suffered by the plaintiff; the sum of P5,000.00 representing moral damages and the
sum of P2.000 as attorney's fees, all with legal rate of interest from date of the filing of this complaint up to final
payment.
C. The cross-claim filed by the defendant Dr. Rodolfo Siason against the defendants, Laura, Flora and Raymundo,
all surnamed Alvarez is hereby dismissed.
D. Defendants, Laura, Flora and Raymundo, all surnamed Alvarez are hereby ordered to pay the costs of this suit.
The Alvarez appealed to the then Intermediate Appellate Court which in its decision of August 31,
1983 30 affirmed the lower court's decision "insofar as it ordered defendants-appellants to pay jointly and
severally the plaintiffs-appellees the sum of P20,000.00 representing the actual value of Lots Nos. 773-A and
773-B of the cadastral survey of Murcia, Negros Occidental, and is reversed insofar as it awarded the sums of
P2,000.00, P5,000.00 and P2,000.00 as actual damages, moral damages and attorney's fees,
respectively." 31 The dispositive portion of said decision reads:
WHEREFORE, the decision appealed from is affirmed insofar as it ordered defendants-appellants to pay jointly
and severally the plaintiffs- appellees the sum of P20,000.00 representing the actual value of Lots Nos. 773-A and
773-B of the cadastral survey of Murcia, Negros Occidental, and is reversed insofar as it awarded the sums of
P2,000.00, P5,000.00 and P2,000.00 as actual damages, moral damages and attorney's fees, respectively. No
costs.
Finding no cogent reason to grant appellants motion for reconsideration, said appellate court denied the same.
Hence, the instant petition. ln their memorandum petitioners raised the following issues:
1. Whethere or not the defense of prescription and estoppel had been timely and properly invoked and
raised by the petitioners in the lower court.
2. Whether or not the cause and/or causes of action of the private respondents, if ever there are any, as
alleged in their complaint dated February 21, 1968 which has been docketed in the trial court as Civil
Case No. 8474 supra, are forever barred by statute of limitation and/or prescription of action and
estoppel.
3. Whether or not the late Rosendo Alvarez, a defendant in Civil Case No. 5022, supra and father of the
petitioners become a privy and/or party to the waiver (Exhibit 4-defendant Siason) in Civil Case No.
8474, supra where the private respondents had unqualifiedly and absolutely waived, renounced and
quitclaimed all their alleged rights and interests, if ever there is any, on Lots Nos. 773-A and 773-B of
Murcia Cadastre as appearing in their written manifestation dated November 6, 1962 (Exhibits "4"
Siason) which had not been controverted or even impliedly or indirectly denied by them.
4. Whether or not the liability or liabilities of Rosendo Alvarez arising from the sale of Lots Nos. 773-A
and 773-B of Murcia Cadastre to Dr. Rodolfo Siason, if ever there is any, could be legally passed or
transmitted by operations (sic) of law to the petitioners without violation of law and due process . 33
The petition is devoid of merit.
As correctly ruled by the Court of Appeals, it is powerless and for that matter so is the Supreme Court, to review
the decision in Civil Case No. 5022 ordering Alvarez to reconvey the lots in dispute to herein private
respondents. Said decision had long become final and executory and with the possible exception of Dr. Siason,
who was not a party to said case, the decision in Civil Case No. 5022 is the law of the case between the parties
thereto. It ended when Alvarez or his heirs failed to appeal the decision against them. 34
Thus, it is axiomatic that when a right or fact has been judicially tried and determined by a court of competent
jurisdiction, so long as it remains unreversed, it should be conclusive upon the parties and those in privity with
them in law or estate. 35 As consistently ruled by this Court, every litigation must come to an end. Access to the
court is guaranteed. But there must be a limit to it. Once a litigant's right has been adjudicated in a valid final
judgment of a competent court, he should not be granted an unbridled license to return for another try. The
prevailing party should not be harassed by subsequent suits. For, if endless litigation were to be allowed,
unscrupulous litigations will multiply in number to the detriment of the administration of justice. 36
There is no dispute that the rights of the Yaneses to the properties in question have been finally adjudicated in
Civil Case No. 5022. As found by the lower court, from the uncontroverted evidence presented, the Yaneses
have been illegally deprived of ownership and possession of the lots in question. 37 In fact, Civil Case No. 8474
now under review, arose from the failure to execute Civil Case No. 5022, as subject lots can no longer be
reconveyed to private respondents Yaneses, the same having been sold during the pendency of the case by the
petitioners' father to Dr. Siason who did not know about the controversy, there being no lis pendens annotated
