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Republic of the Philippines

SUPREME COURT
Manila

EN BANC

G.R. No. L-27650 December 24, 1927

Intestate estate of the late Florencia Diez. SEGUNDO DIEZ, petitioner-appellee,


vs.
TOMAS SERRA for himself, and as guardian of the minors Mercedes, Trinidad, Jose,
Marcelino, Adriano and Felix Serra, opponent-appellant.

Arroyo and Evangelista for appellant.


Hilado and Hilado for appellee.

VILLAMOR, J.:

On September 12, 1923, Segundo Diez applied to the Court of First Instance of Occidental Negros for
letters of administration of the estate of the deceased Florencia Diez alleging that he is a brother of the
said Florencia Diez, who died on August 21, 1921 in the municipality of Cadiz, Province of Occidental
Negros, in which municipality she resided at the time of her death; that the deceased at the time of her
death was a widow and left no will; that the deceased left realty consisting in a share of one-third of lots
Nos. 465 and 490 of Cadiz cadastral case No. 25, more specifically described in the certificates of the
office of the register of deeds of that province; that the deceased left seven children, as follows:

Years old

Tomas Serra y Diez .............................. 21


Mercedes Serra y Diez ........................... 18
Trinidad Serra y Diez ........................... 16
Jose Serra y Diez ............................... 14
Marcelino Serra y Diez .......................... 17
Adriano Serra y Diez ............................ 10
Felix Serra y Diez .............................. 7

That the deceased Florencia Diez's share in the above-mentioned lots is assessed at P22,970.

On September 15, 1923, the court granted the application, ordering the appointment of Segundo Diez as
administrator, upon his filing a bond in the sum of P5,000.

The said bond was filed, and on may 7, 1924, Segundo Diez was appointed administrator. On October
7, 1924, he presented an inventory of the property under his administration.

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From then on the administration functioned until July 31, 1926, when Tomas Serra fro himself and as
guardian of his six minor brothers and sisters, the children of the deceased Florencia Diez, put in a
special appearance, contesting that court's authority to take cognizance of this intestate estate, on the
ground that the deceased Florencia Diez resided in the municipality of San Joaquin, Province of Iloilo,
at the time of her death, as evidenced by the death certificate, Exhibit A.

The North Negros Sugar Co., Inc., filed an intervention in this case, as creditor of the intestate estate
for a mortgage loan granted to the administrator, with the authorization of the court, maintaining the
validity of these proceedings, and asking for the dismissal of the special appearance of Tomas Serra et
al.

The court denied the petition of the special appearance.lawphi1.net

Tomas Serra, et al. appealed from this decision and their counsel in this instance assigns the following
errors as committed by the court below: (a) In finding itself competent and with jurisdiction to take
cognizance of and act in this proceeding for the settlement of the intestate estate of the deceased
Florencia Diez; (b) in not holding that the proceedings had herein are absolutely void ab initio because
no evidence has been heard or introduced anent the facts alleged in the application, and particularly
anent those concerning its own jurisdiction to take cognizance of this case; (c) in finding that the
question set up by the herein petitioners as to the court's jurisdiction is untimely and lacks the legal
requisites for that purpose; (d) in holding that the herein appellants are now estopped from questioning
the regularity and validity of its proceedings in this intestacy; (e) in permitting the North Negros Sugar
Co., Inc., to intervene in the matter of the questioning of the court's jurisdiction.

The legal questions raised by this appeal relate to the jurisdiction of the court that granted the letters of
administration of the estate of the deceased Florencia Diez , and to the challenge of such jurisdiction.
Section 600 of the Code of Civil Procedure provides:

SEC. 600. Where resident's estate settled. — If and inhabitant of the Philippine Islands dies,
whether a citizen or alien, his will shall be proved, or letters of administration granted, and his
estate settled, in the Court of First Instance in the province in which he resided at the time of his
death.

According to the allegations of the application for letters of administration, the deceased Florencia Diez
lived at Cadiz, Occidental Negros at the time of her death; it is therefore clear that the court a quo had
jurisdiction to grant the letters of administration applied for.

In order to render valid a grant of letters of administration the view is generally accepted that certain
jurisdiction facts must exist. These facts are that the person on whose estate the letters are being granted
is in fact dead, and that at the time of death he was a resident of the county wherein letters are being
granted, or if not a resident that he left assets in such county. It has been said that the fact of the death
of the intestate and of his residence within the county are foundation facts upon which all the
subsequent proceedings in the administration of the estate rest, and that if the intestate was not an
inhabitant of the state at the time of his death, and left no assets in the state, and none came into it
afterwards, no jurisdiction is conferred on the court to grant letters of administration in any county. A
probate court has jurisdiction to grant administration of the estate of a person who at the time of his
decease was an inhabitant or resident in the county, without proof that he left an estate to be
administered within the count. (11 R. C. L., par. 81.)

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Section 603 of the Code of Civil Procedure provides that the jurisdiction assumed by a Court of First
Instance for the settlement of an estate, so far as it depends on the place of residence of a person, or of
the location of his estate, shall not be contested in a suit or proceeding, except in an appeal from the
that court, in the original case, or when the lack of jurisdiction appears in the record. In the present case
the lack of jurisdiction did not appear in the record at the time when the court a quo that appointed the
administrator found itself competent, and no appeal was taken from the order decreeing said
appointment.

This administration has functioned for two years, and the appellants after that period have appeared in
this case, too late to avail themselves of the benefits offered by section 113 of the Code of Civil
Procedure, and it would seem that the only remedy left to them is to ask for the reopening of the
proceedings in the lower court that assumed jurisdiction.

Without further need to discuss the points raised by the appellants, the decision appealed from should
be, as it is hereby, affirmed, without special pronouncement as to costs. So ordered.

Avanceña, C.J., Street, Malcolm, Ostrand, Johns and Villa-Real, JJ., concur.

NO CASE DIGEST

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Republic of the Philippines
SUPREME COURT
Manila

THIRD DIVISION

G.R. No. L-44888 February 7, 1992

PILIPINAS SHELL PETROLEUM CORPORATION, petitioner,


vs.
FIDEL P. DUMLAO, Judge of the Court of First Instance of Agusan Del Norte and Butuan City,
BONIFACIO CANONOY, Judicial Administrator of the Estate of Regino Canonoy, CARMEN
VDA. DE CANONOY, TEODULO CANONOY, REGINO CANONOY, JR., MARIANITA
CANONOY GUINTO and GLORIA CANONOY BASA, respondents.

Dominguez & Paderna Law Offices Co. for petitioner.

Wenceslao B. Rosales for private respondents.

DAVIDE, JR., J.:

Brought to focus in this petition are the following issues: (a) whether the jurisdictional facts that need
to be stated in a petition for letters of administration under Section 2(a), Rule 79 of the Rules of Court
include the specific assertion that the petitioner therein is an "interested person," and (b) whether the
administration court may properly and validly dismiss a petition for letters of administration filed by
one who is not an "interested person" after having appointed an heir of the decedent as administrator of
the latter's intestate estate and set for pre-trial a claim against the said estate

Ricardo M. Gonzalez, District Manager of Shell Philippines, Inc. for Mindanao (hereinafter referred to
as Shell), filed on 8 January 1973 a petition entitled "In the Matter of the Intestate Estate of the
Deceased Regino Canonoy, Petition for Letters of Administration, Ricardo M. Gonzalez, Petitioner"
with the then Court of First Instance (now Regional Trial Court) of Agusan del Norte and Butuan City,
praying therein that he be appointed judicial administrator of the estate of the deceased Regino
Canonoy. The case was docketed as SP PROC. No. 343 and was raffled to Branch II of the trial court.

On 27 January 1973, Judge Vicente B. Echavez, Jr. of Branch II issued an Order (1) setting the hearing
on the petition for 23 March 1973 at 8:30 a.m.; (2) directing that the order be published, at petitioner's
expense, once a week for three (3) consecutive weeks in a newspaper with a nationwide circulation
published regularly by a government agency or entity, or in any newspaper published and edited in any
part of the country which is in operation during the existence of the present national emergency and of
general circulation in the province of Agusan del Norte and in Butuan City, if any there be; and (3)
ordering that copies of the order be sent by registered mail or personal delivery, at the petitioner's
expense, to each of all the known heirs of the deceased Regino Canonoy, within the periods prescribed
by Section 4, Rule 76 of the Rules of Court. 1

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In their Opposition to the issuance of letters of administration to Gonzalez filed on 21 March
1973, 2 private respondents, who are heirs of Regino Canonoy, allege that: Gonzalez "is a complete
stranger to the intestate estate" of Regino Canonoy; he is "not even a creditor" of the estate; he is a
resident of Davao City and thus if appointed as administrator of the estate, the bulk of which is located
in Butuan City, "he would not be able to perform his duties efficiently;" and he is an employee of Shell
Philippines, Inc., an alleged creditor of the estate, and so "he would not be able to properly and
effectively protect the interest of the estate in case of conflicts." They, however, "propose" and pray
that since Bonifacio Canonoy, one of Regino's sons, enjoys preference in appointment pursuant to
Section 6, Rule 78 of the Rules of Court, he should "be appointed administrator of the said intestate
estate and the corresponding letters of administration be issued in his favor."

On 25 July 1973, after due hearing, the trial court appointed Bonifacio Canonoy as administrator of the
intestate estate of Regino Canonoy, 3 having found him competent to act as such. None of the parties
moved to reconsider this order or appealed therefrom. On 23 November 1973, herein petitioner Shell,
then known as Shell Philippines, Inc., filed its claim against the estate of the deceased Regino Canonoy.
The duly appointed administrator, Bonifacio Canonoy, filed on 9 October 1974 a Motion to Dismiss the
claim of Shell 4 which the latter contested by filing an Opposition. Shell likewise filed an amended
claim against the estate. 5 On 12 May 1975, the administrator filed his Reply to the Opposition to
Motion to Dismiss. 6 On 25 May 1975, he filed an Answer to the amended claim filed by Shell. 7 In the
said Answer, he interposes compulsory counterclaims for the estate in the amount of P659,423.49
representing rentals for land occupied by the Shell Service Station, lighting allowances, allowances for
salaries and wages of service attendants, sales commission due the deceased Regino Canonoy and
reasonable attorney's fees. Petitioner filed an answer to the Counterclaim.

Upon joinder of the issues on Shell's claim, the trial court, this time presided over by respondent Judge
Fidel P. Dumlao, set the pre-trial for 15 August 1975. 8 This was later re-set to 23 September 1975. 9

On 18 August 1975, petitioner filed a motion to require the judicial administrator to file an inventory of
the properties of the deceased. 10

At the pre-trial held on 23 September 1975, counsel for the administrator requested for time to file a
Motion to Dismiss the case. In an Order issued on that date, the court granted him ten (10) days to file
the motion; opposing counsel was likewise given ten (10) days from receipt of the same to file
whatever pleading he may deem proper to file, after which the motion shall be deemed submitted for
resolution. 11 The motion was filed on 30 September 1975. It alleges that the court did not acquire
jurisdiction over the subject matter and nature thereof because the petitioner therein, Mr. Gonzalez, is
not the "interested person" contemplated by Section 2, Rule 79 of the Rules of Court. 12Shell filed its
Opposition to the Motion on 16 October 1975 13 on the ground that the trial court had acquired
jurisdiction over the case to issue letters of administration as the interest of Gonzalez in the estate is not
a jurisdictional fact that needs to be alleged in the petition. If at all, Gonzalez' lack of interest in the
estate of the deceased only affected his competence to be appointed administrator. In an Order dated 8
November 1975, respondent Judge, finding the motion to be well-taken and meritorious, dismissed the
case. 14 The motion for its reconsideration having been denied by the trial court on 23 January
1976, 15 Shell filed the instant petition which it denominated as a petition for review on certiorari under
Rule 45 of the Rules of Court.

In the Resolution dated 6 December 1976, this Court required the respondents to comment on the
petition; 16 the latter complied with the same on 31 January 1977. 17 Thereafter, on 7 February 1977,
this Court resolved, inter alia, to treat the petition for review as a special civil action under Rule 65 of
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the Rules of Court and require the parties to submit their respective Memoranda; 18 petitioner filed its
Memorandum on 4 April 1977 19 while the respondents filed theirs on 3 June 1977. 20

The petition is impressed with merit; it must perforce be granted.

Under the peculiar circumstances of the case, the trial court clearly acted with grave abuse of discretion
when it dismissed SP PROC. No. 343 after having set for pre-trial petitioner's amended claim against
the estate. That said dismissal was predicated solely on the ground that petitioner therein, Ricardo
Gonzalez, is not an "interested person," and that, since such interest is a jurisdictional requirement, the
trial court acquired no jurisdiction over the case, serves only to compound the error.

1. Section 2, Rule 79 of the Rules of Court provides:

xxx xxx xxx

Sec. 2. Contents of petition of letters of administration. — A petition for letters of


administration must be filed by an interested person and must show, so far as known to
the petitioner:

(a) The jurisdictional facts;

(b) The names, ages, and residences of the heirs, and the names and
residences of the creditors, of the decedent;

(c) The probable value and character of the property of the estate;

(d) The name of the person for whom letters of administration are prayed.

But no defect in the petition shall render void the issuance of letters of administration.

xxx xxx xxx

The jurisdictional facts alluded to are: the death of the testator, his residence at the time of his death in
the province where the probate court is sitting or, if he is an inhabitant of a foreign country, his having
left his estate in such province. 21 These facts are amply enumerated in the petition filed by
Gonzalez. 22 The fact of death of the intestate and of his residence within the country are foundation
facts upon which all the subsequent proceedings in the administration of the estate rest, and that if the
intestate was not an inhabitant of the state at the time of his death, and left no assets in the state, and
none came into it afterwards, no jurisdiction is conferred on the court to grant letters of administration
in any county. 23 Clearly, the allegation that a petitioner seeking letters of administration is an interested
person, does not fall within the enumeration of jurisdictional facts. Of course, since the opening
sentence of the section requires that the petition must be filed by an interested person, it goes without
saying that a motion to dismiss may lie not on the basis of lack of jurisdiction on the part of the court,
but rather on the ground of lack of legal capacity to institute the proceedings.

This is precisely what happened in Saguinsin vs. Lindayag, 24 where the dismissal of a petition for
letters of administration was affirmed because the petitioner "is not an heir of her deceased sister and,
therefore, has no material and direct interest in her estate." 25 In the said case, this Court defined an
interested party as one who would be benefited by the estate, such as an heir, or one who has a claim
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against the estate, such as a creditor; this interest must be material and direct, not merely indirect or
contingent. 26

The Saguinsin doctrine is not, however, without exception. An objection to a petition for letters of
administration on that ground may be barred by waiver or estoppel.

Private respondents herein did not file a motion to dismiss the petition filed by Gonzalez on the ground
of lack of capacity to sue; 27 they instead filed an Opposition which, unfortunately, did not ask for the
dismissal of the petition but merely opposed the issuance of letters of administration in favor of
Gonzalez because, among other reasons, he is a stranger to the estate. The Opposition also proposed
that Bonifacio Canonoy, one of the children of the deceased Regino Canonoy, be appointed
administrator of the latter's intestate estate. The failure to move for a dismissal amounted to a waiver of
the above-mentioned ground. Section 8, Rule 15 of the Rules of Court provides that:

A motion attacking a pleading or a proceeding shall include all objections then available,
and all objections not so included shall be deemed waived.

However, if a motion to dismiss is not filed, as what obtains in this case, any of the grounds available
for such a motion, except for improper venue, may be pleaded as an affirmative defense, and a
preliminary hearing thereon may be had as if a motion to dismiss had been filed. 28 Excepted from the
above rules are the following grounds: (a) failure to state a cause of action which may be alleged in a
later pleading if one is permitted, or by a motion for judgment on the pleadings, or at the trial on the
merits; and (b) lack of jurisdiction over the subject matter of the action, 29 subject to the exception as
hereinafter discussed.

In Insurance Company of North America vs. C.F. Sharp & Co., Inc., 30 this Court ruled:

Finally, appellant would contend that plaintiff has no capacity to sue and is not the real
party in interest. It is now too late to raise these objections here. These should have been
asserted in the motion to dismiss filed by defendant below. Not having been included
therein, they are now barred by the rule on omnibus motion.

By proposing that Bonifacio Canonoy be appointed as administrator instead of Mr. Gonzalez, private
respondents have in fact approved or ratified the filing of the petition by the latter.

In Eusebio vs. Valmores, 31 We held that:

xxx xxx xxx

The evidence submitted in the hearing does not satisfactorily prove that the petitioner
was legally adopted; hence, he did not have any interest in the properties of the deceased
Rosalia Saquitan. Under ordinary circumstances, such defect would authorize the
dismissal of the proceedings especially in view of the fact that the surviving spouse of
Rosalia Saquitan had filed an affidavit of adjudication under the provisions of Section 1
of Rule 74 of the Rules. Counsel for Domingo Valmores, however, had not objected to
the application for the appointment of an administrator; he only objected to the
appointment of the said stranger Eulogio Eusebio as administrator, claiming to have the
right as surviving spouse to be appointed as such administrator. By this act of Domingo
Valmores, surviving spouse of the deceased, therefore, the fatal defect in the petition
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may be considered, as cured. In other words, the filing of the petition for the
appointment of an administrator may be considered as having been ratified by the
surviving husband, Domingo Valmores, and for this reason the proceedings may not be
dismissed.

2. There can be no dispute that the trial court had acquired jurisdiction over SP PROC. No. 343.
Immediately after the filing of the case, the trial court complied with Section 3, Rule 79 of the Rules of
Court by issuing the Order dated 27 January 1973. At the initial hearing on 25 July 1973, petitioner
Gonzalez established the jurisdictional requirements by submitting in evidence proof of publication and
service of notices of the petition. Thereafter, it heard the evidence on the qualifications and competence
of Bonifacio Canonoy, then appointed him as the administrator and finally directed that letters of
administration be issued to him, and that he takes his oath of office after putting up a surety or property
bond in the amount of P5,000.00. 32

It is be presumed that Bonifacio Canonoy immediately qualified as administrator because in that


capacity, he filed a motion to dismiss petitioner's claim against the estate, 33 a Reply to the Opposition
to the motion to dismiss 34 and an Answer to the petitioner's amended claim against the estate wherein
he interposed a counterclaim, 35 praying thus:

WHEREFORE, it is most respectfully prayed of this Honorable Court to dismiss the


above-mentioned "Amended Claim Against the Estate" and to order the claimant to pay
into the intestate estate of Regino Canonoy the said sum of P659,423.49, together with
the interest thereon at the legal rate beginning from the date hereof, the reasonable
attorney's fees for the prosecution of this counterclaim, and costs;

OR IN THE ALTERNATIVE, in the event that any sum is found due from and payable by
the said intestate estate of Regino Canonoy in favor of the said claimant, the said amount
be deducted from the above-mentioned sum and, thereafter, to order the claimant to pay
the balance remaining unto the said intestate estate of Regino Canonoy, together with
interest thereon at the legal rate beginning from date hereof, the reasonable attorney's
fees for the prosecution of this counterclaim, and costs.

