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JUDICIAL SETTLEMENT OF ESTATE Limited Jurisdiction G.R. No. L-18148 February 28, 1963

validity of the donation, the same must be litigated not in the testate proceeding but in a separate civil action.

DEOGRACIAS BERNARDO, executor of the testate estate of the deceased EUSEBIO CAPILI; and the instituted heirs, namely: ARMANDO CAPILI and ARTURO BERNARDO, ET AL., petitioners, vs. HON. COURT OF APPEALS and THE HEIRS OF THE LATE HERMOGENA REYES, namely: FRANCISCO REYES, ET AL., and JOSE ISIDORO, ET AL., respondents.

Wherefore, the parties respectfully pray that the foregoing stipulation of facts be admitted and approved by this Honorable Court, without prejudice to the parties adducing other evidence to prove their case not covered by this stipulation of facts. 1äwphï1.ñët

This is a petition by certiorari for the review of the decision of the Court of Appeals affirming that of the Court of First Instance of Bulacan holding that the probate court in Special Proceeding 1101 had jurisdiction to determine the validity of the deed of donation in question and to pass upon the question of title or ownership of the properties mentioned therein.

The oppositors and heirs of Hermogena Reyes, on their part, argued that the deed of donation itself was determinative of the original conjugal character to the properties, aside from the legal presumption laid down in Article 160 of the Civil Code, and that since the donation was null and void the deceased Eusebio Capili did not become owner of the share of his wife and therefore could not validly dispose of it in his will.

The facts are briefly stated in the appealed decision of the Court of Appeals as follows: Eusebio Capili and Hermogena Reyes were husband and wife. The first died on July 27, 1958 and a testate proceeding for the settlement of his estate was instituted in the Court of the Fist Instance of Bulacan. His will was admitted to probate on October 9, 1958, disposing of his properties in favor of his widow; his cousins Armando, Ursula, and Buenaventura, all surnamed Capili; and Arturo, Deogracias and Eduardo, all surnamed Bernardo. Hermogena Reyes herself died on April 24, 1959. Upon petition of Deogracias Bernardo, executor of the estate of the deceased Eusebio Capili, she was substituted by her collateral relatives and intestate heirs, namely, Marcos, Vicente, Francisco and Dominga, all surnamed Reyes; and Jose, Constancia, Raymunda and Elena, all surnamed Isidoro.

On September 14, 1960, the probate court, the Honorable M. Mejia presiding, issued an order declaring the donation void without making any specific finding as to its juridical nature, that is, whether it was inter vivos or mortis causa, for the reason that, considered under the first category, it falls under Article 133 of the Civil Code, which prohibits donations between spouses during the marriage; and considered under the second category, it does not comply with the formalities of a will as required by Article 728 in relation to Article 805 of the same Code, there being no attestation clause. In the same order the court disapproved both projects of partition and directed the executor to file another," dividing the property mentioned in the last will and testament of the deceased Eusebio Capili and the properties mentioned in the deed of donation, Exhibit B, between the instituted heirs of the deceased Eusebio Capili and the legal heirs of the deceased Hermogena Reyes, upon the basis that the said properties were conjugal properties of the deceased spouses." On September 27, 1960, the executor filed a motion for new trial, reiterating and emphasizing the contention previously raised in their memorandum that the probate court had no jurisdiction to take cognizance of the claim of the legal heirs of Hermogena Reyes involving title to the properties mentioned in the will of Eusebio Capili and taking exception to the court's declaration of the nullity of the donation "without stating facts or provision of law on which it was based." The motion for new trial was denied in an order dated October 3, 1960.

On June 12, 1959, the executor filed a project of partition in the testate proceeding in accordance with the terms of the will, adjudicating the estate of Eusebio Capili among the testamentary heirs with the exception of Hermogena Reyes, whose share was alloted to her collateral relatives aforementioned. On June 16, 1959 these relatives filed an opposition to the executor's project of partition and submitted a counter-project of partition of their own, claiming 1/2 of the properties mentioned in the will of the deceased Eusebio Capili on the theory that they belonged not to the latter alone but to the conjugal partnership of the spouses. The probate court, in two orders dated June 24, 1959 and February 10, 1960, respectively, set the two projects of partition for hearing, at which evidence was presented by the parties, followed by the submission of memoranda discussing certain legal issues. In the memorandum for the executor and the instituted heirs it was contended: (1) that the properties disposed of in the will of the deceased Eusebio Capili belonged to him exclusively and not to the conjugal partnership, because Hermogena Reyes had donated to him her half share of such partnership; (2) that the collateral heirs of Hermogena Reyes had no lawful standing or grounds to question the validity of the donation; and (3) that even assuming that they could question the

On appeal to the Court of Appeals the order appealed from being affirmed, petitioners filed this present petition for review by certiorari. The petitioners-appellants contend that the appellate court erred in not declaring that the probate court, having limited and special jurisdiction, had generally no power to adjudicate title and erred in applying the exception to the rule. In a line of decisions, this Court consistently held that as a general rule, question as to title to property cannot be passed

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JUDICIAL SETTLEMENT OF ESTATE Limited Jurisdiction upon on testate or intestate proceedings,"1 except where one of the parties prays merely for the inclusion or exclusion from the inventory of the property, in which case the probate court may pass provisionally upon the question without prejudice to its final determination in a separate action.2 However, we have also held that when the parties interested are all heirs of the deceased, it is optional to them to submit to the probate court a question as to title to property, and when so submitted, said probate court may definitely pass judgment thereon (Pascual v. Pascual, 73 Phil. 561; Manalac v. Ocampo, et al., 73 Phil. 661); and that with the consent of the parties, matters affecting property under judicial administration may be taken cognizance of by the court in the course of intestate proceeding, provided interests of third persons are not prejudiced (Cunanan v. Amparo, 80 Phil. 229, 232). In the light of this doctrine, may it be said correctly that the trial court as well as the Court of Appeals erred in upholding the power of the probate court in this case to adjudicate in the testate proceedings, the question as to whether the properties herein involved belong to the conjugal partnership of Eusebio Capili and Hermogena Reyes, or to the deceased husband exclusively? At the outset, let it be clarified that the matter at issue is not a question of jurisdiction, in the sense advanced by appellants that the trial court had completely no authority to pass upon the title to the lands in dispute, and that its decision on the subject is null and void and does not bind even those who had invoked its authority and submitted to its decision because, it is contended, jurisdiction is a creature of law and parties to an action can not vest, extend or broaden it. If appellants' contention is correct, then there can be no exception to the nojurisdiction theory. But as has been stated in the case of Cunanan v. Amparo (supra) the Supreme Court speaking through Mr. Justice Pedro Tuason: "Determination of title to property is within the jurisdiction of Courts of First Instance. The responding Soriano's objection (that the probate court lacked jurisdiction to order the delivery of the possession of the lots to the estate) relates exclusively to the procedure, which is distinct from jurisdiction. It affects only personal rights to a mode of practice (the filing of an independent ordinary action) which may be waived". Strictly speaking, it is more a question of jurisdiction over the person, not over the subject matter, for the jurisdiction to try controversies between heirs of a deceased person regarding the ownership of properties alleged to belong to his estate, has been recognized to be vested in probate courts. This is so because the purpose of an administration proceeding is the liquidation of the estate and distribution of the residue among the heirs and legatees. Liquidation means determination of all the assets of the estate and payment of all the debts and expenses.3 Thereafter, distribution is made of the decedent's liquidated estate among the persons entitled to succeed him. The proceeding is in the nature of an action of partition, in which each party is required to bring into the mass whatever community property he has in his possession. To this end, and as a necessary corollary, the interested parties may introduce proofs relative to the ownership of the properties in dispute. All the heirs who take part in the distribution of the decedent's estate are before the court, and subject to the jurisdiction thereof, in all matters and incidents necessary to the complete settlement of such estate, so long as no interests of third parties are affected.4 In the case now before us, the matter in controversy is the question of ownership of certain of the properties involved — whether they belong to the conjugal partnership or to the

husband exclusively. This is a matter properly within the jurisdiction of the probate court which necessarily has to liquidate the conjugal partnership in order to determine the estate of the decedent which is to be distributed among his heirs who are all parties to the proceedings, including, of course, the widow, now represented because of her death, by her heirs who have been substituted upon petition of the executor himself and who have appeared voluntarily. There are no third parties whose rights may be affected. It is true that the heirs of the deceased widow are not heirs of the testatorhusband, but the widow is, in addition to her own right to the conjugal property. And it is this right that is being sought to be enforced by her substitutes. Therefore, the claim that is being asserted is one belonging to an heir to the testator and, consequently, it complies with the requirement of the exception that the parties interested (the petitioners and the widow, represented by dents) are all heirs claiming title under the testator. Petitioners contend additionally that they have never submitted themselves to the jurisdiction of the probate court, for the purpose of the determination of the question of ownership of the disputed properties. This is not borne by the admitted facts. On the contrary, it is undisputed that they were the ones who presented the project of partition claiming the questioned properties as part of the testator's asset. The respondents, as representatives or substitutes of the deceased widow opposed the project of partition and submitted another. As the Court of Appeals said, "In doing so all of them must be deemed to have submitted the issue for resolution in the same proceeding. Certainly, the petitioners can not be heard to insist, as they do, on the approval of their project of partition and, thus, have the court take it for granted that their theory as to the character of the properties is correct, entirely without regard to the opposition of the respondents". In other words, by presenting their project of partition including therein the disputed lands (upon the claim that they were donated by the wife to her husband), petitioners themselves put in issue the question of ownership of the properties — which is well within the competence of the probate court — and just because of an opposition thereto, they can not thereafter withdraw either their appearance or the issue from the jurisdiction of the court. Certainly, there is here a waiver where the parties who raise the objection are the ones who set the court in motion.5 They can not be permitted to complain if the court, after due hearing, adjudges question against them.6 Finally, petitioners-appellants claim that appellees are estopped to raise the question of ownership of the properties involved because the widow herself, during her lifetime, not only did not object to the inclusion of these properties in the inventory of the assets of her deceased husband, but also signed an extra-judicial partition of those inventoried properties. But the very authorities cited by appellants require that to constitute estoppel, the actor must have knowledge of the facts and be appraised of his rights at the time he performs the act constituting estoppel, because silence without knowledge works no estoppel.7 In the present case, the deceased widow acted as she did because of the deed of donation she executed in favor of her husband not knowing that such deed was illegal, if inter-vivos, and ineffectual if mortis-causa, as it has not been executed with the required formalities similar to a will. WHEREFORE, the decision of the Court of Appeals being in accordance with law, the same is hereby affirmed with costs against appellants. So ordered.

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JUDICIAL SETTLEMENT OF ESTATE Limited Jurisdiction [G.R. No. 102126. March 12, 1993.] ANGELICA LEDESMA, Petitioner, v. INTESTATE ESTATE OF CIPRIANO PEDROSA represented by Nelson Jimena, Honorable Judge Bethel Katalbas-Moscardon in her capacity as Presiding Judge-Designate, Branch 51, RTC, Bacolod City, Respondents. Hector P. Teodosio of Defensor and Teodocio Law Office for Petitioner. Edmundo G. Manlapao for Private Respondent. SYLLABUS 1. REMEDIAL LAW; ACTIONS; FINAL DISPOSITION OF CONJUGAL PARTNERSHIP OF GAINS, A MERE INCIDENT TO LEGAL SEPARATION. — On the finality of the judgment decreeing the spouses’ legal separation as of January 4, 1973, the remaining issue for Our resolution is the final disposition of their conjugal partnership of gains which partnership, by reason of the final decree, had been automatically dissolved. The law (Article 106, 107 of the Civil Code) clearly spells out the effects of a final decree of legal separation on the conjugal property. The death on November 30, 1979 of herein petitioner who was declared the guilty spouse by the trial court, before the liquidation of the conjugal property is effected, poses a new problem which can be resolved simply by the application of the rules on intestate succession with respect to the properties of the deceased petitioner. Thus, the rules on dissolution and liquidation of the conjugal partnership of gains under the aforecited provisions of the Civil Code would be applied effective January 4, 1973 when the decree of legal separation became final. Upon the liquidation and distribution conformably with the law governing the effects of the final decree of legal separation, the law on intestate succession should take over in the disposition of whatever remaining properties have been allocated to petitioner. This procedure involves details which properly pertain to the lower court. The properties that may be allocated to the deceased petitioner by virtue of the liquidation of the conjugal assets, shall be distributed in accordance with the laws of intestate succession in Special Proceedings No. 134. (Macadangdang v. Court of Appeals, G.R. No. L-38287, October 23, 1981) 2. ID.; ID.; FINAL DISPOSITION OF CONJUGAL PARTNERSHIP OF GAIN, INCIDENTAL TO AN ANNULMENT CASE. — The Macadangdang decision involved legal separation but, with equal reason, the doctrine enunciated therein should be applied to a marriage annulment which is the situation at bar. The respondent presiding judge is directed to decide the partition (liquidation) case (Civil Case No. 1446) within thirty (30) days from receipt of notice of this decision to determine which of the properties of the conjugal partnership should be adjudicated to the husband and the wife. This is but a consequence or incident of its decision rendered in the same case annulling the marriage. D E C I S I O N PADILLA, J.:

This is a special civil action for certiorari under Rule 65 assailing an order dated 24 January 1991 issued by herein respondent presiding judge-designate Bethel KatalbasMoscardon of the Regional Trial Court of Bacolod City, Branch 51 which considered the supplemental action for partition (after annulment of the marriage) as terminated due to the death of one of the spouses (husband) and the pendency of intestate proceedings over his estate. Petitioner Angelica Ledesma’s marriage to Cipriano Pedrosa was declared a nullity by the Regional Trial Court of Negros Occidental, Branch 51 on 8 February 1984 in Civil Case No. 1446. 1 The dispositive portion of the order annulling the marriage also provided thus:jgc:chanrobles.com.ph ". . . that the properties acquired by plaintiff Cipriano Pedrosa and defendant Angelica Ledesma at the time they were living together as common-law husband and wife is (sic) owned by them as co-owners to be governed by the provision on coownership of the civil code; that the properties acquired by plaintiff and defendant after their marriage was solemnized on March 25, 1965, which was annulled by this Court in the above-entitled proceeding, forms (sic) part of the conjugal partnership and upon dissolution of the marriage, to be liquidated in accordance with the provision of the civil code." 2 Surprisingly it took some time before the next order implementing the above disposition was issued on 4 May 1989, the pertinent part of which reads:jgc:chanrobles.com.ph ". . . It appearing from the records that the court has to verify and determine the correct inventory of the properties of Cipriano Pedrosa and Angelica Ledesma, the parties, including the receiver, through their respective attorneys, are ordered to submit their respective inventory, if one has not been submitted yet, before June 1, 1989. . . ." 3 Pending receipt by the court of the ordered inventory, Cipriano Pedrosa died. A separate petition for the probate of his last will and testament was filed. 4 Nelson Jimena was named executor and substituted Pedrosa in the partition proceedings (Civil Case No. 1446).chanrobles.com : virtual law library Due to disagreement of the parties on the characterization of the properties, the court in the partition proceedings ordered (30 March 1990) the submission of comments, objections and manifestations on the project of partition submitted by the parties. During a lull in the proceedings, the presiding judge also passed away. On 24 January 1991 the following nowquestioned order was issued by the herein respondent presiding judge-designate who took over:jgc:chanrobles.com.ph "It is informed by Atty. Pio Villoso that insofar as the status of this case is concerned, the plaintiff who has long been dead, was substituted by the administrator, now the plaintiff Nelson Jimena, and Atty. Vicente Sabornay, as the receiver. Furthermore, the judgment as to the annulment of the marriage had already been rendered partially by then Presiding Judge Quirino Abad Santos, Jr., on February 8, 1984. What is being litigated here by the parties affects the property division to dissolve the partnership. However, the plaintiff died and an intestate proceeding is now pending before Branch 43 whereby the said Nelson Jimena was actually the appointed administrator, and who was substituted as plaintiff in this case.chanrobles lawlibrary : rednad With all these informations, and considering the nature of the action, the Court finds the substitution of the original plaintiff

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JUDICIAL SETTLEMENT OF ESTATE Limited Jurisdiction improper, as the defendant herein can pursue her claim over the properties before the intestate proceedings being instituted. Action for intervention in order that the judgment in this particular proceeding can be implemented, can be raised in the intestate Court. Likewise, the appointment of the receiver conflicts with that of the judicial administrator considering that with the filing of the intestate case, the properties of the deceased plaintiff are in custodia legis and this Court losses jurisdiction in determining further the distribution of the properties. In view of the above, without prejudice to the defendant’s right to file as intervenor in the intestate proceedings with the judgment annuling the marriage, the proceedings becomes moot and academic with the pendency of the intestate proceeding before Branch 43. This case is therefore deemed TERMINATED." 5 With the denial of petitioner’s motion for reconsideration by the respondent court, this special civil action was initiated. Petitioner argues that respondent judge reneged in the performance of a lawful duty when she refrained from rendering a decision in the partition case (Civil Case No. 1446) and considered the same closed and terminated, due to the pendency of intestate proceedings over the deceased husband’s estate (Sp. Proc. No. 4159). 6 It is likewise erroneous, petitioner contends, to rule that petitioner’s remedy is a motion for intervention in said intestate proceedings to implement judgment in the marriage-annulment case, since petitioner has already presented all her evidence in the annulment case to prove which properties acquired during the marriage pertain to her. The case of Macadangdang v. Court of Appeals, 7 where a similar issue was involved — the husband having died after the legal separation of the spouses had been finally decreed but before the actual liquidation of their community of properties — is on point. The Court therein said:jgc:chanrobles.com.ph "WE do not find merit in petitioner’s submission that the questioned decision had not become final and executory since the law explicitly and clearly provides for the dissolution and liquidation of the conjugal partnership of gains or the absolute community of property as among the effects of the final decree of legal separation. Article 106 of the Civil Code thus reads:chanrob1es virtual 1aw library ‘ARTICLE 106. The decree of legal separation shall have the following effects:chanrob1es virtual 1aw library 1) The spouses shall be entitled to live separately from each other, but the marriage bonds shall not be severed; 2) The conjugal partnership of gains or the absolute conjugal community of property shall be dissolved and liquidated, but the offending spouse shall have no right to any share of the profits earned by the partnership or community, without prejudice to the provisions of Article 176; x x x’ The aforequoted provision mandates the dissolution and liquidation of the property regime of the spouses upon finality of the decree of legal separation. Such dissolution and liquidation are necessary consequences of the final decree. This legal effect of the decree of legal separation ipso facto or automatically follows, as an inevitable incident of, the judgment decreeing legal separation for the purpose of

determining the share of each spouse in the conjugal assets.chanrobles law library x x x."cralaw virtua1aw library ". . ., the decision of the trial court dated January 4, 1973 decreeing the legal separation between then spouses Antonio Macadangdang and Filomena Gaviana Macadangdang had long become final and executory and the division of the conjugal property in a ‘supplemental decision’ is a mere incident of the decree of legal separation.chanroblesvirtualawlibrary Since We have ruled on the finality of the judgment decreeing the spouses’ legal separation as of January 4, 1973, the remaining issue for Our resolution is the final disposition of their conjugal partnership of gains which partnership, by reason of the final decree, had been automatically dissolved. The law (Article 106, 107 of the Civil Code) clearly spells out the effects of a final decree of legal separation on the conjugal property. The death on November 30, 1979 of herein petitioner who was declared the guilty spouse by the trial court, before the liquidation of the conjugal property is effected, poses a new problem which can be resolved simply by the application of the rules on intestate succession with respect to the properties of the deceased petitioner. Thus, the rules on dissolution and liquidation of the conjugal partnership of gains under the aforecited provisions of the Civil Code would be applied effective January 4, 1973 when the decree of legal separation became final. Upon the liquidation and distribution conformably with the law governing the effects of the final decree of legal separation, the law on intestate succession should take over in the disposition of whatever remaining properties have been allocated to petitioner. This procedure involves details which properly pertain to the lower court. The properties that may be allocated to the deceased petitioner by virtue of the liquidation of the conjugal assets, shall be distributed in accordance with the laws of intestate succession in Special Proceedings No. 134."cralaw virtua1aw library The Macadangdang decision involved legal separation but, with equal reason, the doctrine enunciated therein should be applied to a marriage annulment which is the situation at bar. The respondent presiding judge is directed to decide the partition (liquidation) case (Civil Case No, 1446) within thirty (30) days from receipt of notice of this decision to determine which of the properties of the conjugal partnership should be adjudicated to the husband and the wife. This is but a consequence or incident of its decision rendered in the same case annulling the marriage. Petitioner’s letters to the Court indicate that she is seventy (70) years of age and the prolonged action for partition (liquidation) has taken a toll on her resources. Justice and equity demand the disposition of her case with dispatch. Any properties that may be adjudicated to the deceased husband Pedrosa can then be distributed in accordance with his last will and testament in the special proceedings involving his estate (Sp. Proc. No. 4159). ACCORDINGLY, the respondent Judge’s order dated 24 January 1991 considering Civil Case No. 1446 closed and terminated for being moot and academic is REVERSED and SET ASIDE. Respondent Judge or whoever may have succeeded her is ordered to decide said action for partition (liquidation) within thirty (30) days from receipt of this decision.chanrobles virtual

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JUDICIAL SETTLEMENT OF ESTATE Limited Jurisdiction lawlibrary SO ORDERED.



