SpecPro Round 3 Digests

8/3/2019 SpecPro Round 3 Digests

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SPECPRO DIGESTS RDS. 3 & 4 A2010 PROF. LEO BATTAD

MALOLOS V ASIA PACIFIC FINANCECORPORATION147 SCRA 61

PARAS; January 07, 1987

FACTS- Petitioner Josephine Cruz Malolos (deceased) is

represented by her heirs Emmanuel, MariaMarinela and Maria Marjorie, all surnamedMalolos.- APCOR purchased from E. Francisco LinersCompany, Inc. a postdated Far East Bank and

Trust Company check in the amount ofP105,000.00 issued in the latter's favor bypetitioner, Josephine Cruz Malolos.- On purchase, Francisco Liners executed a Deedof Assignment of said check and as payee,endorsed the same in favor of private respondentbefore getting the discounted proceeds.- When deposited on its maturity date, theaforesaid check was dishonored for the reasonthat petitioner's bank account had already been

closed.- APCOR demanded from Francisco Liners andalso from petitioner, in her capacity as drawer ofthe check, the payment of said check, but theobligation remained unpaid.- APCOR filed a complaint for sum of money withpreliminary attachment against E. FranciscoLiners, Co., Inc., Elias A. Francisco, and petitioner(in her capacity as drawer of said check).- Respondent Judge issued an Order ofAttachment.- Josephine Cruz Malolos died and her counselfiled a Motion to Dismiss the complaint as againsther pursuant to Sec. 21, Rule 3 of the Rules ofCourt.

- Private respondent opposed the aforementionedmotion and argued that Sec. 21, Rule 3 of theRules of Court admits of exceptions and one ofthem is when an attachment has been levied onsome of the properties of the defendant, onmotion of the plaintiff, to secure the payment ofthe latter's money claim in which case thepending action should not be dismissed but maybe continued against the executor oradministrator, invoking the ruling in the case ofMacondray Co., Inc. v. Dungao.- Respondent Judge ruled in favor of privaterespondent and denied the motion to dismiss.

ISSUE

WON an attachment levied on some properties ofthe defendant constitutes an exception to thegeneral rule of non-survival of the money claimas provided for in Sec. 21, Rule 3 of the Rules ofCourt.

HELD- NO. There is no question that the action in the

court below is for collection or recovery of money.- It is already a settled rule that an action forrecovery of money or for collection of a debt isone that does not survive and upon the death ofthe defendant the case should be dismissed to bepresented in the manner especially provided inthe Rules of Court. This is explicitly provided inSec. 21, Rule 3 of the Rules of Court .- Dy v. Enage: The language of Section 21 of Rule3 is too clear in this respect as to require anyinterpretation or construction. It very explicitlysays that when the action for recovery of money,debt or interest thereon, and the defendant diesbefore final judgment in the Court of FirstInstance, it shall be dismissed to be prosecuted in

the manner specially provided by the rules,meaning, Section 5 of Rule 86 and its relatedprovisions.- Earlier, Secs. 119 and 700 of Act 190 (Code ofCivil Procedure) from which this Rule was derivedwere interpreted by the Supreme Court in Pabicov. Jaranilla, et al. to be mandatory in characterand confers no jurisdiction upon the Court.- The reason for the dismissal of the case is thatupon the death of the defendant a testate orintestate proceeding shall be instituted in theproper court wherein all his creditors mustappear and file their claims which shall be paidproportionately out of the property left by thedeceased.

- The purpose of the rule is to avoid uselessduplicity of procedure ---- the ordinary actionmust be wiped out from the ordinary court.- The case of Macondray v. Dungao, supra, citedby private respondent to support its position doesnot fall squarely with the case at bar.- In the above-cited case, the facts are as follows:(1) the promissory note executed by defendantDungao represented the purchase price of the carand trucks which said defendant bought fromMacondray on installment; (2) a writ ofattachment was issued on August 16, 1949, butthis was later on dissolved on September 21,1949, when the defendant put up a surety bond;and (3) the promissory note sued upon in the

cited case was secured by a mortgage onpersonal property and the proper action shouldhave been a foreclosure of mortgage.- In the present case, the money claim arose outof a pure and simple debt, which asaforementioned, under the provision of Rule 3,Sec. 21 of the Rules of Court shall be dismissedand must be brought before the probate court.

- In the light of the foregoing considerations, theconclusion is inevitable that the trial courtdeviated from the procedure laid down by theprovisions of the Rules. The fact that a writattachment has been issued cannot provide anexcuse for such deviation, as a writ of attachmentis a remedy ancillary to the principal proceedings.Consequently, if it is mandatory, under Rule 3Sec. 21 of the Rules of Court that the principalproceeding or action be dismissed for non-survival of the money claim, the purpose of theattachment which is to secure the outcome of thetrial no longer exists and so with the reasons forthe issuance of the writ in this case, insofar asthe deceased debtor is concerned.

- Corollary thereto, it has been held that a courtorder which violates the Rules constitutes graveabuse of discretion as it wrecks the orderlyprocedure prescribed for the settlement of claimsagainst deceased persons designed to protect theinterests of the creditors of the decedent.Allowing the private respondent to attachpetitioners' properties for the benefit of her claimagainst the estate would give an undueadvantage over other creditors against theestate. Therefore, under the same principle, awrit of attachment already issued in connectionwith a money claim which has to be dismissedbecause of the death of the defendant beforefinal judgment cannot provide an exception to the

general rule, and must accordingly be dissolved.Disposition Resolution of respondent Judge SETASIDE

LUZON SURETY COMPANY, INC. V.IAC AND THE PUVATS

151 SCRA 652GUTIERREZ, J; June 30, 1987

FACTS-In Civil Case No. 59506 of CFI Manila, entitled'Luzon Surety Co., Inc., v. Material Distributors(Phil.), Inc., et al.,' judgment was rendered

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against the defendants, including Gil Puyat, forthe principal sum of P20T with interest. The

judgment became final on April 13, 1967, but wasnot enforced. Within the prescription period, CivilCase No. 93268 was instituted to revive theearlier judgment.-When Gil Puyat died, a claim against his estatewas filed in Sp. Proc. No. Q-32291 of CFI Rizal

(Quezon City) for the principal sum ofP178,507.76, including interests, unpaidpremiums and stamps, and attorney's fees andcosts of suits. The administrators opposed theclaim for the reason that it is unenforceable andbarred by laches for no steps were taken by theclaimant to secure a writ of execution againstdefendant Gil Puyat during his lifetime to enforceany of the two judgments.-RTC QC dismissed the case. IAC dismissed thepetitioner's appeal by ruling that the prescriptionof an action is not counted from the expiration ofthe five-year period within which the judgmentmay be enforced by a mere motion but from thefinality of that judgment. MFR was denied.

[CA: When the claim against the estate was filedon Sept 1, 1982, more than seventeen years hadelapsed from the time judgment in Civil Case59506 became final and more than five yearsafter the finality of its revived judgment in CivilCase 93268. Clearly, the right of claimant tosatisfy the original judgment had longprescribed.]Petitioner says: the period of ten (10) yearsprescribed in the statute of limitations should becounted not from the date of the finality of theoriginal judgment but from the date of the finalityof the revived judgment.Relevant provisions:*Articles 1144, NCC: The following actions must

be brought within ten years from the time theright of action accrues: xxx 3. Upon judgment.*Rule 39.6, RoC: Execution of motion or byindependent action. A judgment may be executedon motion within five (5) years from the date ofits entry or from the date it becomes final andexecutory. After the lapse of such time, andbefore it is barred by the statute of limitations, a

judgment may be enforced by action.

ISSUEWON the action has prescribed

HELD: YES.

-The decision in Civil Case No. 59506 becamefinal and executory on April 13, 1967. The

judgment was not enforced. The petitionerinstituted Civil Case No. 93268 within theprescriptive period to revive the judgment in CivilCase No. 59506. The revived judgment wasrendered on May 24, 1974. This judgmentbecame final and executory sometime in 1974.

Again, this was not enforced. On September 1,1982, the petitioner filed a claim in SpecialProceedings No. Q-32291 before the then Courtof First Instance of Rizal. What is sought is asecond revival of the judgment that had becomefinal in 1967. This can no longer be done due tothe lapse of the allowable period.-It is now settled that the ten-year periodwithin which an action for revival of ajudgment should be brought, commences torun from the date of finality of the judgment, and not from the expiration ofthe five-year period within which thejudgment may be enforced by mere motion(Art. 1152, Civil Code).

-The source of R39.6 is Sec.447 of the Code ofCivil Procedure which in turn was derived fromthe Code of Civil Procedure of California. The rulefollowed in California in this regard is that aproceeding by separate ordinary action to revivea judgment is a new action rather than acontinuation of the old, and results in a new

judgment constituting a new cause of action,upon which a new period of limitations begins torun.-PNB v. Deloso (32 SCRA 266), citing GutierrezHermanos v. De La Riva 46 Phil., 827 (1923): theten-year prescriptive period commences to runfrom the date of finality of the judgment and notfrom the expiration of five (5) years thereafter.