Clearly, therefore, not only had the administrator and the rest of the private respondents voluntarily
submitted to the jurisdiction of the trial court, they even expressly affirmed and invoked such
jurisdiction in praying for reliefs and remedies in their favor, namely: (a) denial of Gonzalez' prayer to
be appointed as administrator, (b) appointment of Bonifacio Canonoy as administrator, (c) denial of
petitioner Shell's amended claim against the estate, and (d) the granting of the counterclaim. Hence,
they cannot now be heard to question the jurisdiction of the trial court. While it may be true that
jurisdiction may be raised at any stage of the proceedings, a party who has affirmed and invoked it in a
particular matter to secure an affirmative relief cannot be allowed to afterwards deny that same
jurisdiction to escape penalty.

In Tijam, et al. al. vs. Sibonghanoy, et al., 36 this Court held:

It has been held that a party can not invoke the jurisdiction of a court to secure
affirmative relief against his opponent and, after obtaining or failing to obtain such
relief, repudiate or question that same jurisdiction (Dean vs. Dean, 136 Or. 694, 86
A.L.R. 79). In the case just cited, by way of explaining the rule, it was further said that
the question whether (sic) the court had jurisdiction either of the subject-matter of the
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action or of the parties was not important in such cases because the party is barred from
such conduct not because the judgment or order of the court is valid and conclusive as
an adjudication, but for the reason that such a practice can not be tolerated —
obviously for reasons of public policy.

Furthermore, it has also been held that 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 (Pease vs. Rathbun-Jones etc., 243 U.S. 273, 61 L. Ed.
715, 37 S. Ct. 283; St. Louis etc. vs. McBride, 141 U.S. 127, 35 L. Ed. 659). And
in Littleton vs. Burgess, 16 Wyo. 58, the Court said that it is not right for a party who
has affirmed and invoked the jurisdiction of a court in a particular matter to secure an
affirmative relief, to afterwards deny that same jurisdiction to escape a penalty.

The respondent Judge should have lent his ears to Tijam vs. Sibonghanoy instead of peremptorily
granting the motion to dismiss in an Order which does not even care to expound on why the court
found the said motion to be meritorious. He exhibited undue haste in removing the case from his docket
and in abdicating judicial authority and responsibility. Howsoever viewed, he committed grave abuse
of discretion.

WHEREFORE, the instant petition is hereby GRANTED and the Order of respondent Judge of 8
November 1975 in SP PROC. No. 343 is hereby SET ASIDE. The court below is further ordered to
hear and decide petitioner's claim against the estate in said case, unless supervening events had
occurred making it unnecessary, and to conduct therein further proceedings pursuant to the Rules of
Court until the case is closed and terminated.

Costs against private respondents.

IT IS SO ORDERED.

Gutierrez, Jr., Feliciano, Bidin and Romero, JJ., concur.

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DIGEST

Facts:

Ricardo Gonzales, District Manager of Shell Philippines for Mindanao, filed a petition entitled, “In the
Matter of the Intestate Estate of the Deceased Reginoi Canonoy, Petition for Letters of Administration,
Ricardo M. Gonzales, Petitioner” with the RTC of Agusan del Norte and Butuan City, praying that he
be appointed as judicial administrator of the estate of the deceased Regino Canonoy.

Judge Echavez Jr. issued an order setting the hearing on the petition and directing the hearing on the
petition and directing that said order be published and copies of the same be sent by registered mail or
personal delivery to each of all known heirs of the deceased.

The heirs of the deceased opposed the issuance of letters of administration filed by Gonzales based on
the following grounds:
1. Gonzales is a “complete stranger to the intestate estate” of the deceased;
2. He is not even a creditor of the estate but a mere employee of an alleged creditor (Shell
Philippines, Inc.) and so “he would not be able to properly and effectively protect the interest of
the estate in case of conflicts”; and
3. He is a resident of Davao City, and thus if appointed as administrator of the estate, the bulk of
which is located in Butuan City, “he would not be able to perform his duties efficiently”.

The heirs instead propose and pray that Bonifacio Canonoy, one of the deceased’s sons, be appointed
administrator of the said intestate estate and that the corresponding letters of administration be issued in
his favour. The trial court, after due hearing, appointed Bonifacio Canonoy as administrator of the
estate of the deceased.

Petitioner Shell filed its claim against the estate of the deceased. Upon joinder of the issues on the said
claim, the trial court set the pre-trial. The administrator filed a Motion to Dismiss the claim alleging
that the court did not acquire jurisdiction over the subject matter and nature thereof because the
petitioner therein, Mr. Gonzales, is not the “interested person” as contemplated by Rule 79, Section 2 of
the Rules of Court. Petitioner Shell countered the motion, contending that the interest of Mr. Gonzales
in the estate is not a jurisdictional fact that needs to be alleged in the petition.

Respondent Judge granted the motion and dismissed the case.

Issue:

Whether or not the jurisdictional facts that need to be stated in a petition for letter of administration
under Rule 79, Section 2 of the Rules of Court include the specific assertion that the petitioner therein
is an “interested person”

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Ruling:

No. Rule 79, Section 2 of the Rules of Court provides:

Section 2. Contents of petition of letters of administration – A petition for letters of administration must
be files by an interested person and must show, so far as known to the petitioner:

a) The jurisdictional facts;


b) The names, ages, and residences of the heirs, and the names and residences of the creditors, of
the decedent;
c) The probable value and character of the property of the estate;
d) The name of the person for whom letters of administration are prayed.

But no defect in the petition shall render void the issuance of letters of administration.

The jurisdictional facts alluded to are: the death of the testator, his residence at the time of his death in
the province where the probate court is sitting or, if he is an inhabitant of a foreign country, his having
left his estate in such province. These facts are amply enumerated in the petition filed by Mr. Gonzales.

Clearly, the allegation that a petitioner seeking letters of administration is an interested person does not
fall within the enumeration of jurisdictional facts. A Motion to Dismiss may lie not on the basis of lack
of jurisdiction on the part of the court, but rather on the ground of lack of legal capacity to institute the
proceedings.

In Saguinsin vs. Lindayag, the Court defined an “interested party” as one who would be benefitted by
the estate, such as an heir or one who has a claim against the estate, such as a creditor; this interest must
be material and direct, not merely indirect or contingent. As an exemption, an objection to a petition for
letters of administration on that ground may be barred by waiver or estoppel.

Private respondents’ failure to move for a dismissal amounted to a waiver of the abovementioned
ground. Rule 15, Section 8 of the Rules of Court provides that:

“A motion attacking a pleading or a proceeding shall include all objections then available, and all
objections not so included shall be deemed waived.”

By proposing that Bonifacio Canonoy be appointed as administrator instead of Mr. Gonzales, private
respondents have in fact approved or ratified the filing of the petition by the latter. There can be no
dispute that the trial court had acquired jurisdiction over the case.

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Republic of the Philippines
SUPREME COURT
Manila

SECOND DIVISION

G.R. No. 174680 March 24, 2008

VICTORIA C. TAYAG, Petitioner,


vs.
FELICIDAD A. TAYAG-GALLOR, Respondent.

DECISION

TINGA, J.:

This is a petition for review on certiorari seeking the reversal of the Decision1 of the Court of Appeals
dated 29 May 2006, and its Resolution2 dated 28 August 2006 in CA-G.R. SP No. 79205.

The antecedents are as follows:

On 15 January 2001, respondent herein, Felicidad A. Tayag-Gallor, filed a petition for the issuance of
letters of administration over the estate of Ismael Tayag.3 Respondent alleged in the petition, docketed
as Special Proceeding No. 5994 (SP 5994), that she is one of the three (3) illegitimate children of the
late Ismael Tayag and Ester C. Angeles. The decedent was married to petitioner herein, Victoria C.
Tayag, but the two allegedly did not have any children of their own.

On 7 September 2000, Ismael Tayag died intestate, leaving behind two (2) real properties both of which
are in the possession of petitioner, and a motor vehicle which the latter sold on 10 October 2000
preparatory to the settlement of the decedent’s estate. Petitioner allegedly promised to give respondent
and her brothers ₱100,000.00 each as their share in the proceeds of the sale. However, petitioner only
gave each of them half the amount she promised.

Respondent further averred that on 20 November 2000, petitioner has caused the annotation of 5
September 1984 affidavit executed by Ismael Tayag declaring the properties to be the paraphernal
properties of petitioner. The latter allegedly intends to dispose of these properties to the respondent’s
and her brothers’ prejudice.

Petitioner opposed the petition, asserting that she purchased the properties subject of the petition using
her own money. She claimed that she and Ismael Tayag got married in Las Vegas, Nevada, USA on 25
October 1973, and that they have an adopted daughter, Carmela Tayag, who is presently residing in the
USA. It is allegedly not true that she is planning to sell the properties. Petitioner prayed for the
dismissal of the suit because respondent failed to state a cause of action.4

In a Motion5 dated 31 August 2001, petitioner reiterated her sole ownership of the properties and
presented the transfer certificates of title thereof in her name. She also averred that it is necessary to
allege that respondent was acknowledged and recognized by Ismael Tayag as his illegitimate child.
There being no such allegation, the action becomes one to compel recognition which cannot be brought

12 | P a g e
after the death of the putative father. To prevent further encroachment upon the court’s time, petitioner
moved for a hearing on her affirmative defenses.

The Motion was denied in an Order6 dated 3 April 2003. Petitioner’s motion for reconsideration was
likewise denied in an Order7 dated 16 July 2003.

The appellate court, in a Decision8 dated 29 May 2006, upheld the denial of petitioner’s motion and
directed the trial court to proceed with the case with dispatch. The Court of Appeals ruled, in essence,
that the allegation that respondent is an illegitimate child suffices for a cause of action, without need to
state that she had been recognized and acknowledged as such. However, respondent still has to prove
her allegation and, correspondingly, petitioner has the right to refute the allegation in the course of the
settlement proceedings.

The Court of Appeals denied reconsideration in a Resolution9 dated 28 August 2006.

In her Petition10 17 dated September 2006, petitioner asserts that respondent should not be allowed to
prove her filiation in the settlement of Ismael Tayag’s estate. If, following the case of Uyguanco v.
Court of Appeals,11 the claim of filiation may no longer be proved in an action for recognition, with
more reason that it should not be allowed to be proved in an action for the settlement of the decedent’s
estate. Thus, petitioner claims, respondent may no longer maintain an action to prove that she is the
illegitimate child of the decedent after the latter’s death.

Unfortunately, the two-page Comment,12 dated 17 April 2007, fails to shed any more light on the
present controversy.

The Reply13 dated 3 September 2007 reiterates the arguments in the petition.

The main issue in this case is deceptively simple. As crafted by the Court of Appeals, it is whether
respondent’s petition for the issuance of letters of administration sufficiently states a cause of action
considering that respondent merely alleged therein that she is an illegitimate child of the decedent,
without stating that she had been acknowledged or recognized as such by the latter. The appellate court
held that the mere allegation that respondent is an illegitimate child suffices.

Rule 79 of the Rules of Court provides that a petition for the issuance of letters of administration must
be filed by an interested person. In Saguinsin v. Lindayag,14 the Court defined an interested party as
one who would be benefited by the estate, such as an heir, or one who has a claim against the estate,
such as a creditor. This interest, furthermore, must be material and direct, not merely indirect or
contingent.

Hence, where the right of the person filing a petition for the issuance of letters of administration is
dependent on a fact which has not been established or worse, can no longer be established, such
contingent interest does not make her an interested party. Here lies the complication in the case which
the appellate court had not discussed, although its disposition of the case is correct.1avvphi1

Essentially, the petition for the issuance of letters of administration is a suit for the settlement of the
intestate estate of Ismael Tayag. The right of respondent to maintain such a suit is dependent on
whether she is entitled to successional rights as an illegitimate child of the decedent which, in turn, may
be established through voluntary or compulsory recognition.

13 | P a g e
Voluntary recognition must be express such as that in a record of birth appearing in the civil register, a
final judgment, a public instrument or private handwritten instrument signed by the parent
concerned.15 The voluntary recognition of an illegitimate child by his or her parent needs no further
court action and is, therefore, not subject to the limitation that the action for recognition be brought
during the lifetime of the putative parent.16 Judicial or compulsory recognition, on the other hand, may
be demanded by the illegitimate child of his parents and must be brought during the lifetime of the
presumed parents.17

Petitioner’s thesis is essentially based on her contention that by Ismael Tayag’s death, respondent’s
illegitimate filiation and necessarily, her interest in the decedent’s estate which the Rules require to be
material and direct, may no longer be established. Petitioner, however, overlooks the fact that
respondent’s successional rights may be established not just by a judicial action to compel recognition
but also by proof that she had been voluntarily acknowledged and recognized as an illegitimate child.

In Uyguangco v. Court of Appeals, supra, Graciano Uyguangco, claiming to be an illegitimate child of


the decedent, filed a complaint for partition against the latter’s wife and legitimate children. However,
an admission was elicited from him in the course of his presentation of evidence at the trial that he had
none of the documents mentioned in Article 27818 of the 1950 Civil Code to show that he was the
illegitimate son of the decedent. The wife and legitimate children of the decedent thereupon moved for
the dismissal of the case on the ground that he could no longer prove his alleged filiation under the
applicable provision of the Civil Code.

The Court, applying the provisions of the Family Code which had then already taken effect, ruled that
since Graciano was claiming illegitimate filiation under the second paragraph of Article 172 of the
Family Code, i.e., open and continuous possession of the status of an illegitimate child, the action was
already barred by the death of the alleged father.

In contrast, respondent in this case had not been given the opportunity to present evidence to show
whether she had been voluntarily recognized and acknowledged by her deceased father because of
petitioner’s opposition to her petition and motion for hearing on affirmative defenses. There is, as yet,
no way to determine if her petition is actually one to compel recognition which had already been
foreclosed by the death of her father, or whether indeed she has a material and direct interest to
maintain the suit by reason of the decedent’s voluntary acknowledgment or recognition of her
illegitimate filiation.

We find, therefore, that the allegation that respondent is an illegitimate child of the decedent suffices
even without further stating that she has been so recognized or acknowledged. A motion to dismiss on
the ground of failure to state a cause of action in the complaint hypothetically admits the truth of the
facts alleged therein.19 Assuming the fact alleged to be true, i.e., that respondent is the

decedent’s illegitimate child, her interest in the estate as such would definitely be material and direct.
The appellate court was, therefore, correct in allowing the proceedings to continue, ruling that,
"respondent still has the duty to prove the allegation (that she is an illegitimate child of the decedent),
just as the petitioner has the right to disprove it, in the course of the settlement proceedings."

WHEREFORE, the instant petition is DENIED. The Decision of the Court of Appeals dated 29 May
2006 and its Resolution dated 28 August 2006 are AFFIRMED. No pronouncement as to costs.

SO ORDERED.
14 | P a g e
DANTE O. TINGA
Associate Justice

WE CONCUR:

LEONARDO A. QUISUMBING
Associate Justice
Chairperson

CONCHITA CARPIO MORALES MINITA V. CHICO-NAZARIO


Associate Justice Associate Justice

PRESBITERO J. VELASCO, JR.


Associate Justice

ATTESTATION

I attest that the conclusions in the above Decision had been reached in consultation before the case was
assigned to the writer of the opinion of the Court’s Division.

LEONARDO A. QUISUMBING
Associate Justice
Chairperson, Second Division

CERTIFICATION

Pursuant to Section 13, Article VIII of the Constitution, and the Division Chairperson’s Attestation, it is
hereby certified that the conclusions in the above Decision had been reached in consultation before the
case was assigned to the writer of the opinion of the Court’s Division.

REYNATO S. PUNO
Chief Justice

15 | P a g e
DIGEST

FACTS:

On 15 January 2001, respondent herein, Felicidad A. Tayag-Gallor, filed a petition for the issuance of
letters of administration over the estate of Ismael Tayag. Respondent alleged in the petition that she is
one of the three (3) illegitimate children of the late Ismael Tayag and Ester C. Angeles. The decedent
was married to petitioner herein, Victoria C. Tayag, but the two allegedly did not have any children of
their own. On 7 September 2000, Ismael Tayag died intestate, leaving behind two (2) real properties
both of which are in the possession of petitioner, and a motor vehicle which the latter sold on 10
October 2000 preparatory to the settlement of the decedent’s estate. Petitioner allegedly promised to
give respondent and her brothers P100,000 each as their share in the proceeds of the sale. However,
petitioner only gave each of them half the amount she promised. Respondent further averred that on 20
November 2000, petitioner has caused the annotation of 5 September 1984 affidavit executed by Ismael
Tayag declaring the properties to be the paraphernal properties of petitioner. The latter allegedly
intends to dispose of these properties to the respondent’s and her brothers’ prejudice.

Petitioner opposed the petition, asserting that she purchased the properties subject of the petition using
her own money. She claimed that she and Ismael Tayag got married in Las Vegas, Nevada, USA on 25
October 1973, and that they have an adopted daughter, Carmela Tayag, who is presently residing in
the USA. It is allegedly not true that she is planning to sell the properties. Petitioner prayed for the
dismissal of the suit because respondent failed to state a cause of action. Petitioner reiterated her sole
ownership of the properties and presented the transfer certificates of title thereof in her name. She also
averred that it is necessary to allege that respondent was acknowledged and recognized by Ismael
Tayag as his illegitimate child. There being no such allegation, the action becomes one to compel
recognition which cannot be brought after the death of the putative father. The motion was denied by
the trial court.

CA affirmed. The CA ruled that the allegation that respondent is an illegitimate child suffices for a
cause of action, without need to state that she had been recognized and acknowledged as
such. However, respondent still has to prove her allegation and, correspondingly, petitioner has the
right to refute the allegation in the course of the settlement proceedings.

ISSUE:

W/N respondent’s petition for the issuance of letters of administration sufficiently states a cause of
action considering that respondent merely alleged therein that she is an illegitimate child of the
decedent, without stating that she had been acknowledged or recognized as such by the latter

HELD:

Yes, the allegation that respondent is an illegitimate child of the decedent suffices even without further
stating that she has been so recognized or acknowledged.

Rule 79 of the Rules of Court provides that a petition for the issuance of letters of administration must
be filed by an interested person. In Saguinsin v. Lindayag, the Court defined an interested party as
one who would be benefited by the estate, such as an heir, or one who has a claim against the

16 | P a g e
estate, such as a creditor. This interest, furthermore, must be material and direct, not merely indirect
or contingent.

Essentially, the petition for the issuance of letters of administration is a suit for the settlement of the
intestate estate of Ismael Tayag. The right of respondent to maintain such a suit is dependent on
whether she is entitled to successional rights as an illegitimate child of the decedent which, in
turn, may be established through voluntary or compulsory recognition.