on the titles. Hence, it was also settled beyond question that Dr. Siason is a purchaser in good faith.
Under the circumstances, the trial court did not annul the sale executed by Alvarez in favor of Dr. Siason on
November 11, 1961 but in fact sustained it. The trial court ordered the heirs of Rosendo Alvarez who lost in Civil
Case No. 5022 to pay the plaintiffs (private respondents herein) the amount of P20,000.00 representing the
actual value of the subdivided lots in dispute. It did not order defendant Siason to pay said amount. 38
As to the propriety of the present case, it has long been established that the sole remedy of the landowner
whose property has been wrongfully or erroneously registered in another's name is to bring an ordinary action in
the ordinary court of justice for reconveyance or, if the property has passed into the hands of an innocent
purchaser for value, for damages. 39 "It is one thing to protect an innocent third party; it is entirely a different
matter and one devoid of justification if deceit would be rewarded by allowing the perpetrator to enjoy the fruits of
his nefarious decided As clearly revealed by the undeviating line of decisions coming from this Court, such an
undesirable eventuality is precisely sought to be guarded against." 40
The issue on the right to the properties in litigation having been finally adjudicated in Civil Case No. 5022 in favor
of private respondents, it cannot now be reopened in the instant case on the pretext that the defenses of
prescription and estoppel have not been properly considered by the lower court. Petitioners could have appealed
in the former case but they did not. They have therefore foreclosed their rights, if any, and they cannot now be
heard to complain in another case in order to defeat the enforcement of a judgment which has longing become
final and executory.
Petitioners further contend that the liability arising from the sale of Lots No. 773-A and 773-B made by Rosendo
Alvarez to Dr. Rodolfo Siason should be the sole liability of the late Rosendo Alvarez or of his estate, after his
death.
Such contention is untenable for it overlooks the doctrine obtaining in this jurisdiction on the general
transmissibility of the rights and obligations of the deceased to his legitimate children and heirs. Thus, the
pertinent provisions of the Civil Code state:
Art. 774. Succession is a mode of acquisition by virtue of which the property, rights and
obligations to the extent of the value of the inheritance, of a person are transmitted through his
death to another or others either by his will or by operation of law.
Art. 776. The inheritance includes all the property, rights and obligations of a person which are
not extinguished by his death.
Art. 1311. Contract stake effect only between the parties, their assigns and heirs except in case
where the rights and obligations arising from the contract are not transmissible by their nature, or
by stipulation or by provision of law. The heir is not liable beyond the value of the property
received from the decedent.
As explained by this Court through Associate Justice J.B.L. Reyes in the case of Estate of Hemady vs. Luzon
Surety Co., Inc. 41
The binding effect of contracts upon the heirs of the deceased party is not altered by the provision of
our Rules of Court that money debts of a deceased must be liquidated and paid from his estate before
the residue is distributed among said heirs (Rule 89). The reason is that whatever payment is thus
made from the state is ultimately a payment by the heirs or distributees, since the amount of the paid
claim in fact diminishes or reduces the shares that the heirs would have been entitled to receive.
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.
Petitioners being the heirs of the late Rosendo Alvarez, they cannot escape the legal consequences of their
father's transaction, which gave rise to the present claim for damages. That petitioners did not inherit the
property involved herein is of no moment because by legal fiction, the monetary equivalent thereof devolved into
the mass of their father's hereditary estate, and we have ruled that the hereditary assets are always liable in
their totality for the payment of the debts of the estate. 42
It must, however, be made clear that petitioners are liable only to the extent of the value of their inheritance. With
this clarification and considering petitioners' admission that there are other properties left by the deceased which
are sufficient to cover the amount adjudged in favor of private respondents, we see no cogent reason to disturb
the findings and conclusions of the Court of Appeals.
WHEREFORE, subject to the clarification herein above stated, the assailed decision of the Court of Appeals is hereby
AFFIRMED. Costs against petitioners.
G.R. No. 171035 August 24, 2009
WILLIAM ONG GENATO vs. BENJAMIN BAYHON, MELANIE BAYHON, BENJAMIN BAYHON, JR.,
BRENDA BAYHON, ALINA BAYHON-CAMPOS, IRENE BAYHON-TOLOSA, and the minor GINO BAYHON,
as represented herein by his natural mother as guardian-ad-litem, JESUSITA M. BAYHON