Three reasons were there advanced, to wit:(1) Correlating the relevant provisions, theconclusion one arrives at is that after theexpiration of the five years within whichexecution can be issued upon a judgment, thewinning party can revive it only in the mannertherein provided so long as the period of tenyears does not expire from the date of said

judgment(2) Right of the winning party to enforce the

judgment against the defeated party begins toexist the moment the judgment is final; and thisright, consists in (a) having an execution of the

judgment issued during the first five years nextfollowing, and in (b) commencing after that

period the proceeding to revive it, a remedy to bepursued only before the judgment prescribes(i.e., during the five years next following)(3) If it is held that the winning party has still ten(10) years within which to revive the judgmentafter the expiration of five (5) years, then the

judgment would not prescribed until after fifteen(15) years, which is against the provisions of the

Code of Civil Procedure.-Failure of the Puyats to raise prescription in their"Comment to Claim" does not imply the waiver ofsuch defense. In the instant case, there is no newissue of fact that arises in connection with thequestion of prescription. All the pertinent datesshowing that the petitioner's enforcement of the

judgment under Civil Case No. 93268 has alreadyprescribed can be found in the petitioner'sallegations in the "claim" as well as its evidencefiled in Special Proceedings No. Q-32291. Thisremoves the case from the general rule thatprescription if not impleaded in the answer isdeemed waived.Disposition Petition is dismissed.

GONZALES V LOOD

ALBANO V AGTARAPARELLANO; March 25, 1912

FACTS-Lucio Agtarap owned several parcels ofagricultural land and at his death left four sons,one of whom, Silverio, died. Upon the death ofSilverio Agtarap, his widow, Juana Domingo,began special proceedings for settlement of theintestate estate of her deceased husband bypetitioning for an administrator and Rodrigo

Albano was appointed.-As such administrator Rodrigo Albano instituteda civil action against the other three heirs ofLucio Agtarap.-The following are pertinent facts in this case: (1)It is proven that Lucio Agtarap is the legitimatefather of Silverio, Cornelio, and Nicolas Agtarapand the grandfather of Melecio Agtarap; (2) it isadmitted that Lucio Agtarap died leavingproperty; (3) it is proven that the property left athis death by Lucio Agtarap has been seized by hissaid descendants, now the defendants, withoutgiving Silverio his share; (4) it is proven that, atthe least, the property was left by Lucio Agtarap.

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-According to law, one-fourth of this propertybelongs to Silverio Agtarap.-The judgment of the court directs that one-fourthpart of this property be delivered to theadministrator of the intestate estate of the lateSilverio Agtarap, as his legacy, so that, afterproper proceedings, their respective portions maybe adjudicated to the widow and other heirs of

the said Silverio.

ISSUEWON the heirs of Silverio should receive of theestate of Lucio and what is the proper procedure

HELD-Yes he should through a special proceeding.

The necessary procedure of a special proceedingsin the intestate estate of Silverio Agtarap, inwhich may properly be presented the claim of theadministrator of the said intestate estate onbehalf of Juana Domingo for her "legal portion aswidow," as well as the proceedings for provingthat Eugenia Agtarap is a legitimate daughter in

order to have her declared the sole heir of thewhole of the said fourth part of the propertywhich corresponds to him whom she calls herlegitimate father.-A trial held for such purpose it will determinewho are the heirs of the intestate estate ofSilverio Agtarap; whether she who calls herselfhis legitimate daughter, Eugenia Agtarap; or hisbrothers Cornelio and Nicolas and his nephewMelecio, all surnamed Agtara.

The lawful usufruct pertaining to the widow willdepend upon whether the alleged daughter or thebrothers and nephew of the deceased are entitledto the inheritance, for if she who claims to be thedaughter, Eugenia Agtarap, be declared the sole

heir of the deceased Silverio Agtarap, the widowsshare would be different from what it would if thedefendants in this case, as brothers and nephewof the deceased Silverio Agtarap, are declared tobe the sole heirs ---- in accordance with thevarious provisions of the Civil Code in thisrespect.Only in such special proceedings, wherein thenecessary orders can be issued and executed,can findings be made as to who are the heirs andwhat portions to them, the nature of their titles,and in case of usufruct what part pertains toeach.Disposition : Affirmed

MORELAND, DISSENTINGNowhere in the law of these Islands is anadministrator given power to bring an action forthe partition of real estate. The persons and theonly persons authorized to bring such an actionare those mentioned in section 181 of the Codeof Civil Procedure.

The Civil Code does not authorize such an action

as the present.

HEIRS OF GREGOIRE V. BAKER51 PHIIL. 75

STREET; November 19, 1927

NATUREAppeal from an order of CFI

FACTS- J. H. Ankrom, resident of Prov. of Davao, died onSept. 18, 1922. The appellee, A. L. Baker, wasqualified as his administrator. Baker filed his

inventory of the assets pertaining to the estate ofhis decedent, in which inventory was included atract of land covered by Torrens cert. of title andwith an area of more than 930 hectares. In thisinventory, said tract of land, with improvements,was estimated at nearly P60K.- The heirs of Rafael Gregoire, appellants herein,filed a claim against the estate of Ankrom forP70, 877.56, based upon a judgment rendered inSC of Rep. of Panama. This claim was allowed bythe commissioners in the estate of Ankrom, andno appeal was at any time taken against theorder so allowing it.- As the affairs of the estate stood upon theoriginal inventory, there appeared to be sufficient

assets to pay all claimants; but while theseintestate proceedings were being conducted theadministrator discovered that 1 years beforehis death, Ankrom had executed a mortgage onthe property in question in favor of the Phil. TrustCo. to secure that company from liability on anote of P20K. 2 days after this mortgage hadbeen executed Ankrom appears to have made anassignment of all his interest in the mortgagedproperty to one J.G. Jung, of Ohio, for a purportedconsideration of P1 and other good and valuableconsiderations.- In view of these conveyances by his intestate,the administrator presented an amendedinventory, omitting the tract of 930 hectares with

its improvements thereon, the same being theland covered by the transfers above mentioned.

The court, however, having its attention called tothe fact that the omission of this property fromthe inventory would leave the estate insolvent,made an order, directing the administrator torestore said item to his inventory. But Courtmade a new order, approving the omission by the

administrator of said property from the inventory.Hence this appeal.- Appellants arguments: [a] assuming that theassignment to Jung by Ankrom of the equity ofredemption of the latter in the tract of land wasaffected in fraud of creditors, they have aninterest in the payment of the appellant's claim.[b] it was the duty of the administrator to retainthe possession of this tract of land and therebyplace upon Jung, or persons claiming under him,the burden of instituting any action that may benecessary to maintain the rights of the transfereeunder said assignment.- The administrator contends: the assignment isvalid and apparently does not desire to enter into

a contest over the question of its validity with theperson or persons claiming under it.

ISSUEWON the appellants remedy of appeal is proper

HELDNO.- The precise remedy open to appellants (Heirs ofGregoire) is clearly pointed out in Sec. 713 ofCode of Civil Procedure1. Under this provision,

1 When there is a deficiency of assets in thehands of an executor or administrator to paydebts and expenses, and when the deceased

person made in his life-time such fraudulentconveyance of such real or personal estate or of aright or interest therein, as is stated in thepreceding section, any creditor of the estate may,by license of the court, if the executor oradministrator has not commenced such action,commence and prosecute to final judgment, inthe name of the executor or administrator, anaction for the recovery of the same and mayrecover for the benefit of the creditors, such realor personal estate, or interest therein soconveyed. But such action shall not becommenced until the creditor files in court a bondwith sufficient surety, to be approved by the

judge, conditioned to indemnify the executor or

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appellants remedy is to indemnify theadministrator against costs and, by leave ofcourt, to institute an action in the name of theadministrator to set aside the assignment orother conveyance believed to have been made infraud of creditors.- Heirs of Gregoire argue that inasmuch as noappeal was taken from the order, directing the

administrator to include the land in question inthe inventory, said order became final, with theresult that the appealed order, authorizing theexclusion of said property from the inventory,should be considered beyond the competence ofthe court.- This contention is untenable. Orders made by acourt re inclusion of items of property in theinventory or the exclusion of items therefrom aremanifestly of a purely discretionary, provisional,and interlocutory nature and are subject tomodification or change at any time during thecourse of the administration proceedings. Suchorder in question NOT final in the sensenecessary to make it appealable. In fact we note

that the appealed order was expressly made w/oprejudice to the rights of creditors to proceed inthe manner indicated under Sec. 713 of Code ofCivil Procedure.Disposition Order appealed from not being of anappealable nature, so appeal must be dismissed,with costs against the appellants

AGUAS V LLEMOS5 SCRA 959

REYES, JBL; Aug 30, 1962

FACTS

-March 14, 1960: Salinas and the spouses FelixGuardino and Maria Aguas jointly filed an actionin the CFI of Catbalogan, Samar to recoverdamages from Llemos, averring that the latterhad served them by registered mail with a copyof a petition for a writ of possession, with noticethat the same would be submitted to the saidcourt of Samar on Feb 23, 1960, 8am; that in

administrator against the costs of such action.Such creditor shall have a lien upon the judgmentby him so recovered for the costs incurred andsuch other expenses as the court deemsequitable.

view of the copy and notice served, plaintiffsproceeded to the court from their residence inManila accompanied by their lawyers, only todiscover that no such petition had been filed; andthat Llemos maliciously failed to appear in court,so that plaintiffs' expenditure and trouble turnedout to be in vain, causing them mental anguishand undue embarrassment.

