RULE 74 Utolo vs Pasion Nature: This is an appeal taken by the Leona Pasion Vda de Garcia from the order of the Court of First Instance of the Province of Tarlac appointing the applicant as judicial administrator of the property left by the deceased Luz Garcia. Facts: Juan Garcia Sanchez died intestate, and in the proceedings instituted in the Court of First Instance of Tarlac for the administration of his property. Leona Pasion Vda. de Garcia, the surviving spouse and the herein oppositor, was appointed judicial administratrix. The said deceased left legitimate children, named Juan Garcia, jr., Patrocinio Garcia and Luz Garcia who, with the widow, are the presumptive forced heirs. Luz Garcia married the applicant Pablo G. Utulo and during the pendency of the administration proceedings of the said deceased, she died in the province without any legitimate descendants, her only forced heirs being her mother and her husband. The latter commenced in the same court the judicial administration of the property of his deceased wife (special proceedings No. 4188), stating in his petition that her only heirs were he himself and his mother-in-law, the oppositor, and that the only property left by the deceased consisted in the share due her from the intestate of her father, Juan Garcia Sanchez, and asking that he be named administrator of the property of said deceased. Leona Pasion Vda de Garcia objected to the petition, opposing the judicial administration of the property of her daughter and the appointment of the applicant as administrator. She alleged that inasmuch as the said deceased left no indebtedness, there was no occasion for the said judicial administration. Issue: Whether or not there is a need of appointing judicial administrator Ruling: There is no need to appoint judicial administrator. As a general rule that when a person dies living property in the Philippine Islands, his property should be judicially administered and the competent court should appoint a qualified administrator, in the order established in the section, in case the deceased left no will, or in case he had left one should he fail to name an executor therein. This rule, however, is subject to the exceptions established by sections 596 and 597 of the Code of Civil Procedure, as finally amended. According to the first, when all the heirs are of lawful age and there are no debts due from the estate, they may agree in writing to partition the property without instituting the judicial administration or applying for the appointment of an administrator.

Construing the scope of section 596, this court repeatedly held that when a person dies without leaving pending obligations to be paid, his heirs, whether of age or not, are not bound to submit the property to a judicial administration and the appointment of an administrator are superfluous and unnecessary proceedings (Ilustre vs.Alaras Frondosa, 17 Phil., 321; Malahacan vs. Ignacio, 19 Phil., 434; Bondad vs. Bondad, 34 Phil., 232; Baldemorvs. Malangyaon, 34 Phil., 367; Fule vs. Fule, 46 Phil., 317). The SC finally held that, there is no weight in the argument adduced by the appellee to the effect that his appointment as judicial administrator is necessary so that he may have legal capacity to appear in the intestate of the deceased Juan Garcia Sanchez. As he would appear in the said intestate by the right of the representation, it would suffice for him to allege in proof of his interest that he is a usufructuary forced heir of his deceased wife who, in turn, would be a forced heir and an interested and necessary party if she were living. In order to intervene in said intestate and to take part in the distribution of the property it is not necessary that the administration of the property of his deceased wife be instituted an administration which will take up time and occasion inconvenience and unnecessary expenses. N B: This case was decided on Sept 30, 1938 Asuncion vs Dela Cruz Nature: Summary Settlement of the Estate (Rule 74 Sec.2) Facts: The above-entitled proceedings originated with a petition presented in the Court of First Instance of Tarlac for the summary settlement of the estate of the deceased Benedicta de la Cruz. The petition alleges that said deceased left at the time of her death five parcels of land all with original certificates of title in the name of the said deceased. When moved to dismiss the proceedings on the ground that the said oppositor had filed claims in the cadastral proceedings for three of the parcels of land mentioned in the petition. Subsequently the same oppositor filed another opposition on the ground that the said properties did not belong to the deceased Benedicta de la Cruz but to oppositor's father; that if the deceased had any right over the three parcels of land already been transferred by her to the oppositor; that an undivided two-thirds of the other two lots had also been ceded to the oppositor for a valuable consideration and the said decedent had not repurchased the same; etc. After hearing the said opposition the court found that two of the lots mentioned in the petition had been mortgaged to one Juan Cojuangco and another mortgaged also to one Santiago Nicolas, and for this reason the court denied the petition for summary settlement. But a motion for reconsideration was presented, and in accordance therewith the court reconsidered its order of dismissal and granted the summary distribution prayed for, declaring the children of the decedent as her heirs and assigning to all of

them in equal shares, a one-half undivided interest in each of the parcels mentioned in the petition. Contention of the appellant: The lower court erred in finding that the three lots were owned by the deceased and ordering their distribution to her heirs, in the face of the claim of ownership asserted by the oppositor-appellant; that it erred in giving course to the settlement in spite of the fact that the petition in cadastral proceedings had been presented wherein the oppositor-appellant had claimed the three parcels of land in question; and that it erred in not denying the summary settlement in so far as the three lots claimed by the oppositor-appellant are concerned. Issue: 1.Whether or not the lower court erred in finding that the three lots were owned by the deceased and ordering their distribution to her heirs, in the face of the claim of ownership asserted by the oppositor-appellant 2 Whether or not summary settlement should be held in abeyance if there were third party claiming for the title of the property subject of the said settlement. Ruling: 1.No. it did not make a definite finding or conclusion to that effect as against the oppositor-appellant. The court only went to say that there was a presumption that said properties were still owned by the deceased at the time of her death and are free from all incumbrances; but it makes the reservation in favor of the oppositor's claim of the right to a separate action if the claims proprietary rights over said properties. The court states thus in its order: If Celestino de la Cruz claims some proprietary rights over these properties, he can pursue his remedy in a separate and ordinary action which he should bring against the proper parties. 2.No.In the same manner that the court in an administration proceeding determines only in a prima facie manner if a property alleged to belong to the state really belongs to the decedent (Corodova Vda. De Maalac vs. Ocampo, 73 Phil., 661; Baquial vs. Amihan, 49 Off. Gaz., No. 2, p. 511),so also the court in a summary settlement proceeding only determines prima facie the ownership and possession of the properties; but such determination does not prevent the heirs or third parties from claiming title adverse to the decedent's, which title or claims must be decided in a separate suit. (Intestate estate of Miguel Guzman. Guzman vs. Anog and Anog, 37 Phil., 61.) In consonance with these principles the orders appealed from found prima facie that the lots sought to be distributed

among the heirs of the decedent belong to and were in the possession of the said decedent at the time of her death. The orders do not deprive the oppositorappellant of his right to claim said properties as his own and to institute a separate action to assert his title thereto as against the decedent or her heirs.ADELAIDA S. MANECLANG vs. JUAN T. BAUN and AMPARO S. BAUN, ET AL., defendants. CITY OF DAGUPAN Facts: On 12 June 1947, Margarita Suri Santos died intestate. She was survived by her husband Severo Maneclang and nine (9) children. On 30 July 1947, a petition for the settlement of her estate was filed by Hector S. Maneclang, one of her legitimate children. At the time of the filing of the petition, the ages of her children were as follows: Hector Maneclang - 21, Cesar Maneclang 19, Oscar Maneclang 17, Amanda Maneclang 16, Adelaida Meneclang 13, Linda Maneclang 7, Priscila Maneclang 6, Natividad Maneclang 3, Teresita Maneclang 2 No guardian ad litem was appointed by the court for the minor children. On 2 September 1949, Pedro M. Feliciano, the administrator of the intestate estate of Margarita, filed a petition in asking the court to give him "the authority to dispose of so much of the estate that is necessary to meet the debts enumerated" in the petition. While notice thereof was given to the surviving spouse, Severo Maneclang, no such notice was sent to the heirs of Margarita. On 9 September 1949, despite the absence of notice to the heirs, the intestate court issued an Order "authorizing the administrator to mortgage or sell so much of the properties of the estate for the purposes (sic) of paying off the obligations" referred to in the petition. Pursuant to this Order, Oscar Maneclang, the new administrator of the intestate estate, executed on 4 October 1952 a deed of sale 1 in favor of the City of Dagupan, represented by its mayor, Angel B. Fernandez involving the lot in dispute. The City of Dagupan immediately took possession of the land and constructed thereon a public market. On 28 September 1965 (13 yrs after the sale), the new judicial administratrix of the intestate estate, Adelaida S. Maneclang, daughter of the late Margarita Suri Santos, filed an action for the annulment of the sales made by the previous administrator Ruling: As to the notification issue. It does not follow that for purposes of complying with the requirement of notice under Rule 89 of the Rules of the Court, notice to the