This is a consolidated case stemming from two civil cases filed before the Regional Trial Court (RTC) – Civil
Case No. Q-90-7012 and Civil Case No. Q-90-7551.
Civil Case No. Q-90-7012
On October 18, 1990, respondents Benjamin M. Bayhon, Melanie Bayhon, Benjamin Bayhon Jr., Brenda
Bayhon, Alina Bayhon-Campos, Irene Bayhon-Tolosa and the minor Gino Bayhon, as represented by his mother
Jesusita M. Bayhon, filed an action before the RTC, Quezon City, Branch 76, docketed as Civil Case No. Q-90-
7012. In their Complaint, respondents sought the declaration of nullity of a dacion en pago allegedly executed by
respondent Benjamin Bayhon in favor of petitioner William Ong Genato. 2
Respondent Benjamin Bayhon alleged that on July 3, 1989, he obtained from the petitioner a loan amounting to
PhP 1,000,000.00;3 that to cover the loan, he executed a Deed of Real Estate Mortgage over the property
covered by Transfer Certificate of Title (TCT) No. 38052; that, however, the execution of the Deed of Real Estate
Mortgage was conditioned upon the personal assurance of the petitioner that the said instrument is only a
private memorandum of indebtedness and that it would neither be notarized nor enforced according to its tenor. 4
Respondent further alleged that he filed a separate proceeding for the reconstitution of TCT No. 38052 before
the RTC, Quezon City, Branch 87. 5 Petitioner William Ong Genato filed an Answer in Intervention in the said
proceeding and attached a copy of an alleged dacion en pago covering said lot.6 Respondent assailed
the dacion en pago as a forgery alleging that neither he nor his wife, who had died 3 years earlier, had executed
it.7
In his Answer, petitioner Genato denied the claim of the respondent regarding the death of the latter’s wife. 8 He
alleged that on the date that the real estate mortgage was to be signed, respondent introduced to him a woman
as his wife.9 He alleged that the respondent signed the dacion en pago and that the execution of the instrument
was above-board.10
Civil Case No. Q-90-7551
On December 20, 1990, petitioner William Ong Genato filed Civil Case No. Q-90-7551, an action for specific
performance, before the RTC, Quezon City, Branch 79. In his Complaint, petitioner alleged that respondent
obtained a loan from him in the amount of PhP 1,000,000.00. Petitioner alleged further that respondent failed to
pay the loan and executed on October 21, 1989 a dacion en pago in favor of the petitioner. The dacion en
pago was inscribed and recorded with the Registry of Deeds of Quezon City. 11
Petitioner further averred that despite demands, respondent refused to execute the requisite documents to
transfer to him the ownership of the lot subject of the dacion en pago. Petitioner prayed, inter alia, for the court to
order the respondent to execute the final deed of sale and transfer of possession of the said lot. 12
Decision of the Consolidated Cases
The two cases were consolidated and transferred to the RTC, Quezon City, Branch 215. On October 9, 1997,
the trial court rendered its Decision. It found that respondent obtained a loan in the amount of PhP 1,000,000.00
from the petitioner on July 3, 1989. The terms of the loan were interest payment at 5% per month with an
additional 3% penalty in case of nonpayment. 13
With respect to the dacion en pago, the trial court held that the parties have novated the agreement. 14 It deduced
the novation from the subsequent payments made by the respondent to the petitioner. Of the principal amount,
the sum of PhP 102,870.00 had been paid: PhP 27,870.00 on March 23, 1990, PhP 55,000.00 on 26 March
1990 and PhP 20,000.00 on 16 November 1990. 15 All payments were made after the purported execution of
the dacion en pago.
The trial court likewise found that at the time of the execution of the real estate mortgage, the wife of respondent,
Amparo Mercado, was already dead. It held that the property covered by TCT No. 38052 was owned in common
by the respondents and not by respondent Benjamin Bayhon alone. It concluded that the said lot could not have
been validly mortgaged by the respondent alone; the deed of mortgage was not enforceable and only served as
evidence of the obligation of the respondent.16
In sum, the trial court upheld the respondent’s liability to the petitioner and ordered the latter to pay the sum of
Php 5,647,130.00.17 This amount included the principal, the stipulated interest of 5% per month, and the penalty;
and, was calculated from the date of demand until the date the RTC rendered its judgment.
Appeal to the Court of Appeals
Respondents appealed before the Court of Appeals. On March 28, 2002, respondent Benjamin Bayhon died
while the case was still pending decision. 18 On September 16, 2005, the Court of Appeals rendered a decision
reversing the trial court.
The Court of Appeals held that the real estate mortgage and the dacion en pago were both void. The appellate
court ruled that at the time the real estate mortgage and the dacion en pago were executed, or on July 3, 1989