Voluntary recognition must be express such as that in a record of birth appearing in the civil register,
a final judgment, a public instrument or private handwritten instrument signed by the parent
concerned. The voluntary recognition of an illegitimate child by his or her parent needs no further
court action and is, therefore, not subject to the limitation that the action for recognition be brought
during the lifetime of the putative parent. Judicial or compulsory recognition, on the other hand,
may be demanded by the illegitimate child of his parents and must be brought during the lifetime of the
presumed parents.

Petitioner’s thesis is essentially based on her contention that by Ismael Tayag’s death, respondent’s
illegitimate filiation and necessarily, her interest in the decedent’s estate which the Rules require to be
material and direct, may no longer be established. Petitioner, however, overlooks the fact that
respondent’s successional rights may be established not just by a judicial action to compel
recognition but also by proof that she had been voluntarily acknowledged and recognized as an
illegitimate child.

Respondent in this case had not been given the opportunity to present evidence to show whether she
had been voluntarily recognized and acknowledged by her deceased father because of petitioner’s
opposition to her petition and motion for hearing on affirmative defenses. There is, as yet, no way to
determine if her petition is actually one to compel recognition which had already been foreclosed by the
death of her father, or whether indeed she has a material and direct interest to maintain the suit by
reason of the decedent’s voluntary acknowledgment or recognition of her illegitimate filiation.

17 | P a g e
Republic of the Philippines
SUPREME COURT
Manila

EN BANC

G.R. No. L-18788 January 31, 1964

ROMULO LOPEZ, ET AL., plaintiffs-appellants,


vs.
LUIS GONZAGA, ET AL., defendants,
LUIS GONZAGA and ASUNCION GONZAGA, defendants-appellants.

Lakandola G. Lopez and Romulo Lopez for plaintiffs-appellants.


Amalia K. del Rosario for defendants-appellants.

REYES, J.B.L., J.:

Joint and direct appeal by both parties-plaintiffs an parties-defendants from the decision of the Court of
First Instance of Negros Occidental (in its Civil Case No. 5033 to this Supreme Court, because the
properties involved a valued at more than P200,000.00. The appealed decision dismissed the petition of
plaintiffs (appellants) for partition and cancellation of titles of registered lands and ordered them to pay
defendants (appellees) P1,000.00 by way of attorney's fees, but refused to award moral damages in
favor of the defendants.

The original petition was filed with the court a quo on 6 October 1958, alleging, among other things,
that on Soledad Gonzaga Vda. de Ferrer died intestate on 11 April 1935 without any issue and leaving
real and personal properties worth P400,000.00; that she was survived by the plaintiffs, who are her
nearest of kin, being her brother sisters, nephews, and nieces; that during the lifetime the deceased, she
expressed the wish that as long as her brother, Luis Gonzaga, the principal defendant, was engaged in
his coconut oil experimentation he could use products and rentals of her properties in furtherance his
experiments; that the said scientific venture by said defendant was discontinued when he became totally
blind in October, 1955 in view of which the plaintiffs now ask a partition of the estate and the
cancellation of titles of lands allegedly fraudulently transferred by, and in the name of, the defendant.

The defendant filed a motion to dismiss on the grounds of res judicata and non-inclusion of
indispensable parties. The plainttiffs amended their petition to include the omitted parties. After hearing
on the motion to dismiss, the court denied the said motion. Thereupon, the defendant filed their answer,
pleading a denial as to intestacy of deceased, and alleging, among others, that a will of Soledad
Gonzaga Vda. de Ferrer instituted Luis Gonzaga as the sole heir estate, and that the will was duly
allowed and probated.

After trial, the court a quo rendered judgment, a both parties appealed, as aforesaid.

The genuineness of the following documents, and the jurisdiction of the court with respect to them, are
not disputed:

18 | P a g e
REPUBLIC OF THE PHILIPPINES
COURT OF FIRST INSTANCE OF ILOILO
11th Judicial District

December 11, 1958.

TO WHOM IT MAY CONCERN:

This is to certify that according to the records of this office, there is no Expediente No. 2163 entitled
Estate of Doña Soledad Gonzaga Vda. de Ferrer, as all prewar records were burned, lost or destroyed
during the World War II.

(Sgd.) CIPRIANO CABALUNA


Clerk of Court.

UNITED STATES OF AMERICA


COMMONWEALTH OF THE PHILIPPINES
COURT OF FIRST INSTANCE OF
OCCIDENTAL NEGROS
18th Judicial District

G.L.R.O. CAD. RECORD NO. 214


LOTS NOS. 414 and 424
CAD. SURVEY OF MANAPLA
x---------------------x

PETITION

Luis Gonzaga y Jesena through the undersigned attorney, to the Honorable Court respectfully follows:

That Soledad Gonzaga Vda. de Ferrer is the registered owner of Lots Nos. 414 and 424, Cadastral
Survey of Manapla, which parcel of land are described in Transfer Certificate of Title Nos. 11460 and
13855, respectively.

That Soledad Gonzaga Vda. de Ferrer died on April 11, 1935, and she left all her properties in favor of
Luis Gonzaga y Jesena in her will, which will was probated on May 17, 1935, in the Court of First
Instance of Iloilo (Exp. No. 2163, Iloilo).

That the project of partition dated February 3, 1936, (Exp. No. 2163, Iloilo) a copy of which is hereto
attached, in which the petitioner Luis Gonzaga y Jesena is the only heir, was approved by the
Honorable Court of Iloilo in its order dated February 8, 1936, a copy of the said order is hereto
attached. 1äwphï1.ñët

WHEREFORE, in view of the foregoing, the petitioner respectfully prays the Honorable Court to order
the cancellation of Transfer Certificate of Title Nos. 11460 and 13855, Office of the Register of Deeds
of Occidental Negros, wherein Lots Nos. 414 and 424 are described, and in lieu thereof to issue
Transfer Certificate of Titles for Lots 414 and 424, Cadastral Survey of Manapla, Occidental Negros, in

19 | P a g e
favor of Luis Gonzaga y Jesena, single of legal age, Filipino and a resident of Manila, P. I.

Iloilo, Iloilo, for Bacolod, Occ. Neg., P.I. March 11, 1936.

(Sgd.) FRANCISCO S. HORTILLAS


Attorney for the petitioner
2 General Luna, Iloilo Iloilo

I, Francisco S. Hortillas, of legal age, after having been duly sworn, depose and say: That I am the
attorney for the petitioner in the above case, and that all the allegations contained in the foregoing
petition are true to the best of my information tion and belief.

(Sgd.) FRANCISCO HORTILLAS

Subscribed and Sworn to before me this 11th day of March, 1936. He exhibited to me his cedula No. E-
1250120, issued at Jaro, Iloilo, P.I., on January 16, 1936.

(Sgd.) ILLEGIBLE
NOTARY PUBLIC
Until Dec. 31, 1937

Doc. No. 49
Page No. 60
Book No. 1
Series of 1936

The Register of Deeds


Bacolod City, Occ. Negros

Sir:

Please take notice that on Saturday, March 21, 1936, at 8:00 a.m. or soon thereafter as the undersigned
may be heard, he will submit the foregoing petition to this Honorable Court for approval.

(Sgd.) FRANCISCO S. HORTILLAS

I hereby certify that I have sent a copy of the foregoing petition to the Register of Deeds of Occidental
Negros evidenced by the registry receipt hereto attached.

(Sgd.) FRANCISCO S. HORTILLAS

UNITED STATES OF AMERICA


COMMONWEALTH OF THE PHILIPPINES
COURT OF FIRST INSTANCE OF ILOILO
17th Judicial District

TESTATE PROCEEDINGS OF
THE DECEASED SOLEDAD

20 | P a g e
GONZAGA VDA. DE FERRER,
LUIS GONZAGA Y JESENA,
Petitioner.
x-------------------------x

CIVIL CASE NO. 2163

PETITION FOR ADJUDICATION

The undersigned administrator to the Honorable Court respectfully states:

That the undersigned administrator, Luis Gonzaga y Jesena is the only heir mentioned in the
probated will of the late Sra. Soledad G. Vda. de Ferrer.

TOWN TITLE NO. PROVINCE VALUE

Manapla Trans. Cert. 8433 Occ. Neg. P25,230.00

Manapla Trans. Cert. 11460 Occ. Neg. 5,210.00

Manapla Trans. Cert. 13855 Occ. Neg. 7,310.00

Jaro Trans. Cert. 13051 Iloilo 510.00

Jaro Trans. Cert. 13054 Iloilo 500.00

ACCOUNTS COLLECTIBLE AND CASH


Roman Sopena ........................................................... P1,100.00
Juan Sornito ............................................................... 330.00
Quintin Mejorada and others .................................. 2,800.00
Maria Ledesma and others ...................................... 600.00
and Cash ..................................................................... 1,018.54

That there is a pending civil complaint against the administrator by Consolacion G. de Lopez, et al.,
Civil Case No. 10321, Court, of First Instance of Iloilo, demanding payment of the sum of P833.40.
The undersigned administrator is willing to file a cash bond for the sum object of the complaint in case
this expediente will be closed before the trial of the Civil Case No. 10321, Iloilo.

Iloilo, P.I., February 3,1936.

(Sgd.) FRANCISCO S. HORTILLAS


Attorney for the Administrator
2 General Luna, Iloilo.

The Clerk of Court


Iloilo, Iloilo
21 | P a g e
Sir:

Please include the foregoing petition for adjudication in the calendar for Saturday, February 8, 1936.

(Sgd.) FRANCISCO S. HORTILLAS

A TRUE COPY:

(Sgd.) TELESFORO GEDANG


Deputy Clerk of Court
17th Judicial District
Iloilo, P.I.

ESTADOS UNIDOS DE AMERICA


COMMONWEALTH DE FILIPINAS
JUZGADO DE PRIMERA INSTANCIA DE ILOILO
17.0 DISTRITO JUDICIAL

TESTAMENTARIA GONZAGA

Expediente No. 2163

AUTO

Previa prestacion por Luis Gonzaga y Jesena de una fianza por valor de P1,000.00 que tendra por
objecto responder al resultado de la causa civil No. 10321 de este Juzgado, titulada "Consolacion G. de
Lopez, et al., demandantes, contra Luis Gonzaga", se aprueba la cuenta final de fecha enero 29, 1936,
asi como el proyecto de particion de fecha 3 del actual. Queda cancelada la fianza prestada por el
administrador en este expediente, y archivado el mismo por terminado.

Asi se ordena.

Iloilo, Iloilo, febrero 8, 1936.

M. BUYSON LAMPA
Juez

A TRUE COPY:

(Sgd.) TELESFORO GEDANG


Deputy Clerk of Court
17th Judicial District
Iloilo, P. I.

ESTADOS UNIDOS DE AMERICA


MANCOMUNIDAD DE FILIPINAS
JUZGADO DE PRIMERA INSTANCIA DE
NEGROS OCCIDENTAL

22 | P a g e
18.o Distrito Judicial

Expediente Cadastral No. 26


G.L.R.O. Cad Rec.
EL GOBIERNO DE LAS ISLAS
No. 214
FILIPINAS
Lotes Nos. 414 y424
Solicitante.
CATASTRO DE MANAPLA
x--------------------x

AUTO

Vista la peticion del solicitante Sr. Luiz Gonzaga y Jesena, de fecha 11 de marzo de 1936, el Juzgado,
hallando de misma bien fundada;

Por el presente, ordena la cancelacion de los certificados de transferencia de titulo Nos. 11460 y 13855,
sobre los lotes Nos. 414 y 424, respectivamente, del Catastro de Manapla, Negros Occidental, y la
expedicion de otros a favor de Luis Gonzaga y Jesena, filipino, mayor de edad, soltero y vecino de la
ciuda de Manila, I.F., haciendos constar en los certificados que se han de expedir todos los gravamenes
que existen el los certificados de transferencia Nos. 11460 y 13855.

Asi se ordena.
Bacolod, Occ. Negros, 21 de marzo, 1936.

(FDO.) BRAULIO BAJASA


Juez

ESTADOS UNIDOS DE AMERICA


MANCOMUNIDAD DE FILIPINAS
JUZGADO DE PRIMERA INSTANCIA
DE NEGROS OCCIDENTAL
18.o Distrito Judicial

EL GOBIERNO DE LAS Exp. de Reg. No. 72


ISLAS FILIPINAS, G.L.R.O. Rec. No. 10822
Solicitante, Lote No. 313
LUIS GONZAGA Y JESENA, MANAPLA
Mocionante.
x----------------x

AUTO

Vista y considerada la motion del solicitante Luis Gonzaga y Jesena, de Fecha 11 de marzo de 1936, el
Juzgado, hallando la misma bien fundada;

Por el presents, ordena la cancelacion del certificado de transferencia de titulo No. 8422 sobre el Lote
No. 313 del catastro de Manapla, Negros Occidental, y la expedicion de otro a favor de Luis Gonzaga y
Jesena, filipino, mayor de edad; soltero y vecino de la ciudad de Manila. I.F., haciendose constar en al
certificado que se ha de expedir todos los gravamente que existen en al certificado de transferencia

23 | P a g e
cancelado, se tuviere alguno.

Asi se ordena.

Bacolod, Occidental Negros, 21 de Marzo, 1936.

(Sgd.) BRAULIO BEJASA


Juez

BB/spm.
Received the foregoing document at 9:00 A.M. on May 7, 1936,and registered under Act 496 as
follows:
Day Book, Vol. 6, Entry No. 49684
Inscribed on pages 101 of Book Vol. 87 of Transfer Certificate of Title as Certificate of 21151.
Bacolod, Occ. Negros, May 7, 1936

(Sgd.) MARIANO COREOVA


Register of Deeds

ESTADOS UNIDOS DE AMERICA


MANCOMUNIDAD DE FILIPINAS
JUZGADO DE PRIMERA INSTANCIA DE ILOILO
17.o Distrito Judicial

G.L.R.O. RECORD NO. 9959


LOTES NOS. 1129-B y 1129-C
SITUADO EN EL MUNICIPIO DE
JARO
x----------------x

AUTO

Vista la peticion de Luis Gonzaga y Jesena cancelacion de los Certificados de Transferencia de titulo
numeros 10051 y 13054 por las razones expuestas en la misma, y encontrando el Juzgado la misma
bien fundada, por la presente ordena el Registrado de Titulos de la Provincial del Iloilo cancela los
Certificados de Transferencia de Titulos numeros 10051 y 13054 y expiden otros en su lugar a nombre
de Luis Gonzaga y Jesen soltero, mayor de edad, filipino y vecino de Manila, P.I.

Asi se ordena.
Iloilo, Iloilo, Marzo 25, 1936

M. BUYSON LAMP
Juez

As a witness, the defendant's counsel, Atty. Amelia del Rosario, testified that the aforequoted records
of the probate court of Iloilo were discovered by her among the records of the cadastral court in Negros
Occidental.

24 | P a g e
Due to the destruction of the court and property record of Iloilo as a result of the last war, as attested by
the Clerk of Court, no will or probate order was produce and neither were attested copies registered
with the Office of the Register of Deeds of Negros Occidental leave little room for doubt that Doña
Soledad Gonzaga died leaving a will instituting her nephew the appellee Luis Gonzaga y Jesena, as her
sole testamentary heir, in default forced heirs; that said will was duly probated in 1935 or 1936 by the
Court of First Instance of Iloilo in its Special Proceedings No. 2163; that the net residue of the estate
was adjudicated by the court of said appellee, subject to a claim of Consolacion G. de Lopez for
P1,000.00 (Exh. 2); and that, thereafter, upon sworn petition of appellee, through his counsel, Francisco
S. Hortillas, the Court First Instance of Iloilo (Exhibit 22) and Occidental Negros (Exhibit 3) ordered
the respective Provincial Registers of Deeds to cancel the Certificates of Title standing then in the name
of the deceased Soledad Gonzaga and lieu thereof to issue new certificates in the name of apellee Luis
Gonzaga y Jesena, as admittedly was done. In the course of the years prior to the institution of this case
in 1958, appellee held the properties and dealt with them as sole owner, leasing, encumbering, and
selling some them.

We can not fail to be impressed by the statement of attorney Francisco Hortillas, averring under with in
clear and unmistakable terms, not only once, but twice before the Courts of First Instance of Iloilo and
Negros (Exhibits 1 and 9), that the deceased Doña Soledad, in her probated will, made Luis Gonzaga y
Jesena the sole heir to her properties. These manifestations are nigh conclusive, for the reason that
attorney Hortillas was himself married to Monserrat Gonzaga, a sister of Soledad, who would have
been one of the latter's heirs intestate had it not been for the testament in favor of the appellee. It taxes
credulity beyond all reason to imply (as appellants do) that attorney Hortillas, violating family ties and
affection, conspired with appellee to deprive his own wife and children (now some of the present
appellants) of the lawful share by intestacy in the properties left by Doña Soledad if it were untrue that
the latter had duly and properly bequeathed all her estate to appellee Luis Gonzaga. The authenticity of
the sworn petitions of the late attorney Hortillas (Exhibits a and 1) are not impugned, and they were
actually acted upon and granted by the two courts of first instance to which he addressed his petitions.

Coupled with his undoubted possession as owner and with his own dominical acts exercised over the
former properties of Doña Soledad Gonzaga for twenty-two years (1936-1958), the exhibits
aforementioned constitute practically conclusive proof of the truth of appellee's defenses, as found by
the court below, despite the destruction of the original will and decree of probate.

Plaintiffs-appellants, however, assail the trial court is admission of the said court records on the ground
that defendant-appellee failed to lay proper basis, or predicate, for their admission. Granting that the
original will was destroyed with the court records in the last war, it is averred that appellee was duty-
bound to produce the copy that, according to appellee's deposition, was in the custody of Encarnacion
Gonzaga, as well as that left with attorney Hortillas. The argument is misleading. There is no proof that
copies of the will ever existed other than the one burned while in appellee's possession (Dep. p. 23).
Page 24 of the appellee's deposition is to the effect that —

My sister Encarnacion had the custody of the will because she was the one who was at the beside of my
sister (referring to the testatrix Doña Soledad);

but by "the will" was obviously meant the one signed by the testatrix and the witnesses, not a copy.

Similarly, the witness was asked,

25 | P a g e
When you filed this petition through your lawyer for the probate of the will, am I correct that you also
presented a copy of the will?;

to which question the witness answered,

The original was the one submitted.

From this answer, it certainly can not be inferred that Attorney Hortillas kept a copy of the original
submitted to the court.

Neither do we see that appellee was bound to call, or, account, for the witnesses to the testament. He
was not trying to show that the will complied with the statutory requirements, but that the will had been
admitted to probate and of course, the probate decree conclusively established the due execution.