father is notice to the children. Sections 2, 4 and 7 of said Rule state explicitly that the notice, which must be in be writing, must be given to the heirs, devisees, and legatees and that the court shall fix a time and place for hearing such petition and cause notice to be given to the interested parties. There can be no dispute that if the heirs were duly represented by counsel or by a guardian ad litem in the case of the minors, the notice may be given to such counsel or guardian ad litem. In this case, however, only the surviving spouse, Severo Maneclang, was notified through his counsel. Two of the heirs, Hector Maneclang and Oscar Maneclang, who were then of legal age, were not represented by counsel. The remaining seven (7) children were still minors with no guardian ad litem having been appointed to represent them. Obviously then, the requirement of notice was not satisfied. The requisite set forth in the aforesaid sections of Rule 89 are mandatory and essential. Without them, the authority to sell, the sale itself and the order approving it would be null and void ab initio. 19 The reason behind this requirement is that the heirs, as the presumptive owners since they succeed to all the rights and obligations of the deceased from the moment of the latter's death, are the persons directly affected by the sale or mortage and therefore cannot be deprived of the property except in the manner provided by law. For want of notice to the children, the Order approving the sale are all void ab initio as against said children. Severo Maneclang, however, stands on different ground altogether. Having been duly notified of the application, he was bound by the said order, sale and approval of the latter. As to whether the plaintiff is in estoppel from assailing the validity of the sale. Estoppel is unavailable as an argument against the administratrix of the estate and against the children. As to the former, this Court, in Boaga vs. Soler, supra, reiterated the rule "that a decedent's representative is not estopped to question the validity of his own void deed purporting to convey land; and if this be true of the administrator as to his own acts, a fortiori, his successor can not be estopped to question the acts of his predecessor are not conformable to law." Not being the party who petitioned the court for authority to sell and who executed the sale, she cannot be held liable for any act or omission which could give rise to estoppel. Considering that, except as to Oscar Maneclang who executed the deed of sale in his capacity as judicial administrator, the rest of the heirs did not participate in such sale, and considering further that the action was filed solely by the administratrix without the children being impleaded as parties plaintiffs or intervenors, there is neither rhyme nor reason to hold these heirs in estoppel. For having executed the deed of sale, Oscar Maneclang is deemed to have assented to both the motion for and the actual order granting the authority to sell. Estoppel operates solely against him.

As to prescription.As to prescription, this Court ruled in the Boaga case that "[a]ctions to declare the inexsistence of contracts do not prescribe (Art. 1410, N.C.C.), a principle applied even before the effectivity of the new Civil Code (Eugenio, et al. vs. Perdido, et al., supra, citing Tipton vs. Velasco, 6 Phil. 67, and Sabas vs. Germa , 66 Phil. 471 )." As to laches. Laches is different from prescription. As the court held in Nielsen & Co. Inc . vs. Lepanto Consolidated Mining Co., 26 the defense of laches applies independently of prescription. While prescription is concerned with the fact of delay, laches is concerned with the effect of delay. In the instant case, from time the deed of sale in favor of the City of Dagupan was executed on 4 October 1952, up to the time of the filing of the complaint for annulment on 28 September 1965, twelve (12) years, ten (10) months and twentyfour (24) days had elapsed. It is an undisputed fact that the City of Dagupan immediately took possession of the property and constructed thereon a public market; such possession was open, uninterrupted and continuous. Obviously, Hector, Cesar, Oscar and Amanda were already of legal age when the deed of sale was executed. As it was Oscar who executed the deed of sale, he cannot be expected to renounce his own act. With respect to Hector, Cesar and Amanda, they should have taken immediate steps to protect their rights. Their failure to do so for thirteen (13) years amounted to such inaction and delay as to constitute laches. This conclusion, however, cannot apply to the rest of the children who were then minors and not represented by any legal representative. They could not have filed an action to protect their interests; hence, neither delay nor negligence could be attributed to them as a basis for laches. Accordingly, the estate is entitled to recover 5/9 of the questioned property. JULIAN BOAGA vs. ROBERTO SOLER, ET AL. Facts: Spouses Alejandro Ros and Maria Isaac died in 1935 and 1940, respectively. Intestate proceedings for the settlement of their estate were commenced. Juan Garza was appointed administrator of the estate. Upon application, Juan Garza was authorized by the probate court on to sell certain parcels of land pertaining to the estate. Pursuant hereto, Garza sold said parcels of land on in favor of appellee Roberto Soler. The heirs of the deceased wife, Maria Isaac, sold all their shares and interests over certain parcels of land in favor of appellee Soler. Sometime during the war, the records of Special Proceeding were destroyed. Upon reconstitution of these records by court order, Julian Boaga was issued letters of administration. The instant action was filed by Boaga in his capacity as administrator, seeking to annul the sales in favor of Roberto Soler on the ground that said transactions were fraudulent made without notice to the heirs of Alejandro Ros of the hearing of the application to sell.

Nothing in the record would show whether, as required by Rule 90, sections 4 and 7, the application for authority to sell was set for hearing, or that the court ever caused notice thereof to be issued to the heirs of Alejandro Ros. Ruling: A sale of properties of an estate as beneficial to the interested parties, under Sections 4 and 7, Rule 90, must comply with the requisites therein provided, which are mandatory. Among these requisites, the fixing of the time and place of hearing for an application to sell, and the notice thereof to the heirs, are essential; and without them, the authority to sell, the sale itself, and the order approving it, would be null and void ab initio. Rule 90, Section 4, does not distinguish between heirs residing in and those residing outside the Philippines. Therefore, its requirements should apply regardless of the place of residence of those required to be notified under said rule. The contention that the sale was made under Section 2, Rule 90 (wherein notice is required only to those heirs, etc., residing in the Philippines), is not substantiated by the record. Neither the deed of sale on August 30, 1944, nor the orders issued by the probate court in connection there with, show whether, as required by said Section 2, the personal properties were insufficient to pay the debts and expenses of administration. There is not even a showing, to start with, that the sale was made for the purpose of paying debts or expenses of administration (or legacies), a condition which circumscribes the applicability of that section. On the face of the reamended complaint at any rate, it does not appear that the contested sale was one under section 2 of Rule 90; and the same can not be invoked to sustain the motion to dismiss. Without reception of further evidence to determine whether the requisites of the applicable provisions of the Rules had been followed, the dismissal of the action was erroneous and improvident. Plaintiff should at least have been given a chance to prove his case. As to the plea of estoppel, the rule is that a decedent's representative is not estopped to question the validity of his own void deed purporting to convey land (Chase vs. Cartwright, 22 Am. St. Rep. 207, and cases cited; Meeks vs. Olpherts, 25 L. Ed. (U.S.) 735; 21 Am. Jur. 756, s. 667); and if this be true of the administrator as to his own acts, a fortiori, his successor can not be estopped to question the acts of his predecessor are not conformable to law (cf. Walker vs. Portland Savings Bank, L.R.A. 1915 E, p. 840; 21 Am. Jur. p. 820, s. 785). As to the plea of prescription. We also find untenable the claim of prescription of the action. Actions to declare the inexistence of contracts do not prescribe (Art. 1410, N.C.C.), a principle applied even before the effectivity of the new Civil Code (Eugenio, et al. vs. Perdido, et al., supra., citing Tipton vs. Velasco, 6 Phil. 67 and Sabas vs. Germa, 66 Phil. 471). The sale on October 14, 1944 by the heirs of Maria Isaac of whatever interests or participation they might have in the four parcels of land covered by the deed may be valid (De Guanzon vs. Jalandoni and Ramos, L-

5049, October 31, 1953; De Jesus vs. Daza, 77 Phil. 152; Cea vs. C.A., 84 Phil. 798), yet it could not have effected an immediate absolute transfer of title to appellee Soler over any part of the parcels of land themselves, much less over their entirety. Necessarily, the sale was subject to the result of the administration proceedings, a contingency upon which the deed of sale itself expressly founded the transaction. By its terms, not only was the existence of possible heirs of Alejandro Ros recognized, but it also provided for the contingency that said heirs could yet be declared or adjudicated in the administration proceedings as the sole owners of the four parcels being sold. The subsequent registration of those lands covered by the sale, allegedly in the exclusive name of appellee Roberto Soler, gave rise to an action for reconveyance based on trust. Assuming that this case is one of constructive trust, and under the theory that actions to recover property held in constructive trust would prescribe, there is here no showing as to when the alleged fraud was discovered (Article 1391, N.C.C.). Hence, it cannot be said that prescription has tolled the action.