-Before answering the complaint, defendant died.Plaintiffs amended their complaint to includeheirs of deceased. The heirs filed MTD, and byorder of Aug 12, 1960, the court below dismissedit, on the ground that the legal representative,and not the heirs, should have been made party-defendant; and that the action being for recoveryof money, testate/intestate proceedings shouldbe initiated and the claim filed therein. MFRdenied

ISSUEWON the action survives

HELD

YES.Ratio Rule 88.1 enumerates actions that surviveagainst a decedent's executors or administrators,and they are: 1) actions to recover real andpersonal property from the estate; 2) actions toenforce a lien thereon; and 3) actions to recoverdamages for an injury to person or property. Thepresent suit is one for damages under the lastclass, it having been held that "injury to property"is not limited to injuries to specific property, butextends to other wrongs by which personal estateis injured or diminished. To maliciously cause aparty to incur unnecessary expenses, as chargedin this case, is certainly injurious to that party'sproperty.

Be that as it may, it now appears from acommunication from CFI Samar that the partiesarrived at an amicable settlement and haveagreed to dismiss this appeal.DispositionThe case having thus become moot,it becomes unnecessary to resolve the questionsraised therein. This appeal is, therefore, ordereddismissed, without special pronouncement as tocosts.

SALVADOR v. STA. MARIA20 SCRA 603

BENGZON; June 30, 1967

FACTS- In 1941, Celestino Salvador executed a deed ofsale over 7 parcels of titled land and 2 parcels ofuntitled land, situated in Bigaa, Bulacan in favorof the spouses Alfonso Salvador and AnatoliaHalili. Alleging that the sale was void for lack ofconsideration, he filed in 1955 a suit forreconveyance of said parcels of land in the CFI of

Bulacan, Br. I. In 1956, Celestino Salvador died,testate. As his alleged heirs, 21 persons weresubstituted as plaintiffs in the action forreconveyance.- Meanwhile, special proceedings for the probateof his will and for letters testamentary wasinstituted in the CFI of Bulacan, Br. II. DominadorCardenas was appointed special administrator.He filed an inventory of properties of the estatecovering the same parcels of land subject matterof the reconveyance action. Celestino Salvador'swill was admitted to probate and DominadorCardenas was appointed executor of said will. 23persons were instituted heirs in the will. Of these,9 were not among the 21 alleged relatives

substituted in the reconveyance case; and of the21 substituted alleged heirs, 7 were not institutedin the will.- Br. I (reconveyance court) rendered judgmentordering the spouses Alfonso and Anatolia toreconvey the parcels of land to the estate ofCelestino Salvador. The spouses appealed to theCA. The CA affirmed the reconveyance judgment,with the correction that reconveyance be in favorof the 21 heirs substituted as plaintiffs.- Pursuant to an order of Br. II (probate court) oneof the parcels of land, Lot 6, was sold so that withits proceeds debtors who filed claims may bepaid. PNB bought it for P41,184 which was thendeposited in the same bank by the administrator,

subject to court order.- In 1964, the defendants in the suit forreconveyance executed a deed of reconveyanceover the parcels of land in favor of CelestinoSalvador's estate. Revoking the same as not inaccordance with the judgment, Br. I ordered anew deed of reconveyance to be executed infavor of the 21 persons substituted as plaintiffs inthat action. Accordingly, a new deed ofreconveyance was made and a new TCT wassubsequently issued in the name of the 21persons.- In 1965, Br. I ordered PNB to release theP41,184 proceeds of the sale of Lot 6, to the 21plaintiffs in the reconveyance case. Apparently,

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although the passbook was given by theadministrator to said 21 persons, no release wasmade, as the PNB awaited Br. II's order.- Meanwhile, in 1966, Br. II approved variousclaims against the estate amounting toP33,872.58. Br. II ordered the return of thepassbook to the administrator; and release to theadministrator by the PNB of the P41,184 or so

much as is needed to pay the debts of the estate.After failing to get reconsideration of the order,the 21 substituted heirs filed this special civilaction for certiorari with preliminary injunction.

ISSUEWON the P41,184 proceeds of the sale of Lot 6belong to the estate.

HELDYES.Ratio The right of heirs to specific distributiveshares of inheritance does not become finallydeterminable until all the debts of the estate arepaid. Until then, in the face of said claims, their

rights cannot be enforced, are inchoate, andsubject to the existence of a residue afterpayment of the debts.Reasoning Petitioners do not question theexistence of the debts. They only contend thatthe properties involved having been ordered byfinal judgment reconveyed to them, not to theestate, the same are not properties of the estatebut their own, and thus, not liable for debts of theestate.- Such contention is self-refuting. Petitioners relyfor their rights on their alleged character as heirsof Celestino; as such, they were substituted in thereconveyance case; the reconveyance to themwas reconveyance to them as heirs of Celestino

Salvador. It follows that the properties they claimare, even by their own reasoning, part ofCelestino's estate. Their right as allegedly hisheirs would arise only if said parcels of land arepart of the estate of Celestino, not otherwise.

Their having received the same, therefore, in thereconveyance action, was perforce in trust for theestate, subject to its obligations. They cannotdistribute said properties among themselves assubstituted heirs without the debts of the estatebeing first satisfied.- At any rate, the proceeds of Lot 6 alone appearsmore than sufficient to pay the debt and therewill remain the other parcels of land not sold. Asto the question of who will receive how much as

heirs, the same is properly determinable by thesettlement court, after payment of the debts.Disposition Petition DENIED.

PAVIA v DELA ROSAG.R. No. L-3083

TORRES; March 18, 1907

FACTS- Francisco Granda was appointed executor underthe will of Pablo Linart, in which will the minorCarmen Linart was made the only universal heir.- Granda died and was substituted by Jose de laRosa, who took possession of the personalproperty of the estate, amounting to 10,673pesos, Mexican Currency, as well as the lotowned by testator;- Rafaela Pavia, in her own behalf, and asguardian of Carmen, executed a power ofattorney in behalf of de la Rosa, and the attorneyhaving accepted such power proceeded toadminister the aforesaid estate in a carelessmanner, neglecting the interests of the plaintiffsand wasting the capital, and causing damagesamounting to over 15,000 pesos, Philippinecurrency, owing to the fact of having retired ordisposed of without any necessity the sum of7,207 pesos Mexican currency, together withinterest thereon amounting to 360.25 pesos.- In the complaint, it was alleged that theexecutor and attorney De la Rosa neglected toappraise, count, and divide the estate of Linartnotwithstanding his duty to do so, and leased thetestators house to his own relatives at a muchlower rental than could have been obtained.- Jose de la Rosa died, leaving the defendants

Bibiana and Salud de la Rosa as his only heirs andrepresentatives.- As special defense, defendants allege that theyare not responsible for the personal actions of theperson from whom they derived their possessionand title, against whom the plaintiffs neglected tobring action during his lifetime, and even thenbeing without any justifiable reason.

ISSUEWON the defendants Bibiana and Salud de laRosa are responsible for the personal acts of Josedela Rosa

HELD

NO- It has not been shown that the estate or theintestate succession of the deceased, Jose de laRosa, was ever opened or that an inventory hasever been presented in evidence,notwithstanding that at the time of the death ofDe la Rosa, the Code of Civil Procedure (Act No.190) was already in force, and that in accordance

with its provisions the estate of the deceasedshould have been administered and liquidated.- In accordance with the provisions of the Act No.190 it is understood that estate or intestatesuccession of a deceased person is alwaysaccepted and received with benefit of inventory,and his heirs, even after having taken possessionof the estate of the deceased, do not makethemselves responsible for the debts of saiddeceased with their own property, but solely withthat property coming from the estate or intestatesuccession of said deceased.- The Code of Civil Procedure now in force makesnecessary the opening of a testate or intestatesuccession immediately after the death of the

person whose estate is to be administered, theappointment of an executor or administrator, thetaking of an inventory of the estate of thedeceased, and the appointment of two or morecommissioners for the purpose of appraising theproperty of the estate and deciding as to theclaims against said estate- After the death of a person the only entity whichmay lawfully represent a testate or intestatesuccession is the executor or administratorappointed by the court charged to care for,maintain, and administer the estate of thedeceased in such of lands, or for damages doneto such lands, shall be instituted or maintainedagainst him by an heir or devisee, until such time

as there is entered s decree of the courtassigning such lands to the heir or devisee, oruntil the time or period allowed for paying thedebts of the estate has expired, unless theexecutor or administrator surrenders thepossession of the lands to the heir or devisee.- The heir lawfully succeeds the deceased fromwhom he derives his inheritance only after theliquidation of the estate, the payment of thedebts of same and the adjudication of the residueof the estate of said deceased, and in themeantime the only person in charge by law toconsider all claims against the estate of thedeceased and to attend to or consider the same

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is the executor or administrator appointed by acompetent judge or court.- Whatever may be the rights of action on thepart of Rafaela Pavia and the minor, CarmenLinart, the latter represented by the former asguardian, as to the obligations assumed by Josede la Rosa, now deceased, it must be prosecutedagainst the executor or administrator of the

estate of said deceased Jose de la Rosa, whoseexecutor or administrator is at this time the onlyrepresentative of the estate or intestatesuccession of said deceased; and that in view ofthis fact and considering the law before us, theyshould not have brought action against Bibianaand Salud de la Rosa for the mere fact that theywere the sisters of said deceased Jose de la Rosa,inasmuch as it is actually shown that thedefendant De la Rosa died intestate or left duringhis lifetime any will, or that the two defendantsare the heirs of the deceased by virtue of anexecuted will or by reason of existing law, orwhether or not the deceased has left properties,or who is the executor or administrator of the

said properties, or whether the propertiesbelonging to the estate of the deceased brotherof the defendants were ever adjudicated orpartitioned by virtue of an order of court in favorof the defendants.Dispositive Judgment appealed from reversed,reserving to the plaintiffs to right to instituteproper action against the executor oradministrator of the properties of the estate ofthe deceased in accordance with the provisions ofthe Code of Civil Procedure now in force.