and October 21, 1989, respectively, the wife of respondent Benjamin Bayhon was already dead. 19 Thus, she
could not have participated in the execution of the two documents. The appellate court struck down both
the dacion en pago and the real estate mortgage as being simulated or fictitious contracts pursuant to Article
1409 of the Civil Code.20
The Court of Appeals held further that while the principal obligation is valid, the death of respondent Benjamin
Bayhon extinguished it. 21 The heirs could not be ordered to pay the debts left by the deceased. 22 Based on the
foregoing, the Court of Appeals dismissed petitioner’s appeal. Petitioner’s motion for reconsideration was denied
in a resolution dated January 6, 2006. 23
Petition for Review
Petitioner now comes before this Court assailing the decision of the Court of Appeals and raising the following
issues:
Whether or not Benjamin Bayhon is liable to Mr. Genato in the amount of Php 5,647,130.00 in principal and
interest as of October 3, 1997 and 5% monthly interest thereafter until the account shall have been fully paid. 24
The Court of Appeals erred in declaring the Real Estate Mortgage dated July 3, 1989 and the Dacion en Pago
dated October 21, 1989, null and void.25
We shall first tackle the nullity of the dacion en pago.
We affirm the ruling of the appellate court that the subject dacion en pago is a simulated or fictitious contract,
and hence void. The evidence shows that at the time it was allegedly signed by the wife of the respondent, his
wife was already dead. This finding of fact cannot be reversed.
We now go to the ruling of the appellate court extinguishing the obligation of respondent. As a general rule,
obligations derived from a contract are transmissible. Article 1311, par.1 of the Civil Code provides:
Contracts take effect only between the parties, their assigns and heirs, except in case where the rights and
obligations arising from the contract are not transmissible by their nature, or by stipulation or by provision of law.
The heir is not liable beyond the value of the property he received from the decedent.1avvphi1
In Estate of Hemady v. Luzon Surety Co., Inc.,26 the Court, through Justice JBL Reyes, held:
While in our successional system the responsibility of the heirs for the debts of their decedent cannot exceed the
value of the inheritance they receive from him, the principle remains intact that these heirs succeed not only to
the rights of the deceased but also to his obligations. Articles 774 and 776 of the New Civil Code (and Articles
659 and 661 of the preceding one) expressly so provide, thereby confirming Article 1311 already quoted.
"ART. 774. — Succession is a mode of acquisition by virtue of which the property, rights and obligations to the
extent of the value of the inheritance, of a person are transmitted through his death to another or others either by
his will or by operation of law."
"ART. 776. — The inheritance includes all the property, rights and obligations of a person which are not
extinguished by his death."27 (Emphasis supplied)
The Court proceeded further to state the general rule:
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.28 (Emphasis supplied)
The loan in this case was contracted by respondent. He died while the case was pending before the Court of
Appeals. While he may no longer be compelled to pay the loan, the debt subsists against his estate. No property
or portion of the inheritance may be transmitted to his heirs unless the debt has first been satisfied. Notably,
throughout the appellate stage of this case, the estate has been amply represented by the heirs of the
deceased, who are also his co-parties in Civil Case No. Q-90-7012.
The procedure in vindicating monetary claims involving a defendant who dies before final judgment is governed
by Rule 3, Section 20 of the Rules of Civil Procedure, to wit:
When the action is for recovery of money arising from contract, express or implied, and the defendant dies
before entry of final judgment in the court in which the action was pending at the time of such death, it shall not
be dismissed but shall instead be allowed to continue until entry of final judgment. A favorable judgment
obtained by the plaintiff therein shall be enforced in the manner especially provided in these Rules for
prosecuting claims against the estate of a deceased person.
Pursuant to this provision, petitioner’s remedy lies in filing a claim against the estate of the deceased
respondent.
We now go to the interest awarded by the trial court. We note that the interest has been pegged at 5% per
month, or 60% per annum. This is unconscionable, hence cannot be enforced. 29 In light of this, the rate of
interest for this kind of loan transaction has been fixed in the case of Eastern Shipping Lines v. Court of
Appeals,30 at 12% per annum, calculated from October 3, 1989, the date of extrajudicial demand. 31
Following this formula, the total amount of the obligation of the estate of Benjamin Bayhon is as follows:
Plus: Interest
Principal Php 1,000,000.00