Kalalo v. Luz, 34 SCRA 337 On November 17, 1959, plaintiff-appellee Octavio A. Kalalo (hereinafter referred to as appellee), a licensed civil engineer doing business under the firm name of O. A. Kalalo and Associates, entered into an agreement (Exhibit A) 1 with defendant-appellant Alfredo J. Luz (hereinafter referred to as appellant), a licensed architect, doing business under firm name of A. J. Luz and Associates, whereby the former was to render engineering design services to the latter for fees, as stipulated in the agreement. Thereafter, Kalalo rendered engineering services to Luz. On December 11, 1961, appellee sent to appellant a statement of account (Exhibit "1"), 3 to which was attached an itemized statement of defendantappellant's account (Exh. "1-A"), according to which the total engineering fee asked by appellee for services rendered amounted to P116,565.00 from which sum was to be deducted the previous payments made in the amount of P57,000.00, thus leaving a balance due in the amount of P59,565.00. On May 18, 1962 appellant sent appellee a resume of fees due to the latter. Said fees, according to appellant, amounted to P10,861.08 instead of the amount claimed by the appellee. On June 14, 1962 appellant sent appellee a check for said amount, which appellee refused to accept as full payment of the balance of the fees due him. On August 10, 1962, appellee filed a complaint against, appellant, containing four causes of action. In one of the causes of action, appellee alleged that for services rendered in connection with the different projects therein mentioned there was due him fees in sums consisting of $28,000 (U.S.) and P100,204.46,

excluding interests, of which sums only P69,323.21 had been paid, thus leaving unpaid the $28,000.00 and the balance of P30,881.25. The trial court rendered judgment in favor of Kalalo and against Luz, by ordering the latter to pay plaintiff the sum of P51,539.91 and $28,000.00, from which shall be deducted the sum of P69,475.46, which the defendant had paid the plaintiff, As to this issue, Luz contends that Kalalo was in estoppel and cannot modify the statements of accounts that he previously gave to Luz Issue: W/N Kalalo is in estoppels. Held: "Art. 1431. Through estoppel an admission or representation is rendered conclusive upon the person making it, and cannot be denied or disproved as against the person relying thereon." An essential element of estoppel is that the person invoking it has been influenced and has relied on the representations or conduct of the person sought to be estopped, and this element is wanting in the instant case. In Cristobal vs. Gomez, 5 this Court held that no estoppel based on a document can be invoked by one who has not been mislead by the false statements contained therein. And in Republic of the Philippines vs. Garcia, et al., 6 this Court ruled that there is no estoppel when the statement or action invoked as its basis did not mislead the adverse party. Estoppel has been characterized as harsh or odious, and not favored in law. 7 When misapplied, estoppel becomes a most effective weapon to accomplish an injustice, inasmuch as it shuts a man's mouth from speaking the truth and debars the truth in a particular case. 8 Estoppel cannot be sustained by mere argument or doubtful inference; it must be clearly proved in all its essential elements by clear, convincing and satisfactory evidence. 9 No party should be precluded from making out his case according to its truth unless by force of some positive principle of law, and, consequently, estoppel in pains must be applied strictly and should not be enforced unless substantiated in every particular. 10 The essential elements of estoppel in pais may be considered In relation to the party sought to be estopped, and in relation to the party invoking the estoppel in his favor. As related to the party to be estopped, the essential elements are: (1) conduct amounting to false representation or concealment of material facts or at least calculated to convey the impression that the facts are otherwise than, and inconsistent with, those which the party subsequently attempts to assert; (2) intent, or at least expectation that this conduct shall be acted upon by, or at least

influence, the other party; and (3) knowledge, actual or constructive, of the real facts. As related to the party claiming the estoppel, the essential elements are (1) lack of knowledge and of the means of knowledge of the truth as the facts in question; (2), reliance, in good faith, upon the conduct or statements of the party to be estopped; (3) action or inaction based thereon of such character as to change the position or status of the party claiming the estoppel, to his injury, detriment or prejudice. 11 The first essential element in relation to the party sought to be estopped does not obtain in the instant case, for, as appears in the Report of the Commissioner, appellee testified "that when he wrote Exhibit 1 and prepared Exhibit 1-A, he had not yet consulted the services of his counsel and it was only upon advice of counsel that the terms of the contract were interpreted to him resulting in his subsequent letters to the defendant demanding payments of his fees pursuant to the contract Exhibit A." 12 This finding of the Commissioner was adopted by the trial court. 13 It is established, therefore, that Exhibit 1-A was written by appellee through ignorance or mistake, Anent this matter, it has been held that if an act, conduct or misrepresentation of the party sought to be estopped is due to ignorance founded on innocent mistake, estoppel will not arise. 14 Regarding the essential elements of estoppel in relation to the party claiming the estoppel, the first element does not obtain in the instant case, for it cannot be said that appellant did not know, or at least did not have the means of knowing, the services rendered, to him by appellee and the fees due thereon as provided in Exhibit A. The second element is also wanting, for, as adverted to, appellant did not rely on Exhibit 1-A but consistently denied the accounts stated therein. Neither does the third element obtain, for appellant did not act on the basis of the representations in Exhibit 1-A, and there was no change in his position, to his own injury or prejudice De Castro v. Ginete, 27 SCRA 623 Facts: Petitioner Luis G. De Castro and respondent Julio G. Ginete were opposing candidates for the office of municipal mayor of the municipality of Bulan, province of Sorsogon, in the general elections held on November 14, 1967. On January 1, 1968 the board of canvassers, as constituted by the Commission on Elections, proclaimed De Castro as the winning candidate with a margin of 12 votes over Ginete. Ginete filed a motion of protest against the election of De Castro before the Court of First Instance of Sorsogon, alleging the commission of frauds and irregularities to favor the candidacy of De Castro. De Castro then filed a so-called "Manifestation and Motion," which is practically a motion to dismiss the protest upon the ground of estoppel. It is alleged in the

"Manifestation and Motion" that Ginete filed his protest after he had made a written concession of the election of De Castro, and after he had publicly declared during the inauguration and induction of De Castro as Mayor that De Castro had won by a margin of 12 votes and on that occasion he urged the people of Bulan to cooperate with the administration of De Castro. De Castro claims that Ginete is in estoppel due to the following: Petitioner De Castro invited respondent Ginete to attend the ceremony on his inauguration as municipal mayor, scheduled for January 6, 1968, and said respondent accepted the invitation. During the inauguration respondent Ginete accompanied the petitioner to the municipal building and to the plaza where the inaugural program was held. Respondent Ginete went up the inaugural stage along with other officials. Before turning over the symbolic key of responsibility to petitioner De Castro, respondent Ginete delivered a speech saying that the mayor elect had been proclaimed with a majority vote and that the people of Bulan should cooperate with his administration. The outgoing mayor Ginete pleaded with the people that if he had any shortcomings during the four years of his incumbency that he be forgiven by the people. It is now urged by petitioner De Castro before this Court that the lower court should have dismissed the protest because respondent Ginete, by his own acts and utterances, is estopped from contesting the election of herein petitioner. Issue: W/N respondent Ginete is estopped from contesting the election of petitioner De Castro. Held: We cannot sustain the contention of De Castro that Ginete is in estoppel to contest his election. Estoppel rests on this rule: "Whenever a party has, by his own declaration, act or omission, intentionally and deliberately led another to believe a particular thing true, and to act upon such belief, he cannot, in any litigation arising out of such declaration, act, or omission, be permitted to falsify it." 2 The elements of estoppel by conduct are: (1) that there must have been a representation or concealment of material facts; (2) that the representation must have been made with knowledge of the facts; (3) that the party to whom it was made must have been ignorant of the truth of the matter; and (4) that it must have been made with intention that the other party would act upon it. 3 In the case now before Us, it cannot be said that Ginete had by his acts and declarations made representations of fact regarding De Castro's election which

were not known to the latter. Ginete simply made a formal recognition of the fact that De Castro had been proclaimed winner by the municipal board of canvassers of Bulan, and congratulated him and this Ginete did only after the board of canvassers had proclaimed De Castro winner. It can not be said that De Castro came to know about his having won the election because Ginete told him so. Ginete did not mislead De Castro to the belief that he had won the election. It can not be said that De Castro was led to act in assuming the office as mayor because Ginete has made representation to him that he (De Castro) had won the election. De Castro assumed office as mayor by operation of law, because he was proclaimed elected by the municipal board of canvassers in accordance with law. Ginete, by his acts and/or utterances, had not induced De Castro to believe that his election was unquestionable. Ginete is not the one called upon to declare the election of De Castro valid, and so De Castro can not claim that he was induced to believe that he was elected and he assumed office as mayor simply on the basis of Ginete's acts and utterances. Ginete never made any statement that he would not question the election of De Castro. The election case, or the election protest, case that Ginete brought against De Castro did not arise out of any act or declaration of Ginete. The election was that Ginete brought against De Castro has for its basis circumstances that had taken place during the election held on November 14, 1967, or long before Ginete had recognized the proclamation of De Castro as winner. If De Castro was not the real winner in the elections it would not help his case in the election protest to assert that Ginete had congratulated him after he was proclaimed winner by the board of canvassers. We do not see in the facts and/or circumstances shown by the evidence in this case the elements of estoppel that would bar Ginete from questioning the election of De Castro. NIELSON & COMPANY vs. LEPANTO CONSOLIDATED MINING COMPANY G.R. No. L-21601, Dec. 17, 1966 FACTS: On Jan. 30, 1937, a 5-year contract was executed between Nielson and Lepanto whereby Nielson operated and managed the mining properties owned by the Lepanto for a management fee of P2,500.00 a month and a 10% participation in the net profits resulting from the operation of the mining properties. This was later renewed in 1941 for another 5 years. In January, 1942 operation of the mining properties was disrupted on account of the war. The Japanese occupied the mining properties during the war and were ousted from the mining properties only in Aug. of 1945. Lepanto took possession of the properties and its rehabilitation and reconstruction was not completed until 1948. On June 26, 1948 the mines resumed operation under the exclusive management of Lepanto. Nielson and Lepanto had a disagreement as to the status of the operating contract which as renewed expired in 1947. Under its terms the management contract shall remain in suspense in case of fortuitous event or force majeure, such as war or civil commotion, adversely affects the work of mining and milling.