Appellants contend that if it were true that the will constituted Luis Gonzaga as sole heir, he had no
need to ask the court for an order of adjudication. There is no merit to this contention. The order of
adjudication is the judicial recognition that in appointing Luis as her only heir the testatrix did not
contravene the law, and that the heir was in no way disqualified to inherit; just as a final order
admitting a will to probate concludes all and sundry from thereafter contending that statutory formal
requirements have not been observed in executing the testament. Instead of contradicting the
testamentary institution of heir, the order of adjudication confirms it in this case. It may well be noted,
in passing, that the order of February 8, 1936 (Exhibit 1 or B) speaks of approval of a "project of
partition", while the petition of January 29, 1936 referred to therein spoke of an order of adjudication to
a single heir. Since the order made evident reference to the petition of January 29, we agree with the
court below that the difference in terminology was an inadvertent mistake. Anyway, appellants do not
claim under the will or the partition; their theory is that Doña Soledad Gonzaga died intestate.

The failure of the defendant, Luis Gonzaga, to file with the Register of Deeds a certified copy of his
letters of administration and the will, as provided in Section 90 of Act 496, and to record the attested
copies of the will and of the allowance thereof by the court under Section 624 of Act 190, does not
negate the validity of the judgment or decree of probate nor the rights of the devisee under the will.
Section 90 of Act 496 refers to the dealings with registered lands by an executor or administrator; and
while Luis Gonzaga was an administrator, this is beside the point, because his dealings with the lands,
if any, during his tenure as an administrator are not here in question. That the defendant sought judicial
orders to effect the transfers to his name of the certificates of title after the will was probated, and
succeeded in having them so transferred, are not "dealings" with the property as administrator under
section 90 of the Registration Act. The defendant sought and obtained the change in title in his own
behalf and capacity. Although the step taken is not exactly what Section 624 of Act 190 directs, the
same purpose was achieved — that of notice to all strangers of the cause and nature of the transfers;
and it does not appear that anyone was prejudiced by the defect in registration complained of. At any
rate, the recording of the judicial orders sufficed as notice to interested parties, and was substantial
compliance with the required recording of the will itself. No one faced by the recorded documents
could ignore the reference therein to the probated testament; and the rule is that knowledge of what
might have been revealed by proper inquiry is imputable to the inquirer (cf. Emas vs. De Zuzuarregui,
53 Phil. 197, 204).

As to the fact that Luis Gonzaga paid the inheritance taxes, since by law, no delivery of properties can
be made importance. It is usual for an Administrator to pay these taxes, since by law, no delivery of

26 | P a g e
properties can be made to the heirs until and unless the inheritance taxes are paid [Internal Revenue
Code, section 95 (c)].

The contention that defendant-appellee, having been appointed Administrator, must be deemed a
trustee up to the present is infantile. In the first place, no administration could continue to exist after the
order of February 8, 1936 had approved the final account, adjudicate the property to the only heir,
cancelled the bond of the administrator, and ordered the case "archivado el mismo por terminado". No
proof exists that the proceedings were reopened. Secondly, the transfer of the certificates title to Luis
Gonzaga's own name in 1936 would constitute an open and clear repudiation of any trust, and the lapse
of more than twenty years' open and adverse possession as owner would certainly suffice to vest title by
prescription in the appellee, since appellants, who knew of the death of Doña Soledad in 1935, never
made any move to require Luis to reconvey the property, or any part thereof. The explanation that Doña
Soledad Gonzaga had express the wish that all the income should go to Luis while conducted
experimental studies on coconut products wholly unconvincing as an excuse for the laches; his right to
the income could not have blocked a partition of capital assets among appellants, if they had been at
entitled to them.

That some of the plaintiffs were denied their day in court is incredible, since all the plaintiffs were
represented by counsel Vicente Delfin, who claimed, and is presumed, to have been authorized to
appear in their behalf, and did appear for them from the inception of the case after the lower court's
decision was rendered. The authority of said counsel was never questioned until the verse decision was
rendered by the court below; and complainant's failure to appear by themselves, or by counsel, prior to
the judgment is mute but eloquent proof that their allegation that Delfin was not their attorney but a last
minute attempt to escape the adverse effect the appealed decision, a maneuver that deserves no
consideration.

Coming to the defendants' appeal: It is grounded the disallowance of attorney's fees, expense, and
moral damages. The lower court granted only P1,000.00 for attorney's fees, but the defendants urge that
the amount should be P41,000.00, based on an agreement of P1,000.00 Plus 10% of the value of the
properties if the case is decided in their favor. The other expenses refer to transportation, board and
lodging, stenographic notes, photostatic copies of exhibits, securing documents, and taking of
deposition in the sum of P1,205.00. Moral damages asked is P100,000.00.

The award of attorney's fees against the adverse party is essentially discretionary with the trial court
(Francisco vs. GSIS, L-18287, 30 March 1963), and, in the absence of an abuse of discretion, the same
should not be disturbed. The other expenses, unless recoverable as judicial costs, cannot be allowed
because the complaint, although unmeritorious, is not clearly unfounded; moral damages, likewise, are
not allowable because the suit is not a malicious prosecution under No. 8 of Article 2219 of the Civil
Code. The issue is one primarily addressed to the discretion of the court below, which we are not
inclined to disturb.

FOR THE FOREGOING REASONS, the appealed decision is hereby affirmed, with costs against the
plaintiffs-appellants.

Bengzon, C.J., Padilla, Bautista Angelo, Labrador, Concepcion, Barrera, Paredes, Dizon, Regala and
Makalintal, JJ., concur.

27 | P a g e
NO CASE DIGEST

Republic of the Philippines


SUPREME COURT
Manila

FIRST DIVISION
28 | P a g e
G.R. No. L-40502 November 29, 1976

VIRGINIA GARCIA FULE, and HONORABLE SEVERO A. MALVAR, Presiding Judge,


Court of First Instance of Laguna, Branch Vl, petitioners,
vs.
THE HONORABLE COURT OF APPEALS, * PRECIOSA B. GARCIA and AGUSTINA B.
GARCIA, respondents.

G.R. No. L-42670 November 29, 1976

VIRGINIA GARCIA FULE, petitioner,


vs.
HONORABLE ERNANI C. PAÑO, Presiding Judge of Court of First Instance of Rizal, Quezon
City, Branch XVIII, and PRECIOSA B. GARCIA, respondents.

Francisco Carreon for petitioners.

Augusto G. Gatmaytan for private respondents.

MARTIN, J.:

These two interrelated cases bring to Us the question of what the word "resides" in Section 1, Rule 73
of the Revised Rules Of Court, referring to the situs of the settlement of the estate of deceased persons,
means. Additionally, the rule in the appointment of a special administrator is sought to be reviewed.

On May 2, 1973, Virginia G. Fule filed with the Court of First Instance of Laguna, at Calamba,
presided over by Judge Severo A. Malvar, a petition for letters of administration, docketed as Sp. Proc.
No. 27-C, alleging, inter alia, "that on April 26, 1973, Amado G. Garcia, a property owner of Calamba,
Laguna, died intestate in the City of Manila, leaving real estate and personal properties in Calamba,
Laguna, and in other places, within the jurisdiction of the Honorable Court." At the same time, she
moved
ex parte for her appointment as special administratrix over the estate. On even date, May 2, 1973,
Judge Malvar granted the motion.

A motion for reconsideration was filed by Preciosa B. Garcia on May 8, 1973, contending that the order
appointing Virginia G. Fule as special administratrix was issued without jurisdiction, since no notice of
the petition for letters of administration has been served upon all persons interested in the estate; there
has been no delay or cause for delay in the proceedings for the appointment of a regular administrator
as the surviving spouse of Amado G. Garcia, she should be preferred in the appointment of a special
administratrix; and, Virginia G. Fule is a debtor of the estate of Amado G. Garcia. Preciosa B. Garcia,
therefore, prayed that she be appointed special administratrix of the estate, in lieu of Virginia G. Fule,
and as regular administratrix after due hearing.

While this reconsideration motion was pending resolution before the Court, Preciosa B. Garcia filed on
May 29, 1973 a motion to remove Virginia G. Fule as special administratrix alleging, besides the
jurisdictional ground raised in the motion for reconsideration of May 8, 1973 that her appointment was
obtained through erroneous, misleading and/or incomplete misrepresentations; that Virginia G. Fule has
29 | P a g e
adverse interest against the estate; and that she has shown herself unsuitable as administratrix and as
officer of the court.

In the meantime, the notice of hearing of the petition for letters of administration filed by Virginia G.
Fule with the Court of First Instance of Calamba, Laguna, was published on May 17, 24, and 31, 1973,
in the Bayanihan, a weekly publication of general circulation in Southern Luzon.

On June 6, 1973, Preciosa B. Garcia received a "Supplemental Petition for the Appointment of Regular
Administrator ' filed by Virginia G. Fule. This supplemental petition modified the original petition in
four aspects: (1) the allegation that during the lifetime of the deceased Amado G. Garcia, he was
elected as Constitutional Delegate for the First District of Laguna and his last place of residence was at
Calamba, Laguna; (2) the deletion of the names of Preciosa B. Garcia and Agustina Garcia as legal
heirs of Amado G. Garcia; (3) the allegation that Carolina Carpio, who was simply listed as heir in the
original petition, is the surviving spouse of Amado G. Garcia and that she has expressly renounced her
preferential right to the administration of the estate in favor of Virginia G. Fule; and (4) that Virginia G.
Fule be appointed as the regular administratrix. The admission of this supplemental petition was
opposed by Preciosa B. Garcia for the reason, among others, that it attempts to confer jurisdiction on
the Court of First Instance of Laguna, of which the court was not possessed at the beginning because
the original petition was deficient.

On July 19, 1973, Preciosa B. Garcia filed an opposition to the original and supplemental petitions for
letters of administration, raising the issues of jurisdiction, venue, lack of interest of Virginia G. Fule in
the estate of Amado G. Garcia, and disqualification of Virginia G Fule as special administratrix.

An omnibus motion was filed by Virginia G. Fule on August 20, 1973, praying for authority to take
possession of properties of the decedent allegedly in the hands of third persons as well as to secure cash
advances from the Calamba Sugar Planters Cooperative Marketing Association, Inc. Preciosa B. Garcia
opposed the motion, calling attention to the limitation made by Judge Malvar on the power of the
special administratrix, viz., "to making an inventory of the personal and real properties making up the
state of the deceased."

However, by July 2, 1973, Judge Malvar and already issued an order, received by Preciosa B. Garcia
only on July 31, 1973, denying the motion of Preciosa B. Garcia to reconsider the order of May 2,
1973, appointing Virginia G. Fule as special administratrix, and admitting the supplementation petition
of May 18,1973.

On August 31, 1973, Preciosa B. Garcia moved to dismiss the petition, because (1) jurisdiction over the
petition or over the parties in interest has not been acquired by the court; (2) venue was improperly laid;
and (3) Virginia G. Fule is not a party in interest as she is not entitled to inherit from the deceased
Amado G. Garcia.

On September 28, 1973, Preciosa B. Garcia filed a supplemental motion to substitute Virginia G. Fule
as special administratrix, reasoning that the said Virginia G. Fule admitted before before the court that
she is a full-blooded sister of Pablo G. Alcalde, an illegitimate son of Andrea Alcalde, with whom the
deceased Amado G. Garcia has no relation.

Three motions were filed by Preciosa B. Garcia on November 14, 1973, one, to enjoin the special
administratrix from taking possession of properties in the hands of third persons which have not been
determined as belonging to Amado G. Garcia; another, to remove the special administratrix for acting
30 | P a g e
outside her authority and against the interest of the estate; and still another, filed in behalf of the minor
Agustina B. Garcia, to dismiss the petition for want of cause of action, jurisdiction, and improper
venue.

On November 28, 1973, Judge Malvar resolved the pending omnibus motion of Virgina G. Fule and the
motion to dismiss filed by Preciosa B. Garcia. Resolving the motion to dismiss, Judge Malvar ruled that
the powers of the special administratrix are those provided for in Section 2, Rule 80 of the Rules of
Court, 1subject only to the previous qualification made by the court that the administration of the
properties subject of the marketing agreement with the Canlubang Sugar Planters Cooperative
Marketing Association should remain with the latter; and that the special administratrix had already
been authorized in a previous order of August 20, 1973 to take custody and possession of all papers and
certificates of title and personal effects of the decedent with the Canlubang Sugar Planters Cooperative
Marketing Association, Inc. Ramon Mercado, of the Canlubang Sugar Planters Cooperative Marketing
Association, Inc., was ordered to deliver to Preciosa B. Garcia all certificates of title in her name
without any qualifying words like "married to Amado Garcia" does not appear. Regarding the motion
to dismiss, Judge Malvar ruled that the issue of jurisdiction had already been resolved in the order of
July 2, 1973, denying Preciosa B. Garcia's motion to reconsider the appointment of Virginia G. Fule
and admitting the supplemental petition, the failure of Virginia G. Fule to allege in her original petition
for letters of administration in the place of residence of the decedent at the time of his death was cured.
Judge Malvar further held that Preciosa B. Garcia had submitted to the jurisdiction of the court and had
waived her objections thereto by praying to be appointed as special and regular administratrix of the
estate.

An omnibus motion was filed by Preciosa B. Garcia on December 27, 1973 to clarify or reconsider the
foregoing order of Judge Malvar, in view of previous court order limiting the authority of the special
administratrix to the making of an inventory. Preciosa B. Garcia also asked for the resolution of her
motion to dismiss the petitions for lack of cause of action, and also that filed in behalf of Agustina B.
Garcia. Resolution of her motions to substitute and remove the special administratrix was likewise
prayed for.

On December 19, 1973, Judge Malvar issued two separate orders, the first, denying Preciosa B.
Garcia's motions to substitute and remove the special administratrix, and the second, holding that the
power allowed the special administratrix enables her to conduct and submit an inventory of the assets
of the estate.

On January 7, 1974, Preciosa B. Garcia moved for reconsideration of the foregoing orders of November
28, 1973 and December 19, 1973, insofar as they sustained or failed to rule on the issues raised by her:
(a) legal standing (cause of action) of Virginia G. Fule; (b) venue; (c) jurisdiction; (d) appointment,
qualification and removal of special administratrix; and (e) delivery to the special administratrix of
checks and papers and effects in the office of the Calamba Sugar Planters Cooperative Marketing
Association, Inc.

On March 27, 1973, Judge Malvar issued the first questioned order denying Preciosa B. Garcia's
motion for reconsideration of January 7, 1974. On July 19, 1974, Judge Malvar issued the other three
questioned orders: one, directing Ramon Mercado, of the Calamba Sugar Planters Cooperative
Marketing Association, Inc., to furnish Virginia G. Fule, as special administratrix, copy of the
statement of accounts and final liquidation of sugar pool, as well as to deliver to her the corresponding
amount due the estate; another, directing Preciosa B. Garcia to deliver to Virginia G. Fule two motor
vehicles presumably belonging to the estate; and another, directing Ramon Mercado to deliver to the
31 | P a g e
court all certificates of title in his possession in the name of Preciosa B. Garcia, whether qualified with
the word "single" or "married to Amado Garcia."

During the hearing of the various incidents of this case (Sp. Proc. 27-C) before Judge
Malvar, 2 Virginia G. Fule presented the death certificate of Amado G. Garcia showing that his
residence at the time of his death was Quezon City. On her part, Preciosa B. Garcia presented the
residence certificate of the decedent for 1973 showing that three months before his death his residence
was in Quezon City. Virginia G. Fule also testified that Amado G. Garcia was residing in Calamba,
Laguna at the time of his death, and that he was a delegate to the 1971 Constitutional Convention for
the first district of Laguna.

On July 26, 1974, Preciosa B. Garcia and Agustina B. Garcia commenced a special action for certiorari
and/or prohibition and preliminary injunction before the Court of Appeals, docketed as CA-G.R. No.
03221-SP. primarily to annul the proceedings before Judge Malvar in Sp. Proc. No. 27-C of the Court
of First Instance of Laguna, or, in the alternative, to vacate the questioned four orders of that court, viz.,
one dated March 27, 1974, denying their motion for reconsideration of the order denying their motion
to dismiss the criminal and supplemental petitions on the issue, among others, of jurisdiction, and the
three others, all dated July 19, 1974, directing the delivery of certain properties to the special
administratrix, Virginia G. Fule, and to the court.

On January 30, 1975, the Court of Appeals rendered judgment annulling the proceedings before Judge
Severo A. Malvar in Sp. Proc. 27-C of the Court of First Instance of Calamba, Laguna, for lack of
jurisdiction.

Denied of their motion for reconsideration on March 31, 1975, Virginia G. Fule forthwith elevated the
matter to Us on appeal by certiorari. The case was docketed as G.R. No. L-40502.

However, even before Virginia G. Fule could receive the decision of the Court of Appeals, Preciosa B.
Garcia had already filed on February 1, 1975 a petition for letters of administration before the Court of
First Instance of Rizal, Quezon City Branch, docketed as Sp. Proc. No. Q-19738, over the same
intestate estate of Amado G. Garcia. On February 10, 1975, Preciosa B. Garcia urgently moved for her
appointment as special administratrix of the estate. Judge Vicente G. Ericta granted the motion and
appointed Preciosa B. Garcia as special administratrix upon a bond of P30,000.00. Preciosa B. Garcia
qualified and assumed the office.

For the first time, on February 14, 1975, Preciosa B. Garcia informed Judge Ericta of the pendency of
Sp. Proc. No. 27-C before Judge Malvar of the Court of First Instance of Laguna, and the annulment of
the proceedings therein by the Court of Appeals on January 30, 1975. She manifested, however, her
willingness to withdraw Sp. Proc. Q-19738 should the decision of the Court of Appeals annulling the
proceedings before the Court of First Instance of Laguna in Sp. Proc. No. 27-C have not yet become
final, it being the subject of a motion for reconsideration.

On March 10, 1973, Judge Ericta ordered the suspension of the proceedings before his court until
Preciosa B. Garcia inform the court of the final outcome of the case pending before the Court of
Appeals. This notwithstanding, Preciosa B. Garcia filed on December 11, 1975, an "Urgent Petition for
Authority to Pay Estate Obligations."

On December 13, 1975, Virginia G. Fule filed a "Special Appearance to Question Venue and
Jurisdiction" reiterating the grounds stated in the previous special appearance of March 3, 1975, and
32 | P a g e
calling attention that the decision of the Court of Appeals and its resolution denying the motion for
reconsideration had been appealed to this Court; that the parties had already filed their respective briefs;
and that the case is still pending before the Court.

On December 17, 1975, Judge Ernani Cruz Pano, who succeeded Judge Ericta, issued an order granting
Preciosa B. Garcia's "Urgent Petition for Authority to Pay Estate Obligations" in that the payments
were for the benefit of the estate and that there hangs a cloud of doubt on the validity of the
proceedings in Sp. Proc. No. 27-C of the Court of First Instance of Laguna.