Less: Partial Payments 27,870.00
55,000.00
20,000.00
897,130.00
(12% per annum x 20 years) 2,153,552.00
TOTAL: Php 3,050,682.00
IN VIEW WHEREOF, the decision of the Court of Appeals dated September 16, 2005 is AFFIRMED with the
MODIFICATION that the obligation to pay the principal loan and interest contracted by the deceased Benjamin Bayhon
subsists against his estate and is computed at PhP 3,050,682.00.
April 10, 2019 G.R. No. 240199
SPOUSES ISIDRO R. SALITICO AND CONRADA C. SALITICO vs. HEIRS OF RESURRECCION MARTINEZ *
FELIX, NAMELY: LUCIANO, CORAZON AND CONCEPCION, ALL SURNAMED FELIX, RECAREDO P.
HERNANDEZ, IN HIS CAPACITY AS ADMINISTRATOR OF THE ESTATE OF AMANDA H. BURGOS, AND
THE REGISTER OF DEEDS
The instant case stemmed from a Complaint for Specific Performance with Damages (Complaint) filed on
4
February 15, 2011 by the petitioners Sps. Salitico against the respondents Heirs of Resurreccion Martinez Felix
(Resurreccion); namely: Luciano, Corazon, and Concepcion, all surnamed Felix (collectively referred to as the
respondents heirs); Recaredo P. Hernandez (Recaredo), in his capacity as Administrator of the Estate of
Amanda H. Burgos (Amanda); and the Register of Deeds of Bulacan (RD). The case was heard before the
Regional Trial Comt of Malolos City (RTC), Branch 20 and was docketed as Civil Case No. 73-M-2011.
Amanda is the registered owner of a 1,413-square-meter parcel of land registered in her name under Original
Certificate of Title No. (OCT) P-1908, located in Bambang, Bulacan (subject property).
By virtue of a document entitled Huling Habilin ni Amanda H. Burgos dated May 7, 1986 (Huling Habilin), the
5
subject property was inherited by the niece of Amanda, Resurreccion, as a devisee. The pertinent provision of
the Huling Habilin provides:
Sa aking pamangkin nasi RESURRECCION MARTINEZ-FELIX, 'RESY', ay aking inaaboy ang apat (4) na
parselang lupang palayan na napapaloob sa mga titulong sumusunod:
xxxx 6
Thereafter, Resurreccion, as the new owner of the subject property, executed a document entitled
Bilihang Tuluyan ng Lupa dated November 10, 1998, which transferred ownership over the parcel of land in
7
favor of the petitioners Sps. Salitico. The latter then took physical possession of the subject property.
Subsequently, a proceeding for the probate of the Huling Habilin was undertaken before the RTC, Branch 22
(Probate Court). Respondent Recaredo was appointed as the executor of the Huling Habilin. The latter then filed
and presented the Huling Habilin before the Probate Court, which approved it on February 6, 2008. The Probate
Court likewise issued a Certificate of Allowance on January 12, 2009.
On March 9, 2010, the petitioners Sps. Salitico received a demand letter requiring them to vacate the subject
property and surrender possession over it to the respondents heirs. To protect their interest over the subject
property, the petitioners Sps. Salitico executed an Affidavit of Adverse Claim dated March 17, 2009, which was
however denied registration by the respondent RD on November 3, 2009.
In their Complaint before the RTC, the petitioners Sps. Salitico sought the delivery and return in their favor of the
owner's duplicate copy of OCT P-1908 and the execution of the corresponding Deed of Absolute Sale by way of
confirming the Bilihang Tuluyan ng Lupa. They likewise prayed that OCT P-1908 be cancelled and a new one be
issued in their names. Lastly, they also demanded payment of attorney's fees, moral and exemplary damages,
and reimbursement for litigation expenses.
On February 11, 2013, the petitioners Sps. Salitico filed their Motion for Summary Judgment, which was,
8
however, denied by the RTC in its Order dated June 5, 2013. The petitioners Sps. Salitico filed their Motion for
9
Reconsideration, which was partially granted by the RTC in its Order dated September 18, 2013. The RTC 10
issued a partial summary judgment in favor of the petitioners Sps. Salitico, ordering the respondent RD to
register the petitioners' Affidavit of Adverse Claim dated March 17, 2009. The Pre-Trial of the case was
concluded on September 26, 2013. Thereafter, trial ensued.
The Ruling of the RTC
On June 6, 2014, the RTC rendered its Decision dismissing the Complaint for lack of cause of action.
11
In its Decision, the RTC found that Resurreccion had indeed validly sold the subject property which she inherited
from Amanda to the petitioners Sps. Salitico. Nevertheless, the RTC held that the action filed by the petitioners
Sps. Salitico is premature on the ground that it was not shown that the Probate Court had already fully settled
the Estate of Amanda, even as it was not disputed that the Huling Habilin had already been allowed and
certified. Hence, the RTC dismissed the Complaint for the sole reason that the petitioners Sps. Salitico's cause
of action had supposedly not yet accrued, as the Estate of Amanda has not yet been fully settled by the Probate
Court.
The petitioners Sps. Salitico filed their Motion for Reconsideration, which was denied in the RTC's Order dated
May 26, 2015. 13
Hence, on June 16, 2015, the petitioners Sps. Salitico filed their Notice of Appeal, which was granted by the
RTC on June 18, 2015. The appeal was given due course by the CA.
In the assailed Decision, the CA dismissed the appeal due to the pendency of the probate proceedings before
the Probate Court, citing Rule 75, Section 1 of the Rules of Court, which states that no will shall pass either real