Nielson held the view that, on account of the war, the contract was suspended during the war; hence the life of the contract should be considered extended for such time of the period of suspension. On the other hand, Lepanto contended that the contract should expire in 1947 as originally agreed upon because the period of suspension accorded by virtue of the war did not operate to extend further the life of the contract. On Feb. 6, 1958, Nielson brought an action against Lepanto to recover certain sums of money representing damages allegedly suffered by the former in view of the refusal of the latter to comply with the terms of a management contract. ISSUES/ HELD: 1. WON the management contract has been suspended as a result of the supervening war? YES In order that the management contract may be deemed suspended two events must take place which must be brought in a satisfactory manner to the attention of defendant within a reasonable time, to wit: (1) the event constituting the force majeure must be reasonably beyond the control of Nielson, and (2) it must adversely affect the work of mining and milling the company is called upon to undertake. The Court take judicial notice that war supervened in our country and that the mines in the Philippines were either destroyed or taken over by the occupation forces with a view to their operation, the Lepanto mines included. Reports by Mr. DeWitt (president of Lepanto) and Mr. Blessing (an official Nielson) stated that on February of 1942, the mill, power plant, supplies on hand, equipment, concentrates on hand, and mine, were destroyed upon orders of the U.S. Army to prevent their utilization by the enemy. Beginning February, 1942 the operation of the Lepanto mines stopped or became suspended as a result of the destruction of the mill, power plant and other important equipment necessary for such operation in view of a cause which was clearly beyond the control of Nielson and that as a consequence such destruction adversely affected the work of mining and milling which the latter was called upon to undertake under the management contract. Consequently, by virtue of the very terms of said contract the same may be deemed suspended from February, 1942 and as of that month the contract still had 60 months to go. The Lepanto mines were liberated on Aug. 1, 1945, but because of the period of rehabilitation and reconstruction it cannot be said that the suspension of the contract ended on that date. Hence, the contract must still be deemed suspended during the succeeding years of reconstruction and rehabilitation, and this period can only be said to have ended on June 26, 1948 when the company officially resumed the mining operations of the Lepanto. The period of suspension is from Feb. 1942 to June 26, 1948 as urged by Nielson. 2. WON such suspension extended the period of the management contract for the period of said suspension? YES.

The management contract was extended from June 27, 1948 to June 26, 1953, or for a period of 60 months. Schoely (officer of both companies) and Nestle (employee of Nelson) testified that the suspension had the effect of extending the period of the contract. The standard force majeure clause embodied in the management contract was taken from similar mining contracts regarding mining operations and the understanding regarding the nature and effect of said clause was that when there is suspension of the operation that suspension meant the extension of the contract. Records or minutes of the Special Meeting of the Board of Directors of Lepanto where President DeWitt expressed the opinion that as a result of the suspension of the mining operation because of the effects of the war the period of the contract had been extended. 3. WON Nielson is guilty of laches? NO. The elements of laches are the following: (1) conduct on the part of the defendant, or of one under whom he claims, giving rise to the situation of which complaint is made and for which the complaint seeks a remedy; (2) delay in asserting the complainant's rights, the complainant having had knowledge or notice of the defendant's conduct and having been afforded an opportunity to institute a suit; (3) lack of knowledge or notice on the part of the defendant that the complainant would assert the right on which he bases his suit; and (4) injury or prejudice to the defendant in the event relief is accorded to the complainant, or the suit is not held barred. Not all the elements are present in this case. The 1st element is conceded by Nielson when it claimed that Lepanto refused to pay its management fees, its percentage of profits and refused to allow it to resume the management operation As to the 2nd element, while Nielson knew since 1945 that Lepanto refused to permit it to resume management and that since 1948 Lepanto has resumed operation of the mines and Nielson filed its complaint only on February 6, 1958, the delay is justified and as such cannot constitute laches. Only a period of less than one year had elapsed from the date of the final denial of the claim[June 25, 1957] to the date of the filing of the complaint [Feb. 6, 1958], which certainly cannot be considered as unreasonable delay. As to the 3rd element, it cannot be said that Lepanto did not know that Nielson would assert its rights on which it based suit. Since March 10, 1945, Nielson already claimed its right to the extension of the contract. Lastly if there has been some delay in bringing the case to court it was mainly due to the attempts at arbitration and negotiation made by both parties. 4. WON the action of Nielson prescribed? NO. The defense of laches applies independently of prescription. Laches is different from the statute of limitations. Prescription is concerned with the fact of delay, whereas laches is concerned with the effect of delay. Prescription is a matter of time; laches is principally a question of inequity of permitting a claim to be enforced, this inequity being founded on some change in the condition of the

property or the relation of the parties. Prescription is statutory; laches is not. Laches applies in equity, whereas prescription applies at law. Prescription is based on fixed time, laches is not. Lepanto contended that the period to be considered for the prescription of the claim regarding participation in the profits is only four years, because the modification of the sharing embodied in the management contract is merely verbal, no written document to that effect having been presented. This contention is untenable. A modification, was made in the management contract relative to the participation in the profits by Nielson, as contained in the minutes of the special meeting of the Board of Directors of Lepanto held on Aug. 21, 1940, should be considered as a written contract insofar as the application of the statutes of limitations is concerned. Hence, the action thereon prescribes within ten (10) years. The right of Nielson to its 10% participation in the 1941 operations accrued on Dec. 21, 1941 and the right to commence an action thereon began on Jan. 1, 1942 so that the action must be brought within 10 years from the latter date. In this case, even if complaint was filed only on Feb. 6, 1958 (16y, 1m, 5d), the SC held that the action has not yet prescribed for the following reasons: a. Operation of the Moratorium Law: moratorium may be imposed in times of economic crisis or a natural disaster like a flood or earthquake, to allow people to return to normal before having to worry about preventing foreclosures and the like. Operation of the Moratorium Law suspends the running of the statue of limitations. SC held that the Moratorium Law had been enforced for 8 years, 2 months and 8 days. Deducting this period from the time that had elapsed since the accrual of the right of action to the date of the filing of the complaint, there would be less than 8 years to be counted for purposes of prescription. Hence appellant's action on its claim of 10% on the 1941 profits had not yet prescribed. b. Arbitration clause in the management contract between Nielson and Lepanto. It requires that any disagreement as to any amount of profits shall be subject to arbitration before an action may be taken to court. The evidence shows that an arbitration committee was constituted but it failed to accomplish its purpose on June 25, 1957. YUSINGCO vs. ONG HING LIAN G.R. No. L-26523, Dec.24, 1971 FACTS: On Feb. 13, 1952 Pelagio Yusingco, filed a petition under R.A. No. 26 for the reconstitution of certificates of title covering lots nos. 519, 520, 1014, 1015, 1016, and 1020, alleging, that Alfonso Yusingco having died, his children formed a partnership called Alfonso Yusingco Hermanos to continue his business; that the certificates of title to the said lots had also been transferred to

Yusingco Hermanos and prayed, that the transfer certificates of title in the name of the Yusingco Hermanos which had been lost or destroyed be reconstituted and the same be cancelled and in lieu thereof transfer certificates of title be issued in the name of the heirs of Alfonso. The said petition was opposed by Ong Hing Lian, as administrator of the estate of the late Ong Bonpin, alleging in effect that he and his co-heirs are the lawful owners and possessors of the lots covered by the certificates of title sought to be reconstituted as successors of Ong Bonpin, who at the time of his death was the lawful owner thereof. The lower court issued an order denying the petition for reconstitution, predicated on a finding that Ong Bonpin and his heirs exercised possession of the lots in concept of owners. After remanding the case twice, the Court of Appeals affirmed the decision of the lower court on July 30, 1964. On Oct. 30, 1964, Yusingco filed this 2nd civil complaint (Accion Reivindicatoria with damages and preliminary injunction) against Ong Hing Lian, in his own behalf and/or as administrator of the estate of Ong Bonpin to recover possession and ownership of the lots. On Jan. 12, 1965, the defendant filed a motion to dismiss the present action contending that the same is barred by prior judgment or by the statute of limitations. On Feb. 23, 1965, defendant filed an amended motion to dismiss, alleging further that the plaintiffs have no legal capacity to sue, the complaint states no cause of action, the cause of action has been abandoned, and the plaintiffs are in estoppel and/or guilty of laches. In an order dated June 17, 1965, the lower court dismissed the case.