BENEDICTO V. JAVELLANA10 PHIL 197

February 21, 1908

FACTS- For enforcing will made by Maximo Jalandoni,his bro, Maximino Jalandoni petitioned that theadministrator / executor, Julio Javellana, bedirected to pay him P985 w/c he held in lieu ofland donated to petitioner.- Maximino alleged that 1/2 of Hacienda Lantadwas bequeathed to him, w/c was subject topayment of debts / expenses of estate w/ respectto products of 1903-1904, and w/c had alreadybeen applied to that object by administrator

Javellana.

- Half of the hacienda was sold w/ consent ofJavellana, P985 remaining in his possession fromthe proceeds.- Maximino alleges that as Javellana had alreadyrcvd products of hacienda, hes no longer entitledto retain any portion of the legacy, nor demandthat he shld respond for other debts / expenses,bec w/ the value of the portion inherited by heirs

Francisco & Sofia Jalandoni, there was more thanwould be required to pay other debts of estateand expenses.- Javellana alleged that it wasnt proper to ask bymotion for relief that Maximino claimed.Complaint shldve been filed and action broughtagainst legatees or parties concerned and notagainst administrator alone. He alleged thatFrancisco & Sofia Jalandoni shldnt be consideredheirs but simply as legatees. He also alleged thatthe amt w/ him was not P985 but P949.29- Judge granted the motion. Javellana appealed.

ISSUES1. WON the legatees are liable to pay debts /

expenses of the estate2. WON separate action is proper for the reliefsprayed for

HELD1. YES (Order granting Maximinos motion shldbe reversed)- Testator left no lawful ascendants /descendants. He distributed all his prop inlegacies, notwithstanding manner in w/c hedesignates his nephews Francisco & Sofia

Jalandoni, such nephews are likewise legatees.- The will of testator must be respected &complied with. He imposed on his entire estatethe obligation to pay his debts w/ products of the

same. He prescribed manner in w/c same shallbe done until all obligations are extinguished.- Code of Civil Procedure: If testator makesprovision by will or designates estate to beappropriated for payment of debts & expenses,they shall be pd accdg to will. But if provisionmade by will or estate isnt sufficient, such part ofthe estate as is not disposed of by will, if any,shall be appropriated for that purpose.- Since those who benefited fr the will have notrcvd a universal succession to the estate, butcertain prop expressly stated in the will, they shldbe considered merely as legatees, w/o right to rcvshare of the prop of the deceased until after hisdebts have been pd. None of the parties

interested in the will is invested w/ the characterof heir.- In this case, the parties in interest wereindiscriminately designated as heirs or legatees.- Code of Civil Procedure: As to specific devises,Sec 729 provides exemption fr payment of debts& expenses if theres sufficient other prop.- Debts & expenses, in this case, must be pd pro

rata by legatees in manner provided in the will orin accordance w/ Code of Civil Procedure.2. NO- Any challenge to the validity of the will, anyobjection to the authentication, every demand /claim w/c party in interest may make must beacted upon and decided w/in same specialproceedings, not in a separate action. Judgehaving jurisdiction in administration of estateshall take cognizance of question.

LIWANAG v CA14 SCRA 922

CONCEPCION, J.; August 14, 1965

FACTSGliceria Liwanag is the special administratrix ofthe estate of Pio Liwanag. A creditor institutedagainst her as special administratrix proceedingsfor the foreclosure of real estate mortgage infavor of the said creditor. Liwanag moved todismiss on the ground that she cant be sued asspecial administratrix. CFI denied. She went up toCA on certiorari. CA eventually denied.

ISSUEWON a mortgagee can bring an action forforeclosure against the special administrator of

the estate of a deceased person

HELDYES.- The Rules of Court provides that a creditorholding a claim against the deceased, secured bya mortgage or other collateral security, maypursue any of these remedies:(1) abandon his security and prosecute his claimand share in the general distribution of the assetsof the estate;(2) foreclose his mortgage or realize upon hissecurity by an action in court, making theexecutor or administrator a party defendant, andif there is a deficiency after the sale of the

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mortgaged property, he may prove the same inthe testate or intestate proceedings; and(3) rely exclusively upon his mortgage andforeclose it any time within the ordinary period oflimitations, and if he relies exclusively upon themortgage, he shall not...share in the distributionof the assets.- Clearly, the creditor can sue the administratrix,

even a special one. Otherwise, the prescriptiveperiod would continue to run against creditors,until a regular administrator is appointed, and the

purpose of the mortgage defeated.

GODOY V ORELLANO42 PHIL 342

VILLAMOR; November 17, 1921

FACTS-On January 13, 1919, in consideration P1,000received by her, a document was executed byFelisa Pagilinan giving Eusebio A. Godoy anoption to buy for the sum of P10,000, a dredge

which was alleged to be a common property ofthe vendor and of the Orellano siblings-One of the conditions was that Godoy was to paythe whole price of the dredge within twenty days-It was also provided that said option was grantedin accordance with the power of attorneyexecuted by Pagilinan's coowners who reservedthe right to ratify whatever sale might be made,or option granted by her, their attorney-in-fact.-Pagilinan's coowners did not ratify the optioncontract.-Before the expiration of twenty days, Godoy wasready to make complete payment of the price,but Pagilinan failed to deliver the dredge.-Godoy brought suit in the CFI against Pagilinan

and Orellano siblings praying that they beordered to deliver the dredge, upon payment byhim of the sum of P9,000-The defendants Orellano alleged as a specialdefense that the dredge in question was theproperty of the intestate estate of Julio Orellano,pending in the CFI of Manila, and under theadministration of Felisa Pangilinan; that the saiddredge is under judicial control and could not bedisposed of without judicial authority, and thatthe court has never authorized the sale-Felisa Pagilinan alleges among other thingsthat: (a) That the dredge which was the subject-matter of the option is property of the intestateestate of Julio Orellano, of which she is the

administratrix; (b) that the plaintiff, as well as thedefendants, and the notary who prepared theaforesaid option sale, were all aware of thesefacts, and they led her to believe that she had theauthority to dispose of the dredge in her nameand by themselves

ISSUE

WON Pagilinan, in her capacity as judicialadministratrix of the estate of Julio Orelleno, wasauthorized to sell the dredge belonging to saidestateHELDNo.-In the sale of the property of an intestate estatefor the benefit of the heirs, it is necessary tocomply with the provisions of sections 717, 718,and 722 of the Code of Civil Procedure. The saidsections prescribed the proceedings to be hadbefore an administrator of an intestate or testateestate may sell personal or real property and alsothe conditions under which the personal or real

property pertaining to an estate may be sold ordisposed of by the administrator.-A sale and conveyance by executors without anorder of the probate court, under a will devisingproperty to them in trust, but not authorizing anysale of the realty, otherwise than by a direction topay the debts of the testator, is void, and passesno title to the purchase. (Huse vs. Den, 85 Cal.,390.)-A sale by an administrator of the personalproperty of the estate, without the authority of anorder of court, or of a will, or under an order ofcourt which is void for want of jurisdiction, doesnot confer on the purchaser a title which isavailable against a succeeding administrator.

(Wyatt's Adm'r vs. Rambo, 29 Ala., 510.)-Under the law, the court has exclusivejurisdiction to authorize the sale of properties likethe one under consideration and the power ofattorney executed by the heirs of Orellano infavor of the administratrix, without authority ofcourt, has no legal effect, and this is the more so,since two of the said heirs are under age, and theothers did not ratify the option contract, asprovided in the aforesaid power of attorney.-Pagilinan was not, in her capacity as judicialadministratrix of the intestate estate of JulioOrellano, legally authorized to sell, or contract tosell, any property belonging to said estatewithout the authority of the court, and the

contract entered into by her with the plaintiff,without this authority, is null and void.

