Rule 98

Trustees
Who is a Trustee?
a trustee is a person appointed by the
court to carry out the provisions of a
will, as provided in Rule 98.
What is Trust?
A trust is generally understood as the
legal relationship between one person
having an equitable ownership in
property and another person owning the
legal title to such property.

Concept of Trust
A trust is a confidence reposed in one person, called the trustee, for the benefit of
another, called the cestui que trust, with respect to the property held by the former for
the benefit of the latter. The person in whom confidence is reposed as regards the
property for the benefit of another is also known as trustee
Jurisdiction
 If it is a testamentary trust, The RTC or MTC in
which the will is allowed.
 Otherwise or if it is a contractual trust, in the
RTC of the province in which the property, or
some portion thereof, affected by trust is
situated.
 Distinction of Trustee from Executor/
Administrator
Trustee
Court which has jurisdiction is RTC or
MTC if appointed to carry into effect the
provisions of the will (RA 11576); the
RTC have jurisdiction if the trustee dies,
resigns or removed in contractual trust.
Accounts must be under oath and filed
annually.
May sell or encumber property of estate
held in trust if necessary or expedient
upon order of the court.
Exec/Ad
Court which has jurisdiction may be RTC
or MTC (RA 11576).
Accounts are not under oath and shall be
filed only at such times as may be
required by the court except for initial
and final submission of accounts.
May encumber, mortgage sell, or property
if it is necessary for the purpose of paying
debts, expenses of administration or
legacies, or for the preservation of
property or if sale will be beneficial to
heirs, legatees or devisees (upon
application to the court with written
notice to the heirs).
 Trustee Exec/Ad
Appointed by court to carry into effect the Appointed by the court to settle the estate
provisions of a will or other written of the decedent.
instrument.
May be exempted from filing a bond if Cannot be exempted from bond even if
provided in the will or if the beneficiaries such exemption is provided in the will
requested exemption. (Sec. 2, Rule 81).
Trusteeship is terminated upon turning Services of executors/ administrators are
over of the property to the beneficiary terminated upon payment of debts of the
after expiration of trust. estate and distribution of property to
heirs.
Trustee has no obligation to pay the debts Executors/ administrators must pay the
of the beneficiary or the trustor. debts of the estate.

The duties of a trustee are usually Duties are only limited (as provided in
governed by the intention of the trustor or Rule 84 of RoC).
the parties if established by a contract and
may cover a wider range.
 Conditions deemed written in the bond
 That the trustee will make and return to the court, at such
time as it may order, a true inventory of all the real and
personal estate belonging to him as trustee which at the time Exception:
of the making of such inventory shall have come to his
possession or knowledge; The court may dispense with the making
and return of an inventory when:
 That he will manage and dispose of all such estate and
faithfully discharge his trust in relation thereto according to - the trustee is appointed as a
law and the will of the testator or the provisions of the successor to a prior trustee;
instrument or order under which he is appointed;
-return of inventory has already
 That he will render upon oath at least once a year until his been filed.
trust is fulfilled, unless he is excused therefrom in any year
by the court, a true account of the property in his hands and
of the management and disposition thereof and will render
such other accounts as the court may order;

 That at the expiration of his trust, he will settle his accounts

in court and pay over and deliver all the estate remaining in
his hands or due from him on such settlement to the person or
persons entitled thereto.
When Court may allow the resignation
of Trustee?

A trustee, whether appointed by the

court or under a written instrument, may
resign his trust if it appears to the court
proper to allow such resignation.
Requisites for the removal of trustee
A trustee may be removed upon:
Cavender v. Cavender, 114 US 464
1) petition to the proper RTC of the parties
beneficially interested;
John Cavender, by his last will and testament, appoints John
2) after due notice to the trustee; S. Cavender as trustee whereby he directed the latter to invest
the trust funds to real and personal securities in order to yield
3) hearing.
regular year to year income to the beneficiary, Robert S.
Cavender.
Grounds for the removal of trustee
A trustee who is insane or otherwise incapable
The trustee disregarded the investment of the said trust funds,
of discharging his trust or evidently unsuitable hence the court held that the neglect to invest the same
therefor may also, after due notice to all persons constitute a breach of trust, and is a ground for removal.
interested, be removed by the court;

Where the acts or omissions of a trustee show

want of reasonable fidelity to his trust, the court
will remove him.
Extent of authority of trustee

New trustee shall have and exercise the same

powers, rights, and duties as if he had been
originally appointed and the trust estate shall
vest in him in like manner as it had vested or
would have vested in the trustee in whose
place he is substituted.

The Court may order such conveyance to be

made by the former trustee or his
representatives or by other remaining trustees,
as may be proper to vest the trust estate in the
new trustee, either alone or jointly with the
others
Rule 101

Proceedings for hospitalization

of insane persons
 Distinction of Rule 101 from Guardianship
under Rules 92-97

Hospitalization of insane persons Guardianship

The purpose is for the protection of the The purpose is protecting the person and
community at large and in the nature of the estate of the insane.
police regulations.

Venue Who may file?

RTC of the province where the person The Secretary of health with the assistance
alleged to be insane is found of city or provincial prosecutor
Date of hearing

If the petition filed is sufficient in form and substance, the court shall, by an order reciting the
purpose of the petition, fix a date for the hearing thereof and copy of such order shall be served:
(1) On the person alleged to be insane and to the one having charge him;
(2) Or on such of his relatives residing in the province or city as the judge may deem proper.

The court shall also order the sheriff to produce the alleged insane person, if possible, on the date
of the hearing (Sec. 2, Rule 101, RoC).
Order of commitment of insane to hospital

The court shall order the commitment of the insane person to such hospital or other place for the insane
as may be recommended by the Director of Health upon satisfactory proof during the hearing:
(1) that the commitment applied for is for the public welfare or for the welfare of the insane person
(2) that his relatives are unable for any reason to take proper custody and care of him.

The court shall make proper provisions for the custody of property or money belonging to the insane
until a guardian is properly appointed (Sec. 3, Rule 101, RoC).

Note: In all actions and proceedings, the burden of proving insanity is on the plaintiff who alleges it; but
where it is set up as an affirmative defense, the burden of proving rests on the defendant.
When may a person committed to a hospital be discharged?

The Secretary of Health may file a petition in the RTC which ordered the commitment, when he is
of the opinion that the person is permanently or temporarily cured or may be released without
danger. The Health Secretary cannot order release without the approval of the RTC.

On the other hand, the RTC cannot order release without recommendation from the Health
Secretary (Chin Ah Foo v. Concepcion, G.R. No. L-33281).

Aside from the procedure outlined in this Rule, an imbecile or insane person who has committed a
felony can also be directly ordered committed by the trial court and he cannot be released without
the permission of said court.
It shall be the duty of the provincial or city prosecutor to
prepare the petition for the Secretary of Health and represent
him in court in all proceedings under this Rule.
References:

Claridades, A.(2017). Special Proceedings: An exhaustive exposition.Central Book

Supply, Inc.
Festin, G.(2020). SPECIAL PROCEEDINGS: A Foresight to the Bar Exam and the
Practice of Law.
https://www.officialgazette.gov.ph/2021/07/30/republic-act-no-11576/
Thank you for listening 