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JUDICIAL SETTLEMENT OF ESTATE Limited Jurisdiction G.R. No. L-81147 June 20, 1989 VICTORIA BRINGAS PEREIRA, petitioner, vs. THE HONORABLE COURT OF APPEALS and RITA PEREIRA NAGAC, respondents. GANCAYCO, J.: Is a judicial administration proceeding necessary when the decedent dies intestate without leaving any debts? May the probate court appoint the surviving sister of the deceased as the administratrix of the estate of the deceased instead of the surviving spouse? These are the main questions which need to be resolved in this case. Andres de Guzman Pereira, an employee of the Philippine Air Lines, passed away on January 3, 1983 at Bacoor, Cavite without a will. He was survived by his legitimate spouse of ten months, the herein petitioner Victoria Bringas Pereira, and his sister Rita Pereira Nagac, the herein private respondent. On March 1, 1983, private respondent instituted before Branch 19 of the Regional Trial Court of Bacoor, Cavite, Special Proceeding No. RTC-BSP-83-4 for the issuance of letters of administration in her favor pertaining to the estate of the deceased Andres de Guzman Pereira. 1 In her verified petition, private respondent alleged the following: that she and Victoria Bringas Pereira are the only surviving heirs of the deceased; that the deceased left no will; that there are no creditors of the deceased; that the deceased left several properties, namely: death benefits from the Philippine Air Lines (PAL), the PAL Employees Association (PALEA), the PAL Employees Savings and Loan Association, Inc. (PESALA) and the Social Security System (SSS), as well as savings deposits with the Philippine National Bank (PNB) and the Philippine Commercial and Industrial Bank (PCIB), and a 300 square meter lot located at Barangay Pamplona, Las Pinas, Rizal and finally, that the spouse of the deceased (herein petitioner) had been working in London as an auxiliary nurse and as such one-half of her salary forms part of the estate of the deceased. On March 23,1983, petitioner filed her opposition and motion to dismiss the petition of private respondent 2 alleging that there exists no estate of the deceased for purposes of administration and praying in the alternative, that if an estate does exist, the letters of administration relating to the said estate be issued in her favor as the surviving spouse. In its resolution dated March 28, 1985, the Regional Trial Court, appointed private respondent Rita Pereira Nagac administratrix of the intestate estate of Andres de Guzman Pereira upon a bond posted by her in the amount of Pl,000.00. The trial court ordered her to take custody of all the real and personal properties of the deceased and to file an inventory thereof within three months after receipt of the order. 3 Not satisfied with the resolution of the lower court, petitioner brought the case to the Court of Appeals. The appellate court affirmed the appointment of private respondent as administratrix in its decision dated December 15, 1987. 4

Hence, this petition for review on certiorari where petitioner raises the following issues: (1) Whether or not there exists an estate of the deceased Andres de Guzman Pereira for purposes of administration; (2) Whether or not a judicial administration proceeding is necessary where there are no debts left by the decedent; and, (3) Who has the better right to be appointed as administratrix of the estate of the deceased, the surviving spouse Victoria Bringas Pereira or the surviving sister Rita Pereira Nagac? Anent the first issue, petitioner contends that there exists no estate of the deceased for purposes of administration for the following reasons: firstly, the death benefits from PAL, PALEA, PESALA and the SSS belong exclusively to her, being the sole beneficiary and in support of this claim she submitted letterreplies from these institutions showing that she is the exclusive beneficiary of said death benefits; secondly, the savings deposits in the name of her deceased husband with the PNB and the PCIB had been used to defray the funeral expenses as supported by several receipts; and, finally, the only real property of the deceased has been extrajudicially settled between the petitioner and the private respondent as the only surviving heirs of the deceased. Private respondent, on the other hand, argues that it is not for petitioner to decide what properties form part of the estate of the deceased and to appropriate them for herself. She points out that this function is vested in the court in charge of the intestate proceedings. Petitioner asks this Court to declare that the properties specified do not belong to the estate of the deceased on the basis of her bare allegations as aforestated and a handful of documents. Inasmuch as this Court is not a trier of facts, We cannot order an unqualified and final exclusion or nonexclusion of the property involved from the estate of the deceased. 5 The resolution of this issue is better left to the probate court before which the administration proceedings are pending. The trial court is in the best position to receive evidence on the discordant contentions of the parties as to the assets of the decedent's estate, the valuations thereof and the rights of the transferees of some of the assets, if any. 6 The function of resolving whether or not a certain property should be included in the inventory or list of properties to be administered by the administrator is one clearly within the competence of the probate court. However, the court's determination is only provisional in character, not conclusive, and is subject to the final decision in a separate action which may be instituted by the parties.7 Assuming, however, that there exist assets of the deceased Andres de Guzman Pereira for purposes of administration, We nonetheless find the administration proceedings instituted by private respondent to be unnecessary as contended by petitioner for the reasons herein below discussed. The general rule is that when a person dies leaving property, the same should be judicially administered and the competent court should appoint a qualified administrator, in the order established in Section 6, Rule 78, in case the deceased left no will, or in case he had left one, should he fail to name an executor therein. 8 An exception to this rule is established in Section 1 of Rule 74. 9 Under this exception, when all the heirs are of lawful age and there are no debts due from the estate,

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JUDICIAL SETTLEMENT OF ESTATE Limited Jurisdiction they may agree in writing to partition the property without instituting the judicial administration or applying for the appointment of an administrator. Section 1, Rule 74 of the Revised Rules of Court, however, does not preclude the heirs from instituting administration proceedings, even if the estate has no debts or obligations, if they do not desire to resort for good reasons to an ordinary action for partition. While Section 1 allows the heirs to divide the estate among themselves as they may see fit, or to resort to an ordinary action for partition, the said provision does not compel them to do so if they have good reasons to take a different course of action. 10 It should be noted that recourse to an administration proceeding even if the estate has no debts is sanctioned only if the heirs have good reasons for not resorting to an action for partition. 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. 11 Thus, it has been 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, which is always long and costly, or to apply for the appointment of an administrator by the Court. It has been uniformly held that in such case the judicial administration and the appointment of an administrator are superfluous and unnecessary proceedings . 12 Now, what constitutes "good reason" to warrant a judicial administration of the estate of a deceased when the heirs are all of legal age and there are no creditors will depend on the circumstances of each case. In one case, 13 We said: Again the petitioner argues that only when the heirs do not have any dispute as to the bulk of the hereditary estate but only in the manner of partition does section 1, Rule 74 of the Rules of Court apply and that in this case the parties are at loggerheads as to the corpus of the hereditary estate because respondents succeeded in sequestering some assets of the intestate. The argument is unconvincing, because, as the respondent judge has indicated, questions as to what property belonged to the deceased (and therefore to the heirs) may properly be ventilated in the partition proceedings, especially where such property is in the hands of one heir.

wife's deceased mother, since he may just adduce proof of his being a forced heir in the intestate proceedings of the latter.15 We see no reason not to apply this doctrine to the case at bar. There are only two surviving heirs, a wife of ten months and a sister, both of age. The parties admit that there are no debts of the deceased to be paid. What is at once apparent is that these two heirs are not in good terms. The only conceivable reason why private respondent seeks appointment as administratrix is for her to obtain possession of the alleged properties of the deceased for her own purposes, since these properties are presently in the hands of petitioner who supposedly disposed of them fraudulently. We are of the opinion that this is not a compelling reason which will necessitate a judicial administration of the estate of the deceased. To subject the estate of Andres de Guzman Pereira, which does not appear to be substantial especially since the only real property left has been extrajudicially settled, to an administration proceeding for no useful purpose would only unnecessarily expose it to the risk of being wasted or squandered. In most instances of a similar nature, 16 the claims of both parties as to the properties left by the deceased may be properly ventilated in simple partition proceedings where the creditors, should there be any, are protected in any event. We, therefore, hold that the court below before which the administration proceedings are pending was not justified in issuing letters of administration, there being no good reason for burdening the estate of the deceased Andres de Guzman Pereira with the costs and expenses of an administration proceeding. With the foregoing ruling, it is unnecessary for us to delve into the issue of who, as between the surviving spouse Victoria Bringas Pereira and the sister Rita Pereira Nagac, should be preferred to be appointed as administratrix. WHEREFORE, the letters of administration issued by the Regional Trial Court of Bacoor to Rita Pereira Nagac are hereby revoked and the administration proceeding dismissed without prejudice to the right of private respondent to commence a new action for partition of the property left by Andres de Guzman Pereira. No costs. SO ORDERED.

In another case, We held that if the reason for seeking an appointment as administrator is merely to avoid a multiplicity of suits since the heir seeking such appointment wants to ask for the annulment of certain transfers of property, that same objective could be achieved in an action for partition and the trial court is not justified in issuing letters of administration. 14 In still another case, We did not find so powerful a reason the argument that the appointment of the husband, a usufructuary forced heir of his deceased wife, as judicial administrator is necessary in order for him to have legal capacity to appear in the intestate proceedings of his

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JUDICIAL SETTLEMENT OF ESTATE Limited Jurisdiction G.R. No. 75773 April 17, 1990

examining the witnesses of Leonardo, presented no evidence of her own, oral or documentary.

TOMAS JIMENEZ, VISITACION JIMENEZ, DIGNO JIMENEZ, ANTONIO JIMENEZ, AMADEO JIMENEZ, MODESTO JIMENEZ and VIRGINIA JIMENEZ, petitioners, vs. HONORABLE INTERMEDIATE APPELLATE COURT, HON. AMANDA VALERA-CABIGAO, in her capacity as Presiding Judge, Regional Trial Court, Branch XXXVII, Lingayen, Pangasinan, LEONARDO JIMENEZ, JR. and CORAZON JIMENEZ, respondents. FERNAN, CJ.: This is a petition for review on certiorari seeking to reverse and set aside the decision 1 of the Court of Appeals dated May 29, 1986 which dismissed the petition for certiorari and mandamus in AC-G.R. No. 06578 entitled "Tomas Jimenez, et. al. vs. Hon. Amanda Valera-Cabigao." The facts are as follows: The marriage of Leonardo (Lino) Jimenez and Consolacion Ungson produced four (4) children, namely: Alberto, Leonardo, Sr., Alejandra and Angeles. During the existence of the marriage, Lino Jimenez acquired five (5) parcels of land in Salomague, Bugallon, Pangasinan. After the death of Consolacion Ungson, Lino married Genoveva Caolboy with whom he begot the seven petitioners herein: Tomas, Visitacion, Digno, Antonio, Amadeo, Modesto and Virginia, all surnamed Jimenez. Lino Jimenez died on August 11, 1951 while Genoveva Caolboy died on November 21, 1978. Thereafter, in April 1979, Virginia Jimenez filed a petition before the Court of First Instance of Pangasinan, Branch V, docketed as Special Proceedings No. 5346, praying to be appointed as administratrix of the properties of the deceased spouses Lino and Genoveva. Enumerated in her petition were the supposed heirs of the deceased spouses which included herein co-petitioners and the four children of Lino Jimenez by Consolacion Ungson, his previous wife.2 In October, 1979, herein private respondent Leonardo Jimenez, Jr., son of Leonardo Jimenez, Sr., filed a motion for the exclusion of his father's name and those of Alberto, Alejandra, and Angeles from the petition, inasmuch as they are children of the union of Lino Jimenez and Consolacion Ungson and not of Lino Jimenez and Genoveva Caolboy and because they have already received their inheritance consisting of five (5) parcels of lands in Salomague, Bugallon, Pangasinan.3 On March 23, 1981, petitioner Virginia Jimenez was appointed administrator of the Intestate Estate of Lino Jimenez and Genoveva Caolboy.4 On May 21, 1981, she filed an inventory of the estate of the spouses Lino Jimenez and Genoveva Caolboy wherein she included the five (5) parcels of land in Salomague, Bugallon, Pangasinan. As a consequence, Leonardo Jimenez, Jr. moved for the exclusion of these properties from the inventory on the ground that these had already been adjudicated to Leonardo Sr., Alberto, Alejandra and Angeles by their deceased father Lino Jimenez. Private respondent Leonardo Jimenez, Jr. presented testimonial and documentary evidence in support of his motion while petitioner Virginia Jimenez, other than cross-

On September 29, 1981, the probate court ordered the exclusion of the five (5) parcels of land from the inventory on the basis of the evidence of private respondent Leonardo Jimenez, Jr. which consisted among others of: (1) Tax Declaration showing that the subject properties were acquired during the conjugal partnership of Lino Jimenez and Consolacion Ungson; and, (2) a Deed of Sale dated May 12, 1964 wherein Genoveva Caolboy stated, that the subject properties had been adjudicated by Lino Jimenez to his children by a previous marriage, namely: Alberto, Leonardo, Alejandra and Angeles.5 The motion for reconsideration of said order was denied on January 26, 1982.6 Petitioner Virginia Jimenez then went to the Court of Appeals on a petition for certiorari and prohibition, docketed thereat as CA-G.R. No. SP-13916, seeking the annulment of the order dated September 29, 1981 as well as the order of January 26, 1982. On November 18, 1982, the Court of Appeals dismissed the petition because (1) Genoveva Caolboy, petitioners' mother, had admitted that the subject parcels of land had been adjudicated to the children of the previous nuptial; (2) the subject properties could not have been acquired during the marriage of Lino Jimenez to Genoveva Caolboy because they were already titled in the name of Lino Jimenez even prior to 1921, long before Lino's marriage to Genoveva in 1940; (3) the claim of Virginia Jimenez was barred by prescription because it was only in 1981 when they questioned the adjudication of the subject properties, more than ten (10) years after Genoveva had admitted such adjudication in a public document in 1964; and, (4) petitioner Virginia Jimenez was guilty of laches. This decision became final and executory.7 Two (2) years after, petitioners filed an amended complaint dated December 10, 1984 before the Regional Trial Court of Pangasinan, Branch XXXVII, docketed thereat as Civil Case No. 16111, to recover possession/ownership of the subject five (5) parcels of land as part of the estate of Lino Jimenez and Genoveva Caolboy and to order private respondents to render an accounting of the produce therefrom. Private respondents moved for the dismissal of the complaint on the grounds that the action was barred by prior judgment in CA-G.R. No. SP13916 dated November 18, 1982 and by prescription and laches. However, petitioners opposed the motion to dismiss contending that (1) the action was not barred by prior judgment because the probate court had no jurisdiction to determine with finality the question of ownership of the lots which must be ventilated in a separate action; and, (2) the action instituted in 1981 was not barred by prescription or laches because private respondents' forcible acquisition of the subject properties occurred only after the death of petitioners' mother, Genoveva Caolboy in 1978. On February 13, 1985, the trial court resolved to dismiss the complaint on the ground of res judicata. 8 On May 31, 1985, petitioners' motion for reconsideration of the resolution was denied. As earlier intimated, the petition for certiorari and mandamus filed by petitioners before the appellate court was likewise denied due course and dismissed in a decision dated May 29, 1986.9 Hence, this recourse.

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JUDICIAL SETTLEMENT OF ESTATE Limited Jurisdiction The issue in this case is whether in a settlement proceeding (testate or intestate) the lower court has jurisdiction to settle questions of ownership and whether res judicata exists as to bar petitioners' present action for the recovery of possession and ownership of the five (5) parcels of land. In the negative, is the present action for reconveyance barred by prescription and/or laches? We reverse. Petitioners' present action for recovery of possession and ownership is appropriately filed because as a general rule, a probate court can only pass upon questions of title provisionally. Since the probate, court's findings are not conclusive being prima facie, a separate proceeding is necessary to establish the ownership of the five (5) parcels of land. 11 The patent reason is the probate court's limited jurisdiction and the principle that questions of title or ownership, which result in inclusion or exclusion from the inventory of the property, can only be settled in a separate action. All that the said court could do as regards said properties is determine whether they should or should not be included in the inventory or list of properties to be administered by the administrator. If there is a dispute as to the ownership, then the opposing parties and the administrator have to resort to an ordinary action for a final determination of the conflicting claims of title because the probate court cannot do so.

Jimenez, Sr. (referring to private respondents,) forcibly intruded into and took possession of the disputed properties only in 1978, after the death of Genoveva Caolboy. Since the action for reconveyance was instituted in 1984, it would appear that the same has not yet prescribed or otherwise barred by laches. There are a number of factual issues raised by petitioners before the lower court which cannot be resolved without the presentation of evidence at a full-blown trial and which make the grounds for dismissal dubitable. Among others, the alleged admission made by petitioners' mother in the deed of sale is vehemently denied, as well as the fact itself of adjudication, there being no showing that the conjugal partnership of Lino Jimenez and Consolacion Ungson had been liquidated nor that a judicial or extra-judicial settlement of the estate of Lino Jimenez was undertaken whereby such adjudication could have been effected. The grounds stated in the motion to dismiss not being indubitable, the trial court committed grave abuse of discretion in dismissing the complaint in Civil Case No. 16111. WHEREFORE, the questioned decision of the respondent appellate court is hereby REVERSED. Civil Case No. 16111 is reinstated and the Regional Trial Court of Pangasinan, Branch XXXVII is directed to proceed in said case with dispatch. SO ORDERED.

The provisional character of the inclusion in the inventory of a contested property was again reiterated in the following cases: Pio Barreto Realty Development, Inc. vs. Court of Appeals, 14 Junquera vs. Borromeo, 15 Borromeo vs. Canonoy, 16 Recto vs. de la Rosa. 17 It has also been held that in a special proceeding for the probate of a will, the question of ownership is an extraneous matter which the probate court cannot resolve with finality. 18 This pronouncement no doubt applies with equal force to an intestate proceeding as in the case at bar.



Res judicata does not exist because of the difference in the causes of actions. Specifically in S.P. No. 5346, the action was for the settlement of the intestate estate of Lino Jimenez and Genoveva Caolboy while Civil Case No. 16111 was an action for the recovery of possession and ownership of the five (5) parcels of land. Moreover, while admittedly, the Court of First Instance of Pangasinan, Branch V in S.P. No. 5346 had jurisdiction, the same was merely limited jurisdiction. Any pronouncement by said court as to title is not conclusive and could still be attacked in a separate proceeding. Civil Case No. 16111, on the other hand. was lodged before the Regional Trial Court of Pangasinan, Branch XXXVII in the exercise of the court's general jurisdiction. It was, in fact, such "separate or ordinary proceedings" contemplated by the rules for a final determination of the issue of ownership of the disputed properties. To repeat, since the determination of the question of title to the subject properties in S.P. 5346 was merely provisional, petitioners are not barred from instituting the appropriate action in Civil Case No. 16111. Indeed, the grounds relied upon by private respondents in their motion to dismiss do not appear to be indubitable.1âwphi1Res judicata has been shown here to be unavailable and the other grounds of prescription and laches pleaded by private respondents are seriously disputed. The allegation in the complaint is that the heirs of Leonardo

Page 9 of 37



JUDICIAL SETTLEMENT OF ESTATE Limited Jurisdiction G.R. No. L-39532 July 20, 1979

assets in the testator's will, the two San Lorenzo Village lots were included as part of the testate estate.

Testate Estate of Jose M. Valero, FLORA VALERO VDA. DE RODRIGUEZ and ROSIE VALERO DE GUTIERREZ, petitioners-appellants, vs. COURT OF APPEALS and CARMEN VALERORUSTIA, respondents-appellees.

That inclusion provoked Mrs. Rustia, the adopted child of Mrs. Valero, and Mrs. Rodriguez and Mrs. Gutierrez, the legitimate children of the testator, Jose M. Valero, to file (through Mrs. Rustia's lawyer) in the testate proceeding a motion for the exclusion of the two San Lorenzo Village lots from the testator's inventoried estate.