SANTOS v ROMAN CATHOLICBISHOP OF NUEVA CACERES

OSTRAND; April 5, 1924

FACTS- Engracio Orense, a resident of the municipalityof Guinobatan, Albay, died in 1918. He left a will,according to which 6 parcels of land were left tothe Roman Catholic Church (RCC) as trustee forvarious purposes, subject to a usufruct in favor ofhis wife who, in the absence of descendants,ascendants and collateral heirs of the deceased,was made his universal testamentary heir.- The will was probated in 1919 and the wife wasappointed executrix. She stated that thedeceased had obtained a franchise to establishand operate an electric light plant in the town ofGuinobatan and had signed a contract with thePacific Commercial Company (PCC) whereby thelatter agreed to furnish him the machinery for theplant; that the machinery had began to arriveand that company was demanding payment ofthe second installment of the purchase price andthat she was bound to continue to pay 10monthly installments in order to completelyextinguish the obligation; that she had no fundswith which to meet the obligation. She wasgranted authority to sell or mortgage the libertybonds or obtain a loan of P10,000 from the bank.- Upon her motion, the court declared her theuniversal heir of the testator and provided thatthe various legatees under the will should nottake possession of their respective legaciesduring the lifetime of the appellant or while "thedebts of the deceased occasioned by theestablishment of the electric light plant inGuinobatan remained unpaid." The court alsoapproved the nominal partition of the estate,whereby the six parcels of land above referred towere duly assigned to the RCC.- Thereafter, she filed another 2 motions prayingfor authority to sell the parcels of land whichwere devised to the RCC, for the debt to PCC andthe bank. Both contained the indorsement of

Julian Ope, the parish priest of Guinobatan. Thecourt granted both motions.- Before her motion to sell 7 small parcels ofriceland had been acted upon, the RomanCatholic Archbishop of Nueva Caceres, a

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corporation sole, filed a motion asking that theorder authorizing the sale of the property willedto the RCC be revoked on the ground that parishpriests have no control over the temporalities ofthe RCC and that, therefore, the consent given byFather Julian Ope was invalid and of no legaleffect and that the debts to which the proceeds ofthe sale are to be devoted are not the debts of

the deceased, but were incurred during theadministration of the estate by the administratrixthrough the mismanagement of its property.- Court revoked the authority to sell.ISSUES1. WON the motion for the revocation of thelicense to sell was presented out of time and afterthe order granting the license had become final2. WON the court erred in revoking the authorityto sellHELD1. NOAt the time of the granting of the licensed, adistribution of the estate of the deceased hadbeen made, the order of distribution had become

final and the title to the estate in remainderdevised to the RCC had become vested. As far asthe title to the property was concerned, theadministration proceedings were then terminatedand the court had lost its jurisdiction in respectthereto. There might still be a lien on theproperty for the debts of the deceased andlegitimate expenses of administration, but itseems obvious that the court could have no

jurisdiction to foreclose this lien and order theproperty sold unless some sort of notice wasgiven the holder of the title. No notice, neitheractual nor constructive, was given in the presentcase. It does not even appear that the order ofsale was recorded in the office of the registry of

deeds as required by subsection 7 of section 722of the Code of Civil Procedure. The order of salewas therefore void for want of jurisdiction in thecourt and could be vacated at anytime before ithad been acted upon and sale made andconfirmed.2. NO

The appellant also maintains that the court belowerred in vacating the order of sale upon anunverified motion and without the presentation ofevidence. In answer, we may say that the courtcould property take judicial notice of the fact thatthe corporation sole, the Roman CatholicArchbishop of Nueva Caceres is the administratorof the temporalities of that church in the diocese

within which the land in question is situated andthat the parish priest have no control thereover.

VDA. DE CRUZ vs. JESUS ILAGANTUASON ; September 30, 1948

FACTS- The administrator, one of the children and heirs

of the decedent, with the approval of all otherchildren and heirs of the decedent, executed "anabsolute deed of sale" over two parcels of landfor P18,000 in favor of Severo Cruz and his wife.- The heirs of the deceased, except Santos Ilagan,the administrator, filed a written opposition to thesale. Judge Paredes, Jr., held that the sale was"improper." Because the sale was, in effect,primarily, intended to pay the mortgage debt,and to sell the aforesaid property preferentially tothe mortgagee.

ISSUES1. WON the subject matter of the sale, being incustodia legis, the sale "could only be validly

affected under and by virtue of an expressauthority of the Court having cognizance of theproceedings and only upon strict compliance withthe formalities prescribed by law.2. WON the sale is improper

HELD

1. NO. RatioThat the land could not ordinarilybe levied upon while in custodia legis, does notmean that one of the heirs may not sell the right,interest or participation which he has or mighthave in the lands under administration. Theordinary execution of property in custodia legis isprohibited in order to avoid interference with the

possession by the court. But the sale made by anheir of his share in an inheritance, subject to theresult of the pending administration, in no wise,stands in the way of such administration (Tevesde Jakosalem vs. Rafols).2. NO. "A sale which the representative makes,with the written assent of all legatees ordistributees of the estate, is in effect their sale aswell as his, and, if made in good faith, ought tobind strongly provided that all the personsassenting are sui juris."Reasoning

a. The appellees by signing the deed of sale intoken of approval bound themselves ascompletely and as effectively as if they hadsigned the document as vendors, or co-vendorswith the administrator.b. Estoppel. Heir, by their conduct in remainingsilent when a sale of a decedent's property ismade by the executor or administrator, or by so

conducting themselves as to consent or assent inthe consummation of the sale, may estopthemselves from subsequently questioning thevalidity of the sale. The applicable estoppel bydeed, a bar which precludes a party from denyingthe truth of his deed. Prejudice is not an essentialelement of this kind of estoppel.c. Equitable estoppel or estoppel bymisrepresentation fits as well into the facts of thiscase. Disapproval of the sale would result inmaterial injury or detriment of the vendees.d. By reason of the sale, and relying on the goodfaith of these heirs, the vendees, it is inferredfrom the contract, agreed to the cancellation ofthe mortgage and stopped collecting interest.

With the loans cancelled, the mortgage ormortgages were not foreclosed upon theexpiration of their terms. According to theadministrator, in his request for authority to sell,he had not paid interest on the entire loan since1939.e. The subsequent increase in value of theproperty was not a sufficient reason for turningdown the conveyance. Unless fraud, mistake orduress intervened in the sale and there is nocharge that any of these vices intervened, theheirs by their assent placed themselves outsidethe protection of the court. They can not be heardto say that the sale was detrimental to theirinterest.

f. When there are no creditors or all the debtshave been paid, "the heirs have the right to askthe probate court to turn over to them both realand personal property without division; andwhere such request unanimous, it is the duty ofthe court to comply with it, and there is nothingin section 753 of the Code of Civil Procedure (nowsection 1, Rule 9, of the Rules of Court) whichprohibits it." (Del Val vs. Del Val, 29 Phil., 534-539.) The right to demand the delivery ofproperty includes the right to dispose of it in themanner the heir please.DISPOSITION The order appealed from isreversed and the court below shall enter a neworder approving the sale and ordering the

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delivery of the lands in question to the vendeesor their successors in interest, with costs againstthe appellees

BAUN v. BAUN53 Phil. 654

JOHNSON; October 24, 1929

NATUREAppeal from an order of the CFI Tarlac sustainingthe validity of the sale made by the administratorof the estate of Jacinto Baun, of a piece or parcelof land together with the machinery and buildingthereon belonging to said estate, and denying themotion of the heirs to set aside said sale.

FACTS- The administrator of the estate filed a motion,requesting authority to sell personal and realproperties of the estate, in order to pay its debts.

The motion alleged (a) that the estate wasindebted to the Asociacion Cooperation delCredito Rural de Tarlac in the sum of P1,000, withinterest at 10%; (b) that it was also indebted toManuel Urquico in the sum of P7,412.22, withinterest at 12%; and (c) that the estate waswithout sufficient funds to meet said obligations.- Heirs of the estate, with the exception ofDamiana Manankil, widow of the deceased, filedtheir written conformity to the proposed sale ofthe only real property of the estate described inthe inventory, consisting of a parcel of land andthe machinery and building thereon. They alsostated that Genara Pineda offered P20,000 forsaid property and that they considered said offeras most advantageous and beneficial to theirinterest. Said written conformity was signed byAlejandro Calma in his own behalf and asguardian of the minors Guillermo and SimeonaCalma, and by Celedonia Baun, with the consentof her husband Lorenzo Mallari.- Court appointed Jose P. Fausto, as guardian adlitem of the minors Guillermo and SimeonaCalma, heirs of Jacinto Baun, with specialreference to the proposed sale of the realproperty of the estate.- Said guardian ad litem filed his report,recommending favorably the proposed sale of theland and the machinery and building thereon toGenara Pineda at the price offered by her.

- Court authorized the administrator of the estateto sell the property of the deceased in the formand manner most advantageous to the estate.- Simplicio Baun, the administrator of the estate,filed a petition requesting approval by the courtof the sale of said property to Pedro Santos forthe sum of P22,000. The administrator sold theproperty to said vendee, who gave a better price

than that offered by Genara Pineda, which wasfor P20,000 only.- Court approved said sale, and on July 10, 1928,ordered the vendee Pedro Santos to immediatelydeliver to the administrator of the estate theprice of the property amounting to P22,000.- Heirs of the estate filed a motion praying thatthe sale of the property as well as the decree ofthe court approving the same be set aside on thefollowing grounds: (a) That the administrator soldthe real property of the estate without havingfirst sold the personal property; (b) that DamianaManankil, the widow of the deceased, who wasalso an heir of the estate, did not give herconformity or consent to said sale; (c) that no

notice of the hearing of the application forauthority to sell the property of the estate wasserved upon the heirs, either personally or bypublication; and (d) that no hearing was held onsaid application of the administration.- The administrator filed his answer to the motion,alleging (1) that said real property was soldbecause the personal property of the deceasedwas insufficient to meet the obligations of theestate; (2) that the real property of the estatewas sold upon the initiative and with the writtenconsent of the heirs and consequently they arenow estopped from attacking the validity of saidsale; (3) that notice of the hearing of theapplication for authority to sell the property of

the estate was not necessary inasmuch as therequirements of the law had been virtuallysatisfied by the written consent of the heirs to thesale; and (4) that the written consent of all of theheirs was not necessary because the law doesnot specifically require the consent in writing ofall of the heirs.- Judge Lukban issued an order sustaining thevalidity of the sale to Pedro Santos of said landand the machinery and building thereon for thesum of P22,000, and denied the motion of theheirs to set aside said sale.