A compliance of this Order was filed by Preciosa B. Garcia on January 12,1976.

On February 4,1974, VIRGINIA G. FULE instituted G.R. No. L-42670, a petition for certiorari with
temporary restraining order, to annul the proceedings in Sp. Proc. No. Q-19738 and to restrain Judge
Ernani Cruz Paño from further acting in the case. A restraining order was issued on February 9, 1976.

We dismiss the appeal in G.R. No. L-40502 and the petition for certiorari in G.R. No. L-42670 for the
reasons and considerations hereinafter stated.

1. Section 1, Rule 73 of the Revised Rules of Court provides: "If the decedent is an inhabitant of the
Philippines at the time of his death, whether a citizen or an alien, his will shall be proved, or letters of
administration granted, and his estate settled, in the Court of First Instance in the province in which he
resides at the time of his death, and if he is an inhabitant of a foreign country, the Court of First
Instance of any province in which he had estate. The court first taking cognizance of the settlement of
the estate of a decedent, shall exercise jurisdiction to the exclusion of all other courts. The jurisdiction
assumed by a court, so far as it depends on the place of residence of the decedent, or of the location of
his estate, shall not be contested in a suit or proceeding, except in an appeal from that court, in the
original case, or when the want of jurisdiction appears on the record." With particular regard to letters
of administration, Section 2, Rule 79 of the Revised Rules of Court demands that the petition therefor
should affirmatively show the existence of jurisdiction to make the appointment sought, and should
allege all the necessary facts, such as death, the name and last residence of the decedent, the existence,
and situs if need be, of assets, intestacy, where this is relied upon, and the right of the person who seeks
administration, as next of kin, creditor, or otherwise, to be appointed. The fact of death of the intestate
and his last residence within the country are foundation facts upon which all subsequent proceedings in
the administration of the estate rest, and that if the intestate was not an inhabitant of the state at the time
of his death, and left no assets in the state, no jurisdiction is conferred on the court to grant letters of
administration. 3

The aforequoted Section 1, Rule 73 (formerly Rule 75, Section 1), specifically the clause "so far as it
depends on the place of residence of the decedent, or of the location of the estate," is in reality a matter
of venue, as the caption of the Rule indicates: "Settlement of Estate of Deceased Persons. Venue and
Processes. 4 It could not have been intended to define the jurisdiction over the subject matter, because
such legal provision is contained in a law of procedure dealing merely with procedural matters.
Procedure is one thing; jurisdiction over the subject matter is another. The power or authority of the
court over the subject matter "existed and was fixed before procedure in a given cause began." That
power or authority is not altered or changed by procedure, which simply directs the manner in which
the power or authority shall be fully and justly exercised. There are cases though that if the power is not
exercised conformably with the provisions of the procedural law, purely, the court attempting to
exercise it loses the power to exercise it legally. However, this does not amount to a loss of jurisdiction
over the subject matter. Rather, it means that the court may thereby lose jurisdiction over the person or
33 | P a g e
that the judgment may thereby be rendered defective for lack of something essential to sustain it. The
appearance of this provision in the procedural law at once raises a strong presumption that it has
nothing to do with the jurisdiction of the court over the subject matter. In plain words, it is just a matter
of method, of convenience to the parties. 5

The Judiciary Act of 1948, as amended, confers upon Courts of First Instance jurisdiction over all
probate cases independently of the place of residence of the deceased. Because of the existence of
numerous Courts of First Instance in the country, the Rules of Court, however, purposedly fixes the
venue or the place where each case shall be brought. A fortiori, the place of residence of the deceased
in settlement of estates, probate of will, and issuance of letters of administration does not constitute an
element of jurisdiction over the subject matter. It is merely constitutive of venue. And it is upon this
reason that the Revised Rules of Court properly considers the province where the estate of a deceased
person shall be settled as "venue." 6

2. But, the far-ranging question is this: What does the term "resides" mean? Does it refer to the actual
residence or domicile of the decedent at the time of his death? We lay down the doctrinal rule that the
term "resides" connotes ex vi termini "actual residence" as distinguished from "legal residence or
domicile." This term "resides," like, the terms "residing" and "residence," is elastic and should be
interpreted in the light of the object or purpose of the statute or rule in which it is employed. 7 In the
application of venue statutes and rules — Section 1, Rule 73 of the Revised Rules of Court is of such
nature — residence rather than domicile is the significant factor. Even where the statute uses the word
"domicile" still it is construed as meaning residence and not domicile in the technical sense. Some cases
make a distinction between the terms "residence" and "domicile" but as generally used in statutes fixing
venue, the terms are synonymous, and convey the same meaning as the term "inhabitant." 8 In other
words, "resides" should be viewed or understood in its popular sense, meaning, the personal, actual or
physical habitation of a person, actual residence or place of abode. It signifies physical presence in a
place and actual stay thereat. In this popular sense, the term means merely residence, that is, personal
residence, not legal residence or domicile. 9Residence simply requires bodily presence as
an inhabitant in a given place, while domicile requires bodily presence in that place and also an
intention to make it one's domicile. 10 No particular length of time of residence is required though;
however, the residence must be more than temporary. 11

3. Divergent claims are maintained by Virginia G. Fule and Preciosa B. Garcia on the residence of the
deceased Amado G. Garcia at the time of his death. In her original petition for letters of administration
before the Court of First Instance of Calamba, Laguna, Virginia G. Fule measely stated "(t)hat on April
26,1973, Amado G. Garcia, a property owner of Calamba, Laguna, died intestate in the City of Manila,
leaving real estate and personal properties in Calamba, Laguna, and in other places within the
jurisdiction of this Honorable Court." Preciosa B. Garcia assailed the petition for failure to satisfy the
jurisdictional requirement and improper laying of venue. For her, the quoted statement avers no
domicile or residence of the deceased Amado G. Garcia. To say that as "property owner of Calamba,
Laguna," he also resides in Calamba, Laguna, is, according to her, non sequitur. On the contrary,
Preciosa B. Garcia claims that, as appearing in his death certificate presented by Virginia G. Fule
herself before the Calamba court and in other papers, the last residence of Amado G. Garcia was at 11
Carmel Avenue, Carmel Subdivision, Quezon City. Parenthetically, in her amended petition, Virginia
G. Fule categorically alleged that Amado G. Garcia's "last place of residence was at Calamba, Laguna."

On this issue, We rule that the last place of residence of the deceased Amado G. Garcia was at 11
Carmel Avenue, Carmel Subdivision, Quezon City, and not at Calamba, Laguna. A death certificate is
admissible to prove the residence of the decedent at the time of his death. 12 As it is, the death
34 | P a g e
certificate of Amado G. Garcia, which was presented in evidence by Virginia G. Fule herself and also
by Preciosa B. Garcia, shows that his last place of residence was at 11 Carmel Avenue, Carmel
Subdivision, Quezon City. Aside from this, the deceased's residence certificate for 1973 obtained three
months before his death; the Marketing Agreement and Power of Attorney dated November 12, 1971
turning over the administration of his two parcels of sugar land to the Calamba Sugar Planters
Cooperative Marketing Association, Inc.; the Deed of Donation dated January 8, 1973, transferring part
of his interest in certain parcels of land in Calamba, Laguna to Agustina B. Garcia; and certificates of
titles covering parcels of land in Calamba, Laguna, show in bold documents that Amado G. Garcia's
last place of residence was at Quezon City. Withal, the conclusion becomes imperative that the venue
for Virginia C. Fule's petition for letters of administration was improperly laid in the Court of First
Instance of Calamba, Laguna. Nevertheless, the long-settled rule is that objection to improper venue is
subject to waiver. Section 4, Rule 4 of the Revised Rules of Court states: "When improper venue is not
objected to in a motion to dismiss, it is deemed waived." In the case before Us the Court of Appeals had
reason to hold that in asking to substitute Virginia G. Fule as special administratrix, Preciosa B. Garcia
did not necessarily waive her objection to the jurisdiction or venue assumed by the Court of First
Instance of Calamba, Laguna, but availed of a mere practical resort to alternative remedy to assert her
rights as surviving spouse, while insisting on the enforcement of the Rule fixing the proper venue of the
proceedings at the last residence of the decedent.

4. Preciosa B. Garcia's challenge to Virginia G. Fule's appointment as special administratrix is another


issue of perplexity. Preciosa B. Garcia claims preference to the appointment as surviving spouse.
Section 1 of Rule 80 provides that "(w)hen there is delay in granting letters testamentary or of
administration by any cause including an appeal from the allowance or disallowance of a will, the court
may appoint a special administrator to take possession and charge of the estate of the deceased until
the questions causing the delay are decided and executors or administrators appointed. 13 Formerly, the
appointment of a special administrator was only proper when the allowance or disallowance of a will is
under appeal. The new Rules, however, broadened the basis for appointment and such appointment is
now allowed when there is delay in granting letters testamentary or administration by any cause e.g.,
parties cannot agree among themselves. 14 Nevertheless, the discretion to appoint a special
administrator or not lies in the probate court. 15 That, however, is no authority for the judge to become
partial, or to make his personal likes and dislikes prevail over, or his passions to rule, his judgment.
Exercise of that discretion must be based on reason, equity, justice and legal principle. There is no
reason why the same fundamental and legal principles governing the choice of a regular administrator
should not be taken into account in the appointment of a special administrator. 16 Nothing is wrong for
the judge to consider the order of preference in the appointment of a regular administrator in appointing
a special administrator. After all, the consideration that overrides all others in this respect is
the beneficial interest of the appointee in the estate of the decedent. 17 Under the law, the widow would
have the right of succession over a portion of the exclusive property of the decedent, besides her share
in the conjugal partnership. For such reason, she would have as such, if not more, interest in
administering the entire estate correctly than any other next of kin. The good or bad administration of a
property may affect rather the fruits than the naked ownership of a property. 18

Virginia G. Fule, however, disputes the status of Preciosa B. Garcia as the widow of the late Amado G.
Garcia. With equal force, Preciosa B. Garcia maintains that Virginia G. Fule has no relation whatsoever
with Amado G. Garcia, or that, she is a mere illegitimate sister of the latter, incapable of any
successional rights. 19 On this point, We rule that Preciosa B. Garcia is prima facie entitled to the
appointment of special administratrix. It needs be emphasized that in the issuance of such appointment,
which is but temporary and subsists only until a regular administrator is appointed, 20 the appointing
court does not determine who are entitled to share in the estate of the decedent but who is entitled to the
35 | P a g e
administration. The issue of heirship is one to be determined in the decree of distribution, and the
findings of the court on the relationship of the parties in the administration as to be the basis of
distribution. 21The preference of Preciosa B. Garcia is with sufficient reason. In a Donation Inter Vivos
executed by the deceased Amado G. Garcia on January 8, 1973 in favor of Agustina B. Garcia, he
indicated therein that he is married to Preciosa B. Garcia. 22 In his certificate of candidacy for the office
of Delegate to the Constitutional Convention for the First District of Laguna filed on September 1,
1970, he wrote therein the name of Preciosa B. Banaticla as his spouse. 23 Faced with these documents
and the presumption that a man and a woman deporting themselves as husband and wife have entered
into a lawful contract of marriage, Preciosa B. Garcia can be reasonably believed to be the surviving
spouse of the late Amado G. Garcia. Semper praesumitur pro matrimonio. 24

5. Under these circumstances and the doctrine laid down in Cuenco vs. Court of Appeals, 25 this Court
under its supervisory authority over all inferior courts may properly decree that venue in the instant
case was properly assumed by and transferred to Quezon City and that it is in the interest of justice and
avoidance of needless delay that the Quezon City court's exercise of jurisdiction over the settlement of
the estate of the deceased Amado G. Garcia and the appointment of special administratrix over the
latter's estate be approved and authorized and the Court of First Instance of Laguna be disauthorized
from continuing with the case and instead be required to transfer all the records thereof to the Court of
First Instance of Quezon City for the continuation of the proceedings.

6. Accordingly, the Order of Judge Ernani Cruz Pano of December 17, 1975, granting the "Urgent
Petition for Authority to Pay Estate Obligations" filed by Preciosa B. Garcia in Sp. Proc. No. Q-19738,
subject matter of G.R. No. L-42670, and ordering the Canlubang Sugar Estate to deliver to her as
special administratrix the sum of P48,874.70 for payment of the sum of estate obligations is hereby
upheld.

IN VIEW OF THE FOREGOING, the petitions of petitioner Virginia Garcia Fule in G.R. No. L-40502
and in G.R. No. L42670 are hereby denied, with costs against petitioner.

SO ORDERED. Teehankee (Chairman), Makasiar, Aquino and Concepcion, Jr., JJ., concur.

Muñoz Palma, J., took no part.

DIGEST

FACTS:

Virginia G. Fule (illegitimate sister) filed with the CFI of Laguna a petition for letters of administration
alleging “that on April 26, 1973, Amado G. Garcia, a property owner of Calamba, Laguna, died
36 | P a g e
intestate in the City of Manila, leaving real estate and personal properties in Calamba, Laguna, and in
other places, within the jurisdiction of the Honorable Court.” At the same time, she moved ex parte for
her appointment as special administratix over the estate. Judge Malvar granted the motion.

A motion for reconsideration was filed by Preciosa B. Garcia, the surviving spouse of the deceased,
contending that

1) The decedent “resided” in QC for 3 months before his death as shown by his death certificate
and therefore have an improper venue.

2) The CFI of Calamba lacks jurisdiction over the petition.

CFI denied the motion.

CA reversed and affirmed making Preciosa the administratix.

Thus, Fule elevated the matter to the SC on appeal by certiorari.

ISSUES:

a.) Are venue and jurisdiction the same? How can it be determined in the present case?

b.) What does the word “resides” in Revised Rules of Court Rule 73 Section 1 Mean?

c.) Who is entitled as special administratix of the estate?

HELD:

No, jurisdiction is defined as the authority to try, hear and decide a case base on the merits or the
substance of the facts. It is a substantive aspect of the trial proceeding. It is granted by law or by the
constitution and cannot be waived or stipulated.

On the other hand, Rule 4 of Rules of Court define venue as the proper court which has jurisdiction
over the area wherein real property involved or a portion thereof is situated. Venue is the location of the
court with jurisdiction. It is more on convenience purposes. It’s more on procedural aspect of the case.
In some cases it may be waived or stipulated by the parties.

Section 1, Rule 73 of the Revised Rules of Court provides: “If the decedent is an inhabitant of the
Philippines at the time of his death, whether a citizen or an alien, his will shall be proved, or letters of
administration granted, and his estate settled, in the Court of First Instance in the province in which he
resides at the time of his death, and if he is an inhabitant of a foreign country, the Court of First
Instance of any province in which he had estate.

37 | P a g e
“Resides” should be viewed or understood in its popular sense, meaning, the personal, actual or
physical habitation of a person, actual residence or place of abode. It signifies physical presence in a
place and actual stay thereat. In this popular sense, the term means merely residence, that is, personal
residence, not legal residence or domicile. Residence simply requires bodily presence as an inhabitant
in a given place, while domicile requires bodily presence in that place and also an intention to make it
one’s domicile. No particular length of time of residence is required though; however, the residence
must be more than temporary.

In the present case, SC ruled that the last place of residence of the deceased should be the venue of the
court. Amado G. Garcia was in Quezon City, and not at Calamba, Laguna base on his death certificate.
A death certificate is admissible to prove the residence of the decedent at the time of his death.

Withal, the conclusion becomes imperative that the venue for Virginia C. Fule’s petition for letters of
administration was improperly laid in the Court of First Instance of Calamba, Laguna. Therefore
Preciosa B. Garcia was granted as a special administratix.

Republic of the Philippines


SUPREME COURT
Manila

FIRST DIVISION

G.R. No. L-48585 March 3, 1980


38 | P a g e
FELICIANO DE GUZMAN, petitioner,
vs.
THE HONORABLE TEOFILO GUADIZ, JR., Judge of the Court of First Instance of Nueva
Ecija, Branch V, Gapan, and JULIAN VILLEGAS, NATIVIDAD VILLEGAS, GEMINIANO
VILLEGAS, CESAR VILLEGAS, MAXIMO MATIAS, ROSARIO VILLEGAS MATIAS, ANA
MARIE V. MATIAS, and LOURDES V. MATIAS, respondents.

C. C. Paralejo for petitioner.

A.R. Reyes respondents.

FERNANDEZ, J.:

This is a petition for certiorari instituted b Feliciano de Guzman against Honorable Teofilo Guadiz, Jr.
Judge of the Court of First Instance of Nueva Ecija, Branch V, Gapan, and Julian Villegas, Natividad
Villegas, Geminiano Villegas, Cesar Villegas, Maximo Matias, Rosario Villegas Matias, Ana Marie V.
Matias, and Lourdes V. Matias, seeking the following relief.

WHEREFORE, petitioner most respectively prays:

a) That respondents be ordered to answer this petition;

b) That after hearing the Order of respondent Judge dated December 23, 1977 denying
petitioner's Motion for Appointment of a Special Administrator and consequently, the
Order dated July 15, 1978 denying petitioners Motion for Reconsideration be annulled
and that said respondent Judge be declared to have committed a grave abuse of
discretion amounting to lack or excess of jurisdiction in refusing the appointment of the
Special Administrator;

c) That respondent Judge be directed to appoint a Special Administrator pending the


probate of the Last Will of Catalina Bajacan.

Petitioner respectfully prays for such other relief just and equitable in the premises.

Manila, Philippines, August 14, 1978. 1

On August 31, 1978, without giving due course to the instant petition, this Court adopted a resolution
directing the respondents to comment thereon within ten (10) days from notice thereof. 2

The respondents filed on October 10, 1978 their comment dated October 9, 1978. 3

Meanwhile, on September 29, 1978, the petitioner submitted a Constancia manifesting that the
respondent judge cancelled the hearing on the petition for probate of the will scheduled on September
20, 1978 "pending the outcome of the case before the Supreme Court." 4

On October 18. 1978, this Court resolved: a) to GIVE DUE COURSE to the petition; and b) to
REQUIRE (1) the petitioner to deposit P80.40 for costs and clerk's commission within five (5) days
39 | P a g e
from notice thereof, and (2) both parties to submit simultaneous memoranda within thirty (30) days
from notice thereof. 5

Both petitioner and respondents having filed their respective memoranda, 6 on December 6, 1978, this
Court resolved to declare this case submitted for decision. 7

The record discloses that on March 16, 1977, the petitioner filed a petition with the Court of First
Instance of Nueva Ecija, Branch V, Gapan, docketed as Special Proceeding No. 865 8 for the probate of
a will alleged to have been executed by one Catalina Bajacan instituting the herein petitioner as sole
and universal heir and naming him as executor; that Catalina Bajacan died on February 3, 1977; that on
May 10, 1977, the private respondents filed a motion to dismiss and/or opposition contending, among
others, that all the real properties of Catalina Bajacan are now owned by them by virtue of a Deed of
Donation Intervivos executed on June 19, 1972 by Arcadia Bajacan and Catalina Bajacan in their
favor; 9 that on September 30, 1977, the respondent judge resolved to defer resolution on the said
motion to dismiss until the parties shall have presented their evidence; 10 that a motion for the
appointment of a special administrator 11 was filed by the petitioner on September 23, 1977 alleging
that the unresolved motion to dismiss would necessarily delay the probate of the will and the
appointment of an executor; that the decedent's estate consists of eighty (80) hectares of first class
agricultural rice land, more or less, yielding fifty thousand pesos (P50,000.00) worth of rice harvested
twice a year; that somebody representing the estate should collect and receive the palay harvests
pending the probate of the will; that on December 23, 1977, the respondent judge issued an order
denying the motion for appointment of a special administrator, the pertinent portion of which reads:

The appointment of a special administrator is predicated on the necessity of enabling


somebody to take care of the properties where there is a considerable delay in the
appointment of a regular administrator. In the present case, since the properties covered
by the will are undoubtedly in the possession of the oppositors who claim to be the
owners thereof, the Court sees no necessity of appointing a special administrator.