ISSUES/HELD: 1. WON the 2nd civil complaint (Accion Reivindicatoria with damages and preliminary injunction) was barred by res judicata? YES. For a prior judgment to constitute a bar to a subsequent case the following requisites must concur: (1) It must be a final judgment or order; (2) the court rendering the same must have jurisdiction over the subject matter and over the parties; (3) It must be a judgment or order of the merits; and (4) there must be between the two case identity of parties, identity of subject matter, and identify of action. A prior judgment is conclusive in a subsequent suit between the same parties on the same subject matter, and on the same cause of action, not only as to matters which were decided in the first action, but also as to every other matter which the parties could have properly set up in the prior suit.

The judgment in the reconstitution case was on the merits and is now final and that the reconstitution court had jurisdiction over the subject matter and over the parties. The present case and the reconstitution suit refer to the same subject matter Lots Nos. 519, 520, 1014, 1015, and 1020. Yusingco dispute the identity of cause of action between the two suits, contending that the 1st action was merely for the reconstitution of certificates, wherein the question of possession and ownership cannot be validly passed upon; whereas the present action is an accion reivindicatoria, the proper action to determine the question of possession and ownership In the petition for reconstitution, Yusingco not only asked for the reconstitution of the certificates of title in the name of Yusingco Hermanos but also that the certificates, once reconstituted, be cancelled and new ones be issued in the name of the heirs of Alfonso Yusingco, asserting in effect their right of ownership over the disputed parcels of lands, and the same was opposed by Ong Hing Lian who also asserted his right of ownership over the lands. It is patent that the issue of ownership became the determinative factor in the success of the petition for reconstitution. Between the two suits, there is identity of cause of action the Yusingcos' claim of ownership over the disputed lost as opposed by Ong Hing Lian. What is different here is the form of action. But the employment of two different forms of action, does not enable one to escape the operation of the principle that one and the same cause of action shall not be twice litigated. The parties in the two cases are not entirely identical. The only petitioner in the reconstitution case was Pelagio Yusingco. The CA decision in the reconstitution case, therefore does not bind his co-heirs, his co-plaintiffs in the second case for reivindicacion; said decision therefore can only be considered as res judicata as far as Pelagio Yusingco is concerned, but not as against his coheirs.

c. lack of knowledge or notice on the part of the defendant that the complainant would assert the right on which he bases his suit; and d. injury or prejudice to the defendant in the event relief is accorded to the complainant, or the suit is not held barred. The first element is present because Ong Hing Lian and their predecessors took possession in 1936 of the disputed parcels of land and since then have been exercising acts ownership over the same, which constitute an invasion of Yusingco and his predecessors' alleged rights of ownership and possession. The second element is present because from 1936 Yusingco could have instituted the proper action to recover possession and ownership of the disputed lots, but notwithstanding the invasion of their alleged rights of possession and ownership, Yusingco knowing of the intrusion because of the open, adverse and continuous possession by the appellees and their predecessors instituted a suit only on Oct. 30, 1964 or after 28 years. The fact that a petition for reconstitution of certificates of title was filed by Yusingco on Feb. 13, 1952, does not alter the situation; because even if we count as of that date (Feb. 13, 1952), the fact of delay as an element of laches still obtains considering that as of that date a period of 16 years had elapsed from 1936. The third element is likewise present, since from the time Ong Bonpin and his predecessors took possession of the disputed lots, no voice of protest was raised by Yusingco even though he knew of the construction of the buildings being undertaken by the appellees on the disputed lots. Clear also that the fourth element is present, considering that the appellees will, in the event relief is granted to the Yusingcos, be deprived not only of the lots which they acquired for valuable consideration but also of the valuable permanent improvements which they have introduced on the disputed lots. VILLALUZ vs. NEME G.R. No. L-14676 January 31, 1963 Facts: Maria Rocabo died intestate on February 17, 1937, leaving a parcel of land and granted her under Homestead Patent. She has 6 children: Pedro, Severina, Gregoria, Sinforosa, Patricia and Maria. After the approval of her application, but before granting of the patent, Maria Rocabo donated the southern portion of the land to Maria, and the northern portion to Patricia, in two notarial deeds donation, giving them the right to present their deeds of donations to the Bureau of Lands. Maria and Patricia, however, forgot and cared not to present the deeds of donation to the Bureau of Lands. On March 27, 1930, the patent was granted and O.C.T. No. 217 was issued in the name of Maria Rocabo. Carlos de Jesus, Maria, Patricia and Sinforosa (3 sisters) executed a deed of extrajudicial partition among themselves, to the

2. WON Yusingcos claim over the disputed lots is barred by laches? YES. The claim of ownership of Pelagio Yusingco over the disputed lots is also barred by the equitable principle of laches, which requires the ff essential comments: a. conduct on the part of the defendant, or one under whom he claims, giving rise to the situation that led to the complaint and for which the complaint seeks a remedy; b. delay in asserting the complainant's rights, the complainant having had knowledge or notice of the defendant's conduct and having been afforded an opportunity to institute a suit;

exclusion and without the knowledge and consent of their nephews and nieces, and in virtue thereof, O.C.T. No. 217 was cancelled and Transfer Certificate of Title No. 269 was issued in their names after having made representations that they were the only heirs of their mother, Maria Rocabo. Plaintiffs filed a complaint for partition of said land and recovery of their respective shares on the property and accounting of the fruits thereof. RTC held that the plaintiffs' cause of action had already prescribed. Issue: WON there was prescription? Held: No. Sec. 4, Rule 73 of the Rules refers only to the settlement and distribution of the estate of the deceased by the heirs who make such partition among themselves in good faith, believing that they are the only heirs with the right succeed. In the case at bar, however, the surviving sisters could not have ignored that they had co-heirs, the children of the 3 brothers who predeceased their mother. Considering that Maria Rocabo died during the regime of the Spanish Civil Code, the distribution of her properties should be governed by said Code, wherein it is provided that between co-heirs, the act to demand the partition of the inheritance does not prescribe. Verily the 3 living sisters were possessing the property as administratrices or trustees for and in behalf of the other co-heirs, plaintiffsappellants herein, who have the right to vindicate their inheritance, regardless of the lapse of time. Moreover, the acquisition of the land in question is governed by the Public Land Act No. 141 and the Land Registration Law Act No. 496. And considering that the deed of sale had not been registered in accordance with the said laws, the same did not constitute a conveyance which would bind or affect the land, because the registration of a voluntary sale of land is the operative act that transmits or transfers title. JAVIER vs. MAGTIBAY G.R. No. L-6829 December 29, 1954 Facts: Rufina Mercado died intestate, survived by her second husband Eulogio Magtibay, her only living daughter Catalina Javier and the descendants of her two deceased daughters all three daughters being of the first marriage. Shortly after Rufinas' death, these heirs made an extrajudicial partition of her properties. Alleging that there were some properties not included in the partition, one of the heirs, Catalina Javier, petitioned the court for letters of administration and the

appointment of herself as administratrix. The other heirs opposed the petition on the ground that there was not necessity for subjecting the estate to judicial administration since, according to them, the decedent left no debts, all her properties had already been partitioned and the heirs were all of age or represented by guardian. Issue: Is the court justified in issuing letters of administration? Held: No. When a person dies without leaving pending obligations to be paid, his heirs, whether of age or not, are bound to submit the property to judicial administration, which is always long and costly, or to apply for the appointment of an administrator by the court, "for in such the judicial administration and the appointment of an administrator are superflous and unnecessary proceedings." Where administration proceeding is unnecessary because the estate has no debts and the more expeditious remedy by partition is available the heirs or the majority of them may not be compelled to submit the estate to such proceeding. Since the property of the deceased belongs, from the moment of his death, to the heirs, "what reason can there be," if there are no debts, "for the appointment of a judicial administrator to administer the estate for them and to deprive the real owners of their possession to which they are immediately entitled." Withholding the inheritance from the heirs by subjecting it to an administration proceeding for no useful purpose, would only unnecessarily expose it to the risk of being wasted or squandered as not infrequently happens. Take note of the exception to the rule: Section 1 of Rule 74 "does not preclude the heirs from instituting administration proceedings, even if the estate has no debts or obligation, if they do not desire to resort for good reasons an ordinary action of partition." That statement, it should be noted, sanctions recourse to an administration proceeding even if the estate has no debts only if, as heren expressly stated, the heirs have good reasons for not resorting to an action for partition, and is thus a reaffirmance rather than a repudiation of the doctrine being in line with its policy that where partition is possible, either in or out of court, the estate should not be burdened with an administration proceeding without good and compelling reasons. There appearing to be no good reason for burdening of the estate of the deceased Rufina Mercado with the costs and expenses of an administration proceeding, the trial court was not justified in issuing letters of administration. JOSE McMICKING vs. BENITO SY CONBIENG G.R. No. L-6871 January 15, 1912 21 Phil 211