ISSUE

WON the provisions of the Code of CivilProcedure, regulating the sale of the estate of thedeceased and prescribing certain formalities,were not complied with in the sale of the realproperty in question, and consequently the sale isnull and void.

HELD

YES. Consent of all of the heirs is necessarybecause each and every one of them is interestedin the estate and because the law does not statethat the consent of the majority of the heirs issufficient to bind all of the heirs. The phrase "theconsent and approbation, in writing, of the heirs,devisees and legatees," used in section 714 ofthe Code of Civil Procedure, cannot besusceptible of any other interpretation than thatthe consent of all the heirs, etc. is necessary.- The written consent of the widow DamianaManankil, who was also an heir of the deceased,to the application of the administrator forauthority to sell the property of the estate, wasnot obtained. Furthermore, the widow Damiana

Manankil was not notified of the application of theadministrator for authority to sell the property ofthe estate, neither was said application set forhearing.- Section 722 requires a compliance with theformalities as to written consent of heirs, noticeof hearing of the application, and hearing of theapplication before a decree authorizing the salemay be issued. Therefore, the decree of the lowercourt authorizing the sale of the property inquestion is not in conformity with the provisionsof sections 714 and 722 of the Code of CivilProcedure, because (1) the written consent of allof the heirs was not obtained, (2) the heirs werenot notified of the hearing on said application,

and (3) no hearing was held on said application ;and, consequently, the sale of the property of theestate, effected by the administrator inpursuance of said decree of the court, is null andvoid.- In the present case it is true that the heirs, afterthe sale of the property in pursuance of the orderof the court, and after said sale had beenapproved by the court, made a deposit with theclerk of a sum of money sufficient to pay theexisting indebtedness. We are at a loss tounderstand why the lower court did not even thenaccept the offer made by the heirs to pay theindebtedness and thereby save the estate from

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the further expense of litigation, in accordancewith the provisions of the law.

FACTS- 1918, CFI Negros Occidental issued a decreeappointing Cecilia Ortaliz as administratrix ofestate of Jose Ortaliz Jordan with power toauthorize Gil Montilla, among other things, to

mortgage to any entity 8 lots; but that the heirsdid not give their written consent to theadministratrix to make out said power of attorneyand to execute said mortgage. Authorizationstates: "Under such conditions as may bedeemed most advantageous to the interests ofthe estates, etc., etc. . . . of Jose Ortaliz Jordan."No power was given to Cecilia to appoint thesubstitute of Gil Montilla in said power-of-attorney, but neither is there a prohibition againstit in said authorization.- Heirs ofOrtaliz allege:> Ernestina, Elisa, and Jose Ortaliz, were declaredand ratified in the intestate proceedings ofVicenta Montilla, and Jose Ortaliz y Jordan as the

only legitimate and universal heirs of thedecedents> by virtue above stated declaration are thelegitimate and absolute owners of all the estateleft by Jose Ortaliz and Vicenta Montilla,consisting of 8 lots> neither the universal heirs nor theirpredecessors ever executed any mortgage deedin favor of PNB or any document relating to themortgage of realty for the increase of corporatecapital and exclusive benefit of the Maao SugarCentral Company, Inc.> RD illegally recorded an illegal order of CFIauthorizing administratrix without first obtainingthe written consent of the heirs, to mortgage the

property, not for purposes of administration butsolely for business and speculation> RD knew that CFI had no jurisdiction to issuesuch order> authorization given by CFI to administratrixplainly stated that the administratrix was boundto mortgage said property `for the exclusivebenefit of said intestate estates,' but theadministratrix through her attorney-in-fact, GilMontilla, illegally mortgaged said property `forthe exclusive benefit of the Maao Sugar CentralCompany, Inc., a corporation with which theestates were not connected,' and to the seriousand utter prejudice of the interests of theintestate estates, as by such a mortgage for

millions of pesos the property is encumberedforever without any benefit or compensation;> administratrix's illegal power and the unlawfulmortgage executed by Gil Montilla, infringedupon the order and RD also illegally recorded it inthe registry of deeds> Maao Central Co., Inc. illegally mortgaged saidrealty for millions of pesos for their own interests

and to the serious and utter prejudice of theinterests of the intestate estate> administratrix died and RD continuedthereafter to give effect to the illegal power ofsaid administratrix and refused to consider itterminated> heirs Ortaliz requested RD to cancel said illegalencumbrances but RD refused> PNB although fully aware that said realty wasadjudicated in favor of heirs Ortaliz refused todeliver the original title- CFI (1929) > ordered RD to cancel liens in favorof PNB

ISSUE

WON mortgage of properties of estate byattorney-in-fact of administratix is valid giventhat heirs did not give their consent

HELDNORatio The written consent of the heirs, devisees,and legatees is required because they, aspresumptive owners, are the persons directlyaffected by the sale, and mortgage as well, of thedecedent's estate, since a mortgage implies asale in case of default in paying the debt. Thesale of mortgage must be made for the purposeof paying the debts and expenses of administration, because the creditors of the

decedent are indisputably entitled to collect theircredits even before the distribution of the estate.And, lastly, the sale or mortgage must bebeneficial to the heirs, because, in providing forthe administration of decedent's estates, the lawaims to protect the heirs as well as the creditorsof the decedent.Reasoning- SEC. 714. Realty may be sold orencumbered though personal realty notexhausted. When the personal estate of thedecease is not sufficient to pay the debts andcharges of administration without injuring thebusiness of those interested in the estate, orotherwise prejudicing their interests, and where a

testator has not otherwise made sufficientprovision for the payment of such debts andcharges, the court, on application of theexecutors or administrator with the consent andapprobation, in writing, of the heirs, devisees,and legatees, residing in the Philippine Islands,may grant a l icense to the executor oradministrator to sell, mortgage or otherwise

encumber for that purpose real, in lieu ofpersonal estate, if it clearly appears that suchsale, mortgaging or encumbrance or real estatewould be beneficial to the persons interested andwill not defeat any devise of land; in which casethe assent of the devisee shall be required.- According to their provision of law, the probatecourt may authorize the sale or mortgage of realproperty, even when there is still some personproperty, subject to the following conditions:(a) application of the administrator beaccompanied by the written consent andapproval of the heirs, devisees, and legateesresiding in the Philippine Islands>>did not give their consent nor approval to the

mortgage in question(b) sale or mortgage is necessary in order to payoff debts and expenses of administration>>mortgage was not necessary to pay off thedebts and expenses of administration(c) sale or mortgage is beneficial to the heirs andother persons interested in the estate>>no evidence that mortgage has beenbeneficial to the heirs; as a matter of fact, GilMontilla, the attorney-in-fact, mortgaged the saidproperty for the exclusive benefit of the MaaoSugar Central Co., Inc.- The convenience or benefit to be derived fromthe sale or mortgage is not the only thing to beconsidered before a court authorizes a sale or

mortgage; the principal requirement is that theheirs give their written consent and approval, forthey are the owners of the property to be sold ormortgaged, and cannot be deprived thereofwithout due process of law.Disposition Judgment affirmed in so far as itorders RD to cancel the liens in favor of PNB

ESTATE OF GAMBOA V FLORANZA12 Phil 191 / G.R. No. L-4069

December 5, 1908

FACTS

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- The commissioners of the estate allowed a claim

in favor of Balbino Jaucian for P2,720, which was

secured by a mortgage on real estate. They

expressed an opinion as to the preferential rights

to which this creditor and another mortgage

creditor would be entitled in the distribution of

the proceeds of the sale.

- On the 27th of August, 1906, the administratorpresented a petition asked that the court appoint

a day for hearing upon the question as to the

preference which these creditors enjoyed.

- On the 22nd of October, 1906, the court without

hearing any parties interested, directed the

administrator to ask for: (1) an order directing the

sale of the mortgaged property; (2) the mortgage

debt be paid from the proceeds of the sale, (3)

what remained be distributed among the other

creditors. This is one of the orders appealed from.

- On the 23rd of October, 1906, the administrator

complied with the order of the 22nd of October

- On the 12th of November, 1906, the court,without notice and hearing to the parties, ordered

the sale of the property to pay the mortgage debt

to Balbino Jaucian. It provided that notice of the

sale should be given in a certain way. This is the

second order appealed from.

- 14th of December, 1906, the administrator filed

a report of the sale with property sold for P3,005,

and asked that the sale be confirmed.

- No record that sale ever had been confirmed.

On the contrary, it seems that the land upon

which the mortgaged house stood did not belong

to the estate but belonged to the widow.

- The estate insists that the questions as to the

preferential right of Jaucian was determined by

the commissioners in their report and that report,

not having been appealed from, such

determination is final and conclusive. BUT theprovisions of the code are clear thatcommissions had no authority to make anyruling whatever in relation to preferentialrights which some creditors might haveover others. (See sec. 686 and followingsections, and sec. 735, Code of CivilProcedure.)