WHEREFORE, in view of the foregoing, the Court hereby denies the motion for the
appointment of a special administrator filed by the petitioner dated September 22, 1977
... 12

that on June 5, 1978, the petitioner filed a motion for reconsideration of the order dated December 23,
1977 13 ; that said motion was also denied by the respondent judge in an order dated June 9, 1978 which
states:

In a motion for reconsideration filed by the petitioner on June 5, 1978 praying for a
reconsideration of the Order dated Dec. 23, 1977, which denied the motion for
appointment of a Special Administrator filed by him, it is alleged that the Court made a
premature determination of ownership and possession of the oppositors over the
properties of the estate of Catalina Bajacan. This assertion is not accurate. What the
Court merely stated in said Order is that the oppositors, who claim to be the owners, are
in possession of the properties covered by the Will.

WHEREFORE, in view of the foregoing, the Court hereby:

xxx xxx xxx

40 | P a g e
(b) denies the motion for reconsideration filed by petitioner on June 5, 1978. 14

The main issue in this case is whether the respondent judge presiding the Court of First Instance of
Nueva Ecija, Branch V. Gapan, acted with grave abuse of discretion amounting to lack or excess of
jurisdiction in issuing the order dated December 23, 1977 denying petitioner's motion for the
appointment of a special administrator and the order dated June 9, 1978, denying petitioner's motion for
reconsideration.

It is the petitioner's contention that the respondent judge acted with grave abuse of discretion
amounting to lack or excess of jurisdiction because the facts warrant the appointment of a special
administrator of the estate of Catalina Bajacan.

Rule 80, Sec. 1, of the Revised Rules of Court provides:

Section 1 — Appointment of Special Administrator — When there is delay in granting


letters testamentary or of administration by any cause including an appeal from the
allowance or disallowance of a will, the court may appoint a special administrator to
take possession and charge of the estate of the deceased until the questions causing the
delay are decided and executors or administrators appointed.

Under the above rule, the probate court may appoint a special administrator 15 should there be a delay in
granting letters testamentary or of administration occasioned by any cause including an appeal from the
allowance or disallowance of a will. Subject to this qualification, the appointment of a special
administrator lies in the discretion of the Court. 16 This discretion, however, must be sound, that is, not
whimsical, or Contrary to reason, justice, equity or legal principle. 17

The basis for appointing a special administrator under the Rules is broad enough to include any cause
or reason for the delay in granting letters testamentary or of administration as where a contest as to the
will is being carried on in the same or in another court, or where there is an appeal pending as to the
proceeding on the removal of an executor or administrator, or in cases where the parties cannot agree
among themselves. 18 Likewise, when from any cause general administration cannot be immediately
granted, a special administrator may be appointed to collect and preserve the property of the deceased.

It is obvious that the phrase "by any cause" includes those incidents which transpired in the instant case
clearly showing that there is a delay in the probate of the will and that the granting of letters
testamentary will consequently be prolonged necessitating the immediate appointment of a special
administrator.

The facts justifying the appointment of a special administrator are:

(1) Delay in the hearing of the petition for the probate of the win.

(2) The basis of the private respondents' claim to the estate of Catalina Bajacan and
opposition to the probate of the will is a deed of donation dated June 19, 1972 allegedly
executed by the deceased Catalina Bajacan and her late sister Arcadia Bajacan in their
favor. 19

There is an immediate need to file an action for the annulment of such deed of donation in behalf of the
estate. Precisely, the petitioner filed Civil Case No. 1080 in the Court of First Instance of Nueva Ecija
41 | P a g e
Branch V, against the herein private respondents. The case was dismissed by the respondent judge in an
order dated June 9, 1978 on the ground that the petitioner has no personality to file the action because
although he is named heir in the will, the said will is not yet probated. 20 In the meantime there is
nobody to sue in order to protect the interest of the estate considering that the probate of the will and
the appointment of an executor will take time.

Upon the filing of this petition, the respondent judge, on motion of the private respondents, postponed
the hearing of the probate of the will which was then scheduled on August 23, 1978 to September 20,
1978. Again, in view of the motion for reconsideration of the private respondents dated September 4,
1978, the respondent judge issued an order dated September 12, 1978, which in part reads: ... the
hearing of this case scheduled on September 20, 1978 is hereby cancelled pending the outcome of the
case before the Supreme Court. 21

The reasons for the appointment of a special administrator are:

The reason for the practice of appointing a special administrator rests in the fact that
estates of decedents frequently become involved in protracted litigation, thereby being
exposed to great waste and losses if there is no authorized agent to collect the debts and
preserve the assets in the interim. The occasion for such an appointment usually arises
where, for some cause, such as a pendency of a suit concerning the proof of the will,
regular administration is .delayed. No temporary administration can be granted where
there is an executor in being capable of acting, however. 22

Principal object of appointment of temporary administrator is to preserve estate until it


can pass into hands of person fully authorized to administer it for benefit of creditors
and heirs. 23

It appears that the estate the properties registered under the Torrens system in the name of the deceased
Catalina Bajacan consisting of eighty (80) hectares of first class agricultural land. It is claimed that
these 80 hectares produce P50,000.00 worth of palay each harvest twice a year. Obviously there is an
immediate need for a special administrator to protect the interests of the estate as regards the products.

All the facts which warrant the appointment of a special administrator in accordance with Rule 80, Sec.
1 of the Revised Rules of Court are present in the case at bar.

The respondent judge opined that there is no need for the appointment of a special administrator in this
case because the respondents are already in possession of the properties covered by the will. The
respondent judge has failed to distinguish between the partisan possession of litigants from that of the
neutral possession of the special administrator under the Rules of Court. When appointed, a special
administrator is regarded, not as a representative of the agent of the parties suggesting the appointment,
but as the administrator in charge of the estate, and in fact, as an officer of the court. 24 The
accountability which the court. which attaches to the office of a special administrator to be appointed
by the court is absent from the personal possession of private respondents.

The only way to test the validity of the alleged donation in favor of the private respondents is to appoint
a special adiu administrator who will have the personality to file the corresponding action. In view of
all the foregoing, respondent judge committed a grave abuse of discretion in denying the petitioner's
motion for appointment of a special administrator.

42 | P a g e
WHEREFORE, the petition for a writ of certiorari is hereby granted and the Order of the respondent
judge dated December 23, 1977, denying petitioner's motion for appointment of a special administrator
and the order dated June 9, ,978 denying the petitioner's motion for reconsideration are set aside. The
respondent judge is ordered forthwith to appointment a special administrator pending the probate of the
last will of Catalina Bajacan in Special Proceeding No. 865, without pronouncement as to costs.

SO ORDERED.

Teehankee A.C.J., Makasiar, Guerrero, De Castro and Melencio-Herrera, JJ., concur.

NO CASE DIGEST

Republic of the Philippines


SUPREME COURT
Manila

EN BANC

G.R. No. L-5436 June 30, 1953

43 | P a g e
ROMAN OZAETA, ROSA GONZALES VDA. DE PALANCA, JUSTO G. PALANCA,
LEONARDA PALANCA DE ARANAS, SEVERINA G. PALANCA, CARLOS PALANCA, JR.,
ANTONIO G. PALANCA, MACARIO G. PALANCA, MILAGROS PALANCA DE FURER,
and RAMON G. PALANCA, petitioners,
vs.
HONORABLE POTENCIANO PECSON, Judge of First Instance of Manila, and BANK OF
THE PHILIPPINE ISLANDS, respondents.

Roxas, Lichauco, Picazo and Manuel S. San Jose for petitioners.


Sebastian C. Palanca in his own behalf.
Sison, Arguego and Sison for investors.

LABRADOR, J.:

The question posed by the petition filed in this case is: Does a probate court commit an abuse of
discretion if, pending an appeal against its order or judgment admitting a will to probate and appointing
as judicial administrator the person named therein as executor, it appoints as special administrator any
person other than the executor named in the will?

The facts giving rise to the question may be briefly summarized as follows: Carlos Palanca died on
September 2, 1950; leaving a will executed by him on May 19, 1945. In the will petitioner Roman
Ozaeta, former associate justice of this Court, was named executor if General Manuel A. Roxas fails to
qualify. Upon Palanca's death, and General Roxas having died previously, petitioner presented a
petition for the probate of the will, at the same time praying that he be appointed special administrator.
Some of the heirs of the decedent opposed this petition, and the court on October 6, 1950, appointed the
Philippine Trust Company, a non-applicant and a stranger to the proceedings, special administrator. On
April 20, 1951, the Philippine Trust Company presented a petition to resign as special administrator on
the ground of incompatibility of interest, as it had granted a loan to heir Angel Palanca, who had
pledged to it shares of the Far Eastern University allegedly belonging to the estate of the deceased.
Thereupon petitioner reiterated his previous petition, but the court appointed Sebastian Palanca, one of
the heirs, to take the place of the Philippine Trust Company. The order is dated June 30, 1951. But on
October 23rd, the court rendered an order admitting the will to probate and appointing petitioner as
administrator. The order reads thus:

In view of all the foregoing, the court declares that the document which was executed by the
testator on May 19, 1945 (Exhibit D), is the last will of Carlos Palanca Tanguinlay, and its
probate is hereby allowed. The court appoints the petitioner, Roman Ozaeta, as executor, with a
bond of P50,000 with sufficient sureties and subject to the approval by this court. Once this
decision has become final and upon the approval of the said bond and the taking of the oath of
office, let letters testamentary issue accordingly. With costs against the oppositors.

And on October 25, 1951, the court allowed the Philippine Trust Company to resign, reconsidered its
order appointing Sebastian Palanca special administrator, and appointed instead the Bank of the
Philippine Islands. Petitioner moved to reconsider the order, but his motion was denied, and thereupon
the present petition was filed. In its order the court held that it has discretion to choose the special
administrator and is not bound to appoint the person named therein as executor, because the order had
been appealed.

44 | P a g e
Petitioner claims that the reason why the respondent judge does not appoint him special administrator is
his personal dislike for him, and that the reasons given by the judge in not appointing him, namely,
alleged partiality to one group of heirs, less ability and experience in handling estates as the appointees
— the previous and the subsequent one — are not actually the reasons that impelled him to deny
petitioner's appointment. On the other hand, intervenors Maria Cuartero, et al., (a group of heirs), claim
that petitioner had close personal relations with Rosa Gonzales (second wife of deceased) and her
children, acting as sponsor in her marriage with the deceased, obtaining a loan from her family, etc. We
have overlooked all the personal grounds or reasons given by the parties, and have chosen to decide the
issue from a purely legal point of view.

It should be noted at the outset that Rule 81 of the Rules of Court, under the provisions of which the
order appealed from was made, grants discretion to the probate court to appoint or not to appoint a
special administrator. It is silent as to the person that may be appointed as special administrator, unlike
section 6 of Rule 79, which expressly gives the order of preference of the persons that may be
appointed regular administrator. We have held in the case of Roxas vs. Pecson, however, that the
appointment of special administrators is not governed by the rules regarding the appointment of regular
administrators. (Roxas vs. Pecson, 82 Phil., 407, 46 Off. Gaz. [5] 2058.) But we further held, however,
that while the choice of the person lies within the court's discretion, such discretion should not be a
whimsical one, but one that is reasonable and logical and in accord with fundamental legal principles
and justice. The fact that a judge is granted discretion does not authorize him to become partial, or to
make his personal likes and dislikes prevail over, or his passions to rule, his judgment. Such discretion
must be based on reason and legal principle, and it must be exercised within the limits thereof. And
there is no reason why the same fundamental and legal principles governing the choice of a regular
administrator should not be taken into account in the appointment of the special administrator.

The choice of his executor is a precious prerogative of a testator, a necessary concomitant of his right to
dispose of his property in the manner he wishes. It is natural that the testator should desire to appoint
one of his confidence, one who can be trusted to carry out his wishes in the disposal of the estate. The
curtailment of this right may be considered as a curtailment of the right to dispose. And as the rights
granted by will take effect from the time of death (Article 777, Civil Code of the Philippines), the
management of his estate by the administrator of his choice should be made as soon as practicable,
when no reasonable objection to his assumption of the trust can be interposed any longer. It has been
held that when a will has been admitted to probate, it is the duty of the court to issue letters
testamentary to the person named as executor upon his application (23 C.J. 1023). It is the testator that
appoints his executor, as the question as to his peculiar fitness for such a position or his want of ability
to manage the estate can not be addressed to the discretion of the county judge. (Holbrook vs. Head, 6
S.W. 592, 593, 9 Ky. 755.).

In the case at bar, the will has already been admitted to probate, and respondent judge himself has
expressly appointed petitioner as administrator. The only reason or ground, therefore, for suspending
his appointment, and for the appointment of a special administrator, who is not the petitioner himself, is
a very technical one. It also appears that the Philippine Trust Company, which had acted as special
administrator for a period of only a few months, has submitted a bill for P90,000. This would cut deep
into the income of the estate, and if the new special administrator appointed by the respondent judge
takes office, it is not improbable that the estate may again be subjected to the same expensive cost of
administration. Under these circumstances, it would seem unreasonable to refuse to appoint the
petitioner as special administrator. To do so would be delaying the fulfillment of the wishes of the
testator and subjecting the estate to unnecessary expense. Petitioner has cited precedents in the
surrogate courts of the State of New York to support his claim that as the will appointing him regular
45 | P a g e
administrator has been admitted to probate by the trial judge, he should now be appointed special
administrator during the pendency of the appeal against the order admitting the will to probate. In the
case of In re Shonts' Estate, 178 N.Y.S. 762, 767-768, the judge makes the following very pertinent
remarks:

. . . . It is my firm belief that the appointment of the executors named in a will as temporary
administrators during contested probates is not only more economical for suitors and estates in
ninety-nine cases of a hundred, but more consonant with the dignity of a court of this character.
The intrusion of nominees of the court, strangers to the dead, very distasteful to the inhabitants
of this state, should be as rare as possible in this court if people of property are to continue to
feel as ease and in security in this state.

The case of In re Erlanger's Estate, 242 N.Y.S. 249, also reiterates the same principle.

The courts have always respected the right to which a testator enjoys to determine who is most
suitable to settle his testamentary affairs, and his solemn selection should not lightly be
disregarded. After the admission of a will to probate, the courts will not name a better executor
for the testator nor disqualify, by a judicial veto, the widow or friend or other person selected in
the will, except upon strict proof of the statutory grounds of incompetency. Matter of Leland's
Will, 219 N.Y. 387, 393, 114 N.E. 854. For the foregoing reasons the person selected by the
testator in three successive wills will be appointed. (Pages 254-255).

The claimant's principal objection to the selection of Mr. Baron as temporary administrator is
founded upon her charge that he exercised undue influence upon the testator in the drafting of
the will offered for probate here. She also stresses his personal hostility to her. In my opinion,
and in view of the special circumstances of this case, these considerations do not constitute a
disqualification. Matter of Hilton's Will, 29 Misc. Rep. 532, 61 N.Y.S. 1073; Jessup-Redfield
Surrogate's Courts, 6th Edit., page 743; Matter of Robert, N.Y. Law Journal, January 9th, 1912;
Matter of Ashmore's Estate, 48 Misc. Rep. 312, 96 N.Y.S. 772. He receives no legacy under the
will. He is an attorney of long experience and his professional standing is attested by several
affiants. In addition to the fact that he was selected by Mr. Erlanger as executor in three wills, it
appears from several affidavits that he was for a long period of time intimately associated with
Mr. Erlanger. This association not only involved a personal friendship, but also the relationship
of Mr. Baron as lawyer and Mr. Erlanger as client. It involved also knowledge of Mr. Erlanger's
financial transactions, and, in addition, a close business contact with Mr. Erlanger's various
enterprises. Mr. Baron was an officer or director of over thirty corporations through which Mr.
Erlanger's various activities were conducted. He held powers of attorney from him in the last
years of Mr. Erlanger's life. He is qualified, therefore, by this experience to safeguard the estate
as temporary administrator. (Pages 252- 253).

The writ prayed for is, therefore, granted, the appealed order reversed, and the temporary injunction
issued by the court made absolute. Let temporary letters of administration be issued in favor of
petitioner during the pendency of the appeal from the order admitting the will to probate.

Paras, C.J., Pablo, Bengzon, Tuason, Montemayor, Reyes, Jugo and Bautista Angelo, JJ., concur.

46 | P a g e
DIGEST

FACTS:

Carlos Palanca died leaving a will, appointing petitioner Ozaeta, being a former associate justice of
SC,a close friend of his wife and sponsor to their marriage, as his executor should Gen. Roxas fails to
qualify
Since Gen. Roxas already died, Ozaeta petition the court for the probate of the will of Carlos and pray
he be appointed as special administrator. The will was allowed, but some of the heirs opposed. Thus
pending appeal, the court appointed Phil. Trust Bank as special administrator but later on it withdrew
on ground of incompatibility of interest.
Petitioner Ozaeta reiterate his appointment as special administrator but the court refused and instead
appoint 1 of the heirs and the BPI. Petitioner then filed the present petition.

ISSUE:

w/n probate court committed grave abuse of discretion when it appointed special
administrator other than the name executor, while pending appeal.

HELD: Court Favor Ozaeta and held that


1. While the rule grant discretion to the probate court to appoint or not a special administrator and
the choice of person lies within its power, SUCH DISCRETION should not be whimsical and
partial but one that is reasonable, logical and in accordance with the fundamental legal principle
of justice.A probate court cannot make a personal likes and dislikes prevail over his judgment
2. Since the choice of executor is a precious prerogative of testator according to his desire to
appoint 1 of his confidence who can he trust 2 carry out his wishes, the appointment and
issuance of letters must be made as soon as practicable
3. In the case at bar, since will has already been admitted to probate and the only reason for
suspending petitioner’s appointment as executor and instead appoint special administrator is a
technical one, unreasonable and would further delay the disposition causing unnecessary
expense.