AQUINO, J. This is supposedly a case about collation. As factual background, it should be stated that the spouses, Beatriz Bautista and Jose M. Valero, did not beget any child during their marriage In 1951 Beatriz adopted Carmen (Carmencita) Bautista. Jose wanted also to adopt her but because, by his first marriage, he had two children named Flora Valero Vda. de Rodriguez and Rosie Valero Gutierrez. he was disqualified to adopt Carmen. Jose manifested in the adoption proceeding that he consented to the use by Carmen of his surname Valero. (See Civil Case No. 12475, Manila CFI; Art. 338[1], Civil Code and art. 28, Child and Youth Welfare Code.) On September 18, 1964, Jose M. Valero donated to Carmen B. Valero (who was already married to Doctor Sergio Rustia) his one-half proindiviso share (apparently his inchoate share) in two conjugal lots, with the improvements thereon, located at San Lorenzo Village, Makati, Rizal, with an area of 1,500 square meters. His wife, Beatriz, consented to the donation. However, the deed of donation was not registered. On January 13, 1966, Jose M. Valero, who was then seventythree years old, executed his last will and testament wherein he enumerated the conjugal properties of himself and his wife, including the two San Lorenzo Village lots. In that will, he did not mention the donation. He devised to his wife properties sufficient to constitute her legitime and bequeathed the remainder to his two children, Mrs. Rodriguez and Mrs. Gutierrez. About a month later, or on February 15, 1966, the Valero spouses, by means of a deed of absolute sale, conveyed the San Lorenzo Village lots and the improvements thereon to Carmen B. Valero-Rustia for the sum of one hundred twenty thousand pesos. The sale was registered on the following day. Transfer Certificates of Title Nos. 163270 and 163271 were issued to the vendee, Mrs. Rustia. On December 4, 1967 she mortgaged the two lots to the Quezon City Development Bank as security for a loan of fifty thousand pesos (page 204, Rollo). Beatriz B. Valero died intestate on September 12, 1972, survived by her husband and her adopted child. Her estate is pending settlement in Special Proceeding No. 88896 of the Court of First Instance of Manila. Mrs. Rustia was named administratrix of her adopted mother's estate. More than a month later, or on October 18, 1972, Jose M. Valero died testate, survived by his two children, Mrs. Rodriguez and Mrs. Gutierrez. His will was duly probated in Special Proceeding No. 88677, also of the Court of First Instance of Manila. Lawyer Celso F. Unson, the executor, submitted an inventory wherein, following the list of conjugal

Adduced as reason for the exclusion is the fact that since February 16, 1966 Mrs. Rustia has been the registered owner of the lots as shown by two Torrens titles, copies of which were attached to the motion. The executor opposed the motion on the ground that the two lots were donated to Mrs. Rustia and the donation would allegedly involve collation and the donee's title to the lots. The executor revealed that he was informed by Mrs. Gutierrez and Mrs. Rodriguez (supposed movants) that the two lots should be included in the inventory. Thus, the issue of collation was prematurely raised. The probate court in its order of August 9, 1973 excluded the two lots from the inventory of the testator's estate but with the understanding "that the same are subject to collation". On December 4, 1973 or one hundred twelve days after Mrs. Rustia was served with a copy of that order, she filed a motion for its reconsideration. She insisted that she is the owner of the two San Lorenzo Village lots as indicated in the Torrens titles. No one opposed that motion. At the hearing of that motion, Mrs. Rustia's lawyer apprised the court that the executor informed him over the phone that he was not opposing the motion. The probate court in its order of December 14, 1973 ruled that the two lots were unconditionally excluded from the inventory of Jose M. Valero's estate, meaning "that they are not subject to collation". That order is the bone of contention in this case. Mrs. Rodriguez (without being joined by her sister, Mrs. Gutierrez) filed a motion for the reconsideration of the order of December 14, 1973. She alleged that the two San Lorenzo Village lots were really conveyed to Mrs. Rustia by way of donation because the consideration for the sale was allegedly only one-fifth of the true value of the lots. Mrs. Rodriguez further contended that the order of August 9, 1973 was final in character. In reply, Mrs. Rustia countered that the prior order was interlocutory and that in 1966 the true value of the two lots was around P120,000 and that their value increased considerably in 1973 or 1974. Moreover, the relatively low price of the sale could be attributed to the fact that Mrs. Rustia and her husband lived with the Valeros and were taking care of them. The probate court denied the motion for reconsideration. Mrs. Rodriguez and Mrs. Gutierrez, in their petition for certiorari in the Court of Appeals, assailed the probate court's order declaring that the two lots were not subject to collation.

Page 10 of 37

JUDICIAL SETTLEMENT OF ESTATE Limited Jurisdiction The Court of Appeals held that the order of exclusion dated August 9, 1973 was interlocutory and that it could be changed or Modified at anytime during the course of the administration proceedings. It further held that it was immaterial whether the two lots were donated or sold to Mrs. Rustia as "a mere subterfuge to avoid payment of the donor's and donee's taxes". According to the Appellate Court, it was immaterial because under article 1061 of the Civil Code, only compulsory heirs are required to make collation for the determination of their legitimes and, under section 2, Rule 90 of the Rules of Court, only heirs are involved in questions as to advancement and Mrs. Rustia is not an heir of the testator, Jose M. Valero (Vda. de Rodriguez vs. Valero Rustia, CA-G. R. No. SP- 02944, August 28, 1974, per G. S. Santos, Gaviola, Jr. and De Castro, JJ.). From that decision, an appeal was made to this Court. The appeal was not given due course. However, upon motion for reconsideration and over Mrs. Rustia's opposition, the appeal was later allowed. The appellants' only assignment of error is that the Court of Appeals should have held that the probate court's order of exclusion dated August 9, 1973 was not interlocutory but was a final and appealable order valid that the order of December 14, 1973 modifying the order of August 3 is void. We hold that the order of exclusion dated August 9, 1973 was not a final order. It was interlocutory in the sense that it did not settle once and for all the title to the San Lorenzo Village lots. The probate court in the exclusion incident could not determine the question of title.

We have examined the expedientes of the two cases. We found that the proceedings have not yet reached the stage when the question of collation or advancement to an heir may be raised and decided. The numerous debts of the decedents are still being paid. The net remainder (remanente liquido) of their conjugal estate has not yet been determined. On the other hand, up to this time, no separate action has been brought by the appellants to nullify Mrs. Rustia's Torrens titles to the disputed lots or to show that the sale was in reality a donation. In this appeal, it is not proper to pass upon the question of collation and to decide whether Mrs. Rustia's titles to the disputed lots are questionable. The proceedings below have not reached the stage of partition and distribution when the legitimes of the compulsory heirs have to be determined. WHEREFORE, we affirm the decision of the Court of Appeals and the orders of the, lower court dated August 9 and December 14, 1973, excluding from the inventory of Jose M. Valeros estate the two San Lorenzo Village lots now registered in the name of Carmen B. Valero-Rustia, but we delete from that decision and the two orders any ruling regarding collation which is a matter that may be passed upon by the probate court at the time when it is seasonably raised by the interested parties, if it is ever raised at all. No costs. SO ORDERED.

The prevailing rule is that for the purpose of determining whether a certain property should or should not be included in the inventory, the probate court may pass upon the title thereto but such determination is not conclusive and is subject to the final decision in a separate action regarding ownership which may be instituted by the parties (3 Moran's Comments on the Rules of Court, 1970 Edition, pages 448-9 and 473; Lachenal vs. Salas, L-42257, June 14, 1976, 71 SCRA 262, 266). We hold further that the dictum of the Court of Appeals and the probate court that the two disputed lots are not subject to collation was a supererogation and was not necessary to the disposition of the case which merely involved the issue of inclusion in, or exclusion from, the inventory of the testator's estate. The issue of collation was not yet justifiable at that early stage of the testate proceeding. It is not necessary to mention in the order of exclusion the controversial matter of collation. Whether collation may exist with respect to the two lots and whether Mrs. Rustia's Torrens titles thereto are indefeasible are matters that may be raised later or may not be raised at all. How those issues should be resolved, if and when they are raised, need not be touched upon in the adjudication of this appeal. The intestate and testate proceedings for the settlement of the estates of the deceased Valero spouses were consolidated, as ordered by the lower court on November 21, 1974, so that the conjugal estate of the deceased spouses may be properly liquidated, as contemplated in section 2, Rule 73 of the Rules of Court and Act No. 3176 (Pages 223 and 235-6, Rollo).

Page 11 of 37



JUDICIAL SETTLEMENT OF ESTATE Limited Jurisdiction G.R. No. L-62431-33 August 31, 1984 PIO BARRETTO REALTY DEVELOPMENT, INC., petitioner, vs. THE HON. COURT OF APPEALS (SIXTH DIVISION) and HONOR MOSLARES, respondents.

Special Proceedings Nos. 7257, 7261, and 7269 of the CFI of Makati Branch Civil Case No. 41287 abovementioned. The proceedings for the settlement of the estate of Drepin were initiated shortly after his death on July 29, 1972 with the filing of a petition for probate of his holographic will on August 23, 1972.

Azucena E. Lozada for petitioner. Estrella Funelas Iral & Associates and Tomas Trinidad for respondents.

GUTIERREZ, JR., J.: This petition for certiorari to review the decision of the Court of Appeals promulgated on June 30, 1982 in CA-G.R. Nos. 12599-R, 12600-R, and 12601-R entitled "Honor P. Moslares, petitioner v. Honorable Reynaldo P. Honrado, et al., respondents, was filed as part of the effort to expedite the final settlement of the estate of the deceased NICOLAI DREPIN. The dispositive portion of the decision of the respondent Court of Appeals reads as follows: WHEREFORE, all the foregoing considered, judgment is hereby rendered: (a) making permanent the temporary restraining order issued: (b) declaring null and void the impugned orders of April 15, 1980, July 2, 1980, September 30, 1980, and October 20, 1980, for having been issued in grave abuse of discretion and in excess of jurisdiction, with the September and October orders having the additional defect of due process violation; (c) declaring null and void the Deed of Undertaking and Deed of Sale in favor of respondent Pio Barretto Realty Development, Inc., for being mere consequences of null orders;

In this holographic will the late Drepin listed twenty-two (22) persons as his alleged creditors, and within the six (6) months after publication within which to file claims against the estate, twelve (12) persons filed their respective claims. The total amount of obligations that may be chargeable against the Drepin Estate is P1,299,652.66. The only asset of the testate estate of Drepin consists of three (3) parcels of titled land with an area of approximately eighty (80) hectares, and another parcel with an area of eighty-one (81) hectares still pending registration. The estate is saddled with claims of creditors named in the Drepin will and creditors who have filed their claims within the reglementary period. The only way to pay their claims is to sell the Drepin lots, so that from the proceeds of the sale, the debts of the estate could be paid, and any remaining balance distributed to the Drepin heirs. Since the filing of the petition for probate of the Drepin will, on August 23, 1972, nine (9) offers had been made for the purchase of the Drepin lands, among them, that of GM Management Phils., dated August 15, 1978, through its President Honor P. Moslares. Basis for Moslares' letter proposal is a deed of sale with mortgage executed by the decedent in his favor on October 9, 1970. It appears that on said date, the deceased sold 80.3980 hectares of land absolutely and perpetually to Honor P. Moslares for the sum of P2,600,000.00 with a downpayment of P300,000.00. To secure the payment of the remaining P2,300,000.00, the latter mortgaged the land to the former. The parties further agreed not to register the sale yet until P1,300,000.00 shall have been paid to Drepin and P1,000.000.00 paid to Drepin's creditors. Subsequently, on June 25, 1971, Drepin and Moslares entered into a "Joint Venture Agreement". Said agreement listed Drepin as the registered "owner" of the lots and denominated Moslares as "developer" tasked with converting the lands into a residential subdivision. The agreement specified:

(d) ordering the Register of Deeds of Rizal to cancel the transfer certificates of title issued to Pio Barreto Realty Development, (TCT Nos. N-50539, N-50540, N-50541) and to transfer the same to the Estate of Nicolai Drepin with the annotation that this transfer to the estate is subject to the final decision in Civil Case No. 41287 of the CFI of Pasig, Metro Manila; and (e) denying the prayer for the exclusion of the three titled lots involved from

Page 12 of 37

(h) That the Developer agrees to reserve the right of the registered Owner of the land to ask for immediate CASH payment against an "Absolute Deed of Sale " on the said above mentioned properties, subject of this "Joint Venture Agreement" on the amount of not less than TWO MILLION THREE HUNDRED THOUSAND (P2,300,000.00) PESOS, after the big loan is granted to the Developer in or about thirty (30) days to forty-five (45) days from the signing of this Joint Venture Agreement and the "Special Power of Attorney",

JUDICIAL SETTLEMENT OF ESTATE Limited Jurisdiction (i) However, if the Owner of the property Mr. Nicolai Drepin not choose to be paid on this said above mentioned property in CASH of TWO MILLION THREE HUNDRED THOUSAND (P2,300,000.00) PESOS, this "joint venture agreement is still in full force and effect, OTHERWISE if full payment of TWO MILLION THREE HUNDRED THOUSAND (P2,300,000.00) PESOS receipt is acknowledged by the said Mr. Nicolai Drepin, the "Joint Venture Agreement" is automatically cancelled and declared no force and effect.

probate court ordered the parties to submit memoranda and set a conference on November 28, 1979 to discuss the new offer. On November 12, 1979, respondent Moslares submitted his memorandum containing three points to wit: l. Actually, Honor P. Moslares is already owner of the Property, subject matter of this proceedings, and as such, could no longer be the subject matter of this testate proceedings. The payment made by Honor P. Moslares to the Judicial Administrator through this Honorable Court on 19 October, 1979, is in compliance with the Contract entered into between him and the late Nicolai Drepin, in 1970;

Before the agreement could be implemented, Nicolai Drepin died. Upon learning of the existence of Special Proceedings No. 7257, 7261 and 7269 herein respondent Moslares, on August 15, 1978, informed the Judicial Administrator Atty. Tomas Trinidad that he is already the owner of the properties made subject matter of the Special Proceedings and proposed that he be permitted to pay the balance on the sale with mortgage in accordance with the terms of his written proposal. The probate court, on August 17, 1978 issued an order approving respondent Moslares' proposal and authorizing administrator Trinidad to enter into the appropriate agreement. This was reiterated by the court in its order dated January 9, 1979, with the condition that GM Management Phils. had only up to February 28, 1979 to comply with its letter-offer dated August 15, 1978 and "failure on their part to comply with the same within the period specified, the contract with the decedent shall be deemed resolved and ineffective." Counsel for heir claimant Cornelia Tejano was Revise given up to said date to make and submit a more beneficial offer. Neither GM Management nor counsel for Tejano was able to perform as required. Requests for revision of payment and extension of period within which to pay the balance of P1,600,000.00 were made by Moslares. Further, he filed a Manifestation and Urgent Motion proposing transfer of the certificate of titles over the land subject of the proceedings so as to enable him to generate funds to liquidate the payable balance. The same were left unacted upon by the probate court. Meanwhile, on September 25,1979, A Deed of Undertaking was entered into by respondent Moslares and the Administrator to implement the Contract of Sale with Mortgage. Such deed provided for the mode of payment which Moslares was to follow as well as the clearing and transfer of the certificates of title in the name of Moslares. The latter proviso was to enable Moslares to secure the loan needed to pay for the balance of the purchase price. Postdated checks were issued by Moslares to cover the amount embraced in said undertaking. Approval of the agreement with Moslares was strongly urged by the Administrator. No action was taken by the court thereon. At the hearing of October 19, 1979, Moslares tendered P1,600,000.00 to the Judicial Administrator. This was opposed by counsel for heir Tejano, Atty. Ramon Encarnacion, on the ground that respondent Moslares had only until February 28, 1979 within which to pay the same. Attorney Encarnacion thereupon brought to the attention of the court an offer to buy the properties for P3,000,000.00 by herein petitioner Pio Barretto Realty Development, Inc. Because of the differing contentions and the new offer, the

2. The Order of this Honorable Court dated 9 January, 1979, particularly with reference to the period, mentioned in No. 1, page 2 of the Order of this Honorable Court giving Honor P. Moslares up to 28 February, 1979, within which to comply with his letteroffer to the Court dated 15 August, 1978, is not yet final, said period having been extended; 3. The Order of this Honorable Court dated 9 January, 1979, particularly No. 2, Page 2 thereof, barred Counsel for Cornelia B. Tejano from making any further offer, his right to do so having expired on 28 February, 1979. Thereupon, the probate court judge directed Moslares through the administrator Atty. Trinidad, to furnish copies of — (1) Deed of Absolute Sale; (2) Special Power of Attorney; and (3) Joint Venture Agreement. The same were promptly submitted. On February 28, 1979, March 6, 1980 and April 15, 1980, letters to Judicial Administrator Trinidad were sent by respondent Moslares seeking further extension of time within which to pay the balance of his obligation to the estate, and for favorable recommendations to the probate court in his reports saying: "Help me now, this is ours. We can make money of all this sacrifice we had on the pass (sic)." On April 15, 1980, the probate court reiterated its order dated August 17, 1978 authorizing the Administrator to finalize the sale with GM Management Phils. and giving respondent Moslares ten (10) days from date to deposit the necessary amount to cover the value of the checks as each fallsdue. Failure to do so would result in the automatic rescission of the authority to sell to GM Management Phils. and the Administrator would be permitted to accept other offers in the best interest of the Estate. This order was the probate court's prompt action on a "Report with Motion for Cancellation of Order Approving Sale to GM Management, Phils. Honor P. Moslares, if it fails to make good the April 15, 1980 check "As Token Payment in Good Faith", filed by administrator Trinidad on the same day, April 15, 1980.

Page 13 of 37

JUDICIAL SETTLEMENT OF ESTATE Limited Jurisdiction GM Management sought reconsideration and amendment of the Order of April 15, 1980 to conform to the provisions of the Deed of Undertaking.

(P1,600,000.00) PESOS, Philippine Currency; 2. As of November, 1979, the law that governs between the ESTATE and MOVANT, Honor P. Moslares, is the DEED OF UNDERTAKING executed by the Administrator in favor of Movant Honor P. Moslares, pursuant to the authority given by the Honorable Probate Court to the Administrator contained in the Order dated August 15, 1978, reiterated in the Order dated January 9, 1979, and in the Order dated 15 April 1980; and

On May 23, 1980, administrator Trinidad filed a "Report with Motion to Authorize Administrator to Screen Offers to Purchase Estate and Others. On May 31, 1980, respondent Moslares filed another manifestation praying that his pending motions be acted upon and that the motion of administrator Trinidad be denied for lack of merit. On June 30, 1980, administrator Trinidad made the following "Observation and Report on the Motion of Buyer GM Management Phils. for reconsideration" — 2. Two checks, one for P50,000.00 and one for P250,000.00 were deposited on April 28, 1980 after the Order of the Probate Court. BOTH BOUNCED. DAIF (Drawn against insufficient funds). 3. Another check for P300,000.00 is now held by the Administrator, postdated for today, June 30, 1980 and Administrator just received, June 29, 1980 a telegram asking to withhold deposit until after 30 days from amendatory order of the Probate Court. xxx xxx xxx 6. The motion of Administrator is reiterated. On July 2, 1980, the probate court issued the following order: Finding the Motion of the Administrator well-taken and in the best interests of the Estate, the administrator is authorized to enter into agreement with any other interested parties on a first paid first served basis without prejudice to G.M. Management Philippines to continue with its offer and make good the same in as an ordinary buyer on the same first paid first served basis. Respondent Moslares filed a motion for reconsideration of said July 2, 1980 order on the ground that: 1. The Honorable Probate Court has no jurisdiction over the three (3) parcels of land, consisting of 80.3980 hectares subject matter of the Deed of Sale which the late Nicolai Drepin, conveyed to Movant Honor P. Moslares. The only right which pertains to the ESTATE, is the right to demand from Honor P. Moslares, the balance of the Deed of Sale, which has been fixed by this Honorable Court at ONE MILLION SIX HUNDRED THOUSAND

3. The Honorable Probate Court has no jurisdiction to decree rescission of the Contract into (sic) between the decedent and Movant Honor P. Moslares on the 9th day of October, 1970. This motion for reconsideration was opposed by administrator Trinidad as well as the Tejano heirs through counsel, arguing that the probate court has jurisdiction to issue the questioned orders because petitioner submitted himself to the court's jurisdiction and his checks bounced also that the Deed of Undertaking was validly cancelled as a result of the valid rescission of Trinidad's authority to sell to petitioner. On September 30, 1980, the probate court issued an order denying respondent Moslares' motion for reconsideration for lack of merit. And on October 10, 1980 administrator Trinidad executed the Deed of Sale in favor of Pio Barretto Realty, Inc. transferring the titles to the properties in question in the name of the latter. The same was duly registered. On October 20, 1980, the probate court approved the report of administrator Trinidad dated October 16, 1980, with xerox copies of the Deed of Sale in favor of Pio Barretto Realty, Inc. of the estate of Nicolai Drepin pursuant to respondent court's order authorizing the sale, and of the approved Deed of Undertaking with the vendee. An urgent Motion and Manifestation was filed by respondent Moslares on April 8, 1981 praying that his motion for reconsideration of the orders be already resolved, followed by an Omnibus Motion on April 27, 1981 to resolve all pending motions and praying that the Deed of Sale and Deed of Undertaking in favor of Pio Barretto be cancelled. The same remained unacted upon. On May 18, 1981, respondent filed Civil Case No. 41287 before the Court of First Instance of Rizal in Pasig, Metro Manila to determine title and ownership over the Drepin lands. On June 23, 1981, a petition for certiorari was filed by respondent Moslares before the Court of Appeals which issued a temporary restraining order. Judgment was rendered by respondent court in favor of respondent Moslares, the dispositive portion of which has been quoted. Barretto filed a motion for reconsideration which was denied on November 12, 1982. Hence, this petition.