- It is claimed by the Floriza that, under the

provisions of section 708 of the Code of Civil

Procedure, Jaucian waived his mortgage lien by

presenting his claim before the commissioners.

ISSUES1 WON CFI acting as probate court erred inordering the sale of the property to satisfy a

specific debt2 WON CFI erred in ordering the sale of theproperty without notice and hearing as per CivProrequirements

HELD:1 YES- The code states in its sections 714 to 721

various conditions under which the real estate of

the deceased may be sold for the payment of

debts. There is nothing in any one of these

sections nor in any other sections of the code

which indicates that the Court of First Instance, in

the exercise of its probate jurisdiction, has any

power to order the sale of a specific piece of realestate for the purpose of paying a mortgage debt

which is a lien thereon.

- It may be that the court would have authority to

sell the property, subject to the mortgage lien, for

the purpose of paying other debts of the estate,

but there is nothing giving the court authority to

sell it for the purpose of paying that specific debt.

2 YES- The court entirely failed to comply with the

provisions of section 722 of the Code of Civil

Procedure. That section requires the

administrator to present a petition asking for the

sale of the real estate. It also distinctlyprovides that, when such petition is made,the court shall appoint a time and place forhearing it and shall require notice of thepetition and of the time and place of suchhearing to be given in a newspaper ofgeneral circulation, and that the court mayorder such further notice given as it deemsproper.- No attempt was made to comply with the

provisions of the law. No notice whatever was

given to any of the persons interested of the

application for license to sell.

Disposition: The orders appealed from arereversed, and case remanded for furtherproceedings in accordance with the law.

DE JESUS (LEON) V DE JESUS(EUSEBIA)GR L-16553

REYES, JBL; November 29, 1961

NATUREAppeal from order of CFI Bataan

FACTS- in the intestate estate proceedings for thesettlement of the estate of Melecio De Jesus,widow-administratrix Ines Alejandrino submittedand inventory of the estate, including a lot inHermosa, Bataan covered by a TCT in the nameof Melecio- Eusebia (sister of Melecio) filed a money claimagainst the estate, but this was never heard.

Subsequently, Ines, Eusebia, and the heirs ofCirilo (brother of Melecio) entered into astipulation of facts, recognizing that siblingsMelecio, Eusebia, and CIrilo were co-owners ofthe lot in Hermosa, Bataan, and that the said lotwas registered in Melecios name only in trust. Asupplemental agreement was executed wherebyEusebia agreed to waive and renounce hermoney claim against the estate. Theseagreements were approved by the probate courtthe very next day they were executed andsubmitted for approval- Years later, Ines son Leon replaced her asadministrator of the estate. In such capacity, and

joining as plaintiff his mother, Leon filed an action

for annulment of the stipulations entered by Ineswith Eusebia and Cirilo, for lack of jurisdiction andlack of requisite notices to all interested parties.Eusebia, et al. filed a motion to dismiss (based onprescription and res judicata), which the probatecourt granted. Hence, this appeal

ISSUEWON the stipulations in question are void andineffective, either for lack of jurisdiction of theprobate court to act on them, or for lack of noticeof their approval to the heirs of the deceased

HELDYES, the stipulations are void for lack of notice

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Ratio It is mandatory that notice be served onthe heirs and other interested persons of theapplication for approval of any conveyance ofproperty held in trust by the deceased, andwhere no such notice is given, the orderauthorizing the conveyance, as well as theconveyance itself, is completely void.Reasoning Rule 90.9 provides that authority can

be given by the probate court to theadministrator to convey property held in trust bythe deceased to the beneficiaries of the trust onlyafter notice given as required in the last

preceding section; i.e., that. no suchconveyance shall be authorized until notice of theapplication for that purpose has been given

personally or by mail to all persons interested,and such further notice has been given, by

publication or otherwise, as the court deemsproper(Rule 90.8).- Here, it is quite probable that there was no suchnotice, because the heirs were all minors whenthe proceedings in question took place. It wouldhave been necessary to appoint a guardian ad

litem for them before they could be validly servedsaid notice, yet the records here do not show thatsuch appointment of guardian was obtained. Infact, any such appointment appears improbable,considering that the stipulations in question wereapproved the very next day following theirexecution and submission for approval. It must beobserved that in 1948, before the promulgationof the NCC, parents as such were not legalrepresentatives of their children before the courtsand could not dispose of their property without

judicial authorization.- As this question or notice would ultimatelydecide the validity or invalidity of the entireproceedings in the probate court leading to the

approval of the contested stipulations, plaintiffsshould be given the opportunity to prove theirclaim that no such notice was given them. Ifproved, the claim would likewise dispose of thedefense of prescription put up by defendants intheir MD, for an action to set aside completelyvoid proceedings is imprescriptible and can notbe barred by lapse of time.- Unquestionably, the probate court had

jurisdiction to approve the stipulations under Rule90.9, which permits the probate court, wheneverthe deceased in his lifetime held real property intrust for another person, to authorize theexecutor or administrator to deed such propertyto the person or persons for whose use and

benefit it was so held. There being no controversybetween Ines and the siblings that the latter andMelecio co-own the lot and that it was registeredin Melecio's name only in trust for all the co-owners, there was no need to file a separateaction to an ordinary court to establish thecommon ownership of the parties over saidproperty; and the probate court could approve, as

it did, the agreement wherein the partiesexpressly recognized their common ownership ofthe property and the trust character of theexclusive title held by Melecio, especially sincethe parties themselves state that such agreementwas entered into to forestall future litigation andto foster family relations, and in addition, Eusebiahad agreed, in consideration of the court'sapproval of said agreement, to waive a moneyclaim against the estate, so that approval of saidagreement would really redound to the benefit ofthe estate and the heirs.- As for the ruling of the RTC that Leon isestopped from questioning the agreementsvoluntarily entered into by former administratrix

Ines, suffice it to repeat what was said in Boagavs. Soler: a decedent's representative is notestopped to question the validity of his own voiddeed purporting to convey land; and if this betrue of the administrator as to his own acts, afortiori, his successor can not be estopped toquestion the acts of his predecessor that are notconformable to law.Disposition Appeal granted. Order reversed andcase remanded for trial on the merits

BLAS ET. AL. VS. JUDGE CECILIAMUOZ-PALMA

4 SCRA 900

LABRADOR, J. (1962)NATUREPetition for certiorari, mandamus and prohibitionagainst the order of the Court of First Instance ofRizal, Judge Cecilia Muoz Palma

FACTS(NOTE: I CULLED OUT THIS ONE FROM ANEARLIER CASE COZ ITS DIFF ICULT TOUNDERSTAND THE CURRENT CASE WITHOUTREFERRING TO THE 1961 DECISION: In deferenceto her husbands wishes embodied in a last willand testament where the latter expressed desireto convey properties to certain heirs and

legatees, Maxima Santos Vda. De Blas executedher own will obliging herself to honor said wishesof her husband. Specifically, she vowed to giveher husbands heirs and legatees, of her sharein the conjugal partnership. The husbands heirsand legatees (me anak kasi itong si Blas sa priormarriage niya) sued on the promise of Maximathe second wife. SC held that the promise in the

will is valid and ordered Judge Palma to proceedwith the distribution of properties accordingly).

NOW- On July 26, 1961, plaintiffs, petitioners herein,filed before the Court of First Instance of Rizal, amotion for the execution of the decision ofthis Court in G. R. No. L-14070.- Pursuant to said order, a writ of execution wasissued by the clerk of the lower court on August24, 1961, and notice thereof served uponrespondent Rosalina Santos on August 29, 1961,giving the latter 10 days within which to complywith the same.- Instead of complying with the order, respondent

executrix, on September 15, 1961, filed a motionto set the case for hearing, alleging that it wouldbe difficult to comply with the court's orderunless the following questions were first resolved:(1) what properties are to be conveyed by theexecutrix; (2) to whom conveyance is to bemade; and (3) in what proportions conveyanceshould be effected.- This motion was opposed by herein petitionersas well as by Marta Chivi on the ground that thedecision of this Court was clear enough on thequestions raised and could be complied withwithout the necessity of adducing evidence. Areply to this opposition was filed by respondentexecutrix and a rejoinder thereto presented by

petitioners.

ISSUE

WON respondent executrix is justified inrefusing to comply with the order of theCourt on the ground that it is vague andimpossible to execute since no specificallocation of properties were made (nodesignation as to who are entitled toreceive which property).

HELDNO.