or personal estate unless it is proved and allowed in the proper court. The CA also cited Rule 90, Section 1,
which states that no distribution shall be allowed until the payment of debts, funeral charges, and expenses of
administration, allowance to the widow, and inheritance tax have been made, unless the distributees or any of
them give a bond in a sum fixed by the court conditioned on the payment of the said obligations.
The petitioners Sps. Salitico filed their Motion for Reconsideration dated November 9, 2017, which was denied
14
by the CA in the assailed Resolution.
Issue
Stripped to its core, the Court is asked to rule on whether the CA erred in upholding the RTC's Decision dated
June 6, 2014 and Order dated May 26, 2015, which dismissed the petitioners Sps. Salitico's Complaint for
Specific Performance due to lack of cause of action.
The Court's Ruling
The instant Petition is partly meritorious. 1âшphi1
It is not disputed that by virtue of the decedent Amanda's will, i.e., Huling Habilin, Resurreccion inherited the
subject property as the designated devisee. The respondents heirs themselves admit that Resurreccion is a
testamentary heir of Amanda. 17
It is likewise not disputed that Resurreccion sold her interest over the subject property by executing a document
entitled Bilihang Tuluyan ng Lupa in favor of the petitioners Sps. Salitico who then proceeded to take physical
possession of the subject property. In fact, in the assailed Decision, the CA recognized that the RTC itselfhad
held that "Resurreccion validly sold to [the petitioners Sps. Salitico] all her rights in the [subject property] which
she inherited from Amanda H. Burgos as part of her undivided share in the estate of the latter." 18
Article 777 of the Civil Code, which is substantive law, states that the rights of the inheritance are transmitted
from the moment of the death of the decedent. Article 777 operates at the very moment of the decedent's death
meaning that the transmission by succession occurs at the precise moment of death and, therefore, at that
precise time, the heir is already legally deemed to have acquired ownership of his/her share in the inheritance,
"and not at the time of declaration of heirs, or partition, or distribution." Thus, there is no legal bar to an heir
19
disposing of his/her hereditary share immediately after such death. The Court, early on in Teves de Jakosalem
20
v. Rafols, et al., explained that a sale made by a legal or intestate heir of his share in an inheritance does not
21
interfere with the administration of the estate.
As applied to the instant case, upon the death of Amanda, Resurreccion became the absolute owner of the
devised subject property, subject to a resolutory condition that upon settlement of Amanda's Estate, the devise
is not declared inofficious or excessive. Hence, there was no legal bar preventing Resurreccion from entering
into a contract of sale with the petitioners Sps. Salitico with respect to the former's share or interest over the
subject property.
In a contract of sale, the parties' obligations are plain and simple. The law obliges the vendor to transfer the
ownership of and to deliver the thing that is the object of sale to the vendee. Therefore, as a consequence of
22
the valid contract of sale entered into by the parties, Resurreccion had the obligation to deliver the subject
property to the petitioners Sps. Salitico. In fact, it is not disputed that the physical delivery of the subject property
to the petitioners Sps. Salitico had been done, with the latter immediately entering into possession of the subject
property after the execution of the Bilihang Tuluyan ng Lupa. Therefore, considering that a valid sale has been
entered into in the instant case, there is no reason for the respondents heirs to withhold from the petitioners Sps.
Salitico the owner's duplicate copy of OCT P-1908. To reiterate, Resurreccion already sold all of her interest
over the subject property to the petitioners Sps. Salitico. Therefore, the respondents heirs have absolutely no
rhyme nor reason to continue possessing the owner's duplicate copy of OCT P-1908.
Nevertheless, the existence of a valid sale in the instant case does not necessarily mean that the RD may
already be compelled to cancel OCT P-1908 and issue a new title in the name of the petitioners Sps. Salitico.
According to Section 92 of Presidential Decree No. (PD) 1529, otherwise known as the Property Registration
Decree, with respect to the transfer of properties subject of testate or intestate proceedings, a new certificate of
title in the name of the transferee shall be issued by the Register of Deeds only upon the submission of a
certified copy of the partition and distribution, together with the final judgment or order of the court approving the
same or otherwise making final distribution, supported by evidence of payment of estate tax or exemption
therefrom, as the case may be. The said provision provides:
Section 92. Registration of final distribution of estate. A certified copy of the partition and distribution, together
with the final judgment or order of the court approving the same or otherwise making final distribution, supported
by evidence of payment of estate tax or exemption therefrom, as the case may be, shall be tiled with the
Register of Deeds, and upon the presentation of the owner's duplicate certificate of title, new certificates of title