Page 14 of 37

JUDICIAL SETTLEMENT OF ESTATE Limited Jurisdiction In its decision, the Court of Appeals laid down the two principal issues involved in the case, as follows:

provisional in character and is without prejudice to a judgment in a separate action on the issue of title or ownership" (Sebial v. Sebial, L-23419, June 27, 1975, 64 SCRA 385). Consequently, in reviewing the exercise of such limited probate jurisdiction, We cannot order an unqualified and final exclusion of the properties involved, as prayed for; to do so would expand the probate court's jurisdiction beyond the perimeters set by law and jurisprudence. It is fitting and proper that this issue be ventilated and finally resolved in the already instituted Civil Case No. 41287, even as We hold that respondent court's act of not excluding the lots involved did not constitute grave abuse of discretion. In view of this limitation, We need not resolve the issue of whether there was novation of the Deed of Sale with Mortgage, or not.

(1) whether or not the respondent judge (Judge R. Honrado) acted without or in excess of jurisdiction or with grave abuse of discretion in refusing to exclude the parcels of land involved from the testate proceedings of the Drepin estate; and (2) whether or not the respondent judge acted without or in excess of jurisdiction or with grave abuse of discretion in issuing the impugned orders dated April 15, 1980, July 2, 1980, September 30, 1980, and October 20, 1980. We are in full accord with the respondent court's resolution of the first issue, and we quote: For continually presuming that the three titled lots were part of the Drepin estate and for refusing to provisionally pass upon the question of exclusion, did the respondent court act without or in excess of jurisdiction or with grave abuse of discretion? We hold that even with such presumption and refusal, the respondent court still acted within its jurisdiction and not with grave abuse of discretion. After all, the jurisprudence and rule are both to the effect that the probate court "may" provisionally pass upon the question of exclusion, not "should". The obvious reason is the probate court's limited jurisdiction and the principle that questions of title or ownership, which result to inclusion in or exclusion from the inventory of the property, can only be settled in a separate action. Hence, even if respondent court presumed an the way that the properties sold by Drepin to petitioner were part of Drepin's estate, that would not prevent nor defeat petitioner's remedy in a separate suit. And We hold that Civil Case No. 41287 is just such a suit instituted to settle the question of ownership over the lots covered originally by TCTs Nos. 259060, 259061 and 259062, despite the claim for damages, because of the composite effect of the prayer in the complaint thereof ... xxx xxx xxx In effect, We are saying that the question of whether the properties sold by Drepin to Petitioner should be excluded from the probate proceedings below, can not be determined with finality by Us in this case, because in this petition We are merely reviewing the acts of the respondent CFI as a probate court. Any ruling by the probate court to include those properties "is only

This same elemental principle, we found occasion to reiterate in the cases of Junquera v. Borromeo (19 SCRA 656); Borromeo v. Canonoy (19 SCRA 667); Recto v. dela Rosa (75 SCRA 226); Lachenal v. Salas (71 SCRA 202); Bolisay v. Alcid (85 SCRA 213); Vda. de Rodriguez v. Court of Appeals (91 SCRA 540). However, from here, the road forks as we disagree with the respondent court's findings on the second issue. In his petition for certiorari before the Court of Appeals, respondent Moslares assails the issuance of the four impugned orders by the probate court on the ground that the court had no jurisdiction to rescind the Deed of Sale with the Mortgage entered into by the deceased during his lifetime, due to the limited jurisdiction of the probate court merely to settle and liquidate the estates of a decedent and not to pass upon questions of title to property. On the other hand, the petitioner argues that in voiding and nullifying the four orders of the probate court, the Court of Appeals, in effect, would have the former court recognize the alleged ownership of Mr. Moslares over the three titled Drepin lots involved in this case contrary to its pronouncement in settling the first issue. It is to be noted that the last agreement entered into by the deceased prior to his death, that is, the Joint Venture Agreement listing Drepin as owner of the properties in question, and the surrender to administrator Trinidad of the certificates of title, had led the probate court to enter or include said properties in its inventory of the deceased's estate. Thus, provisionally, ownership thereof was recognized as vested in the estate. Subsequently, in the course of the probate proceedings, the sale of the properties was found to be necessary to settle the deceased's obligations. It was then that herein private respondent Moslares submitted himself to the jurisdiction of the court in an "Offer to Buy" said properties, based on his previous agreement with the deceased during the latter's lifetime. It is noteworthy that contrary to Moslares' assertion of ownership, he had offered to buy the Drepin lands from the

Page 15 of 37

JUDICIAL SETTLEMENT OF ESTATE Limited Jurisdiction probate court. Surely, this is not conduct ordinarily expected of one who is the owner of the property. Further, the fact that subsequent to the Deed of Sale, the deceased as buyer and as absolute owner entered into an agreement with the respondent merely as developer of the lands in question evidences a change of cause or object as well as a change of relation between the parties. Moslares' own acts negate his claims in this petition that he had acquired ownership of the properties. Thus, the transparency of respondent's argument becomes readily apparent. Having submitted his letter-proposal to the court, the same was approved, allowing Moslares to pay the balance of the purchase price agreed upon by respondent and the decedent in the amount of One Million Six Hundred Thousand Pesos (P1,600,000.00) specifying the time and manner of payment thereof. Thus, he was given preference and priority over other persons or groups offering to buy the estate. Having failed to comply with the conditions of payment of the contract, the same was rescinded by the probate court. Now, respondent questions this rescission which he maintains to be beyond the jurisdiction of the court. Estoppel works to preclude respondent from questioning the jurisdiction of the court. By offering to buy the properties in question, respondent has clearly recognized the jurisdiction of the probate court to which he had effectively submitted himself. It is well settled that a party is estopped from disputing the jurisdiction of the court after invoking it himself (Tible v. Aquino, 65 SCRA 207). After voluntarily submitting a cause and encountering an adverse decision on the merits, it is too late for the loser to question the jurisdiction or power of the court (People v. Munar, 53 SCRA 278; Capilitan v. dela Cruz, 55 SCRA 706; Summit Guaranty and Insurance Co., Inc., v. Court of Appeals, 110 SCRA 241; Tajonera v. Lamoroza, 110 SCRA 438). A party will not be allowed to make a mockery of justice by taking inconsistent positions. Doctrine of estoppel bars a party from trifling with the courts (Depositario v. Hervias, 121 SCRA 756). The merits of the case likewise lead to similar conclusions. It cannot but be conceded that the limited jurisdiction of a probate court prohibits it from determining rights to property left by a decedent which depends on the contract (Goodin v. Casselman 200 N.W. 94, 51 N.D. 543). However, actions of the probate court, in the case at bar, do not refer to the adjudication of rights under the contract entered into by the deceased during his lifetime. It is to be noted that the dealings of the respondent with the court arose out of the latter's bid to sell property under its authority to sell, mortgage or otherwise encumber property of the estate to pay or settle against the estate (Rule 89, Revised Rules of Court). Thus, respondent bound himself under an agreement with the court separate and distinct from that which he had with the decedent. In rescinding such contract, the court merely seeks to enforce its right to put an end to an agreement which had ceased to be a working proposition. Surely, this is well within the power of the probate court. Though of limited and special jurisdiction, it cannot be denied, however, that when the law confers jurisdiction upon a court, the latter is deemed to have all the necessary powers to exercise such jurisdicton to make it effective (Zuniga v. Court of Appeals, 95 SCRA 740).

We cannot allow an absurd situation to arise where the Drepin estate will never be settled and liquidated because even if Moslares cannot pay the agreed purchase price of the Drepin lands, still the probate court can no longer sell the lands to other prospective buyers. Under the theory of respondent, it is insisted that the probate court has no authority to cancel his unfulfilled offer to buy, notwithstanding the fact that he failed miserably to comply with the terms of his own offer to buy. It is to be remembered that Moslares had already been granted undue leniency by the probate court to meet his obligations to pay. But, the saga of Moslares' bouncing checks remains. Three reports of Administrator Trinidad had been submitted as annexes to the petition for certiorari. The report, dated June 30, 1980 showed that two of Moslares' checks were dishonored, having been drawn against insufficient funds. The August 18, 1980 report stated that: "All the checks submitted to the probate court for payment bounced." And in the report dated April 15, 1981, it was further averred by the administrator that "... believing that the bouncing checks were not intended to defraud the Estate," "he refrained from prosecuting Honor P. Moslares criminally under the law on dishonored checks." It is also to be emphasized that it was not respondent's contract of sale with decedent that had been invalidated but rather the administrator's authority to sell to respondent. Although the court recognized the Deed of Sale with Mortgage, still the same was not being enforced as such but was used only as basis for the terms and conditions of respondent's agreement with the court. To enforce the same is truly beyond the scope of the probate court's jurisdiction. The court's actions constitute a refusal to pass upon the validity of the contract to sell. Further, the probate court has ample discretion in determining whether conditions of a particular sale would be beneficial to the estate and this is generally respected by the appellate courts (Court of First Instance v. Court of Appeals, 106 SCRA 114, Fernandez, et al., v. Montejo, 109 Phil. 701). To attack the nullity of the order of the probate court to sell property of the deceased, it must be shown that the contract of sale is null and void (Rafols v. Barba, 119 SCRA 147). The infirmity of the subject deed of sale is premised on the alleged nullity of the order of the court authorizing the sale. The validity of said order may not be attacked in a collateral proceeding, the supposed ground for declaring it void for lack of jurisdiction not being apparent on the face thereof (Rafols v. Barba, supra). Nevertheless, respondent could have prevented the sale of the Drepin lands. Section 3, Rule 89 of the Revised Rules of Court, to wit: Section 3. Persons interested may prevent such sale, etc., by giving bond. — No such authority to sell mortgage, or otherwise encumber real or personal estate shall be granted if any person interested in the estate gives a bond, in a sum to be fixed by the court, conditioned to pay the debts, expenses of administration, and legacies within such tune as the court directs; and such bond shall be for the security of the creditors, as well as of the executor or administrator, and may be prosecuted for the benefit of either. provides respondent with the legal means by which he could have forestalled the sale of the Drepin lands to the petitioner.

Page 16 of 37

JUDICIAL SETTLEMENT OF ESTATE Limited Jurisdiction (Court of First Instance v. Court of Appeals, supra) If third persons oppose an application for leave to sell the property of the decedent, claiming title to the property, the title claim, cannot be adjudicated by the probate court, but it can hold approval of the sale in abeyance until the question of ownership shall have been decided in a proper action (Baquial v. Amihan, 92 Phil. 501). But this, he failed to do. Ergo, we find no reason to disturb the questioned orders of the probate court. Moreover, the respondent is not without remedy if truly his claim of ownership is proper and meritorious. Since the probate court has no jurisdiction over the question of title and ownership of the properties, the respondents may bring a separate action if they wish to question the petitioner's titles and ownership (Vda. de Rodriguez v. Court of Appeals, 91 SCRA 540). Though an order of the probate court approving the sale of the decedent's property is final, the respondent may file a complaint in the proper court for the rescission of the sale. (Pizarro v. Court of Appeals, 99 SCRA 72). Likewise, the initial question of respondent regarding the propriety of including the properties in question in the inventory of the probate court as he claims ownership thereof may therein be finally and conclusively settled (Vda. de Rodriguez v. Court of Appeals, supra; Lachenal v. Salas, 71 SCRA 202). The respondent has ample protection of his rights for the province of the probate court remains merely the settlement of the estate and may not be extended beyond (Pizarro v. Court of Appeals, supra). WHEREFORE, in view of the foregoing, the petition for certiorari is hereby GRANTED. The decision of the Court of Appeals (now Intermediate Appellate Court), dated June 30, 1982 is REVERSED and SET ASIDE. The permanent restraining order issued against the trial court is hereby DISMISSED. The impugned orders of the probate court dated April 15, 1980, July 2, 1980, September 30, 1980 and October 20, 1980 are accordingly REINSTATED. SO ORDERED.



Page 17 of 37

JUDICIAL SETTLEMENT OF ESTATE Limited Jurisdiction [G.R. No. 108581. December 8, 1999]

LOURDES L. DOROTHEO, petitioner, vs. COURT OF APPEALS, NILDA D. QUINTANA, for Herself and as Attorney-in-Fact of VICENTE DOROTHEO and JOSE DOROTHEO, respondents. D E C I S I O N YNARES-SANTIAGO, J.: May a last will and testament admitted to probate but declared intrinsically void in an order that has become final and executory still be given effect? This is the issue that arose from the following antecedents: Private respondents were the legitimate children of Alejandro Dorotheo and Aniceta Reyes. The latter died in 1969 without her estate being settled. Alejandro died thereafter. Sometime in 1977, after Alejandros death, petitioner, who claims to have taken care of Alejandro before he died, filed a special proceeding for the probate of the latters last will and testament. In 1981, the court issued an order admitting Alejandros will to probate. Private respondents did not appeal from said order. In 1983, they filed a Motion To Declare The Will Intrinsically Void. The trial court granted the motion and issued an order, the dispositive portion of which reads: WHEREFORE, in view of the foregoing, Order is hereby issued declaring Lourdes Legaspi not the wife of the late Alejandro Dorotheo, the provisions of the last will and testament of Alejandro Dorotheo as intrinsically void, and declaring the oppositors Vicente Dorotheo, Jose Dorotheo and Nilda Dorotheo Quintana as the only heirs of the late spouses Alejandro Dorotheo and Aniceta Reyes, whose respective estates shall be liquidated and distributed according to the laws on intestacy upon payment of estate and other taxes due to the government.[1] Petitioner moved for reconsideration arguing that she is entitled to some compensation since she took care of Alejandro prior to his death although she admitted that they were not married to each other.Upon denial of her motion for reconsideration, petitioner appealed to the Court of Appeals, but the same was dismissed for failure to file appellants brief within the extended period granted.[2] This dismissal became final and executory on February 3, 1989 and a corresponding entry of judgment was forthwith issued by the Court of Appeals on May 16, 1989. A writ of execution was issued by the lower court to implement the final and executory Order. Consequently, private respondents filed several motions including a motion to compel petitioner to surrender to them the Transfer Certificates of Titles (TCT) covering the properties of the late Alejandro. When petitioner refused to surrender the TCTs, private respondents filed a motion for cancellation of said titles and for issuance of new titles in their names. Petitioner opposed the motion. An Order was issued on November 29, 1990 by Judge Zain B. Angas setting aside the final and executory Order dated January 30, 1986, as well as the Order directing the issuance of the writ of execution, on the ground that the order was merely interlocutory, hence not final in character. The court added that the dispositive portion of the said Order even directs the

distribution of the estate of the deceased spouses. Private respondents filed a motion for reconsideration which was denied in an Order dated February 1, 1991. Thus, private respondents filed a petition before the Court of Appeals, which nullified the two assailed Orders dated November 29, 1990 and February 1, 1991. Aggrieved, petitioner instituted a petition for review arguing that the case filed by private respondents before the Court of Appeals was a petition under Rule 65 on the ground of grave abuse of discretion or lack of jurisdiction. Petitioner contends that in issuing the two assailed orders, Judge Angas cannot be said to have no jurisdiction because he was particularly designated to hear the case. Petitioner likewise assails the Order of the Court of Appeals upholding the validity of the January 30, 1986 Order which declared the intrinsic invalidity of Alejandros will that was earlier admitted to probate. Petitioner also filed a motion to reinstate her as executrix of the estate of the late Alejandro and to maintain the status quo or lease of the premises thereon to third parties.[3] Private respondents opposed the motion on the ground that petitioner has no interest in the estate since she is not the lawful wife of the late Alejandro. The petition is without merit. A final and executory decision or order can no longer be disturbed or reopened no matter how erroneous it may be. In setting aside the January 30, 1986 Order that has attained finality, the trial court in effect nullified the entry of judgment made by the Court of Appeals. It is well settled that a lower court cannot reverse or set aside decisions or orders of a superior court, for to do so would be to negate the hierarchy of courts and nullify the essence of review. It has been ruled that a final judgment on probated will, albeit erroneous, is binding on the whole world.[4] It has been consistently held that if no appeal is taken in due time from a judgment or order of the trial court, the same attains finality by mere lapse of time. Thus, the order allowing the will became final and the question determined by the court in such order can no longer be raised anew, either in the same proceedings or in a different motion. The matters of due execution of the will and the capacity of the testator acquired the character of res judicata and cannot again be brought into question, all juridical questions in connection therewith being for once and forever closed.[5] Such final order makes the will conclusive against the whole world as to its extrinsic validity and due execution. It should be noted that probate proceedings deals generally with the extrinsic validity of the will sought to be probated, particularly on three aspects: whether the will submitted is indeed, the decedents last will and testament; compliance with the prescribed formalities for the execution of wills; the testamentary capacity of the testator;[8] and the due execution of the last will and testament.[9] Under the Civil Code, due execution includes a determination of whether the testator was of sound and disposing mind at the time of its execution, that he had freely executed the will and

Page 18 of 37

JUDICIAL SETTLEMENT OF ESTATE Limited Jurisdiction was not acting under duress, fraud, menace or undue influence and that the will is genuine and not a forgery,[10] that he was of the proper testamentary age and that he is a person not expressly prohibited by law from making a will.[11]

according to the laws of intestacy. Accordingly, it has no option but to implement that order of intestate distribution and not to reopen and again re-examine the intrinsic provisions of the same will.

The intrinsic validity is another matter and questions regarding the same may still be raised even after the will has been authenticated. Thus, it does not necessarily follow that an extrinsically valid last will and testament is always intrinsically valid. Even if the will was validly executed, if the testator provides for dispositions that deprives or impairs the lawful heirs of their legitime or rightful inheritance according to the laws on succession, the unlawful provisions/dispositions thereof cannot be given effect. This is specially so when the courts had already determined in a final and executory decision that the will is intrinsically void. Such determination having attained that character of finality is binding on this Court which will no longer be disturbed. Not that this Court finds the will to be intrinsically valid, but that a final and executory decision of which the party had the opportunity to challenge before the higher tribunals must stand and should no longer be reevaluated. Failure to avail of the remedies provided by law constitutes waiver. And if the party does not avail of other remedies despite its belief that it was aggrieved by a decision or court action, then it is deemed to have fully agreed and is satisfied with the decision or order. As early as 1918, it has been declared that public policy and sound practice demand that, at the risk of occasional errors, judgments of courts must at some point of time fixed by law[14]become final otherwise there will be no end to litigation. Interes rei publicae ut finis sit litium - the very object of which the courts were constituted was to put an end to controversies.[15] To fulfill this purpose and to do so speedily, certain time limits, more or less arbitrary, have to be set up to spur on the slothful.[16] The only instance where a party interested in a probate proceeding may have a final liquidation set aside is when he is left out by reason of circumstances beyond his control or through mistake or inadvertence not imputable to negligence,[17] which circumstances do not concur herein.

It can be clearly inferred from Article 960 of the Civil Code, on the law of successional rights that testacy is preferred to intestacy.[20] But before there could be testate distribution, the will must pass the scrutinizing test and safeguards provided by law considering that the deceased testator is no longer available to prove the voluntariness of his actions, aside from the fact that the transfer of the estate is usually onerous in nature and that no one is presumed to give - Nemo praesumitur donare.[21] No intestate distribution of the estate can be done until and unless the will had failed to pass both its extrinsic and intrinsic validity. If the will is extrinsically void, the rules of intestacy apply regardless of the intrinsic validity thereof. If it is extrinsically valid, the next test is to determine its intrinsic validity that is whether the provisions of the will are valid according to the laws of succession. In this case, the court had ruled that the will of Alejandro was extrinsically valid but the intrinsic provisions thereof were void. Thus, the rules of intestacy apply as correctly held by the trial court.

Petitioner was privy to the suit calling for the declaration of the intrinsic invalidity of the will, as she precisely appealed from an unfavorable order therefrom. Although the final and executory Order of January 30, 1986 wherein private respondents were declared as the only heirs do not bind those who are not parties thereto such as the alleged illegitimate son of the testator, the same constitutes res judicatawith respect to those who were parties to the probate proceedings. Petitioner cannot again raise those matters anew for relitigation otherwise that would amount to forum-shopping. It should be remembered that forum shopping also occurs when the same issue had already been resolved adversely by some other court.[18] It is clear from the executory order that the estates of Alejandro and his spouse should be distributed according to the laws of intestate succession.