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Ratio The practice in the distribution of theestates of deceased persons is to assign thewhole of the properties left for distributionto the heirs in a certain definite proportion,an aliquot part pertaining to each of theheirs. This method or plan of distribution andpartition of estates is provided for in section 1 ofRule 91, which reads thus:

"Section 1. When order for distr ibution ofresidue made. Testimony taken on controversypreserved. When the debts, funeral charges,and expenses of administration, the allowancesto the widow, and inheritance tax, if any,chargeable to the estate in accordance with law,have been paid, the court, on the applicationof the executor or administrator, or of aperson interested in the estate, and afterhearing upon notice, shall assign theresidue of the estate to the persons entitledto the same, naming them and theproportions, or parts, to which each isentitled, and such persons may demand andrecover their respective shares from the

executor or administrator, or any otherperson having the same in hispossession. . . . "ReasoningThe project of partition mentioned inthe dispositive part of our decision sought to beenforced, which is the project of partition in CivilCase No. 6707 of the Court of First Instance ofRizal, contains the following resume of theproperties received by Maxima Santos in variouscapacities in the settlement of the estate of herhusband, Simeon Blas:1/2 of all properties left by the deceased as her

share in the conjugal partnershipproperty P339,440.001/3 free disposition

113,146.661/3 of strict legitime devised to Lazaro Blas andsold by the latter to the widow37,715.56

Total

P490,302.22- The properties received by Maxima Santos asher share in the conjugal partnership properties isexpressly stated to be P339,440.00. Inaccordance with the promise made in Annex "H",to convey and deliver to the heirs of thedeceased husband one-half thereof, the value ofthe properties that she was obliged to conveyand deliver is one-half of said properties, or

P169,720. Following what we have stated above,that the practice in the settlement of assets ofdeceased persons is to assign to each heir orparticipant a certain aliquot portion,undivided if division is difficult to carry out,the share to be assigned by Maxima Santosis P169,720 divided by P490,302.22 orapproximately 34.61 1/3%. In order to carry

out the decision of this Court, therefore, theadministratrix should have been compelledor ordered to convey and deliver the 34.611/3% of the total amount of the propertiesthat she received in the project of partition.- The procedure to be followed is that outlined insection 8 of Rule 90 which reads as follows:"Sec. 8. When court may authorize conveyanceof realty which deceased contracted to convey.Notice. Effect of deed. Where the deceasedwas in his lifetime under contract, binding in law,to deed real property, or an interest therein, thecourt having jurisdiction of the estate may, onapplication for that purpose, authorize theexecutor or administrator to convey such

property according to such contract, or withsuch modifications as are agreed upon bythe parties and approved by the court; andif the contract is to convey real property tothe executor or administrator, the clerk ofthe court shall execute the deed. The deedexecuted by such executor, administrator, orclerk of court shall be as effectual to convey theproperty as if executed by the deceased in hislifetime; but no such conveyance shall beauthorized until notice of the application for thatpurpose has been given personally or by mail toall persons interested, and such further noticehas been given, by publication or otherwise, asthe court deems proper; nor if the assets in the

hands of the executor or administrator willthereby be reduced so as to prevent a creditorfrom receiving his full debt or diminish hisdividend."- The above-quoted section is applicable becausethe deceased Maxima Santos had agreed andpromised to convey in her will one-half of hershare in the conjugal assets to such of the heirsof her husband as she may designate. If theadministratrix Rosalina Santos is reluctantto execute the deed as ordered by theCourt, the deed of conveyance and deliveryof the properties may be executed by theclerk of court, in which case, as declared bythe rule, the deed shall be as effectual to

convey the property as if executed by thedeceased in her lifetime.- We note that the petitioners prepared a deed ofconveyance to be signed by the clerk of court,BUT THE ERROR IN THE SAID DEED OFCONVEYANCE LIES IN THAT IT INCLUDES ALLOF THE PROPERTIES MENTIONED IN THEPROJECT OF PARTITION, ADJUDICATED TO

MAXIMA SANTOS WHICH, AS ABOVEINDICATED, SHOULD NOT BE THE CASE,BECAUSE WHAT WAS ACTUALLY ADJUDICATED TO HER IN THE PROJECT OFPARTITION INCLUDED NOT ONLY HER SHAREIN THE CONJUGAL PARTNERSHIP PROPERTY,BUT ALSO WHAT SHE RECEIVED FROM HERHUSBAND OUT OF THE FREE PORTION, ANDWHAT SHE HAD PURCHASED FROM AN HEIROF HER HUSBAND.- It is to be noted further that in order to have thedocument executed and approved by the court,the specific steps prior to the execution of thedeed of conveyance as pointed out in the lastpart of the above-quoted section must be strictly

followed.

VILLANUEVA VS CHAVEZ24 Phil 170

CARSON; January 25,1913

NATUREAppeal from an order of CFI of Iloilo dismissing acomplaint filed in a separate action incident tothe proceedings had in connection with theadministration of the estate of Gualberto Galve,deceased, wherein plaintiffs-appellants sought toestablish and recover a claim against the estate.

FACTS- Hugo Chavez was appointed as theadministrator of the estate of Gualberto Galve. Acommittee was duly appointed to appraise theassets of the estate and to hear and pass uponclaims. The claimants, heirs of Lucio Villanueva,deceased, presented to the committee a claimamounting to some P5,575.80. This claim wasallowed by the committee, but the administratorgave notice of appeal to the CFIt. This notice wasincorporated in the report of the committee,which was filed.- Counsel for the administrator filed a formalnotice of appeal setting forth therein that they

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had just been apprised of the filing of the reportof the committee. Claimants submitted theirformal objections to the allowance of the appealon the ground that it had not been presentedwithin the period prescribed by law. CFI held thatthe notice of appeal filed at the time when thecommittee admitted the claim, which was dulyincorporated in their report, was a sufficientcompliance with the statutory provisions in thisregard, and directed the claimants to file acomplaint against the administrator and thusbring the question at issue to trial as in any otherordinary action.- To this order claimants excepted, and again thecourt directed that a civil action be instituted. Onthe 24th day of July claimants submitted a bill ofexceptions to the trial court which the courtrefused to testify. Claimants then applied for awrit of mandamus to the Supreme Court tocompel the trial judge to certify the bill ofexceptions. The application for the writ wasdenied by the Supreme Court on August 12,1911. On the 24th day of October the

administrator reported to the CFI that he wasready to make distribution of the estate, and thecourt thereupon directed that he proceed to thedistribution, and at the same time entered anorder disallowing the claim of these claimants onthe ground of their failure to prosecute the sameto final judgment in accordance with the repeatedorder of the court. It appears that the claimantshad no notice as to the action of the court in thisregard, and that they were not advised that anapplication would be made by the administratorfor an order of distribution on the 24th day ofOctober. On the 28th of October, four days afterthe entry of the order directing the administratorto proceed with the distribution and disallowing

the claimant's claim, claimants filed theircomplaint against the administrator for theamount of their claim. Two days thereafter, onthe 30th day of October, the administrator wasduly notified of the filing of this complaint. Fourdays thereafter, on the 4th of November, withoutnotice to claimant and in his absence, theadministrator presented his accounts andreceipts to the Court of First Instance, and on hismotion his accounts and the receipts covering thedistribution of the estate were accepted andapproved, and an order entered discharging theadministrator.It appears from the opinion of the trial judge thathe had no notice of the filing of the complaint at

the time when he approved and allowed theadministrator's accounts and the report of hisproceedings under the order for distribution; andit is clear that the administrator, although he haddue notice four days prior to the date of the orderdischarging him, did not advise the court of thatfact at the time when he procured the issuance ofthe order of discharge.- The administrator filed his answer to claimant'scomplaint that he was no longer theadministrator of the estate of Gualberto Galve,deceased, that his accounts had been settled anddistribution made under the order of the court,and that he had been finally discharged and waswithout legal capacity to defend the action.Claimants contended that he was in fact theadministrator at the time of the filing of the suit,that he had notice thereof prior to the time whenhe procured the order for his discharge.Claimants further alleged that the administratorhad fraudulently concealed this knowledge fromthe court; that at the time of the filing of the suitthe proceeds of the estate had not yet been

distributed; and that they had no knowledge ofthe settling of the administrator's accounts, untilthey were advised of it by his pleadings filed onthe 20th of November, setting forth those facts.Claimant's allegations as to lack of notice are notcontroverted in the record and must therefore betaken to be true. The case was heard upon thepleadings and the court entered an orderdismissing the complaint upon the followinggrounds: (1) Because final distribution wasordered on the 24th day of October, four daysbefore it was filed, and on the same day the claimhad been disallowed by the court because ofclaimant's failure to file their complaint incompliance with the court's order. (2) Because all

of the estate having been distributed under anorder issued four days prior to the filing of thesuit, no property remained in the hands of theadministrator.ISSUEWON the action against the administrator for therecovery of the claim against the estate may beprosecuted against him to judgment, where itappears that he has procured the erroneousdismissal of the action, the erroneousdisallowance of the claim, and the issuance oforders of the distribution of the estate and for hisown discharge which are erroneous in so far asthe claimants are affected thereby.HELDYES

RatioThe claimants, under these circumstances,are entitled to proceed with their action againstthe administrator, and that the order directingthe dismissal of their complaint must bereversed. The supreme court of Mississippi, indiscussing the rights of creditors to recover fromthe estates of deceased debtors, under theMississippi statutes, says that: "It is only after

the payment of all existing debts due fromthe estate and not barred by the statute oflimitations, or upon their payment beingproperly secured as provided by law, thatthe administrator may lawfully proceed tothe distribution of the estate."Reasoning When is it that an executor oradministrator may make a full settlement of theadministration? The statute answers, when theestate has been fully administered by thepayment of all the debts. When is it, that uponfinal settlement, the court shall order theexecutor or administrator to make immediatedistribution of all the property in his hands? Theanswer is, when the estate has been fully

administered by the payment of all the debts. It isnot to be presumed that whilst the claims ofcreditors, the primary objec

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