shall be issued to the parties severally entitled thereto in accordance with the approved partition and distribution.
Further, under Section 91 of PD 1529, even without an order of final distribution from the testate/intestate court
and in anticipation of a final distribution of a portion or the whole of the property, the Register of Deeds may be
compelled to issue the corresponding certificate of title to the transferee only when the executor/administrator of
the estate submits a certified copy of an order from the court having jurisdiction of the testate or intestate
proceedings directing the executor/administrator to transfer the property to the transferees. The said provision
provides:
Section 91. Transfer in anticipation of final distribution. Whenever the court having jurisdiction of the testate or
intestate proceedings directs the executor or administrator to take over and transfer to the devisees or heirs, or
any of them, in anticipation of final distribution a portion or the whole of the registered land to which they might
be entitled on final distribution, upon the filing of a certified copy of such order in the office of the Register of
Deeds, the executor or administrator may cause such transfer to be made upon the register in like manner as in
case of a sale, and upon the presentation of the owner's duplicate certificate to the Register of Deeds, the
devisees or heirs concerned shall be entitled to the issuance of the corresponding certificates of title.
The aforementioned sections of PD 1529 are in perfect conjunction with Rule 90, Section 1 of the Rules of
23
Court, which states that the actual distribution of property subject to testate or intestate proceedings, i.e., the
issuance of a new title in the name of the distributee, shall occur only when the debts, funeral charges, and
expenses of administration, the allowance to the widow, and inheritance tax, if any, chargeable to the estate,
have been paid. Only then can the testate or intestate court assign the residue of the estate to the persons
entitled to the same. Under Rule 90, Section 1, the testate or intestate court may also order the distribution of
the property pending the final order of distribution if the distributees give a bond in a sum fixed by the court
conditioned upon the payment of the aforesaid said obligations within such time as the court directs, or when
provision is made to meet those obligations.
Hence, under the applicable provisions of PD 1529 and the Rules of Court, it is only upon the issuance by the
testate or intestate court of the final order of distribution of the estate or the order in anticipation of the final
distribution that the certificate of title covering the subject property may be issued in the name of the distributees.
In the instant case, there is no showing that, in the pendency of the settlement of the Estate of Amanda, the
Probate Court had issued an order of final distribution or an order in anticipation of a final distribution, both of
which the law deems as requirements before the RD can issue a new certificate of title in the name of the
petitioners Sps. Salitico.
To clarify, this holding does not go against Article 777 of the Civil Code whatsoever. What the aforesaid Civil
Code provision signifies is that there is no legal bar preventing an heir from disposing his/her hereditary share
and transferring such share to another person, inasmuch as the right thereto is vested or transmitted to the heir
from the moment of the death of the decedent or testator. The rule, however, does not state that the transferee
may already compel the issuance of a new certificate of title covering the specific property in his/her name.
Hence, reading Article 777 of the Civil Code together with the pertinent provisions of PD 1529 and the Rules of
Court, while an heir may dispose and transfer his/her hereditary share to another person, before the transferee
may compel the issuance of a new certificate of title covering specific property in his/her name, a final order of
distribution of the estate or the order in anticipation of the final distribution issued by the testate or intestate court
must first be had.
Therefore, despite the existence of a valid contract of sale between Resurreccion and the petitioners Sps.
Salitico, which ordinarily would warrant the delivery of the owner's duplicate copy of OCT P-1908 in favor of the
latter, pending the final settlement of the Estate of Amanda, and absent any order of final distribution or an order
in anticipation of a final distribution from the Probate Court, the RD cannot be compelled at this time to cancel
OCT P-1908 and issue a new certificate of title in favor of the petitioners Sps. Salitico.
WHEREFORE, the appeal is hereby PARTIALLY GRANTED. The Decision dated October 19, 2017 and Resolution dated
June 7, 2018 of the Court of Appeals Twelfth Division and Former Special Twelfth Division, respectively, in CA-G.R. CV No.
105166 are PARTIALLY REVERSED. Judgment is hereby rendered ordering the respondents Heirs of Resurreccion
Martinez Felix to DELIVER the owner's duplicate copy of Owner's Certificate of Title No. P-1908 to the petitioners Sps.
Salitico.
With respect to the petitioners Sps. Salitico's prayer compelling the Register of Deeds to cancel OCT P-1908 and issue a
new certificate of title in their favor, for the reasons stated above, the said prayer is DENIED.