Furthermore, Alejandros disposition in his will of the alleged share in the conjugal properties of his late spouse, whom he described as his only beloved wife, is not a valid reason to reverse a final and executory order. Testamentary dispositions of properties not belonging exclusively to the testator or properties which are part of the conjugal regime cannot be given effect. Matters with respect to who owns the properties that were disposed of by Alejandro in the void will may still be properly ventilated and determined in the intestate proceedings for the settlement of his and that of his late spouses estate. Petitioners motion for appointment as administratrix is rendered moot considering that she was not married to the late Alejandro and, therefore, is not an heir. WHEREFORE, the petition is DENIED and the decision appealed from is AFFIRMED. SO ORDERED.

Petitioner posits that the January 30, 1986 Order is merely interlocutory, hence it can still be set aside by the trial court. In support thereof, petitioner argues that an order merely declaring who are heirs and the shares to which set of heirs is entitled cannot be the basis of execution to require delivery of shares from one person to another particularly when no project of partition has been filed.[19] The trial court declared in the January 30, 1986 Order that petitioner is not the legal wife of Alejandro, whose only heirs are his three legitimate children (petitioners herein), and at the same time it nullified the will.But it should be noted that in the same Order, the trial court also said that the estate of the late spouses be distributed

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JUDICIAL SETTLEMENT OF ESTATE Limited Jurisdiction G.R. No. L-42257 June 14, 1976 ILDEFONSO LACHENAL, ELIAS LACHENAL, IRENEA L. SANTOS, FLORA L. SANCHEZ and NATIVIDAD D. LACHENAL, petitioners, vs. HON. EMILIO V. SALAS, Presiding Judge of the Court of First Instance of Pasig, Rizal, Branch I, and FLAVIANA L. LEONIO, respondents. AQUINO, J.: Victorio Lachenal died on November 20, 1969. His testate estate is pending settlement in the Court of First Instance of Rizal, Pasig Branch I (Special Proceeding No. 5836). His son, Ildefonso Lachenal, was named executor of his will. Among the properties included in the inventory of his estate is a fishing boat called Lachenal VII. On April 1, 1971 the executor filed in that proceeding a motion to require the spouses Lope L. Leonio and Flaviana LachenalLeonio to pay the rentals for the lease of Lachenal VII and to return the boat to Navotas, Rizal for drydocking and repair. Mrs. Leonio, who was a daughter of the testator, opposed the executor's motion. She countered with a motion to exclude the fishing boat from the decedent's estate. She claimed that she is the owner of the boat because she purchased it from her father in 1967. The executor opposed the motion for exclusion. The probate court in its order of January 28, 1972 designated a commissioner to receive the evidence of the parties relative to the ownership of the motorboat. Mrs. Leonio had already finished the presentation of her evidence before the commissioner. The executor did not present his countervailing evidence. Instead, on July 8, 1975 he and the testator's other children named Flora, Elias and Irenea, and the children of a deceased child filed in the Caloocan City Branch of the Court of First Instance of Rizal an action against the Leonio spouses and the other three children of the testator named Crispula, Modesto and Esperanza, for the recovery of the motorboat Lachenal VII, allegedly valued at P150,000, together with back rentals and damages (Civil Case No. 3597). It was alleged in the complaint that Victorio Lachenal in 1964 leased the said motorboat to his son-in-law, Lope L. Leonio, for a monthly rental of P2,000 and that after Victorio's death, the executor of his estate demanded from Leonio the return of the boat and the payment of the back rentals. On July 20, 1975 the said plaintiffs in Civil Case No. 3597 filed in the probate court their own motion to exclude the said motorboat from the decedent's estate on the ground that the, probate court has no jurisdiction to decide the question as to its ownership because that matter has to be resolved by the Caloocan court where Civil Case No. 3597 is pending. The probate court denied that motion. It held that it has jurisdiction over the issue of ownership because the heirs had agreed to present their evidence on that point before a commissioner.

It invoked the rule that generally "questions of title to property cannot be passed upon in testate or intestate proceedings, except when the parties interested are all heirs of the deceased in which event it is optional upon them to submit to the probate court the question as to title to property and when so submitted, said probate court may definitely pass judgment thereon. The reason is that questions of collation or of advancement are generally inevitably involved therein which are proper matters to be passed upon in the due course of administration. And it has also been held that with the consent of the parties, matters affecting property under administration may be taken cognizance of by the court in the course of the intestate proceedings provided the interests of third persons are not prejudiced." (3 Moran's Comments on the Rules of Court, 1970 Edition, page 473, citing Alvarez vs. Espiritu, L18833, August 14, 1965, 14 SCRA 892, 899; Pascual vs. Pascual, 73 Phil. 561; Vda. de Manalac vs. Ocampo, 73 Phil. 661; Cunanan vs. Amparo, 80 Phil. 227; Dinglasan vs. Ang Chia, 88 Phil. 476; Baquial vs. Amihan, 92 Phil. 501). On January 5, 1976 the executor and his co-plaintiffs in Civil Case No. 3597 filed these special civil actions of prohibition and certiorari against the probate court. The issue is whether the probate court should be allowed to continue the hearing on the ownership of the fishing boat or whether that question should be left to the determination of the Caloocan court where the subsequent separate action (now in the pre-trial stage) for the recovery of the motorboat is pending. We hold that the title to the fishing boat should be determined in Civil Case No. 3597 because it affects the lessee thereof, Lope L Leonio, the decedent's son-in-law, who, although married to his daughter or compulsory heir, is nevertheless a third person with respect to his estate. "The administrator may not pull him against his will, by motion, into the administration proceeding" (De la Cruz vs. Camon, 63 O.G. 8704, 16 SCRA 886; De Paula vs. Escay, infra). This case falls under the general rule that questions as to title to property cannot be passed upon in the testate or intestate proceeding but should be ventilated in a separate action (Ongsingco vs. Tan, 97 Phil. 330, 334; Bernardo vs. Court of Appeals ,117 Phil. 835; Magallanes vs. Kayanan, L-31048, January 20, 1976; Recto vs. Dela Rosa, L-42799, March 16, 1976). Where a party in a probate proceeding prays for the inclusion in, or exclusion from, the inventory of a piece of property, the court may provisionally pass upon the question without prejudice to its final determination in a separate action (Garcia vs. Garcia, 67 Phil. 353; Guinguing vs. Abuton, 48 Phil. 144, 147; Junquera vs. Borromeo, L-18498, March 30, 1967, 19 SCRA 656; Borromeo vs. Canonoy, L-25010, March 30, 1967, 19 SCRA 667). The Court of First Instance is a court of general original jurisdiction invested with power to take cognizance of all kinds of cases: civil cases, criminal cases, special proceedings, land registration, guardianship, naturalization, admiralty and insolvency cases (Sec. 39, Judiciary Law; De Paula vs. Escay, 97 Phil. 617, 619; Manalo vs. Mariano, L-33850, January 22, 1976).

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JUDICIAL SETTLEMENT OF ESTATE Limited Jurisdiction Whether a particular matter should be resolved by the Court of First Instance in the exercise of its general jurisdiction or of its limited jurisdiction as a special court (probate, land registration, etc.) is in reality not a question of over the subject matter. It is in essence a procedural question involving a mode of practice "which may be waived" (Cunanan vs. Amparo, supra, page 232; Cf. Reyes vs. Diaz, 73 Phil. 484 rejurisdiction over the issue). Probate jurisdiction includes all matters relating to the settlement of estates and the probate of wills of persons (Sec. 599, Act 190), particularly the administration of the decedent's estate, the payment of his debts, questions as to collation or advancements to the heirs, the liquidation of the conjugal partnership, and the partition and distribution of the estate (De La Cruz vs. Camon, supra).

In the instant case, in as much as the controversy over the fishing boat concerns members of the same family, the Caloocan court should endeavor before trial to persuade the litigants to agree upon some compromise (Arts. 222 and 2029, Civil Code; Sec. 1[j], Rule 16, Rules of Court). WHEREFORE, the probate court's orders of September 17 and October 20, 1975, asserting its jurisdiction to decide the title to the fishing boat, Lachenal VII, are set aside. No costs. SO ORDERED.

For the recovery or protection or the property rights of the decedent. an executor or administrator may bring or defend in the right of the decedent, actions for causes which survive. Actions to recover real or personal property, or an interest therein, from the decedent's estate, or to enforce a lien thereon, and actions to recover damages for an injury to or property, real or personal, may be commenced against an executor or administrator (Secs. 1 and 2, Rule 87, Rules of Court). In the instant case, the executor, by virtue of section 2 of Rule 87, filed a separate action in the Caloocan court for the recovery of the fishing boat and back rentals from the Leonio spouses. In the De la Cruz case, supra, it was held that rentals allegedly due to the decedent's estate may not be collected by the administrator by filing a motion in the testate proceeding. The said rentals do not constitute property in the administrator's hands and are not thus within the effective control of the probate court. The proper procedure in collecting such rentals is to file an independent action in the Court of First Instance so that the right of the estate thereto may be threshed out in a full-dress trial on the merits. The ruling in the De la Cruz case applies with stronger force to this case because here the executor seeks to recover not only the rentals but also the leased property itself, as to which the wife of the lessee had asserted adverse title. Normally, it is expedient and convenient that the question of title to property, which arises between the decedent's estate and other persons, should be adjucated in a separate action because such a question requires the presentation of appropriate pleadings (complaint, motion to dismiss, answer, counterclaim and reply). A resort to the modes of discovery may be necessary so that the issues may be clearly defined and the trial may be expedited. Those matters can be effectively accomplished in an ordinary action rather than in the testamentary or intestate proceeding (Mangaliman vs. Gonzales, L-21033, December 28, 1970, 36 SCRA 462). The court may also have to resolve ancillary issues as to damages and counterclaims for money or property. Ultimately, execution has to be issued. The execution of a judgment is usually made by the Court of First Instance in an ordinary action and not in a special proceeding (See Magallanes vs. Kayanan, supra).

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JUDICIAL SETTLEMENT OF ESTATE Limited Jurisdiction G.R. No. L-42678 April 9, 1987

filed a motion to cite said Jose Diaz and Cipriano Evangelista in contempt of court. 5

PEDRO E. BAYBAYAN, CIPRIANO EVANGELISTA, and SPOUSES BARTOLOME and CONSUELO BAYBAYAN, petitioners, vs. HON. NARCISO A. AQUINO, as Presiding Judge CFI Pangasinan Branch XIV; Deputy Sheriff CONSTANCIO PAGADUAN; EULALIA EVANGELISTA, NORBERTO, PAULINA, FELIZA, all surnamed PADUA; DIONISIA, LAUREANO, JOSEFINA, LEONARDO, ANASTACIA, VALENTINA, all surnamed ORPIANO; SERVILLANO, GERTRUDES, PASTORA, LORENZO, FAUSTA, all surnamed DELFIN; and DIONISIO, FAUSTINA, AMADO BENJAMIN, all surnamed ORIA, respondents. PADILLA, J.: This is a petition for certiorari to annul and set aside the Order issued by the respondent Judge on 4 December 1975, which dismissed, without prejudice, the petitioners' complaint filed in Civil Case No. 23 1 -R of the then Court of First Instance of Pangasinan, as well as the Order, dated 24 December 1975, which denied petitioners' motion for the reconsideration of said order. The antecedent facts of the case are as follows: On 19 January 1960, herein private respondents Norberto Padua, Paulina Padua, Felisa Padua, Dionisia Orpiano, Laureano Orpiano, Leonardo Orpiano, Josefina Orpiano, Valentina Orpiano, Servillano Delfin, Gertrudes Delfin, Pastors Delfin Lorenzo Delfin, Fausta Delfin, Dionisio Oria, Faustina Oria, Amado Oria, and Benjamin Oria, all claiming to be the nephews and nieces of one Vicente Oria who died intestate sometime in 1945 in Balungao, Pangasinan, filed a petition for the summary settlement of the decedent's estate, the value of which did not exceed P6,000.00. The petition was filed in the then Court of First Instance of Pangasinan, Tayug Branch. The case was docketed therein as Special Proceeding No. T-300. 1 After due publication and hearing, the probate court issued an order adjudicating the estate to the heirs of the decedent, who were ordered to submit a project of partition. 2 Sometime in 1971, the case was transferred to the Resales Branch of the Court of First Instance of Pangasinan where it was docketed as Spec. Proc. No. 24-R. On 18 September 1974, the probate court confirmed the adjudication earlier made and ordered Eulalia Evangelista to deliver the respective shares of her co-heirs; to make an accounting of the produce thereof from 1960; and to deliver said produce to her co-heirs or pay its equivalent. A writ of execution was subsequently issued pursuant thereto. 3 A writ of possession was also issued sometime thereafter, and the private respondents were placed in possession of their respective shares. 4 However, when a representative of the private respondents went to cultivate the portion adjudicated to said private respondents, he was prevented by Jose Diaz and Cipriano Evangelista. In view thereof, the private respondents

As a consequence, herein petitioners Pedro Baybayan, Cipriano Evangelists, and the spouses Bartolome and Consuelo Baybayan, claiming to be the registered owners of the lots involved, filed a complaint in the Court of First Instance of Pangasinan, Rosales Branch docketed therein as Civil Case No. 231-R, against the Deputy Sheriff and the herein private respondents, for the quieting of their title, plus damages, and to restrain said defendants from enforcing the writ of execution issued in Spec. Proc. No. 24-R. 6 Meanwhile, at the hearing of the motion for contempt in Spec. Proc. No. 24-R, the question of the Identity of the lands subject of Spec. Proc. No. 24-R, was brought up, so that the probate court ordered a relocation survey and commissioned a geodetic engineer to undertake said survey. After the survey, the commissioner submitted to the Court a report stating, among others, that the lands which were delivered by the Deputy Sheriff to the heirs of Vicente Oria, pursuant to the writ of possession issued by the probate court, are registered in the names of herein petitioners under TCT No. 50269 and TCT No. 50270 of the Register of Deeds of Pangasinan. 7 By reason thereof, the probate court, in an order dated 30 October 1975, dismissed the contempt charge against Jose Diaz and Cipriano Evangelista. However, the same court ordered the petitioners to amend their complaint filed in Civil Case No. 231-R since "it is necessary that an amended complaint be filed by Pedro Baybayan in order to determine whether or not the property in question is part of the property under Spec. Proc. No. 24-R, inasmuch as it is now the property claimed by him which is covered by Transfer Certificate of Title No. 50269." 8 Pursuant thereto, the herein petitioners filed an Omnibus Motion in Civil Case No. 231-R, to which was attached an amended complaint wherein some defendants were dropped. 9 The respondent Judge, however, found that the Amended Complaint did not comply with his order of 30 October 1975 to exclude Lot E and dismissed the case, "without prejudice on the part of the plaintiffs to file a proper complaint for the recovery of ownership or possession of the property in controversy which is Lot B in the relocation plan and formerly covered by Original Certificate of Title No. 23684, now under Transfer Certificate of Title No. 50269." 10 The petitioners filed a motion for reconsideration of the order, 11 but the motion was denied on 24 December 1975. 12 Thereupon, they filed with this Court a petition for certiorari for the review of the orders of the lower court. The Court treated the petition as a special civil action for certiorari. 13 Counsel for the petitioners, in this petition, contends that the respondent Judge had no authority under the law, both substantive and procedural, to issue the questioned orders because the order to amend the complaint was issued in, and in connection with Spec. Proc. No. 24-R where the herein petitioners are not even parties. The contention, in our opinion, is not meritorious. While it may be true that the order to amend the complaint filed in Civil Case No. 231-R was issued in Spec. Proc. No. 24-R, so that it cannot ordinarily bind the herein petitioners who are not parties in

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JUDICIAL SETTLEMENT OF ESTATE Limited Jurisdiction said special proceedings, it appears, however, that the petitioners voluntarily submitted themselves to the jurisdiction of the probate court, when they filed an Omnibus Motion in Civil Case No. 231-R, wherein they prayed for leave to amend their complaint in accordance with the order of the probate court of 30 October 1975. They cannot now be allowed belatedly to adopt an inconsistent posture by attacking the jurisdiction of the respondent trial Judge to whom they submitted their cause voluntarily. 14 We find, however, that the respondent Judge committed a grave abuse of discretion, amounting to lack of jurisdiction, in dismissing the complaint filed by the petitioners, for their alleged failure to amend their complaint to exclude therefrom Lot E which the respondent Judge found, in his order of 30 October 1975, issued in the probate court, to be owned by the petitioners Cipriano Evangelists and Consuelo Baybayan. The findings of the respondent Judge as to the ownership of Lot E after the hearing conducted in Spec. Proc. No. 24-R do not justify the order to amend the complaint since the determination of the ownership of the said lot by the respondent Judge presiding over a court exercising probate jurisdiction is not final or ultimate in nature and is without prejudice to the right of an interested party to raise the question of ownership in a proper action. 15 It is a well-settled rule in this jurisdiction, sanctioned and reiterated in a long fine of decisions, that "when questions arise as to ownership of property alleged to be a part of the estate of a deceased person, but claimed by some other person to be his property, not by virtue of any right of inheritance from the deceased, but by title adverse to that of the deceased and his estate, such questions cannot be determined in the courts of administrative proceedings. The Court of First Instance, acting, as a probate court, has no jurisdiction to adjudicate such contentions, which must be submitted to the Court of First Instance in the exercise of its general jurisdiction as a court of first instance." 16 Besides, the order to amend the complaint is vague and hazy and does not specify what the amendments should be or how the complaint should be amended so that the petitioners should not be faulted if the amended complaint subsequently filed by them in Civil Case No. 231-R does not contain the allegations that the respondent Judge would want to appear therein. WHEREFORE, the petition is GRANTED and a writ issued, setting aside the Orders issued by the respondent Judge on 7 December 1975 and 24 December 1975, in Civil Case No. 231-R of the then Court of First Instance of Pangasinan. Without costs. SO ORDERED.



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JUDICIAL SETTLEMENT OF ESTATE Limited Jurisdiction G.R. No. L-28040 August 18, 1972 TESTATE ESTATE OF JOSEFA TANGCO, JOSE DE BORJA, administrator-appellee; JOSE DE BORJA, as administrator, CAYETANO DE BORJA, MATILDE DE BORJA and CRISANTO DE BORJA (deceased) as Children of Josefa Tangco, appellees, vs. TASIANA VDA. DE DE BORJA, Special Administratrix of the Testate Estate of Francisco de Borja, appellant. . G.R. No L-28568 August 18, 1972 TESTATE ESTATE OF THE LATE FRANCISCO DE BORJA, TASIANA O. VDA. DE DE BORJA, special Administratrix appellee, vs. JOSE DE BORJA, oppositor-appellant. G.R. No. L-28611 August 18, 1972 TASIANA 0. VDA. DE BORJA, as Administratrix of the Testate Estate of the late Francisco de Borja, plaintiffappellee, vs. JOSE DE BORJA, as Administrator of the Testate Estate of the late Josefa Tangco, defendant-appellant.

widower Francisco de Borja allegedly took unto himself a second wife, Tasiana Ongsingco. Upon Francisco's death, Tasiana instituted testate proceedings in the Court of First Instance of Nueva Ecija, where, in 1955, she was appointed special administratrix. The validity of Tasiana's marriage to Francisco was questioned in said proceeding. The relationship between the children of the first marriage and Tasiana Ongsingco has been plagued with several court suits and counter-suits; including the three cases at bar, some eighteen (18) cases remain pending determination in the courts. The testate estate of Josefa Tangco alone has been unsettled for more than a quarter of a century. In order to put an end to all these litigations, a compromise agreement was entered into on 12 October 1963,2 by and between "[T]he heir and son of Francisco de Borja by his first marriage, namely, Jose de Borja personally and as administrator of the Testate Estate of Josefa Tangco," and "[T]he heir and surviving spouse of Francisco de Borja by his second marriage, Tasiana Ongsingco Vda. de Borja, assisted by her lawyer, Atty. Luis Panaguiton Jr." The terms and conditions of the compromise agreement are as follows: A G R E E M E N T THIS AGREEMENT made and entered into by and between The heir and son of Francisco de Borja by his first marriage, namely, Jose de Borja personally and as administrator of the Testate Estate of Josefa Tangco,

REYES, J.B.L., J.:p Of these cases, the first, numbered L-28040 is an appeal by Tasiana Ongsingco Vda. de de Borja, special administratrix of the testate estate of Francisco de Borja,1 from the approval of a compromise agreement by the Court of First Instance of Rizal, Branch I, in its Special Proceeding No. R-7866, entitled, "Testate Estate of Josefa Tangco, Jose de Borja, Administrator". Case No. L-28568 is an appeal by administrator Jose Borja from the disapproval of the same compromise agreement by the Court of First Instance of Nueva Ecija, Branch II, in its Special Proceeding No. 832, entitled, "Testate Estate of Francisco de Borja, Tasiana O. Vda. de de Borja, Special Administratrix".