Road Map: 1902 Margarita Jose (died) Engracio Palanca (administrator) Mariano Ocampo Lao Sempco and Dy Cunyao (surities) 1904 Mariano Ocampo Lao Sempco (died) Doroteo Velasco (administrator) - Mariano Velasco and Pio de la Guardia Barretto (surities) 1905 - Pio de la Guardia Barretto (died) - Benito Sy Conbieng (administrator) Facts: In 1902 one Margarita Jose, died and one Engracio Palanca was appointed administrator with the will annexed of the estate of the said Margarita Jose, and Mariano Ocampo Lao Sempco and Dy Cunyao became his sureties. After the execution of this bond said Palanca, as such administrator, took possession of all the property of the said Margarita Jose. In 1904, Mariano Ocampo Lao Sempco died in the city of Manila. CFI made an order directing the Palanca to furnish a bond to take the place of the undertaking upon which said Mariano Ocampo and Dy Cuyao. The bond thus required was duly filed and the new surities thereon being Juan Fernandez, Luis Saenz de Vismanos and Alejandro Palanca. In the same year 1904, Doroteo Velasco was appointed administrator of Mariano Ocampo Lao Sempco and Mariano Velasco and Pio de la Guardia Barretto qualified as sureties of the said administrator. Doroteo Velasco, as administrator, filed with the court a complete report and inventory of the property of the deceased, together with a statement of all his debts and liabilities. As a part of this report and inventory said administrator filed an instrument signed by all of the persons interested in the estate of the said Mariano Ocampo agreeing to the partition of the estate among themselves without proceedings in court, at the same time assuming the payment of all obligations against the estate. The CFI, upon the request of the administrator and of all parties interested in the estate of the said Mariano Ocampo, entered an order in said agreement. Pursuant to such agreement and order of the court approving the same, Doroteo Velasco, as administrator, delivered to the devisees and legatees of Mariano Ocampo, all of the property of said decedent pursuant to the terms of said agreement of partition, leaving in the hands of the administrator no property or thing of value whatsoever belonging to the said estate. From that time forward said administrator has not had in his possession or control any of the assets of the said estate and has not had any participation in the management thereof. At the time the agreement for participation was made and signed and at the time of the distribution of the property of the estate pursuant thereto, no committee had been appointed to hear claims against the estate of the said Mariano Ocampo, and no notice had been published to creditors of the said deceased to present their claims against the said estate in the manner prescribed by law.

In 1908, Palanca was removed from office as administrator of the estate of said Margarita Jose and Jose McMicking, was appointed in his stead. Palanca refused to render an account of the property and funds of the estate of the said Margarita Jose. Instead of so doing, he retained possession of said property and funds, absconded with the same, and never returned to the Philippine Islands. In 1909, Jose McMicking, as administrator, made an application to the court for the appointment of commissioners of the estate of said Mariano Ocampo for the purpose of hearing claims against the estate. The commission having been appointed and qualified, a claim was presented to it by the plaintiff based upon the defalcation of said Engracio Palanca, as administrator, which claim was allowed by said commission and later approved by the court, which directed that the said claim be paid by Doroteo Velasco, if he had sufficient funds to make such payment. No part of the sum thus found to be due by the commission has been paid to the representative of the estate of said Margarita Jose. In 1905, Pio de la Barretto died and letters of administration were issued to Benito Sy Conbieng. In 1909, upon the application of McMicking, a committee was appointed by CFI Manila to appraise the estate of the said Pio de la Guardia Barretto, deceased, and to hear claims presented against his estate. The claim so presented against the estate of Pio de la Guardia Barretto, deceased, was disallowed by the committee thereof. Upon these facts the court having heard the evidence and the arguments of counsel, rendered judgment in favor of the defendant and against the plaintiff, dismissing the complaint upon merits, without costs. Hence this appeal. Held: The judgement must be affirmed base upon the ground that Doroteo Velasco, for whom the deceased Pio de la Guardia Barretto was surety, would not have been liable himself had this action been commenced against him. If the principal is not liable upon the obligation, the surety cannot be. At the head of the law of administration of the Philippine Islands stands sections 596 and 597 of the Code of Civil Procedure. They are as follows: SEC. 596. Settlement of intestate estates, without legal proceedings, in certain cases. Whatever all the heirs of a deceased person are of lawful age and legal capacity, and their are no debts due from the intestate estate, or all the debts have been paid by the heirs, the heirs may, by a family council as shown under Spanish law, or by agreement between themselves, duly executed in writing, apportion and divide the estate among themselves, as they may see fit, without proceedings in court. SEC. 597. In such case distributees liable for debts. But if it shall appear, at any time within two years after such settlement and distribution of the estate, that there are debts outstanding against the estate which have not been paid, any creditor may compel the settlement of the estate in the courts

in the manner hereinafter provided, unless his debt shall be paid, with interest; and the administrator appointed by the court may recover the assets of the estate from those who have received them, for the purpose of paying the debts; and the real estate belonging to the deceased shall remain charged with the liability to creditors for the full period of two years after such distribution, notwithstanding any transfers thereof that may have been made. These sections provide for the voluntary division of the whole property of the decedent without proceedings in court. These provisions should, therefore, be given the most liberal construction so that the intent of the framers may be fully carried out. In the case at the bar we are of the opinion that, the decision of the property of Mariano Ocampo, deceased, falls within the provisions of said sections and may be termed, a partition of the property of a decedent without legal proceedings within the meaning of those sections. The fact of the prior appointment of an administrator and the filing of an inventory before such partition is of no consequence so far as the right of the owners to partition is concerned. The only requisite for such petition prescribed by the law is that "there are no debts . . . or all the debts have been paid by the heirs." When the condition is fulfilled the partition can take place, no matter what stage the administration may have reached. The basis of the liability of a surety on an administrators' bond is the fault or failure of the principal. The liability of the principal precedes that of the surety. If Velasco incurred no liability, then his surety incurred none. When the persons interested in the estate of Mariano Ocampo agreed voluntarily upon a partition and division of the property of said estate and the actual partition followed, the matter passed out of the hands of Velasco as administrator. Observance of the law discharges obligations; it does not create them; and an obligation once discharged cannot be re-acted by the act of others in which the person as to whom it was discharged takes no part. Moreover, the sureties of an administrator so appointed cannot be held liable for property which by force of law has been taken from the principal and its ownership and control turned over to others. Their obligation is that their principal shall obey the law in the handling and distribution of the estate. Their obligation is discharged when the estate is legally turned over to those entitled thereto. The law requires the principal to turn it over to those who bring themselves within the provisions of section 596. Having turned over the whole estate under the compelling power of the law, his obligation ceased. The responsibility of the sureties ceased at the same time. Without their consent another obligation could not be imposed upon them in relation to the same principal, and the same property, or apart thereof, especially after the lapse of two years. Their undertaking was that their principal should discharge one obligation, not two. It requires no argument to demonstrate that the administration contemplated by section 597 is a new administration and one entirely apart from any other administration theretofore had. This section requires the appointment of a new administrator, with a new undertaking. The administration under the section is

distinct and separate from any administration which may have been in progress at the time of the partition and division under section 596. After the partition and division provided for in sections 596 and 597 have been fully consummated, no further administration of the estate can be had unless there occur the following requisites: 1. There must have been discovered a claim against the estate "within two years after such settlement and distribution of estate." 2. The creditor holding the claim must be the person who moves the court for the appointment of an administrator. In the case at bar: 1. No debt was discovered during the prescribed period. It was nearly four years after the partition of the estate and the taking possession by the heirs of their respective portions before it was even discovered that Palanca had been guilty of converting the property of the estate to his own use; and, so far as the records shows, it was nearly five years before the alleged claim against the estate of Mariano Ocampo was fixed; and 2. No creditor made his application. The necessary conclusion is that the appointment of commissioners to hear the claim above referred to was beyond the powers of the court and was without jurisdiction. The finding of the commissioners had no force or effect. It gave no right against the estate and none against the so-called administrator. This section creates a statute of limitations which deprives all debts which are not discovered within the prescribed time of the power of requiring an administration of the estate. The administration of the estate after the partition under the law has been accomplished depends upon the discovery of the debt "at any time within two years after such settlement and distribution of the estate." The law does not operate unless that discovery is made within the time prescribed. The contention that upon the assumption that a partition is void unless every debt is paid or provided for by the petitioning parties, and may therefore be entirely disregarded by the creditor holding a claim either unpaid or provided for. We do not believe that this assumption is warranted. In the first place, we must remember that the partition proceedings in question are proceedings out of court. Consequently there is no prescribed method of ascertaining and settling claims. The appointment of commissioners, the publication of notice to creditors, and all the other proceedings necessary in cases of administration in court are not required in partition out of court. Second, it was not the intention of the law to pronounce the partition void of no effect simply because not all of the debts were paid before the partition was made. The fact of non payment cannot, then, because by the creditor as a