Republic of the Philippines


SUPREME COURT

SECOND DIVISION

G.R. No. 162934 November 11, 2005

HEIRS OF BELINDA DAHLIA A. CASTILLO, namely, BENA JEAN, DANIEL, MELCHOR,


MICHAEL and DANIBEL, all surnamed CASTILLO, Petitioners,

47 | P a g e
vs.
DOLORES LACUATA-GABRIEL, Respondent.

DECISION

CALLEJO, SR., J.:

This is a petition for review on certiorari of the Decision1 of the Court of Appeals (CA) in CA-G.R. SP
No. 70645, as well as its Resolution2 denying the motion for reconsideration thereof.

On January 25, 1989, Crisanta Yanga-Gabriel, wife of Lorenzo B. Almoradie, died in Malabon City,
Metro Manila, leaving behind a sizable inheritance consisting mostly of real estate and shares of stock.3

A little over a month after Crisanta’s death, her mother, Crisanta Santiago Vda. de Yanga, commenced
an intestate proceeding before the Regional Trial Court (RTC) of Malabon City, Branch 72, docketed
as Spec. Proc. No. 192-MN. She alleged, among others, that to her knowledge, her daughter died
intestate leaving an estate with an estimated net value of ₱1,500,000.00 and that such estate was being
managed by her wastrel and incompetent son-in-law, Lorenzo, and by two other equally incompetent
persons. She prayed that letters of administration be issued to her son, Mariano Yanga, Jr., also the
brother of the deceased, and that she be awarded her share of the estate of her daughter after due
hearing.4 However, the RTC appointed Lorenzo as administrator.

Meantime, the marriage between Crisanta Yanga-Gabriel and Lorenzo Almoradie was declared void for
being bigamous. The RTC then removed Lorenzo as administrator and appointed Mariano, Jr. in his
stead.5

On October 16, 1989, one Belinda Dahlia Y. Almoradie Castillo, claiming to be the only legitimate
child of Lorenzo and Crisanta, filed a motion for intervention.6 Resolution on this motion was,
however, held in abeyance pending some incidents in the CA.

On November 3, 1989, Roberto Y. Gabriel, the legally adopted son of Crisanta Y. Gabriel, filed before
the RTC of Malabon City a petition for probate of an alleged will and for the issuance of letters
testamentary in his favor. The petition was docketed as Spec. Proc. No. 211-MN. 7 He alleged that he
discovered his mother’s will on October 25, 1989 in which he was instituted as the sole heir of the
testatrix, and designated as alternate executor for the named executor therein, Francisco S. Yanga, a
brother of Crisanta, who had predeceased the latter sometime in 1985 or 1986.

On June 2, 1990, Belinda Castillo died.

The two (2) special proceedings were consolidated. On May 15, 1991, the RTC issued an Order
dismissing the intestate proceedings, Spec. Proc. No. 192-MN.8 Mariano Yanga, Jr. questioned the
dismissal of the intestate proceedings before the appellate court via a petition for certiorari (CA-G.R.
SP No. 25897).

On July 8, 1991, the probate court appointed Roberto Y. Gabriel as special administrator of his
mother’s estate.9

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On May 23, 2001, the heirs of Belinda, namely, Bena Jean, Daniel, Melchor, Michael, and Danibel, all
surnamed Castillo, filed a Motion10 praying that they be substituted as party-litigants in lieu of their late
mother Belinda, who died in 1990.

On April 16, 2001, Roberto Gabriel died. His widow, Dolores L. Gabriel, filed a "Manifestation and
Motion"11 where she informed the
probate court of her husband’s death and prayed that she be admitted as substitute in place of her late
husband, and be appointed as administratrix of the estate of Crisanta Gabriel as well. She alleged that
she had a bachelor’s degree in law and had worked for several years in a law office.12

On August 14, 2001, the heirs of Belinda opposed Dolores’ manifestation and motion. They averred
that Dolores was not Crisanta Gabriel’s next of kin, let alone the lawful wife of the late Roberto.13 This
elicited a Reply14 from Dolores where she refuted these allegations.

On August 24, 2001, Bena Jean filed a "Motion for Appointment as Administrator of the Estate of
Crisanta Y. Gabriel"15 praying that she be appointed administratrix of the estate of her grandmother
Crisanta.

On October 11, 2001, Dolores opposed the motion of Bena Jean, claiming that the latter has neither
proven her kinship with Crisanta Gabriel nor shown any particular qualification to act as administratrix
of the estate.16

On November 28, 1991, the CA dismissed the petition for certiorari of Mariano Yanga, Jr. in CA-G.R.
SP No. 25897.

In a Resolution17 dated December 5, 2001, the lower court appointed Dolores as special administratrix
upon a bond of ₱200,000.00. The probate court merely noted the motion for substitution filed by the
heirs of Belinda,
stating that they were "mere strangers to the case" and that their cause could better be ventilated in a
separate proceeding. According to the trial court –

Contrary to the assertions of Oppositors Heirs of Belinda A. Castillo, movant Dolores L. Gabriel has
amply proven her kinship with petitioner Roberto Y. Gabriel, and therefore her kinship, by operation of
law, with decedent Crisanta Y. Gabriel. In the probate proceedings, this Court has the power to
determine questions as to who are the heirs of the decedent …, the recognition of a natural child …, the
validity of disinheritance effected by the testator … and the status of a woman who claims to be the
lawful wife of the decedent. ...

Guided by the foregoing precepts, this Court is of the opinion, and so holds, that movant Dolores L.
Gabriel has established her claim that she is the lawfully wedded wife of petitioner Roberto Y. Gabriel
and that the previous marriage between petitioner and one Lucita V. Cruz was already long dissolved
prior to the celebration of marriage between petitioner and movant Dolores L. Gabriel’s marriage in
July 4, 1997.

And even assuming that movant Dolores L. Gabriel’s lawful relationship with petitioner, and
corollarily with the decedent, was not proven, the stringent rules regarding the order of preference in
the appointment of an Administrator does not find application in the instant case … for what is at stake
here is the appointment of a Special Administrator as such position was vacated by the death of the
previously appointed Special Administrator in the person of petitioner herein. The reason for the
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relaxation of the rules regarding the appointment of a Special Administrator is the nature of its position,
being merely temporary and will subsist only until a regular administrator or executor is appointed.

In view thereof, movant Dolores L. Gabriel is hereby appointed as Special Administrator of the estate
of decedent Crisanta Y. Gabriel, and upon posting of a bond in the amount of ₱200,000.00 pursuant to
the mandate of Section 4, Rule 81 of the Rules of Court, may assume the functions and duties of such
Special Administrator.

SO ORDERED.18

The heirs of Belinda moved to reconsider.19 In the meantime, Dolores took her oath of office on
January 11, 2002.20

The probate court denied the motion for reconsideration filed by Belinda’s heirs in its Order21 dated
March 19, 2002. The said heirs then filed with the CA a petition for certiorari with prayer for a
temporary restraining order or/and preliminary injunction against Dolores and the probate court. The
case was docketed as CA-G.R. SP No. 70645. They prayed, among others, that Bena Jean be appointed
as the regular administratrix of Crisanta Gabriel’s estate, thus –

WHEREFORE, premises considered, petitioners most respectfully pray that:

1. Upon filing of this petition and in order not to prejudice the rights of petitioners, a temporary
restraining order and/or writ of preliminary injunction be issued against respondent Dolores L. Gabriel
enjoining her to cease and desist from acting as special administratrix of the estate of Crisanta Y.
Gabriel;

2. After hearing and consideration, a writ of preliminary injunction be issued against respondent
Dolores L. Gabriel to cease and desist from acting as special administratrix of Crisanta Y. Gabriel until
further order from this Honorable Court;

3. An Order be issued nullifying and setting aside the assailed Orders dated December 5, 2001 and
March 19, 2002 both issued by the respondent Judge for having been rendered with grave abuse of
discretion amounting to lack of jurisdiction and for this Honorable Court to issue a new one by
appointing petitioner Bena Jean A. Castillo as regular administratrix of the estate of Crisanta Y.
Gabriel.

Petitioner likewise prays for such other just, fair and equitable relief under the premises.22

On October 30, 2003, the appellate court dismissed the petition in CA-G.R. SP No. 70645. It ruled that
the probate court did not commit grave abuse of discretion in appointing Dolores as special
administratrix.23

The heirs of Belinda Dahlia Castillo, now the petitioners, filed the instant petition for review
on certiorari against Dolores Lacuata-Gabriel, assigning the following errors –

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A

With due respect, the decision dated October 30, 2003 rendered by the honorable court of appeals is
based on a misapprehension of facts.

With due respect, the honorable court of appeals erred in ruling that private respondent Dolores lacuata-
gabriel is entitled to the administration of the estate of Crisanta y. Gabriel, she being the heir of her
deceased husband whose estate is the former estate Of his adopting mother Crisanta as the sAme is
contrary to the law on succession.

The appointment of private respondent Dolores lacuata-gabriel is contrary to the ruling laid down by
this honorable court in the case of Gonzalez vs. guido, 190 SCRA 112.

The honorable court of appeals erred in ruling that IT is section 1, rule 80 and not section 6, rule 78 of
the rules of court which is applicable in this case.24

The assigned errors in this case boil down to the propriety of the appointment of respondent as special
administratrix of the estate left by Crisanta Yanga-Gabriel.

The petitioners argue that since the respondent does not have any right to inherit from their
grandmother, either by her own right or by the right of representation, she is not qualified to be
appointed as administratrix of the estate; in contrast, they are Crisanta Gabriel’s only compulsory heirs.
They insist that the respondent’s late husband, Roberto, was just a nephew of the decedent and not a
legally adopted son as he claimed to be. Even assuming
this claim was true, the fact that the respondent is not naturally related to the decedent by blood in the
direct descending line makes it unfair to appoint her as the special administratrix. Citing jurisprudence,
the petitioners explain that the principal consideration in the appointment of administrator of a deceased
person’s estate is the applicant’s interest therein. This is the same consideration which Section 6,25 Rule
78 of the Rules of Court takes into account in establishing the order of preference in the appointment of
such administrators. The underlying assumption behind this rule, the petitioners insist, is that those who
will reap the benefit of a wise, speedy, economical administration of the estate, or suffer the
consequences of waste, improvidence or mismanagement, have the highest interest and most influential
motive to administer the estate correctly. Lastly, the petitioners posit that since CA-G.R. SP No. 25897
had long been dismissed by the CA, a regular administrator of the said estate should now be appointed.

The petition is without merit.

In ruling against the petitioners and dismissing their petition, the CA ratiocinated as follows:

The appointment of a special administrator lies entirely in the discretion of the court. The order of
preference in the appointment of a regular administrator under Section 6, Rule 78 of the Rules of Court
does not apply to the selection of a special administrator. In the issuance of such appointment, which is
but temporary and subsists only until a regular administrator is appointed, the court determines who is
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entitled to the administration of the estate of the decedent. On this point, We hold that the preference of
private respondent Dolores Gabriel is with sufficient reason.

The facts of this case show that Roberto Gabriel – the legally adopted son of Crisanta Yanga-Gabriel –
survived Crisanta’s death. When Crisanta died on January 25, 1989, her estate passed on to her
surviving adopted son Roberto. When Roberto himself later died on April 16, 2001, pursuant to the law
on succession, his own estate which he inherited from Crisanta passed on to his surviving widow,
private respondent.

While it is true, as petitioners submit, that private respondent is neither a compulsory nor a legal heir of
Crisanta Yanga-Gabriel and is considered a third person to the estate of Crisanta, nonetheless, private
respondent is undeniably entitled to the administration of the said estate because she is an heir of her
husband Roberto, whose estate is the former estate of his adopting mother Crisanta.26

The ruling of the CA is correct. The Court has repeatedly held that the appointment of a special
administrator lies in the sound discretion of the probate court.27 A special administrator is a
representative of a decedent appointed by the probate court to care for and preserve his estate until an
executor or general administrator is appointed.28 When appointed, a special administrator is regarded
not as a representative of the agent of the parties suggesting the appointment, but as the administrator in
charge of the estate, and, in fact, as an officer of the court.29 As such officer, he is subject to the
supervision and control of the probate court and is expected to work for the best interests of the entire
estate, especially its smooth administration and earliest settlement.30 The principal object of
appointment of temporary administrator is to preserve the estate until it can pass into hands of person
fully authorized to administer it for the benefit of creditors and heirs.31 In many instances, the
appointment of administrators for the estates of decedents frequently become involved in protracted
litigations, thereby exposing such estates to great waste and losses unless an authorized agent to collect
the debts and preserve the assets in the interim is appointed. The occasion for such an appointment,
likewise, arises where, for some cause, such as a pendency of a suit concerning the proof of the will,
regular administration is delayed.32

Section 1, Rule 80 of the Revised Rules of Court provides:

Section 1. Appointment of Special Administrator. – When there is delay in granting letters testamentary
or of administration by any cause including an appeal from the allowance or disallowance of a will, the
court may appoint a special administrator to take possession and charge of the estate of the deceased
until the questions causing the delay are decided and executors or administrators appointed.

The new Rules have broadened the basis for the appointment of an administrator, and such appointment
is allowed when there is delay in granting letters testamentary or administration by any cause, e.g.,
parties cannot agree among themselves. Nevertheless, the discretion to appoint a special administrator
or not lies in the probate court.33In De Guzman v. Guadiz, Jr.,34 the Court further elucidated –

Under the above rule, the probate court may appoint a special administrator should there be a delay in
granting letters testamentary or of administration occasioned by any cause including an appeal from the
allowance or disallowance of a will. Subject to this qualification, the appointment of a special
administrator lies in the discretion of the Court. This discretion, however, must be sound, that is, not
whimsical, or contrary to reason, justice, equity or legal principle.

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The basis for appointing a special administrator under the Rules is broad enough to include any cause
or reason for the delay in granting letters testamentary or of administration as where a contest as to the
will is being carried on in the same or in another court, or where there is an appeal pending as to the
proceeding on the removal of an executor or administrator, or in cases where the parties cannot agree
among themselves. Likewise, when from any cause general administration cannot be immediately
granted, a special administrator may be appointed to collect and preserve the property of the deceased.

It is obvious that the phrase "by any cause" includes those incidents which transpired in the instant case
clearly showing that there is a delay in the probate of the will and that the granting of letters
testamentary will consequently be prolonged necessitating the immediate appointment of a special
administrator.35

As enunciated above, the probate court has ample jurisdiction to appoint respondent as special
administratrix. The deceased Crisanta Yanga-Gabriel left a document purporting to be her will where
her adopted son, Roberto, was named as the sole heir of all her properties. However, pending probate of
the will, Roberto died leaving his widow, the respondent herein, as his sole heir. Thus, the respondent
has much stake in Crisanta’s estate in case the latter’s will is allowed probate. It needs to be
emphasized that in the appointment of a special administrator (which is but temporary and subsists only
until a regular administrator is appointed), the probate court does not determine the shares in the
decedent’s estate, but merely appoints who is entitled to administer the estate. The issue of heirship is
one to be determined in the decree of distribution, and the findings of the court on the
relationship of the parties in the administration as to be the basis of distribution.36 Thus, the preference
of respondent is sound, that is, not whimsical, or contrary to reason, justice, equity or legal principle.

The petitioners’ strenuous invocation of Section 6, Rule 78 of the Rules of Court is misplaced. The rule
refers to the appointment of regular administrators of estates; Section 1, Rule 80, on the other hand,
applies to the appointment of a special administrator. It has long been settled that the appointment of
special administrators is not governed by the rules regarding the appointment of regular
administrators.37 Thus, in Roxas v. Pecson,38 this Court ruled:

It is well settled that the statutory provisions as to the prior or preferred right of certain persons to the
appointment of administrator under Section 1, Rule 81, as well as the statutory provisions as to causes
for removal of an executor or administrator under section 653 of Act No. 190, now Section 2, Rule 83,
do not apply to the selection or removal of special administrator. ... As the law does not say who shall
be appointed as special administrator and the qualifications the appointee must have, the judge or court
has discretion in the selection of the person to be appointed, discretion which must be sound, that is, not
whimsical or contrary to reason, justice or equity.

On the plea of the petitioners for this Court to appoint their co-petitioner, Bena Jean Castillo, as the
regular administratrix of the estate of Crisanta Yanga-Gabriel, the matter should be addressed to the
probate court for its consideration. It is not for this Court to preempt the discretion of the probate court
and appoint a regular administrator in the present action.

WHEREFORE, the petition is hereby DENIED. The Decision of the Court of Appeals in CA-G.R. SP
No. 70645, dated October 30, 2003, and its Resolution of March 26, 2004 are AFFIRMED. Costs
against the petitioners.

SO ORDERED.

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ROMEO J. CALLEJO, SR.
Associate Justice

WE CONCUR:

REYNATO S. PUNO

Associate Justice

Chairman

MA. ALICIA AUSTRIA-MARTINEZ, DANTE O. TINGA


Associate Justice Associate Justice

MINITA V. CHICO-NAZARIO

Associate Justice

CERTIFICATION

Pursuant to Section 13, Article VIII of the Constitution, it is hereby certified that the conclusions in the
above decision were reached in consultation before the case was assigned to the writer of the opinion of
the Court’s Division.

REYNATO S. PUNO

Acting Chief Justice

DIGEST

Facts:

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Crisanta Yanga-Gabriel, wife of Lorenzo B. Almoradie, died in Malabon City, Metro Manila, leaving
behind a sizable inheritance. A little over a month after Crisanta’s death, her mother, Crisanta Santiago
Vda. de Yanga, commenced an intestate proceeding before the RTC. She alleged, among others, that to
her knowledge, her daughter died intestate leaving an estate being managed by her wastrel and
incompetent son-in-law, Lorenzo, and by two other equally incompetent persons. She prayed that
letters of administration be issued to her son, Mariano Yanga, Jr., also the brother of the deceased, and
that she be awarded her share of the estate of her daughter after due hearing. However, the RTC
appointed Lorenzo as administrator.

Meantime, the marriage between Crisanta Yanga-Gabriel and Lorenzo Almoradie was declared void for
being bigamous. The RTC then removed Lorenzo as administrator and appointed Mariano, Jr. in his
stead.

Belinda Castillo, claiming to be the only legitimate child of Lorenzo and Crisanta, filed a motion for
intervention.

Roberto Y. Gabriel, the legally adopted son of Crisanta Y. Gabriel, filed before the RTC of Malabon
City a petition for probate of an alleged will and for the issuance of letters testamentary in his favor. He
alleged that he discovered his mother’s will in which he was instituted as the sole heir of the testatrix,
and designated as alternate executor for the named executor therein, Francisco S. Yanga, a brother of
Crisanta, who had predeceased the latter sometime.

On June 2, 1990, Belinda Castillo died.