A N D The heir and surviving spouse of Francisco de Borja by his second marriage, Tasiana Ongsingco Vda. de Borja, assisted by her lawyer, Atty. Luis Panaguiton Jr. W I T N E S S E T H

And Case No. L-28611 is an appeal by administrator Jose de Borja from the decision of the Court of First Instance of Rizal, Branch X, in its Civil Case No. 7452, declaring the Hacienda Jalajala Poblacion, which is the main object of the aforesaid compromise agreement, as the separate and exclusive property of the late Francisco de Borja and not a conjugal asset of the community with his first wife, Josefa Tangco, and that said hacienda pertains exclusively to his testate estate, which is under administrator in Special Proceeding No. 832 of the Court of First Instance of Nueva Ecija, Branch II. It is uncontested that Francisco de Borja, upon the death of his wife Josefa Tangco on 6 October 1940, filed a petition for the probate of her will which was docketed as Special Proceeding No. R-7866 of the Court of First Instance of Rizal, Branch I. The will was probated on 2 April 1941. In 1946, Francisco de Borja was appointed executor and administrator: in 1952, their son, Jose de Borja, was appointed co-administrator. When Francisco died, on 14 April 1954, Jose became the sole administrator of the testate estate of his mother, Josefa Tangco. While a

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THAT it is the mutual desire of all the parties herein terminate and settle, with finality, the various court litigations, controversies, claims, counterclaims, etc., between them in connection with the administration, settlement, partition, adjudication and distribution of the assets as well as liabilities of the estates of Francisco de Borja and Josefa Tangco, first spouse of Francisco de Borja. THAT with this end in view, the parties herein have agreed voluntarily and without any reservations to enter into and execute this agreement under the following terms and conditions: 1. That the parties agree to sell the Poblacion portion of the Jalajala properties situated in Jalajala, Rizal, presently under administration in the

JUDICIAL SETTLEMENT OF ESTATE Limited Jurisdiction Testate Estate of Josefa Tangco (Sp. Proc. No. 7866, Rizal), more specifically described as follows: Linda al Norte con el Rio Puwang que la separa de la jurisdiccion del Municipio de Pililla de la Provincia de Rizal, y con el pico del Monte Zambrano; al Oeste con Laguna de Bay; por el Sur con los herederos de Marcelo de Borja; y por el Este con los terrenos de la Familia Maronilla with a segregated area of approximately 1,313 hectares at the amount of P0.30 per square meter. 2. That Jose de Borja agrees and obligates himself to pay Tasiana Ongsingco Vda. de de Borja the total amount of Eight Hundred Thousand Pesos (P800,000) Philippine Currency, in cash, which represent P200,000 as his share in the payment and P600,000 as pro-rata shares of the heirs Crisanto, Cayetano and Matilde, all surnamed de Borja and this shall be considered as full and complete payment and settlement of her hereditary share in the estate of the late Francisco de Borja as well as the estate of Josefa Tangco, Sp. Proc. No. 832-Nueva Ecija and Sp. Proc. No. 7866-Rizal, respectively, and to any properties bequeathed or devised in her favor by the late Francisco de Borja by Last Will and Testament or by Donation Inter Vivos or Mortis Causa or purportedly conveyed to her for consideration or otherwise. The funds for this payment shall be taken from and shall depend upon the receipt of full payment of the proceeds of the sale of Jalajala, "Poblacion." 3. That Tasiana Ongsingco Vda. de de Borja hereby assumes payment of that particular obligation incurred by the late Francisco de Borja in favor of the Rehabilitation Finance Corporation, now Development Bank of the Philippines, amounting to approximately P30,000.00 and also assumes payment of her 1/5 share of the Estate and Inheritance taxes on the Estate of the late Francisco de Borja or the sum of P3,500.00, more or less, which shall be deducted by the buyer of Jalajala, "Poblacion" from the payment to be made to Tasiana Ongsingco Vda. de Borja under paragraph 2 of this Agreement and paid directly to the

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Development Bank of the Philippines and the heirs-children of Francisco de Borja. 4. Thereafter, the buyer of Jalajala "Poblacion" is hereby authorized to pay directly to Tasiana Ongsingco Vda. de de Borja the balance of the payment due her under paragraph 2 of this Agreement (approximately P766,500.00) and issue in the name of Tasiana Ongsingco Vda. de de Borja, corresponding certified checks/treasury warrants, who, in turn, will issue the corresponding receipt to Jose de Borja. 5. In consideration of above payment to Tasiana Ongsingco Vda. de de Borja, Jose de Borja personally and as administrator of the Testate Estate of Josefa Tangco, and Tasiana Ongsingco Vda. de de Borja, for themselves and for their heirs, successors, executors, administrators, and assigns, hereby forever mutually renounce, withdraw, waive, remise, release and discharge any and all manner of action or actions, cause or causes of action, suits, debts, sum or sums of money, accounts, damages, claims and demands whatsoever, in law or in equity, which they ever had, or now have or may have against each other, more specifically Sp. Proceedings Nos. 7866 and 1955, CFIRizal, and Sp. Proc. No. 832-Nueva Ecija, Civil Case No. 3033, CFI Nueva Ecija and Civil Case No. 7452-CFI, Rizal, as well as the case filed against Manuel Quijal for perjury with the Provincial Fiscal of Rizal, the intention being to completely, absolutely and finally release each other, their heirs, successors, and assigns, from any and all liability, arising wholly or partially, directly or indirectly, from the administration, settlement, and distribution of the assets as well as liabilities of the estates of Francisco de Borja and Josefa Tangco, first spouse of Francisco de Borja, and lastly, Tasiana Ongsingco Vda. de de Borja expressly and specifically renounce absolutely her rights as heir over any hereditary share in the estate of Francisco de Borja. 6. That Tasiana Ongsingco Vda. de de Borja, upon receipt of the payment under paragraph 4 hereof, shall deliver to the heir Jose de Borja all the papers, titles and documents belonging to Francisco de Borja which are in her possession and said heir Jose de Borja shall issue in turn the corresponding receive thereof. 7. That this agreement shall take effect only upon the fulfillment of the sale of the properties mentioned under paragraph 1 of this agreement and upon receipt of the total and full payment of the proceeds of the sale of the Jalajala property

JUDICIAL SETTLEMENT OF ESTATE Limited Jurisdiction "Poblacion", otherwise, the nonfulfillment of the said sale will render this instrument NULL AND VOID AND WITHOUT EFFECT THEREAFTER. IN WITNESS WHEREOF, the parties hereto have her unto set their hands in the City of Manila, Philippines, the 12th of October, 1963. On 16 May 1966, Jose de Borja submitted for Court approval the agreement of 12 October 1963 to the Court of First Instance of Rizal, in Special Proceeding No. R-7866; and again, on 8 August 1966, to the Court of First Instance of Nueva Ecija, in Special Proceeding No. 832. Tasiana Ongsingco Vda. de de Borja opposed in both instances. The Rizal court approved the compromise agreement, but the Nueva Ecija court declared it void and unenforceable. Special administratrix Tasiana Ongsingco Vda. de de Borja appealed the Rizal Court's order of approval (now Supreme Court G.R. case No. L-28040), while administrator Jose de Borja appealed the order of disapproval (G.R. case No. L-28568) by the Court of First Instance of Nueva Ecija. The genuineness and due execution of the compromised agreement of 12 October 1963 is not disputed, but its validity is, nevertheless, attacked by Tasiana Ongsingco on the ground that: (1) the heirs cannot enter into such kind of agreement without first probating the will of Francisco de Borja; (2) that the same involves a compromise on the validity of the marriage between Francisco de Borja and Tasiana Ongsingco; and (3) that even if it were valid, it has ceased to have force and effect. In assailing the validity of the agreement of 12 October 1963, Tasiana Ongsingco and the Probate Court of Nueva Ecija rely on this Court's decision in Guevara vs. Guevara. 74 Phil. 479, wherein the Court's majority held the view that the presentation of a will for probate is mandatory and that the settlement and distribution of an estate on the basis of intestacy when the decedent left a will, is against the law and public policy. It is likewise pointed out by appellant Tasiana Ongsingco that Section 1 of Rule 74 of the Revised Rules explicitly conditions the validity of an extrajudicial settlement of a decedent's estate by agreement between heirs, upon the facts that "(if) the decedent left no will and no debts, and the heirs are all of age, or the minors are represented by their judicial and legal representatives ..." The will of Francisco de Borja having been submitted to the Nueva Ecija Court and still pending probate when the 1963 agreement was made, those circumstances, it is argued, bar the validity of the agreement. Upon the other hand, in claiming the validity of the compromise agreement, Jose de Borja stresses that at the time it was entered into, on 12 October 1963, the governing provision was Section 1, Rule 74 of the original Rules of Court of 1940, which allowed the extrajudicial settlement of the estate of a deceased person regardless of whether he left a will or not. He also relies on the dissenting opinion of Justice Moran, in Guevara vs. Guevara, 74 Phil. 479, wherein was expressed the view that if the parties have already divided the estate in accordance with a decedent's will, the probate of the will is a useless ceremony; and if they have divided the estate in a different manner, the probate of the will is worse than useless.

The doctrine of Guevara vs. Guevara, ante, is not applicable to the case at bar. This is apparent from an examination of the terms of the agreement between Jose de Borja and Tasiana Ongsingco. Paragraph 2 of said agreement specifically stipulates that the sum of P800,000 payable to Tasiana Ongsingco — shall be considered as full — complete payment — settlement of her hereditary share in the estate of the late Francisco de Borja as well as the estate of Josefa Tangco, ... and to any properties bequeathed or devised in her favor by the late Francisco de Borja by Last Will and Testament or by Donation Inter Vivos or Mortis Causa or purportedly conveyed to her for consideration or otherwise. This provision evidences beyond doubt that the ruling in the Guevara case is not applicable to the cases at bar. There was here no attempt to settle or distribute the estate of Francisco de Borja among the heirs thereto before the probate of his will. The clear object of the contract was merely the conveyance by Tasiana Ongsingco of any and all her individual share and interest, actual or eventual in the estate of Francisco de Borja and Josefa Tangco. There is no stipulation as to any other claimant, creditor or legatee. And as a hereditary share in a decedent's estate is transmitted or vested immediately from the moment of the death of such causante or predecessor in interest (Civil Code of the Philippines, Art. 777)3 there is no legal bar to a successor (with requisite contracting capacity) disposing of her or his hereditary share immediately after such death, even if the actual extent of such share is not determined until the subsequent liquidation of the estate.4 Of course, the effect of such alienation is to be deemed limited to what is ultimately adjudicated to the vendor heir. However, the aleatory character of the contract does not affect the validity of the transaction; neither does the coetaneous agreement that the numerous litigations between the parties (the approving order of the Rizal Court enumerates fourteen of them, Rec. App. pp. 79-82) are to be considered settled and should be dismissed, although such stipulation, as noted by the Rizal Court, gives the contract the character of a compromise that the law favors, for obvious reasons, if only because it serves to avoid a multiplicity of suits. It is likewise worthy of note in this connection that as the surviving spouse of Francisco de Borja, Tasiana Ongsingco was his compulsory heir under article 995 et seq. of the present Civil Code. Wherefore, barring unworthiness or valid disinheritance, her successional interest existed independent of Francisco de Borja's last will and testament and would exist even if such will were not probated at all. Thus, the prerequisite of a previous probate of the will, as established in the Guevara and analogous cases, can not apply to the case of Tasiana Ongsingco Vda. de de Borja. Since the compromise contract Annex A was entered into by and between "Jose de Borja personally and as administrator of the Testate Estate of Josefa Tangco" on the one hand, and on the other, "the heir and surviving spouse of Francisco de Borja by his second marriage, Tasiana Ongsingco Vda. de de Borja", it is clear that the transaction was binding on both in their individual capacities, upon the perfection of the contract, even without previous authority of the Court to enter into the same. The only difference between an extrajudicial compromise and one that is submitted and approved by the Court, is that the

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JUDICIAL SETTLEMENT OF ESTATE Limited Jurisdiction latter can be enforced by execution proceedings. Art. 2037 of the Civil Code is explicit on the point: 8. Art. 2037. A compromise has upon the parties the effect and authority of res judicata; but there shall be no execution except in compliance with a judicial compromise. It is argued by Tasiana Ongsingco that while the agreement Annex A expressed no definite period for its performance, the same was intended to have a resolutory period of 60 days for its effectiveness. In support of such contention, it is averred that such a limit was expressly stipulated in an agreement in similar terms entered into by said Ongsingco with the brothers and sister of Jose de Borja, to wit, Crisanto, Matilde and Cayetano, all surnamed de Borja, except that the consideration was fixed at P600,000 (Opposition, Annex/Rec. of Appeal, L28040, pp. 39- 46) and which contained the following clause: III. That this agreement shall take effect only upon the consummation of the sale of the property mentioned herein and upon receipt of the total and full payment of the proceeds of the sale by the herein owner heirs-children of Francisco de Borja, namely, Crisanto, Cayetano and Matilde, all surnamed de Borja; Provided that if no sale of the said property mentioned herein is consummated, or the non-receipt of the purchase price thereof by the said owners within the period of sixty (60) days from the date hereof, this agreement will become null and void and of no further effect. Ongsingco's argument loses validity when it is considered that Jose de Borja was not a party to this particular contract (Annex 1), and that the same appears not to have been finalized, since it bears no date, the day being left blank "this — day of October 1963"; and while signed by the parties, it was not notarized, although plainly intended to be so done, since it carries a proposed notarial ratification clause. Furthermore, the compromise contract with Jose de Borja (Annex A), provides in its par. 2 heretofore transcribed that of the total consideration of P800, 000 to be paid to Ongsingco, P600,000 represent the "prorata share of the heirs Crisanto, Cayetano and Matilde all surnamed de Borja" which corresponds to the consideration of P600,000 recited in Annex 1, and that circumstance is proof that the duly notarized contract entered into wit Jose de Borja under date 12 October 1963 (Annex A), was designed to absorb and supersede the separate unformalize agreement with the other three Borja heirs. Hence, the 60 days resolutory term in the contract with the latter (Annex 1) not being repeated in Annex A, can not apply to the formal compromise with Jose de Borja. It is moreover manifest that the stipulation that the sale of the Hacienda de Jalajala was to be made within sixty days from the date of the agreement with Jose de Borja's co-heirs (Annex 1) was plainly omitted in Annex A as improper and ineffective, since the Hacienda de Jalajala (Poblacion) that was to be sold to raise the P800,000 to be paid to Ongsingco for

her share formed part of the estate of Francisco de Borja and could not be sold until authorized by the Probate Court. The Court of First Instance of Rizal so understood it, and in approving the compromise it fixed a term of 120 days counted from the finality of the order now under appeal, for the carrying out by the parties for the terms of the contract. This brings us to the plea that the Court of First Instance of Rizal had no jurisdiction to approve the compromise with Jose de Borja (Annex A) because Tasiana Ongsingco was not an heir in the estate of Josefa Tangco pending settlement in the Rizal Court, but she was an heir of Francisco de Borja, whose estate was the object of Special Proceeding No. 832 of the Court of First Instance of Nueva Ecija. This circumstance is irrelevant, since what was sold by Tasiana Ongsingco was only her eventual share in the estate of her late husband, not the estate itself; and as already shown, that eventual share she owned from the time of Francisco's death and the Court of Nueva Ecija could not bar her selling it. As owner of her undivided hereditary share, Tasiana could dispose of it in favor of whomsoever she chose. Such alienation is expressly recognized and provided for by article 1088 of the present Civil Code: Art. 1088. Should any of the heirs sell his hereditary rights to a stranger before the partition, any or all of the co-heirs may be subrogated to the rights of the purchaser by reimbursing him for the price of the sale, provided they do so within the period of one month from the time they were notified in writing of the sale of the vendor. If a sale of a hereditary right can be made to a stranger, then a fortiori sale thereof to a coheir could not be forbidden. Tasiana Ongsingco further argues that her contract with Jose de Borja (Annex "A") is void because it amounts to a compromise as to her status and marriage with the late Francisco de Borja. The point is without merit, for the very opening paragraph of the agreement with Jose de Borja (Annex "A") describes her as "the heir and surviving spouse of Francisco de Borja by his second marriage, Tasiana Ongsingco Vda. de de Borja", which is in itself definite admission of her civil status. There is nothing in the text of the agreement that would show that this recognition of Ongsingco's status as the surviving spouse of Francisco de Borja was only made in consideration of the cession of her hereditary rights. It is finally charged by appellant Ongsingco, as well as by the Court of First Instance of Nueva Ecija in its order of 21 September 1964, in Special Proceedings No. 832 (Amended Record on Appeal in L-28568, page 157), that the compromise agreement of 13 October 1963 (Annex "A") had been abandoned, as shown by the fact that, after its execution, the Court of First Instance of Nueva Ecija, in its order of 21 September 1964, had declared that "no amicable settlement had been arrived at by the parties", and that Jose de Borja himself, in a motion of 17 June 1964, had stated that the proposed amicable settlement "had failed to materialize". It is difficult to believe, however, that the amicable settlement referred to in the order and motion above-mentioned was the compromise agreement of 13 October 1963, which already had been formally signed and executed by the parties and duly notarized. What the record discloses is that some time after its

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JUDICIAL SETTLEMENT OF ESTATE Limited Jurisdiction formalization, Ongsingco had unilaterally attempted to back out from the compromise agreement, pleading various reasons restated in the opposition to the Court's approval of Annex "A" (Record on Appeal, L-20840, page 23): that the same was invalid because of the lapse of the allegedly intended resolutory period of 60 days and because the contract was not preceded by the probate of Francisco de Borja's will, as required by this Court's Guevarra vs. Guevara ruling; that Annex "A" involved a compromise affecting Ongsingco's status as wife and widow of Francisco de Borja, etc., all of which objections have been already discussed. It was natural that in view of the widow's attitude, Jose de Borja should attempt to reach a new settlement or novatory agreement before seeking judicial sanction and enforcement of Annex "A", since the latter step might ultimately entail a longer delay in attaining final remedy. That the attempt to reach another settlement failed is apparent from the letter of Ongsingco's counsel to Jose de Borja quoted in pages 35-36 of the brief for appellant Ongsingco in G.R. No. 28040; and it is more than probable that the order of 21 September 1964 and the motion of 17 June 1964 referred to the failure of the parties' quest for a more satisfactory compromise. But the inability to reach a novatory accord can not invalidate the original compromise (Annex "A") and justifies the act of Jose de Borja in finally seeking a court order for its approval and enforcement from the Court of First Instance of Rizal, which, as heretofore described, decreed that the agreement be ultimately performed within 120 days from the finality of the order, now under appeal. We conclude that in so doing, the Rizal court acted in accordance with law, and, therefore, its order should be upheld, while the contrary resolution of the Court of First Instance of Nueva Ecija should be, and is, reversed. In her brief, Tasiana Ongsingco also pleads that the time elapsed in the appeal has affected her unfavorably, in that while the purchasing power of the agreed price of P800,000 has diminished, the value of the Jalajala property has increased. But the fact is that her delay in receiving the payment of the agreed price for her hereditary interest was primarily due to her attempts to nullify the agreement (Annex "A") she had formally entered into with the advice of her counsel, Attorney Panaguiton. And as to the devaluation de facto of our currency, what We said in Dizon Rivera vs. Dizon, L-24561, 30 June 1970, 33 SCRA 554, that "estates would never be settled if there were to be a revaluation with every subsequent fluctuation in the values of currency and properties of the estate", is particularly opposite in the present case. Coming now to Case G.R. No. L-28611, the issue is whether the Hacienda de Jalajala (Poblacion), concededly acquired by Francisco de Borja during his marriage to his first wife, Josefa Tangco, is the husband's private property (as contended by his second spouse, Tasiana Ongsingco), or whether it forms part of the conjugal (ganancial) partnership with Josefa Tangco. The Court of First Instance of Rizal (Judge Herminio Mariano, presiding) declared that there was adequate evidence to overcome the presumption in favor of its conjugal character established by Article 160 of the Civil Code. We are of the opinion that this question as between Tasiana Ongsingco and Jose de Borja has become moot and academic, in view of the conclusion reached by this Court in the two preceding cases (G.R. No. L-28568), upholding as valid the cession of Tasiana Ongsingco's eventual share in the estate of her late husband, Francisco de Borja, for the sum of P800,000 with the accompanying reciprocal quit-claims

between the parties. But as the question may affect the rights of possible creditors and legatees, its resolution is still imperative. It is undisputed that the Hacienda Jalajala, of around 4,363 hectares, had been originally acquired jointly by Francisco de Borja, Bernardo de Borja and Marcelo de Borja and their title thereto was duly registered in their names as co-owners in Land Registration Case No. 528 of the province of Rizal, G.L.R.O. Rec. No. 26403 (De Barjo vs. Jugo, 54 Phil. 465). Subsequently, in 1931, the Hacienda was partitioned among the co-owners: the Punta section went to Marcelo de Borja; the Bagombong section to Bernardo de Borja, and the part in Jalajala proper (Poblacion) corresponded to Francisco de Borja (V. De Borja vs. De Borja 101 Phil. 911, 932). The lot allotted to Francisco was described as — Una Parcela de terreno en Poblacion, Jalajala: N. Puang River; E. Hermogena Romero; S. Heirs of Marcelo de Borja O. Laguna de Bay; containing an area of 13,488,870 sq. m. more or less, assessed at P297,410. (Record on Appeal, pages 7 and 105) On 20 November 1962, Tasiana O. Vda. de Borja, as Administratrix of the Testate Estate of Francisco de Borja, instituted a complaint in the Court of First Instance of Rizal (Civil Case No. 7452) against Jose de Borja, in his capacity as Administrator of Josefa Tangco (Francisco de Borja's first wife), seeking to have the Hacienda above described declared exclusive private property of Francisco, while in his answer defendant (now appellant) Jose de Borja claimed that it was conjugal property of his parents (Francisco de Borja and Josefa Tangco), conformably to the presumption established by Article 160 of the Philippine Civil Code (reproducing Article 1407 of the Civil Code of 1889), to the effect that: Art. 160. All property of the marriage is presumed to belong to the conjugal partnership, unless it be proved that it pertains exclusively to the husband or to the wife. Defendant Jose de Borja further counterclaimed for damages, compensatory, moral and exemplary, as well as for attorney's fees. After trial, the Court of First Instance of Rizal, per Judge Herminio Mariano, held that the plaintiff had adduced sufficient evidence to rebut the presumption, and declared the Hacienda de Jalajala (Poblacion) to be the exclusive private property of the late Francisco de Borja, and his Administratrix, Tasiana Ongsingco Vda. de Borja, to be entitled to its possession. Defendant Jose de Borja then appealed to this Court. The evidence reveals, and the appealed order admits, that the character of the Hacienda in question as owned by the conjugal partnership De Borja-Tangco was solemnly admitted by the late Francisco de Borja no less than two times: first, in the Reamended Inventory that, as executor of the estate of his deceased wife Josefa Tangco, he filed in the Special Proceedings No. 7866 of the Court of First Instance of Rizal on 23 July 1953