reason for attacking the partition directly; that is, by asserting that, inasmuch as a payment of all the debts is a condition precedent to the right of partition, such partition cannot legally and validly take place while a debt is outstanding. The mere fact, therefore, that a creditor was not paid before the partition took place furnishes no ground for a revocation of the partition. It simply provides a fact which he may urge as a reason for the appointment of an administrator and the consequent administration of so much of the estate as may be necessary to pay the debt discovered. DAMASA ALCALA vs. MODESTA PABALAN G.R. No. L-6463 August 12, 1911 19 Phil 520 Facts: On April 23, 1897, Juan Banatin died, leaving a widow and seventeen nieces and nephews. That on the June 13, 1987, the said widow and all of the seventeen nieces and nephews, except Tranquilina Banatin, entered into a voluntary agreement among themselves for the division "entre ellos," of all of the property left by the said Juan Banatin, deceased, except the house. That by the terms of said agreement, the said house was to remain undivided and the widow should receive the one-half of the usufruct of said house during her lifetime. That the other one-half of the usufruct should be distributed equally among the other seventeen heirs and Francisco Salgado, one of the nephews, should administer the said house, collecting the rents of the same and deliver one-half to the widow and the other one-half to the nieces and nephews. Francisco Salgado, having failed to pay to Damasa Alcala her share of the usufruct of said property, was sued by her and a judgment was finally rendered against him for the same. In 1907, one-half of the undivided property in question was sold to one Macario Decena. In October 1908, the said one-half of the property in question was repurchased by the heirs of Francisco Salgado. The money used in repurchasing the property by the heirs of Francisco Salgado was the money of four of the heirs of Juan Banatin to wit: Modesta Pabalan, Procopio Pabalan, Basilio Salgado, and Juan Banay-banay and not the money of Francisco Salgado. Thirteen of the nieces and nephews or heirs of Juan Banatin, by means of a public document, recognized the right of the said Modesta Pabalan, Procopio Pabalan, Basilio Salgado, and Juan Banay-banay as the owners of the one-half of the undivided property in question, and thereafter appointed Modesta Pabalan as "administradora" of all of the house in question, in substitution of the said Francisco Salgado deceased. Damasa Alcala presented a petition in the CFI of Laguna, praying that she be appointed administratrix of the property in question which was granted. Issue: WON the appointment of Damasa Alcala as an administratrix correct. Held: No.

The lower court in appointing the Alcala as administratrix of the property in question, evidently did so upon the theory that the said property was still the property of the estate of Juan Banatin. In this theory the lower court was mistaken. There was nothing left of the estate of Juan Banatin to be administered. The heirs by mutual agreement had divided the property among themselves. After the actual division of the estate among themselves they became the absolute owners of their respective allotments and were tenants in common of that portion of the property which remained pro indiviso. After the mutual agreement among themselves for the division of the estate, either actually distributing their respective shares or leaving the same undivided, the property in question was no longer the property of the estate of Juan Banatin, but the undivided property of the heirs. There was no occasion and no reason for the appointment of an administrator by the probate court, and, therefore, the judgment of the lower court appointing Damasa Alcala as administratrix of the estate of Juan Banatin for the purpose of administering the property mentioned in paragraph 4 of the petition, is hereby revoked. Hernandez v, Andal, 78 Phil 196 Lajom v. Viola, 60 OG 452 VICENTA FALCATAN vs. ANASTACIO SANCHEZ (Unreported case) Appeal from a decision of the CFI of the City of Zamboanga providing for the summary settlement of the estate of Patricio Sanchez, deceased. The main issue refers to the manner in which the lot in question shall be divided. Appellant assails the decision upon the ground that in proceedings for the summary settlement of the estate of a deceased person under section 2 Rule 74, the court has no jurisdiction to pass upon the question of title to real property. This is true only where the title is disputed by a third person, not by the surviving spouse or heirs of the deceased, as successors of the latter. There are 2 conjugal partnerships involved here. Under the circumstances, it would be fair to hold that the property in question belongs to the 2 conjugal partnerships, share and share alike. HEIRS OF JOAQUIN TEVES vs. COURT OF APPEALS and the HEIRS OF ASUNCION IT-IT G.R. No. 109963 October 13, 1999

Marcelina Cimafranca and Joaquin Teves had nine children, namely Teotimo, Felicia, Pedro, Andres, Asuncion, Gorgonio, Cresenciano, Arcadia and Maria. After they died, intestate and without debts, in 1943 and 1953, respectively, their children executed extrajudicial settlements purporting to adjudicate unto themselves the ownership over two parcels of land belonging to their deceased parents and to alienate their shares thereto in favor of their sister Asuncion Teves. On May 9, 1984, plaintiffs-appellants Ricardo, son of Cresenciano, and Arcadia Teves filed a complaint with the RTC of Negros Oriental for the partition and reconveyance of two parcels of land located in Dumaguete, designated as Lots 769-A and 6409, against the heirs of Asuncion Teves. The complaint was subsequently amended to include Maria Teves and the heirs of Teotimo, Felicia, Pedro, and Gorgonio Teves as plaintiffs. They alleged that defendants-appellees, without any justifiable reason, refused to partition the said parcels of land and to convey to plaintiffs their rightful shares. The present controversy involves only Marcelina Cimafranca's one-fourth (1/4) share in the land, designated as Lot 769A. On June 13, 1956, Teotimo, Felicia, Pedro, Asuncion, Gorgonio and Arcadia Teves executed a document entitled "Settlement of Estate and Sale," adjudicating unto themselves, in equal shares, Lot 769-A and conveying their shares, interests and participations over the same in favor of Asuncion Teves for the consideration of P425.00. A similar deed denominated "Extrajudicial Settlement and Sale was signed by Maria Teves on April 21, 1959. Under such deed, Maria conveys her own share over Lot 769-A in favor of Asuncion Teves for the consideration of P80.00. The two settlements were denounced by the plaintiffs as spurious. In answer to plaintiffs-appellants' charges of fraud, defendants-appellees maintained that the assailed documents were executed with all the formalities required by law and are therefore binding and legally effective as bases for acquiring ownership or legal title over the lots in question. Furthermore, it is contended that plaintiffs-appellants have slept on their rights and should now be deemed to have abandoned such rights. The trial court ruled in favor of defendants-appellees and rendered judgment dismissing the complaint with costs against plaintiffs-appellants. The Court of Appeals upheld the trial court's decision. Issue 1: Are the extrajudicial settlements executed by the heirs of Teves valid? Held: YES. For a partition pursuant to section 1 of Rule 74 to be valid, the following conditions must concur: (1) the decedent left no will; (2) the decedent left no debts, or if there were debts left, all had been paid; (3) the heirs are all of age, or if they are minors, the latter are represented by their judicial guardian or

legal representatives; (4) the partition was made by means of a public instrument or affidavit duly filed with the Register of Deeds. We uphold, finding no cogent reason to reverse, the trial and appellate courts' factual finding that the evidence presented by plaintiffs-appellants is insufficient to overcome the evidentiary value of the extrajudicial settlements. The deeds are public documents and it has been held by this Court that a public document executed with all the legal formalities is entitled to a presumption of truth as to the recitals contained therein. In order to overthrow a certificate of a notary public to the effect that the grantor executed a certain document and acknowledged the fact of its execution before him, mere preponderance of evidence will not suffice. Rather, the evidence must be so clear, strong and convincing as to exclude all reasonable dispute as to the falsity of the certificate. When the evidence is conflicting, the certificate will be upheld. The appellate court's ruling that the evidence presented by plaintiffs-appellants does not constitute the clear, strong, and convincing evidence necessary to overcome the positive value of the extrajudicial settlements executed by the parties, all of which are public documents, being essentially a finding of fact, is entitled to great respect by the appellate court and should not be disturbed on appeal. The division of Lot 769-A was embodied in two deeds. The first extrajudicial settlement was entered into by Teotimo, Felicia, Pedro, Gorgonio, Arcadia and Asuncion Teves in 1956 , while the second deed was executed in 1959 by Maria Teves. Cresenciano was not a signatory to either settlement. However, in contrast to the extrajudicial settlement covering Lot 6409, the two extrajudicial settlements involving Lot 769-A do not purport to exclude Cresenciano from his participation in Lot 769-A or to cede his share therein in favor of Asuncion. The settlement clearly adjudicated the property in equal shares in favor of the eight heirs of Marcelina Cimafranca. Moreover, the deeds were intended to convey to Asuncion Teves only the shares of those heirs who affixed their signatures in the two documents.