General Provisions (774 To 782)

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General Provisions (774 To 782)

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ANALITA P. INOCENCIO, substituting for RAMON INOCENCIO (Deceased) vs.

HOSPICIO DE SAN JOSE

G.R. No. 201787 September 25, 2013

On 3 March 2005, HDSJ sent a letter to Ramon:

(2) demanding payment of ₱756,449.26 as unrealized fruits; and

(3) giving him 30 days to vacate the property.14

In his Answer dated 1 August 2005,24 Ramon claimed that:

The Ruling of the MeTC-Pasay

Aggrieved, Analita filed an appeal before the RTC-Pasay.

The Ruling of the RTC-Pasay

The Ruling of the CA

The petition questions the following rulings made by the CA:

(1) The sublease contracts were invalid;

Article 1311 of the Civil Code provides:

(1) existence of a valid contract;

(3) interference of the third person without legal justification or excuse. 41

The Inocencios also claimed that:

We do not agree. In Duellome v. Gotico48 and Caleon v. Agus Development Corporation, 49

As correctly pointed out by HDSJ in its Comment: 50

The foregoing provision applies if the improvements were:

Heirs of Villeza vs. Aliangan – GR Nos. 244667-69 (December 2, 2020)

G.R. No. 224144, June 28, 2017

The fallo of the Decision read:

This Court grants the petition.

[G.R. No. 113899. October 13, 1999.]

Synthesized below are the assigned errors for our resolution:

Section 8 of the Insurance Code provides:

Hence, this petition for review.

[ G.R. No. 232579, September 08, 2020 ]

The Ruling of the CA

The Court likewise finds this argument to be without merit.

III. The Necessity of a Prior

 Determination of Heirship in a Separate Special Proceeding

 Ordinary Civil Actions vis-à-vis Special Proceedings

In Bonilla, et al. v. Barcena, et al., the Court held that:

The applicable provisions of the Civil Code are the following:

This argument is not well taken.

On February 7, 1997, the RTC rendered a Decision9 disposing as follows:

and dismissing all other claims of the parties.

Plaintiffs are ordered to pay the costs.

Hence, the instant petition raising a sole issue, to wit:

The Court is not persuaded.

WHEREFORE, we DENY the motion for reconsideration.

PAULA CONDE v. ROMAN ABAYA

1. ESTATES: ACTION AGAINST EXECUTION OR ADMINISTRATIONS. — While an estate is in the

2. DISTINCTION BETWEEN RIGHTS OF ACTION BY LEGITIMATE AND BY NATURAL CHILDREN TO

Per Torres, J., dissenting:

3. NATURAL CHILDREN; SUCCESSION AND TRANSMISSION OF RIGHTS TO DEMAND

According to section 782 of the Code of Civil Procedure —

In support of the foregoing the following authorities may be cited:

(Ibid., Vol. II, 171.)

[G.R. No. L-33187. March 31, 1980.]

On May 6, 1946, Monica Maniega died intestate in Calamba, Laguna.

A contract of sale may be absolute or conditional."

G.R. No. L-68053 May 7, 1990

LAURA ALVAREZ, FLORA ALVAREZ and RAYMUNDO ALVAREZ vs.

The petition is devoid of merit.

G.R. No. 171035 August 24, 2009

Civil Case No. Q-90-7012

Civil Case No. Q-90-7551

Decision of the Consolidated Cases

Appeal to the Court of Appeals

Petition for Review