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JUDICIAL SETTLEMENT OF ESTATE Limited Jurisdiction (Exhibit "2"); and again, in the Reamended Accounting of the same date, also filed in the proceedings aforesaid (Exhibit "7"). Similarly, the plaintiff Tasiana O. Vda. de Borja, herself, as oppositor in the Estate of Josefa Tangco, submitted therein an inventory dated 7 September 1954 (Exhibit "3") listing the Jalajala property among the "Conjugal Properties of the Spouses Francisco de Borja and Josefa Tangco". And once more, Tasiana Ongsingco, as administratrix of the Estate of Francisco de Borja, in Special Proceedings No. 832 of the Court of First Instance of Nueva Ecija, submitted therein in December, 1955, an inventory wherein she listed the Jalajala Hacienda under the heading "Conjugal Property of the Deceased Spouses Francisco de Borja and Josefa Tangco, which are in the possession of the Administrator of the Testate Estate of the Deceased Josefa Tangco in Special Proceedings No. 7866 of the Court of First Instance of Rizal" (Exhibit "4"). Notwithstanding the four statements aforesaid, and the fact that they are plain admissions against interest made by both Francisco de Borja and the Administratrix of his estate, in the course of judicial proceedings in the Rizal and Nueva Ecija Courts, supporting the legal presumption in favor of the conjugal community, the Court below declared that the Hacienda de Jalajala (Poblacion) was not conjugal property, but the private exclusive property of the late Francisco de Borja. It did so on the strength of the following evidences: (a) the sworn statement by Francis de Borja on 6 August 1951 (Exhibit "F") that — He tomado possession del pedazo de terreno ya delimitado (equivalente a 1/4 parte, 337 hectareas) adjunto a mi terreno personal y exclusivo (Poblacion de Jalajala, Rizal). and (b) the testimony of Gregorio de Borja, son of Bernardo de Borja, that the entire Hacienda had been bought at a foreclosure sale for P40,100.00, of which amount P25,100 was contributed by Bernardo de Borja and P15,000. by Marcelo de Borja; that upon receipt of a subsequent demand from the provincial treasurer for realty taxes the sum of P17,000, Marcelo told his brother Bernardo that Francisco (son of Marcelo) wanted also to be a co-owner, and upon Bernardo's assent to the proposal, Marcelo issue a check for P17,000.00 to pay the back taxes and said that the amount would represent Francisco's contribution in the purchase of the Hacienda. The witness further testified that — Marcelo de Borja said that that money was entrusted to him by Francisco de Borja when he was still a bachelor and which he derived from his business transactions. (Hearing, 2 February 1965, t.s.n., pages 13-15) (Emphasis supplied) The Court below, reasoning that not only Francisco's sworn statement overweighed the admissions in the inventories relied upon by defendant-appellant Jose de Borja since probate courts can not finally determine questions of ownership of inventoried property, but that the testimony of Gregorio de Borja showed that Francisco de Borja acquired his share of the original Hacienda with his private funds, for which reason that share can not be regarded as conjugal partnership property, but as exclusive property of the buyer, pursuant to Article 1396(4)

of Civil Code of 1889 and Article 148(4) of the Civil Code of the Philippines. The following shall be the exclusive property of each spouse: xxx xxx xxx (4) That which is purchased with exclusive money of the wife or of the husband. We find the conclusions of the lower court to be untenable. In the first place, witness Gregorio de Borja's testimony as to the source of the money paid by Francisco for his share was plain hearsay, hence inadmissible and of no probative value, since he was merely repeating what Marcelo de Borja had told him (Gregorio). There is no way of ascertaining the truth of the statement, since both Marcelo and Francisco de Borja were already dead when Gregorio testified. In addition, the statement itself is improbable, since there was no need or occasion for Marcelo de Borja to explain to Gregorio how and when Francisco de Borja had earned the P17,000.00 entrusted to Marcelo. A ring of artificiality is clearly discernible in this portion of Gregorio's testimony. As to Francisco de Borja's affidavit, Exhibit "F", the quoted portion thereof (ante, page 14) does not clearly demonstrate that the "mi terreno personal y exclusivo (Poblacion de Jalajala, Rizal) " refers precisely to the Hacienda in question. The inventories (Exhibits 3 and 4) disclose that there were two real properties in Jalajala owned by Francisco de Borja, one of 72.038 sq. m., assessed at P44,600, and a much bigger one of 1,357.260.70 sq. m., which is evidently the Hacienda de Jalajala (Poblacion). To which of these lands did the affidavit of Francisco de Borja (Exhibit "F") refer to? In addition, Francisco's characterization of the land as "mi terreno personal y exclusivo" is plainly self-serving, and not admissible in the absence of cross examination. It may be true that the inventories relied upon by defendant-appellant (Exhibits "2", "3", "4" and "7") are not conclusive on the conjugal character of the property in question; but as already noted, they are clear admissions against the pecuniary interest of the declarants, Francisco de Borja and his executor-widow, Tasiana Ongsingco, and as such of much greater probative weight than the selfserving statement of Francisco (Exhibit "F"). Plainly, the legal presumption in favor of the conjugal character of the Hacienda de Jalajala (Poblacion) now in dispute has not been rebutted but actually confirmed by proof. Hence, the appealed order should be reversed and the Hacienda de Jalajala (Poblacion) declared property of the conjugal partnership of Francisco de Borja and Josefa Tangco. No error having been assigned against the ruling of the lower court that claims for damages should be ventilated in the corresponding special proceedings for the settlement of the estates of the deceased, the same requires no pro announcement from this Court. IN VIEW OF THE FOREGOING, the appealed order of the Court of First Instance of Rizal in Case No. L-28040 is hereby affirmed; while those involved in Cases Nos. L-28568 and L28611 are reversed and set aside. Costs against the appellant Tasiana Ongsingco Vda. de Borja in all three (3) cases.

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JUDICIAL SETTLEMENT OF ESTATE Limited Jurisdiction FAUSTINO REYES, ESPERIDION G.R. No. 162956 REYES, JULIETA C. RIVERA, and EUTIQUIO DICO, JR., Petitioners, Present: PUNO, C.J., Chairperson, - versus - CARPIO, CORONA, *AZCUNA, and LEONARDO-DE CASTRO, JJ. PETER B. ENRIQUEZ, for himself and Attorney-in-Fact of his daughter DEBORAH ANN C. ENRIQUEZ, and SPS. DIONISIO FERNANDEZ and CATALINA FERNANDEZ, Respondents. April 10, 2008 x - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - x D E C I S I O N PUNO, C.J.: This case is a Petition for Review on Certiorari under Rule 45 of the Revised Rules of Court from the decision of the Court of Appeals (CA) dated September 29, 2003 in CA G.R. CV No. 68147, entitled Peter B. Enriquez, et al. v. Faustino Reyes, et al., reversing the decision of the Regional Trial Court (RTC) of Cebu City, Branch XI dated June 29, 2000, which dismissed the complaint filed by the respondents herein.[1] The subject matter of the present case is a parcel of land known as Lot No. 1851 Flr-133 with an aggregate area of 2,017 square meters located in Talisay, Cebu.[2] According to petitioners Faustino Reyes, Esperidion Reyes, Julieta C. Rivera, and Eutiquio Dico, Jr., they are the lawful heirs of Dionisia Reyes who co-owned the subject parcel of land with Anacleto Cabrera as evidenced by Transfer Certificate of Title (TCT) No. RT-3551 (T-8070). On April 17, 1996, petitioners executed an Extrajudicial Settlement with Sale of the Estate of Dionisia Reyes (the Extra Judicial Settlement) involving a portion of the subject parcel of land. On March 21, 1997, the petitioners and the known heirs of Anacleto Cabrera executed a Segregation of Real Estate and Confirmation of Sale (the Segregation and Confirmation) over the same property. By virtue of the aforestated documents, TCT No. RT-35551 (T8070) was cancelled and new TCTs were issued: (1) TCT No. T98576 in the name of Anacleto Cabrera covering Lot 1851-A; (2) TCT No. T-98577 covering Lot 1851-B in the name of petitioner Eutiquio Dico, Jr.; (3) TCT No. T-98578 covering Lot 1851-C in the name of petitioner Faustino Reyes; (4) TCT No. T-98579 covering Lot 1851-D in the name of petitioner Esperidion Reyes; (5) TCT No. T-98580 covering Lot 1851-E in the name of petitioner Julieta G. Rivera; (6) TCT No. T-98581 covering Lot 1851-F in the name of Felipe Dico; and (7) TCT No. T-98582 covering Lot 1851-G in the name of Archimedes C. Villaluz.[3]

Respondents Peter B. Enriquez (Peter) for himself and on behalf of his minor daughter Deborah Ann C. Enriquez (Deborah Ann), also known as Dina Abdullah Enriquez Alsagoff, on the other hand, alleges that their predecessor-ininterest Anacleto Cabrera and his wife Patricia Seguera Cabrera (collectively the Spouses Cabrera) owned pro-indiviso share in the subject parcel of land or 1051 sq. m. They further allege that Spouses Cabrera were survived by two daughters Graciana, who died single and without issue, and Etta, the wife of respondent Peter and mother of respondent Deborah Ann who succeeded their parents rights and took possession of the 1051 sq. m. of the subject parcel of land. During her lifetime, Graciana sold her share over the land to Etta. Thus, making the latter the sole owner of the one-half share of the subject parcel of land. Subsequently, Etta died and the property passed on to petitioners Peter and Deborah Ann by virtue of an ExtraJudicial Settlement of Estate. On June 19, 1999, petitioners Peter and Deborah Ann sold 200 sq. m. out of the 1051 sq. m. for P200,000.00 to Spouses Dionisio and Catalina Fernandez (Spouses Fernandez), also their co-respondents in the case at bar. After the sale, Spouses Fernandez took possession of the said area in the subject parcel of land.[4] When Spouses Fernandez, tried to register their share in the subject land, they discovered that certain documents prevent them from doing so: (1) Affidavit by Anacleto Cabrera dated March 16, 1957 stating that his share in Lot No. 1851, the subject property, is approximately 369 sq. m.; (2) Affidavit by Dionisia Reyes dated July 13, 1929 stating that Anacleto only owned of Lot No. 1851, while 302.55 sq. m. belongs to Dionisia and the rest of the property is co-owned by Nicolasa Bacalso, Juan Reyes, Florentino Reyes and Maximiano Dico; (3) ExtraJudicial Settlement with Sale of the Estate of Dionisia Reyes dated April 17, 1996; (4) certificates of title in the name of the herein petitioners; and (5) Deed of Segregation of Real Estate and Confirmation of Sale dated March 21, 1997 executed by the alleged heirs of Dionisia Reyes and Anacleto Cabrera. Alleging that the foregoing documents are fraudulent and fictitious, the respondents filed a complaint for annulment or nullification of the aforementioned documents and for damages. [5]They likewise prayed for the repartition and resubdivision of the subject property.[6] The RTC, upon motion of the herein petitioners, dismissed the case on the ground that the respondents-plaintiffs were actually seeking first and foremost to be declared heirs of Anacleto Cabrera since they can not demand the partition of the real property without first being declared as legal heirs and such may not be done in an ordinary civil action, as in this case, but through a special proceeding specifically instituted for the purpose.[7] On appeal, the Court of Appeals (CA) reversed the RTC and directed the trial court to proceed with the hearing of the case.[8] The Motion for Reconsideration filed by the herein petitioners was similarly denied.[9] Hence this petition. The primary issue in this case is whether or not the respondents have to institute a special proceeding to determine their status as heirs of Anacleto Cabrera before they can file an ordinary civil action to nullify the affidavits of Anacleto Cabrera and Dionisia Reyes, the Extra-Judicial Settlement with the Sale of Estate of Dionisia Reyes, and the Deed of Segregation of Real Estate and Confirmation of Sale executed by the heirs of Dionisia Reyes and the heirs of

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JUDICIAL SETTLEMENT OF ESTATE Limited Jurisdiction Anacleto Cabrera, as well as to cancel the new transfer certificates of title issued by virtue of the above-questioned documents. We answer in the affirmative. An ordinary civil action is one by which a party sues another for the enforcement or protection of a right, or the prevention or redress of a wrong.[10] A special proceeding, on the other hand, is a remedy by which a party seeks to establish a status, a right or a particular fact.[11] The Rules of Court provide that only a real party in interest is allowed to prosecute and defend an action in court.[12] A real party in interest is the one who stands to be benefited or injured by the judgment in the suit or the one entitled to the avails thereof.[13] Such interest, to be considered a real interest, must be one which is present and substantial, as distinguished from a mere expectancy, or a future, contingent, subordinate or consequential interest.[14] A plaintiff is a real party in interest when he is the one who has a legal right to enforce or protect, while a defendant is a real party in interest when he is the one who has a correlative legal obligation to redress a wrong done to the plaintiff by reason of the defendants act or omission which had violated the legal right of the former.[15] The purpose of the rule is to protect persons against undue and unnecessary litigation.[16] It likewise ensures that the court will have the benefit of having before it the real adverse parties in the consideration of a case.[17] Thus, a plaintiffs right to institute an ordinary civil action should be based on his own right to the relief sought. In cases wherein alleged heirs of a decedent in whose name a property was registered sue to recover the said property through the institution of an ordinary civil action, such as a complaint for reconveyance and partition, or nullification of transfer certificate of titles and other deeds or documents related thereto, this Court has consistently ruled that a declaration of heirship is improper in an ordinary civil action since the matter is within the exclusive competence of the court in a special proceeding. [20] In the recent case of Portugal v. Portugal-Beltran,[21] the Court had the occasion to clarify its ruling on the issue at hand, to wit: The common doctrine in Litam, Solivio and Guilas in which the adverse parties are putative heirs to the estate of a decedent or parties to the special proceedings for its settlement is that if the special proceedings are pending, or if there are no special proceedings filed but there is, under the circumstances of the case, a need to file one, then the determination of, among other issues, heirship should be raised and settled in said special proceedings. Where special proceedings had been instituted but had been finally closed and terminated, however, or if a putative heir has lost the right to have himself declared in the special proceedings as co-heir and he can no longer ask for its re-opening, then an ordinary civil action can be filed for his declaration as heir in order to bring about the annulment of the partition or distribution or adjudication of

a property or properties belonging to the estate of the deceased.[22] In the instant case, while the complaint was denominated as an action for the Declaration of Non-Existency[sic], Nullity of Deeds, and Cancellation of Certificates of Title, etc., a review of the allegations therein reveals that the right being asserted by the respondents are their right as heirs of Anacleto Cabrera who they claim co-owned one-half of the subject property and not merely one-fourth as stated in the documents the respondents sought to annul. As correctly pointed out by the trial court, the ruling in the case of Heirs of Guido Yaptinchay v. Hon. Roy del Rosario[23] is applicable in the case at bar. In the said case, the petitioners therein, claiming to be the legal heirs of the late Guido and Isabel Yaptinchay filed for annulment of the transfer certificates of title issued in the name of Golden Bay Realty Corporation on the ground that the subject properties rightfully belong to the petitioners predecessor and by virtue of succession have passed on to them. In affirming the trial court therein, this Court ruled: ...(T)he plaintiffs who claimed to be the legal heirs of the said Guido and Isabel Yaptinchay have not shown any proof or even a semblance of it except the allegations that they are the legal heirs of the aforementioned Yaptinchays that they have been declared the legal heirs of the deceased couple. Now, the determination of who are the legal heirs of the deceased couple must be made in the proper special proceedings in court, and not in an ordinary suit for reconveyance of property. This must take precedence over the action for reconveyance.[24] In the same manner, the respondents herein, except for their allegations, have yet to substantiate their claim as the legal heirs of Anacleto Cabrera who are, thus, entitled to the subject property. Neither is there anything in the records of this case which would show that a special proceeding to have themselves declared as heirs of Anacleto Cabrera had been instituted. As such, the trial court correctly dismissed the case for there is a lack of cause of action when a case is instituted by parties who are not real parties in interest.While a declaration of heirship was not prayed for in the complaint, it is clear from the allegations therein that the right the respondents sought to protect or enforce is that of an heir of one of the registered coowners of the property prior to the issuance of the new transfer certificates of title that they seek to cancel. Thus, there is a need to establish their status as such heirs in the proper forum. Furthermore, in Portugal,[25] the Court held that it would be superfluous to still subject the estate to administration proceedings since a determination of the parties' status as heirs could be achieved in the ordinary civil case filed because it appeared from the records of the case that the only property left by the decedent was the subject matter of the case and that the parties have already presented evidence to establish their right as heirs of the decedent. In the present case, however, nothing in the records of this case shows that the only property left by the deceased Anacleto Cabrera is the subject lot, and

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JUDICIAL SETTLEMENT OF ESTATE Limited Jurisdiction neither had respondents Peter and Deborah Ann presented any evidence to establish their rights as heirs, considering especially that it appears that there are other heirs of Anacleto Cabrera who are not parties in this case that had signed one of the questioned documents.Hence, under the circumstances in this case, this Court finds that a determination of the rights of respondents Peter and Deborah Ann as heirs of Anacleto Cabrera in a special proceeding is necessary. IN VIEW WHEREOF, the petition is GRANTED. The decision of the Court of Appeals is hereby REVERSED and the decision of the Regional Trial Court dated June 29, 2000 DISMISSING the complaint is REINSTATED. No costs. SO ORDERED.