Issue 2: Does the non-registration of an extrajudicial settlement affect its intrinsic validity? Held: No. In the case of Vda. de Reyes vs. CA, the Court, interpreting section 1 of Rule 74 of the Rules of Court, upheld the validity of an oral partition of the decedent's estate and declared that the non-registration of an extrajudicial settlement does not affect its intrinsic validity. It was held in this case that [t]he requirement that a partition be put in a public document and registered has for its purpose the protection of creditors and at the same time the protection of

the heirs themselves against tardy claims. The object of registration is to serve as constructive notice to others. It follows then that the intrinsic validity of partition not executed with the prescribed formalities does not come into play when there are no creditors or the rights of creditors are not affected. Where no such rights are involved, it is competent for the heirs of an estate to enter into an agreement for distribution in a manner and upon a plan different from those provided by law. Thus, despite its non-registration, the extrajudicial settlements involving Lot 769A are legally effective and binding among the heirs of Marcelina Cimafranca since their mother had no creditors at the time of her death. G.R. No. L-5217 May 13, 1953 Intestate Estate of the deceased, CARLOS VELORIA. VICENTE VILORIA, petitioner-appelle, vs. ISIDRO VILORIA, oppositor-appellant. FACTS: On May 10, 1948, petitioner Vicente Viloria filed in the CFI of Pangasinan a petition for summary distribution of the properties left by the deceased Carlos Viloria among the petitioner and Isidoro Viloria. After several postponement of the hearing, the parties, assisted by their respective attorneys, submitted a written stipulation whereby one-fourth portion on the western side of lot No. 3436 and a one-fourth portion of the northeastern side of lot No. 3394 are ceded to the Isidoro Viloria and the remaining threefourths of said lots are ceded to the petitioner Vicente Viloria. In view of this stipulation, the CFI of Pangasinan rendered a decision on March 8,1951, that the dispositive parts of which reads as follows: said properties be summarily adjudicated in accordance with the stipulated agreement submitted by said heirs on February 26,1951 and which is hereby approved, subject, however, to the provision of section 4, Rule 74 of the Rules of Court. Notice of this decision was served on the parties, thru their respective attorneys, on March 13, 1951. On August 1, 1951, the oppositor, Isidoro Viloria, thru another counsel filed a petition praying that said decision be set aside and a trial on the merits be ordered, on the ground that the oppositor, being illiterate, does not know the true contents of the stipulation on which of the decision was based, and that said decision came to his personal knowledge only on July 23, 1951. ISSUE: Whether or not the stipulation or agreement is binding between the parties. RULING: YES. Appellant argued that his petition is one for relief under Rule 38 of the Rules of Court, founded on fraud or mistake consisting in the fact that he signed the stipulation in question in the belief that it adjudicated to him one-half of the

entire estate left by the deceased Carlos Viloria. We cannot accept the appellant's position. The stipulation bore not only his signature but also that of his attorney, and during the hearing held on March 5, 1951, he confirmed, upon being questioned by the trial Judge, his thumbmark appearing on the document containing the stipulation. His attorney was also present at the hearing, and it cannot be supposed, in the absence of any showing to the contrary, that the latter acted irregularly. Indeed, the appellant did not ask for a change of attorney. The appellant cannot claim that he learned of the decision only on July 23, 1951, because he was represented by counsel who received notice on March 13, 1951, and this is notice to the appellant. Much less can the latter claim that he was not timely apprised of the tenor of the appealed decision, but he must have known that said decision was to conform to the stipulation in question. G.R. No. L-10474 February 28, 1958 BENNY SAMPILO and HONORATO SALACUP, petitioners, vs. THE COURT OF APPEALS and FELISA SINOPERA respondent. FACTS: Teodoro Tolete died intestate in January, 1945. He left 4 parcels of land in San Manuel, Pangasinan. He left as heirs his widow, Leoncia de Leon, and several nephews and nieces, children of deceased brothers and sisters. On July 25, 1946, without any judicial proceedings, his widow executed an affidavit stating that "the deceased Teodoro Tolete left no children or ascendants or acknowledged natural children neither brother, sisters, nephews or nieces, but the, widow Leoncia de Leon, alone to inherit the above properties". On the same day, she executed a deed of sale of all the above parcels of land in favor of Benny Sampilo for the sum of P10,000. On June 17, 1950, Benny Sampilo, in turn, sold the said parcels of land to Honorato Salacup for P50,000. In March, 1950, Felisa Sinopera instituted proceedings for the administration of the estate of Teodoro Tolete (Special Proceeding No. 3694, Pangasinan), and having secured her appointment as administratrix, brought the present action on June 20, 1950. The complaint alleges that the widow Leoncia de Leon, had no right to execute the affidavit of adjudication and the invalidity of the sale. Sampilo and Salacup filed an amended answer alleging that the complaint states no cause of action; and that if such a cause exists the same is barred. The CFI rendered judgment for the plaintiff, Felisa Sinopera, declaring that the affidavit of adjudication and the deeds of sale as all null and void. The case was appealed to the CA. It held that the sale is valid as to the one-half share of the land. ISSUE: Whether or not respondent Felisa Sinopera's right of action to recover her and her co-heirs' participation to the lands in question had not prescribed at the time the action to recover was filed.

RULING: YES. It is argued that as the action was instituted almost 4 years after the affidavit of adjudication was registered in the Office of the Register of Deeds Of Pangasinan, the right of action of the administratrix has prescribed and lapsed because the same was not brought within the period of 2 years as prescribed in Section 4 of Rule 74 of the Rules of Court, and as decided in the cases of McMicking vs. Sy Conbieng, 21 Phil., 211 and Ramirez vs. Gmur, 42 Phil., 855 869. Section 4 of Rule 74 provides, in part, as follows: SEC. 4. Liability of distributees and estate. If it shall appear at any time within two years after the settlement and distribution of an estate in accordance with the provisions of either of the first two sections of this rule, that an heir or other has been unduly deprived of his lawful participation of the such heir or such other person may compel the settlement estate in the courts in the manner hereinafter provided for the purpose of satisfying such lawful participation. . . . Section 1, which is mentioned in Section 4, reads as follows: SEC. 1. Extrajudcial settlement by agreement between the heirs. If the decedent left no debts and the heirs and legatees are all of age, or the minors are represented by their judicial guardians, the parties may, without securing letters of administration, divide the estate among themselves as they see fit by means of a public instrument filed in the office of the register of deeds, and should they disagree, they may do so in an ordinary action of partition. If there is only one heir or one legatee, he may adjudicate to himself the entire estate by means of an affidavit filed in the office of the register of deeds. It shall be presumed that the decedent left no debts if no creditor files a petition for letters of administration within two years after the death of the decedent. There are two significant provisions in Sections 1 and 4 of Rule 74. In Section 1, it is required that if there are two or more heirs, both or all of them should take part in the extrajudicial settlement. This requirement is made more imperative in the old law (Section 596, Act No. 190) by the addition of the clause "and not otherwise." By the title of Section 4, the "distributees and estate" indicates the persons to answer for rights violated by the extrajudicial settlement. On the other hand, it is also significant that no mention is made expressly of the effect of the extrajudicial settlement on persons who did not take part therein or had no notice or knowledge thereof. There cannot be any doubt that those who took part or had knowledge of the extrajudicial settlement are bound thereby. As to them the law is clear that if they claim to have been in any manner deprived of their lawful right or share in the estate by the extrajudicial settlement, they may demand their rights or interest within the period of two years, and both the distributees and estate would be liable to them for such rights or interest.

But as to those who did not take part in the settlement or had no notice of the death of the decedent or of the settlement, there is no direct or express provision. Thus, it is unreasonable and unjust that they also be required to assert their claims within the period of two years. To extend the effects of the settlement to them, to those who did not take part or had no knowledge thereof, without any express legal provision to that effect, would be violative of the fundamental right to due process of law. The procedure outlined in Section 1 of Rule 74 of extrajudicial settlement, or by affidavit, is an ex parte proceeding. It cannot by any reason or logic be contended that such settlement or distribution would affect third persons who had no knowledge either of the death of the decedent or of the extrajudicial settlement or affidavit, especially as no mention of such effect is made, either directly or by implication. Hence, the provisions of Section 4 of Rule 74, 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, in addition, (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. The case at bar fails to comply with both requirements because not all the heirs interested have participated in the extrajudicial settlement, the Court of Appeals having found that the decedent left aside from his widow, nephews and nieces living at the time of his death. BELTRAN, ET ALvs. AYSON and JEMINEZ G.R. No. L-14662 FACTS: This action was commenced principally to set aside a deed of extrajudicial partition registered with the proper Registry of Deeds, Pursuant to Section 1, Rule 74, of the Rules of Court (extrajudicial settlement by agreement between heirs), and the Torrens title issued by virtue thereof. The parties stipulated on the facts: 1. That there is no question about the Original Certificate of Title No. 51521 in the name of Macario Beltran; 2. That a deed of partition was made in the year 1943 by Corazon Ayson and Jose de la Cruz; 3. That pursuant to the deed of extrajudicial partition, the defendants obtained Transfer Certificate of Title No. 23235; 4. That the plaintiffs are the nephews and nieces of Macario Beltran, being the children of his brothers and sisters; Leonarda Beltran, sister of Macario Beltran, survived by Bartolome, Mariano, Felipe, Juan, Felix, Marcela, Pilar all surnamed Jeminez; Marcela died in 1950, survived by

her children, Juanita and Gregorio, both surnamed Austria; Genoveva Beltran died survived by Damian, Petra Dionisio, and Donato, all surnamed De la Cruz, as children; 5. That the defendant is the widow of Macario Beltran; 6. That the plaintiffs were not aware of the deed of extrajudicial partition until shortly before th