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JUDICIAL SETTLEMENT OF ESTATE Limited Jurisdiction [G.R. No. 155555. August 16, 2005]

ISABEL P. PORTUGAL and JOSE DOUGLAS PORTUGAL JR., petitioners, vs. LEONILA PORTUGAL-BELTRAN, respondent. D E C I S I O N CARPIO MORALES, J.: Petitioners Isabel P. Portugal and her son, Jose Douglas Portugal Jr., assail the September 24, 2002[1] Decision of the Court of Appeals affirming that of the Regional Trial Court (RTC) of Caloocan City, Branch 124[2] which dismissed, after trial, their complaint for annulment of title for failure to state a cause of action and lack of jurisdiction. From the records of the case are gathered the following material allegations claims of the parties which they sought to prove by testimonial and documentary evidence during the trial of the case: On November 25, 1942, Jose Q. Portugal (Portugal) married Paz Lazo.[3] On May 22, 1948, Portugal married petitioner Isabel de la Puerta.[4] On September 13, 1949, petitioner Isabel gave birth to a boy whom she named Jose Douglas Portugal Jr., her herein copetitioner.[5] On April 11, 1950, Paz gave birth to a girl, Aleli,[6] later baptized as Leonila Perpetua Aleli Portugal, herein respondent.[7] On May 16, 1968, Portugal and his four (4) siblings executed a Deed of Extra-Judicial Partition and Waiver of Rights over the estate of their father, Mariano Portugal, who died intestate on November 2, 1964. In the deed, Portugals siblings waived their rights, interests, and participation over a 155 sq. m. parcel of land located in Caloocan in his favor. On January 2, 1970, the Registry of Deeds for Caloocan City issued Transfer Certificate of Title (TCT) No. 34292 covering the Caloocan parcel of land in the name of Jose Q. Portugal, married to Paz C. Lazo. On February 18, 1984, Paz died.

In their complaint, petitioners alleged that respondent is not related whatsoever to the deceased Portugal, hence, not entitled to inherit the Caloocan parcel of land and that she perjured herself when she made false representations in her Affidavit of Adjudication. Petitioners accordingly prayed that respondents Affidavit of Adjudication and the TCT in her name be declared void and that the Registry of Deeds for Caloocan be ordered to cancel the TCT in respondents name and to issue in its stead a new one in their (petitioners) name, and that actual, moral and exemplary damages and attorneys fees and litigation expenses be awarded to them. Following respondents filing of her answer, the trial court issued a Pre-Trial Order chronicling, among other things, the issues as follows: a. Which of the two (2) marriages contracted by the deceased Jose Q. Portugal Sr., is valid? b. Which of the plaintiff . . . Jose Portugal Jr. and defendant Leonila P. Beltran is the legal heir of the deceased Jose Q. Portugal Sr.? c. Whether or not TCT No. 159813 was issued in due course and can still be contested by plaintiffs. d. Whether or not plaintiffs are entitled to their claims under the complaint.[16] (Underscoring supplied) After trial, the trial court, by Decision of January 18, 2001,[17] after giving an account of the testimonies of the parties and their witnesses and of their documentary evidence, without resolving the issues defined during pre-trial, dismissed the case for lack of cause of action on the ground that petitioners status and right as putative heirs had not been established before a probate (sic) court, and lack of jurisdiction over the case, citing Heirs of Guido and Isabel Yaptinchay v. Del Rosario.[18] In relying on Heirs of Guido and Isabel Yaptinchay, the trial court held: The Heirs of Yaptinchay case arose from facts not dissimilar to the case at bar. x x x

On April 21, 1985, Portugal died intestate. On February 15, 1988, respondent executed an Affidavit of Adjudication by Sole Heir of Estate of Deceased Person adjudicating to herself the Caloocan parcel of land. TCT No. 34292/T-172[13] in Portugals name was subsequently cancelled and in its stead TCT No. 159813[14] was issued by the Registry of Deeds for Caloocan City on March 9, 1988 in the name of respondent, Leonila Portugal-Beltran, married to Merardo M. Beltran, Jr. Later getting wind of the death in 1985 of Portugal and still later of the 1988 transfer by respondent of the title to the Caloocan property in her name, petitioners filed before the RTC of Caloocan City on July 23, 1996 a complaint against respondent for annulment of the Affidavit of Adjudication executed by her and the transfer certificate of title issued in her name.

In the instant case, plaintiffs presented a Marriage Contract, a Certificate of Live Birth, pictures (sic) and testimonial evidence to establish their right as heirs of the decedent. Thus, the preliminary act of having a status and right to the estate of the decedent, was sought to be determined herein. However, the establishment of a status, a right, or a particular fact is remedied through a special proceeding (Sec. 3(c), Rule 1, 1997 Rules of Court), not an ordinary civil action whereby a party sues another for the enforcement or protection of a right, or the protection or redress of a wrong (ibid, a). The operative term in the former is to establish, while in the latter, it is to enforce, a right. Their status and right as putative heirs of the decedent not having been established, as yet, the Complaint failed to state a cause of action.

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JUDICIAL SETTLEMENT OF ESTATE Limited Jurisdiction The court, not being a probate (sic) court, is without jurisdiction to rule on plaintiffs cause to establish their status and right herein. Plaintiffs do not have the personality to sue (Secs. 1 and 2, Rule 3, in relation to Secs. 1 and 2, Rule 2, supra).[19] (Italics in the original; emphasis and underscoring supplied). Petitioners thereupon appealed to the Court of Appeals, questioning the trial courts ratio decedendi in dismissing the case as diametrically opposed to this Courts following ruling in Cario v. Cario,[20] viz: Under Article 40 of the Family Code, the absolute nullity of a previous marriage may be invoked for purposes of remarriage on the basis solely of a final judgment declaring such previous marriage void. Meaning, where the absolute nullity of a previous marriage is sought to be invoked for purposes of contracting a second marriage, the sole basis acceptable in law, for said projected marriage to be free from legal infirmity, is a final judgment declaring the previous void. (Domingo v. Court of Appeals, 226 SCRA 572, 579 [1993]) However, for purposes other than remarriage, no judicial action is necessary to declare a marriage an absolute nullity. For other purposes, such as but not limited to the determination of heirship, legitimacy or illegitimacy of a child, settlement of estate, dissolution of property regime, or a criminal case for that matter, the court may pass upon the validity of marriage even after the death of the parties thereto, and even in a suit not directly instituted to question the validity of said marriage, so long as it is essential to the determination of the case. (Nial, et al. v. Bayadog, GR No. 13378, March 14, 2000). In such cases, evidence must be adduced, testimonial or documentary, to prove the existence of grounds rendering such a previous marriage an absolute nullity. These need not be limited solely to an earlier final judgment of a court declaring such previous marriage void. (Domingo v. Court of Appeals, supra) (Emphasis and underscoring supplied). Conceding that the ruling in Cario was promulgated (in 2001) subsequent to that of Heirs of Guido and Isabel Yaptinchay (in 1999), the appellate court found Cario to be inapplicable, however, to the case in this wise: To be borne in mind is the fact that the main issue in the Cario case was the validity of the two marriages contracted by the deceased SPO4 Santiago Cario, whose death benefits was the bone of contention between the two women both named Susan (viz., Susan Nicdao Cario and Susan Yee Cario) both of whom he married. It is not disputed in said case that SPO4 S. Cario contracted two marriages with said two women during his lifetime, and the only question was: which of these two marriages was validly celebrated? The award of the death benefits of the deceased Cario was thus, merely an incident to the question of which of the two marriages was valid. Upon the other hand, the case at bench is of a different milieu. The main issue here is the annulment of title to property. The only undisputed fact in this case is that the deceased Jose Portugal, during his lifetime, owned a parcel of land covered by Transfer Certificate of Title (TCT) No. T-34292. However, here come two contending parties, herein plaintiffs-appellants and defendant-appellee, both now insisting to be the legal heir(s) of the decedent. x x x. The status and rights of the parties herein have not, therefore, been definitively established, as yet. x x x.

Necessarily and naturally, such questions as to such status or right must be properly ventilated in an appropriate special proceeding, not in an ordinary civil action, whereunder a party sues another for the enforcement or protection of a right, or the protection or redress of a wrong. The institution of an ordinary civil suit for that purpose in the present case is thus impermissible. For it is axiomatic that what the law prohibits or forbids directly, it cannot permit or allow indirectly. To permit, or allow, a declaration of heirship, or the establishment of the legitimacy or illegitimacy of a child to be determined in an ordinary civil action, not in an appropriate special proceeding brought for that purpose, is thus to impinge upon this axiom. x x x[21] (Emphasis in the original, underscoring supplied). The appellate court, by Decision of September 24, 2002,[22] thus affirmed the trial courts dismissal of the case. Hence, the present Petition for Review on Certiorari,[23] faulting the appellate court to have erred when I. . . . it affirmed the RTC decision dismissing the initiatory complaint as it failed to state a cause of action. II. . . . (i) it applied the ruling in Heirs of Guido [and Isabel] Yaptingchay despite the existence of a later and contrary ruling in Cario, and (ii) when the Honorable CA and the lower court failed to render judgment based on the evidence presented relative to the issues raised during pre-trial, . . .[24] (Emphasis and underscoring supplied). Petitioners thus prayed as follows: WHEREFORE, it is respectfully prayed of this Honorable Supreme Court that the questioned CA decision be reversed, and a new one entered in accordance with the prayers set forth in the instant complaint based on the above disquisition and evidence adduced by petitioners in the court a quo. IN THE ALTERNATIVE, should the Honorable Supreme Court find that the pronouncements in Cario apply, a decision be entered remanding to the court a quo the determination of the issues of which of the two marriages is valid, and the determination of heirship and legitimacy of Jose Jr. and Leonila preparatory to the determination of the annulment of title issued in the name of Leonila. Other relief and remedy just and equitable in the premises are likewise prayed for.[25] (Underscoring supplied). Petitioners, in the main, argue that the appellate court misapplied Heirs of Guido and Isabel Yaptinchay and in effect encouraged multiplicity of suits which is discouraged by this Court as a reading of Cario shows; that Cario allows courts to pass on the determination of heirship and the legitimacy or illegitimacy of a child so long as it is necessary to the determination of the case; and that contrary to the appellate courts ruling, they had established their status as compulsory heirs.

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JUDICIAL SETTLEMENT OF ESTATE Limited Jurisdiction In the main, the issue in the present petition is whether petitioners have to institute a special proceeding to determine their status as heirs before they can pursue the case for annulment of respondents Affidavit of Adjudication and of the TCT issued in her name. In the above-cited case of Heirs of Guido and Isabel Yaptinchay,[26] the therein petitioners executed on March 17, 1994 an extrajudicial settlement of the estate of the deceased Guido and Isabel Yaptinchay, owners-claimants of the two lots mentioned therein. They later discovered on August 26, 1994 that a portion, if not all, of the two lots had been titled in the name of the therein respondent Golden Bay Realty and Development Corporation which in turn sold portions thereof to the therein individual respondents. The therein petitioners Heirs thus filed a complaint for annulment of titles. The therein respondents moved to dismiss the case for failure of the therein petitioners to, inter alia, state a cause of action and prove their status as heirs. The trial court granted the motion to dismiss in this wise: But the plaintiffs who claimed to be the legal heirs of the said Guido and Isabel Yaptinchay have not shown any proof or even a semblance of itexcept the allegations that they are the legal heirs of the aforementioned Yaptinchaysthat they have been declared the legal heirs of the deceased couple. Now, the determination of who are the legal heirs of the deceased couple must be made in the proper special proceedings in court, and not in an ordinary suit for reconveyance of property. This must take precedence over the action for reconveyance . . .[27] (Italics in the original; underscoring supplied). On petition for certiorari by the Heirs, this Court, albeit holding that the petition was an improper recourse, found that the trial court did not commit grave abuse of discretion in dismissing the case. Citing Litam et al. v. Rivera[28] and Solivio v. Court of Appeals,[29] this Court held that the declaration of heirship can be made only in a special proceeding inasmuch as the petitioners here are seeking the establishment of a status or right. In the above-cited case of Litam,[30] Gregorio Dy Tam instituted a special proceeding for issuance of letters of administration before the then Court of First Instance (CFI) of Rizal, alleging in his petition that he is the son of Rafael Litam who died in Manila on January 10, 1951 and is survived by him and his therein named seven (7) siblings who are children of the decedent by his marriage to Sia Khin celebrated in China in 1911; that the decedent contracted in 1922 in the Philippines another marriage with Marcosa Rivera; and that the decedent left neither a will nor debt. Dy Tam thus prayed for the issuance of letters of administration to Marcosa Rivera, the surviving spouse of the decedent. The CFI granted the petition and issued letters of administration to, on Marcosas request, her nephew Arminio Rivera. While the special proceeding was pending, Dy Tam and his purported siblings filed a civil case before the same court, against the estate of Rafael Litam administrator Arminio Rivera and Remedios R. Espiritu, duly appointed guardian of Marcosa. In their complaint, Dy Tam and his purported siblings substantially reproduced the allegations made in his petition in the special proceeding, with the addition of a list of properties allegedly acquired during the marriage of the decedent and Marcosa. Finding the issue raised in the civil case to be identical to some unresolved incidents in the special proceeding, both were jointly heard by the trial court, following which it

rendered a decision in the civil case dismissing it, declaring, inter alia, that the plaintiffs Dy Tam et al. are not the children of the decedent whose only surviving heir is Marcosa. On appeal to this Court by Dy Tam et al., one of the two issues raised for determination was whether they are the legitimate children of Rafael Litam. This Court, holding that the issue hinged on whether Rafael Litam and Sia Khin were married in 1911, and whether Rafael Litam is the father of appellants Dy Tam et al., found substantially correct the trial courts findings of fact and its conclusion that, among other things, the birth certificates of Dy Tam et al. do not establish the identity of the deceased Rafael Litam and the persons named therein as father [and] it does not appear in the said certificates of birth that Rafael Litam had in any manner intervened in the preparation and filing thereof; and that [t]he other documentary evidence presented by [them] [is] entirely immaterial and highly insufficient to prove the alleged marriage between the deceased Rafael Litam and Sia Khin and [their] alleged status . . . as children of said decedent. This Court went on to opine in Litam, however, that the lower court should not have declared, in the decision appealed from, that Marcosa is the only heir of the decedent, for such declaration is improper in the [civil case], it being within the exclusive competence of the court in [the] [s]pecial [p]roceeding. In Solivio,[31] also cited in Heirs of Guido and Isabel Yaptinchay, there was a special proceeding for the settlement of the estate of the deceased, who was a soltero, filed before the RTC of Iloilo. In the special proceeding, Branch 23 of said court declared as sole heir Celedonia Solivio, the decedents maternal aunt-half sister of his mother. Concordia Javellana-Villanueva, the decedents paternal aunt-sister of his father, moved to reconsider the courts order declaring Celedonia Solivio as sole heir of the decedent, she claiming that she too was an heir. The court denied the motion on the ground of tardiness. Instead of appealing the denial of her motion, Concordia filed a civil case against Celedonia before the same RTC, for partition, recovery of possession, ownership and damages. The civil case was raffled to Branch 26 of the RTC, which rendered judgment in favor of Concordia. On appeal by Celedonia, the appellate court affirmed the said judgment. On petition for review filed before this Court by Celedonia who posed, among other issues, whether Branch 26 of the RTC of Iloilo had jurisdiction to entertain [the civil action] for partition and recovery of Concordia Villanuevas share of the estate of [the deceased] while the [estate] proceedings . . . were still pending . . . in Branch 23 of the same court, this Court held that [i]n the interest of orderly procedure and to avoid confusing and conflicting dispositions of a decedents estate, a court should not interfere with [estate] proceedings pending in a co-equal court, citing Guilas v. CFI Judge of Pampanga.[32] This Court, however, in Solivio, upon [c]onsidering that the estate proceedings are still pending, but nonetheless [therein private respondent-Concordia Villanueva] had lost her right to have herself declared as co-heir in said proceedings, opted to proceed to discuss the merits of her claim in the interest of justice, and declared her an heir of the decedent. In Guilas[33] cited in Solivio, a project of partition between an adopted daughter, the therein petitioner Juanita Lopez Guilas (Juanita), and her adoptive father was approved in the proceedings for the settlement of the testate estate of the

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JUDICIAL SETTLEMENT OF ESTATE Limited Jurisdiction decedent-adoptive mother, following which the probate court directed that the records of the case be archived. Juanita subsequently filed a civil action against her adoptive father to annul the project of partition on the ground of lesion, preterition and fraud, and prayed that her adoptive father immediately deliver to her the two lots allocated to her in the project of partition. She subsequently filed a motion in the testate estate proceedings for her adoptive father to deliver to her, among other things, the same two lots allotted to her. After conducting pre-trial in the civil case, the trial court, noting the parties agreement to suspend action or resolution on Juanitas motion in the testate estate proceedings for the delivery to her of the two lots alloted to her until after her complaint in the civil case had been decided, set said case for trial. Juanita later filed in the civil case a motion to set aside the order setting it for trial on the ground that in the amended complaint she, in the meantime, filed, she acknowledged the partial legality and validity of the project of partition insofar as she was allotted the two lots, the delivery of which she was seeking. She thus posited in her motion to set aside the April 27, 1966 order setting the civil case for hearing that there was no longer a prejudicial question to her motion in the testate estate proceedings for the delivery to her of the actual possession of the two lots. The trial court, by order of April 27, 1966, denied the motion. Juanita thereupon assailed the April 27, 1966 order before this Court. The probate courts approval of the project of partition and directive that the records of the case be sent to the archives notwithstanding, this Court held that the testate estate proceedings had not been legally terminated as Juanitas share under the project of partition had not been delivered to her. Explained this Court: As long as the order of the distribution of the estate has not been complied with, the probate proceedings cannot be deemed closed and terminated (Siguiong vs. Tecson, supra.); because a judicial partition is not final and conclusive and does not prevent the heir from bringing an action to obtain his share, provided the prescriptive period therefor has not elapse (Mari vs. Bonilla, 83 Phil., 137). The better practice, however, for the heir who has not received his share, is to demand his share through a proper motion in the same probate or administration proceedings, or for re-opening of the probate or administrative proceedings if it had already been closed, and not through an independent action, which would be tried by another court or Judge which may thus reverse a decision or order of the probate o[r] intestate court already final and executed and re-shuffle properties long ago distributed and disposed of (Ramos vs. Ortuzar, 89 Phil. 730, 741-742; Timbol vs. Cano, supra,; Jingco vs. Daluz, L-5107, April 24, 1953, 92 Phil. 1082; Roman Catholic vs. Agustines, L-14710, March 29, 1960, 107 Phil., 455, 460-461).[34] (Emphasis and underscoring supplied).

settlement is that if the special proceedings are pending, or if there are no special proceedings filed but there is, under the circumstances of the case, a need to file one, then the determination of, among other issues, heirship should be raised and settled in said special proceedings. Where special proceedings had been instituted but had been finally closed and terminated, however, or if a putative heir has lost the right to have himself declared in the special proceedings as co-heir and he can no longer ask for its re-opening, then an ordinary civil action can be filed for his declaration as heir in order to bring about the annulment of the partition or distribution or adjudication of a property or properties belonging to the estate of the deceased. In the case at bar, respondent, believing rightly or wrongly that she was the sole heir to Portugals estate, executed on February 15, 1988[35] the questioned Affidavit of Adjudication under the second sentence of Rule 74, Section 1 of the Revised Rules of Court.[36] Said rule is an exception to the general rule that when a person dies leaving a property, it should be judicially administered and the competent court should appoint a qualified administrator, in the order established in Sec. 6, Rule 78 in case the deceased left no will, or in case he did, he failed to name an executor therein.[37] Petitioners claim, however, to be the exclusive heirs of Portugal. A probate or intestate court, no doubt, has jurisdiction to declare who are the heirs of a deceased. It appearing, however, that in the present case the only property of the intestate estate of Portugal is the Caloocan parcel of land,[38] to still subject it, under the circumstances of the case, to a special proceeding which could be long, hence, not expeditious, just to establish the status of petitioners as heirs is not only impractical; it is burdensome to the estate with the costs and expenses of an administration proceeding. And it is superfluous in light of the fact that the parties to the civil case subject of the present case, could and had already in fact presented evidence before the trial court which assumed jurisdiction over the case upon the issues it defined during pretrial. In fine, under the circumstances of the present case, there being no compelling reason to still subject Portugals estate to administration proceedings since a determination of petitioners status as heirs could be achieved in the civil case filed by petitioners the trial court should proceed to evaluate the evidence presented by the parties during the trial and render a decision thereon upon the issues it defined during pre-trial, which bear repeating, to wit: 1. Which of the two (2) marriages contracted by the deceased Jose Q. Portugal, is valid; 2. Which of the plaintiff, Jose Portugal Jr. and defendant Leonila P. Beltran is the legal heir of the deceased Jose Q. Portugal (Sr.); 3. Whether or not TCT No. 159813 was issued in due course and can still be contested by plaintiffs;

This Court thus set aside the assailed April 27, 1966 order of the trial court setting the civil case for hearing, but allowed the civil case to continue because it involves no longer the two lots adjudicated to Juanita.

4. Whether or not plaintiffs are entitled to their claim under the complaint.[40]

The common doctrine in Litam, Solivio and Guilas in which the adverse parties are putative heirs to the estate of a decedent or parties to the special proceedings for its

WHEREFORE, the petition is hereby GRANTED. The assailed September 24, 2002 Decision of the Court of Appeals is hereby SET ASIDE.

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