The two (2) special proceedings were consolidated. The probate court appointed Roberto Y. Gabriel as
special administrator of his mother’s estate.

The heirs of Belinda, namely, Bena Jean, Daniel, Melchor, Michael, and Danibel, all surnamed
Castillo, filed a Motion praying that they be substituted as party-litigants in lieu of their late mother
Belinda, who died.

Roberto Gabriel died. His widow, Dolores L. Gabriel, filed a "Manifestation and Motion" where she
informed the probate court of her husband’s death and prayed that she be admitted as substitute in place
of her late husband, and be appointed as administratrix of the estate of Crisanta Gabriel as well.

The heirs of Belinda opposed Dolores’ manifestation and motion. They averred that Dolores was not
Crisanta Gabriel’s next of kin, let alone the lawful wife of the late Roberto.

The lower court appointed Dolores as special administratrix upon a bond of P200,000.00. The probate
court merely noted the motion for substitution filed by the heirs of Belinda,
stating that they were "mere strangers to the case" and that their cause could better be ventilated in a
separate proceeding. The probate court denied the motion for reconsideration filed by Belinda’s heirs in
its Order.

Issue:

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The propriety of the appointment of respondent as special administratrix of the estate left by Crisanta
Yanga-Gabriel.

Held:

The petition is without merit.

In ruling against the petitioners and dismissing their petition, the CA ratiocinated as follows:

The appointment of a special administrator lies entirely in the discretion of the court. The order of
preference in the appointment of a regular administrator under Section 6, Rule 78 of the Rules of Court
does not apply to the selection of a special administrator. In the issuance of such appointment, which is
but temporary and subsists only until a regular administrator is appointed, the court determines who is
entitled to the administration of the estate of the decedent. On this point, We hold that the preference of
private respondent Dolores Gabriel is with sufficient reason.

While it is true, as petitioners submit, that private respondent is neither a compulsory nor a legal heir of
Crisanta Yanga-Gabriel and is considered a third person to the estate of Crisanta, nonetheless, private
respondent is undeniably entitled to the administration of the said estate because she is an heir of her
husband Roberto, whose estate is the former estate of his adopting mother Crisanta.

The ruling of the CA is correct. The Court has repeatedly held that the appointment of a special
administrator lies in the sound discretion of the probate court. A special administrator is a
representative of a decedent appointed by the probate court to care for and preserve his estate until an
executor or general administrator is appointed.

Section 1, Rule 80 of the Revised Rules of Court provides:

Section 1. Appointment of Special Administrator. – When there is delay in granting letters testamentary
or of administration by any cause including an appeal from the allowance or disallowance of a will, the
court may appoint a special administrator to take possession and charge of the estate of the deceased
until the questions causing the delay are decided and executors or administrators appointed.

The basis for appointing a special administrator under the Rules is broad enough to include any cause
or reason for the delay in granting letters testamentary or of administration as where a contest as to the
will is being carried on in the same or in another court, or where there is an appeal pending as to the
proceeding on the removal of an executor or administrator, or in cases where the parties cannot agree
among themselves. Likewise, when from any cause general administration cannot be immediately
granted, a special administrator may be appointed to collect and preserve the property of the deceased.

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Republic of the Philippines
SUPREME COURT
Manila

SECOND DIVISION

G.R. No. 187879 July 5, 2010

DALISAY E. OCAMPO, VINCE E. OCAMPO, MELINDA CARLA E. OCAMPO, and


LEONARDO E. OCAMPO, JR., Petitioners,
vs.
RENATO M. OCAMPO and ERLINDA M. OCAMPO, Respondents.

DECISION

NACHURA, J.:

This petition1 for review on certiorari under Rule 45 of the Rules of Court seeks to reverse and set aside
the Decision2 dated December 16, 2008 and the Resolution3 dated April 30, 2009 of the Court of
Appeals (CA) in CA-G.R. SP No. 104683. The Decision annulled and set aside the Order dated March
13, 20084 of the Regional Trial Court (RTC), Branch 24, Biñan, Laguna, in Sp. Proc. No. B-3089;
while the Resolution denied the motion for reconsideration of the Decision.

The Antecedents

Petitioners Dalisay E. Ocampo (Dalisay), Vince E. Ocampo (Vince), Melinda Carla E. Ocampo
(Melinda), and Leonardo E. Ocampo, Jr. (Leonardo, Jr.) are the surviving wife and the children of
Leonardo Ocampo (Leonardo), who died on January 23, 2004. Leonardo and his siblings, respondents
Renato M. Ocampo (Renato) and Erlinda M. Ocampo (Erlinda) are the legitimate children and only
heirs of the spouses Vicente and Maxima Ocampo, who died intestate on December 19, 1972 and
February 19, 1996, respectively. Vicente and Maxima left several properties, mostly situated in Biñan,
Laguna. Vicente and Maxima left no will and no debts.

On June 24, 2004, five (5) months after the death of Leonardo, petitioners initiated a petition for
intestate proceedings, entitled "In Re: Intestate Proceedings of the Estate of Sps. Vicente Ocampo and
Maxima Mercado Ocampo, and Leonardo M. Ocampo," in the RTC, Branch 24, Biñan, Laguna,
docketed as Spec. Proc. No. B-3089.5The petition alleged that, upon the death of Vicente and Maxima,
respondents and their brother Leonardo jointly controlled, managed, and administered the estate of their
parents. Under such circumstance, Leonardo had been receiving his share consisting of one-third (1/3)
of the total income generated from the properties of the estate. However, when Leonardo died,
respondents took possession, control and management of the properties to the exclusion of petitioners.
The petition prayed for the settlement of the estate of Vicente and Maxima and the estate of Leonardo.
It, likewise, prayed for the appointment of an administrator to apportion, divide, and award the two
estates among the lawful heirs of the decedents.

Respondents filed their Opposition and Counter-Petition dated October 7, 2004,6 contending that the
petition was defective as it sought the judicial settlement of two estates in a single proceeding. They
argued that the settlement of the estate of Leonardo was premature, the same being dependent only
upon the determination of his hereditary rights in the settlement of his parents’ estate. In their counter-
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petition, respondents prayed that they be appointed as special joint administrators of the estate of
Vicente and Maxima.

In an Order dated March 4, 2005,7 the RTC denied respondents’ opposition to the settlement
proceedings but admitted their counter-petition. The trial court also clarified that the judicial settlement
referred only to the properties of Vicente and Maxima.

Through a Motion for Appointment of Joint Special Administrators dated October 11,
2005,8 respondents reiterated their prayer for appointment as special joint administrators of the estate,
and to serve as such without posting a bond.

In their Comment dated November 3, 2005,9 petitioners argued that, since April 2002, they had been
deprived of their fair share of the income of the estate, and that the appointment of respondents as
special joint administrators would further cause injustice to them. Thus, they prayed that, in order to
avoid further delay, letters of administration to serve as joint administrators of the subject estate be
issued to respondents and Dalisay.

In another Motion for Appointment of a Special Administrator dated December 5, 2005,10 petitioners
nominated the Biñan Rural Bank to serve as special administrator pending resolution of the motion for
the issuance of the letters of administration.

In its June 15, 2006 Order,11 the RTC appointed Dalisay and Renato as special joint administrators of
the estate of the deceased spouses, and required them to post a bond of ₱200,000.00 each.12

Respondents filed a Motion for Reconsideration dated August 1, 200613 of the Order, insisting that
Dalisay was incompetent and unfit to be appointed as administrator of the estate, considering that she
even failed to take care of her husband Leonardo when he was paralyzed in 1997. They also contended
that petitioners’ prayer for Dalisay’s appointment as special administrator was already deemed
abandoned upon their nomination of the Biñan Rural Bank to act as special administrator of the estate.

In their Supplement to the Motion for Reconsideration,14 respondents asserted their priority in right to
be appointed as administrators being the next of kin of Vicente and Maxima, whereas Dalisay was a
mere daughter-in-law of the decedents and not even a legal heir by right of representation from her late
husband Leonardo.

Pending the resolution of the Motion for Reconsideration, petitioners filed a Motion to Submit
Inventory and Accounting dated November 20, 2006,15 praying that the RTC issue an order directing
respondents to submit a true inventory of the estate of the decedent spouses and to render an accounting
thereof from the time they took over the collection of the income of the estate.

Respondents filed their Comment and Manifestation dated January 15, 2007,16 claiming that they could
not yet be compelled to submit an inventory and render an accounting of the income and assets of the
estate inasmuch as there was still a pending motion for reconsideration of the June 15, 2006 Order
appointing Dalisay as co-special administratrix with Renato.

In its Order dated February 16, 2007, the RTC revoked the appointment of Dalisay as co-special
administratrix, substituting her with Erlinda. The RTC took into consideration the fact that respondents
were the nearest of kin of Vicente and Maxima. Petitioners did not contest this Order and even
manifested in open court their desire for the speedy settlement of the estate.
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On April 23, 2007, or two (2) months after respondents’ appointment as joint special administrators,
petitioners filed a Motion for an Inventory and to Render Account of the Estate,17 reiterating their
stance that respondents, as joint special administrators, should be directed to submit a true inventory of
the income and assets of the estate.

Respondents then filed a Motion for Exemption to File Administrators’ Bond18 on May 22, 2007,
praying that they be allowed to enter their duties as special administrators without the need to file an
administrators’ bond due to their difficulty in raising the necessary amount. They alleged that, since
petitioners manifested in open court that they no longer object to the appointment of respondents as
special co-administrators, it would be to the best interest of all the heirs that the estate be spared from
incurring unnecessary expenses in paying for the bond premiums. They also assured the RTC that they
would faithfully exercise their duties as special administrators under pain of contempt should they
violate any undertaking in the performance of the trust of their office.

In an Order dated June 29, 2007,19 the RTC directed the parties to submit their respective comments or
oppositions to the pending incidents, i.e., petitioners’ Motion for Inventory and to Render Account, and
respondents’ Motion for Exemption to File Administrators’ Bond.

Respondents filed their Comment and/or Opposition,20 stating that they have already filed a comment
on petitioners’ Motion for Inventory and to Render Account. They asserted that the RTC should, in the
meantime, hold in abeyance the resolution of this Motion, pending the resolution of their Motion for
Exemption to File Administrators’ Bond.

On October 15, 2007, or eight (8) months after the February 16, 2007 Order appointing respondents as
special joint administrators, petitioners filed a Motion to Terminate or Revoke the Special
Administration and to Proceed to Judicial Partition or Appointment of Regular
Administrator.21 Petitioners contended that the special administration was not necessary as the estate is
neither vast nor complex, the properties of the estate being identified and undisputed, and not involved
in any litigation necessitating the representation of special administrators. Petitioners, likewise,
contended that respondents had been resorting to the mode of special administration merely to delay
and prolong their deprivation of what was due them. Petitioners cited an alleged fraudulent sale by
respondents of a real property for ₱2,700,000.00, which the latter represented to petitioners to have
been sold only for ₱1,500,000.00, and respondents’ alleged misrepresentation that petitioners owed the
estate for the advances to cover the hospital expenses of Leonardo, but, in fact, were not yet paid.

Respondents filed their Opposition and Comment22 on March 10, 2008, to which, in turn, petitioners
filed their Reply to Opposition/Comment23 on March 17, 2008.

In its Order dated March 13, 2008,24 the RTC granted petitioners’ Motion, revoking and terminating the
appointment of Renato and Erlinda as joint special administrators, on account of their failure to comply
with its Order, particularly the posting of the required bond, and to enter their duties and
responsibilities as special administrators, i.e., the submission of an inventory of the properties and of an
income statement of the estate. The RTC also appointed Melinda as regular administratrix, subject to
the posting of a bond in the amount of ₱200,000.00, and directed her to submit an inventory of the
properties and an income statement of the subject estate. The RTC likewise found that judicial partition
may proceed after Melinda had assumed her duties and responsibilities as regular administratrix.

Aggrieved, respondents filed a petition for certiorari25 under Rule 65 of the Rules of Court before the
CA, ascribing grave abuse of discretion on the part of the RTC in (a) declaring them to have failed to
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enter the office of special administration despite lapse of reasonable time, when in truth they had not
entered the office because they were waiting for the resolution of their motion for exemption from
bond; (b) appointing Melinda as regular administratrix, a mere granddaughter of Vicente and Maxima,
instead of them who, being the surviving children of the deceased spouses, were the next of kin; and (c)
declaring them to have been unsuitable for the trust, despite lack of hearing and evidence against them.

Petitioners filed their Comment to the Petition and Opposition to Application for temporary restraining
order and/or writ of preliminary injunction,26 reiterating their arguments in their Motion for the
revocation of respondents’ appointment as joint special administrators. Respondents filed their Reply.27

On December 16, 2008, the CA rendered its assailed Decision granting the petition based on the finding
that the RTC gravely abused its discretion in revoking respondents’ appointment as joint special
administrators without first ruling on their motion for exemption from bond, and for appointing
Melinda as regular administratrix without conducting a formal hearing to determine her competency to
assume as such. According to the CA, the posting of the bond is a prerequisite before respondents could
enter their duties and responsibilities as joint special administrators, particularly their submission of an
inventory of the properties of the estate and an income statement thereon.

Petitioners filed a Motion for Reconsideration of the Decision.28 The CA, however, denied it. Hence,
this petition, ascribing to the CA errors of law and grave abuse of discretion for annulling and setting
aside the RTC Order dated March 13, 2008.

Our Ruling

The pertinent provisions relative to the special administration of the decedents’ estate under the Rules
of Court provide—

Sec. 1. Appointment of special administrator. – When there is delay in granting letters testamentary or
of administration by any cause including an appeal from the allowance or disallowance of a will, the
court may appoint a special administrator to take possession and charge of the estate of the deceased
until the questions causing the delay are decided and executors or administrators appointed.29

Sec. 2. Powers and duties of special administrator. – Such special administrator shall take possession
and charge of goods, chattels, rights, credits, and estate of the deceased and preserve the same for the
executor or administrator afterwards appointed, and for that purpose may commence and maintain suits
as administrator. He may sell only such perishable and other property as the court orders sold. A special
administrator shall not be liable to pay any debts of the deceased unless so ordered by the court.30

Sec. 1. Bond to be given before issuance of letters; Amount; Conditions. – Before an executor or
administrator enters upon the execution of his trust, and letters testamentary or of administration issue,
he shall give a bond, in such sum as the court directs, conditioned as follows:

(a) To make and return to the court, within three (3) months, a true and complete inventory of
all goods, chattels, rights, credits, and estate of the deceased which shall come to his possession
or knowledge or to the possession of any other person for him;

(b) To administer according to these rules, and, if an executor, according to the will of the
testator, all goods, chattels, rights, credits, and estate which shall at any time come to his
possession or to the possession of any other person for him, and from the proceeds to pay and
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discharge all debts, legacies, and charges on the same, or such dividends thereon as shall be
decreed by the court;

(c) To render a true and just account of his administration to the court within one (1) year, and
at any other time when required by the court;

(d) To perform all orders of the court by him to be performed.31

Sec. 4. Bond of special administrator. – A special administrator before entering upon the duties of his
trust shall give a bond, in such sum as the court directs, conditioned that he will make and return a true
inventory of the goods, chattels, rights, credits, and estate of the deceased which come to his possession
or knowledge, and that he will truly account for such as are received by him when required by the
court, and will deliver the same to the person appointed executor or administrator, or to such other
person as may be authorized to receive them.32

Inasmuch as there was a disagreement as to who should be appointed as administrator of the estate of
Vicente and Maxima, the RTC, acting as a probate court, deemed it wise to appoint joint special
administrators pending the determination of the person or persons to whom letters of administration
may be issued. The RTC was justified in doing so considering that such disagreement caused undue
delay in the issuance of letters of administration, pursuant to Section 1 of Rule 80 of the Rules of Court.
Initially, the RTC, on June 15, 2006, appointed Renato and Dalisay as joint special administrators,
imposing upon each of them the obligation to post an administrator’s bond of ₱200,000.00. However,
taking into account the arguments of respondents that Dalisay was incompetent and unfit to assume the
office of a special administratrix and that Dalisay, in effect, waived her appointment when petitioners
nominated Biñan Rural Bank as special administrator, the RTC, on February 16, 2007, revoked
Dalisay’s appointment and substituted her with Erlinda.

A special administrator is an officer of the court who is subject to its supervision and control, expected
to work for the best interest of the entire estate, with a view to its smooth administration and speedy
settlement.33 When appointed, he or she is not regarded as an agent or representative of the parties
suggesting the appointment.34 The principal object of the appointment of a temporary administrator is
to preserve the estate until it can pass to the hands of a person fully authorized to administer it for the
benefit of creditors and heirs, pursuant to Section 2 of Rule 80 of the Rules of Court.35

While the RTC considered that respondents were the nearest of kin to their deceased parents in their
appointment as joint special administrators, this is not a mandatory requirement for the appointment. It
has long been settled that the selection or removal of special administrators is not governed by the rules
regarding the selection or removal of regular administrators.36 The probate court may appoint or
remove special administrators based on grounds other than those enumerated in the Rules at its
discretion, such that the need to first pass upon and resolve the issues of fitness or unfitness37 and the
application of the order of preference under Section 6 of Rule 78,38 as would be proper in the case of a
regular administrator, do not obtain. As long as the discretion is exercised without grave abuse, and is
based on reason, equity, justice, and legal principles, interference by higher courts is unwarranted.39The
appointment or removal

of special administrators, being discretionary, is thus interlocutory and may be assailed through a
petition for certiorari under Rule 65 of the Rules of Court.40

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Granting the certiorari petition, the CA found that the RTC gravely abused its discretion in revoking
respondents’ appointment as joint special administrators, and for failing to first resolve the pending
Motion for Exemption to File Administrators’ Bond, ratiocinating that the posting of the
administrators’ bond is a pre-requisite to respondents’ entering into the duties and responsibilities of
their designated office. This Court disagrees.

It is worthy of mention that, as early as October 11, 2005, in their Motion for Appointment as Joint
Special Administrators, respondents already prayed for their exemption to post bond should they be
assigned as joint special administrators. However, the RTC effectively denied this prayer when it issued
its June 15, 2006 Order, designating Renato and Dalisay as special administrators and enjoining them
to post bond in the amount of ₱200,000.00 each. This denial was, in effect, reiterated when the RTC
rendered its February 16, 2007 Order substituting Dalisay with Erlinda as special administratrix.

Undeterred by the RTC’s resolve to require them to post their respective administrators’ bonds,
respondents filed anew a Motion for Exemption to File Administrators’ Bond on May 22, 2007,
positing that it would be to the best interest of the estate of their deceased parents and all the heirs to
spare the estate from incurring the unnecessary expense of paying for their bond premiums since they
could not raise the money themselves. To note, this Motion was filed only after petitioners filed a
Motion for an Inventory and to Render Account of the Estate on April 23, 2007. Respondents then
argued that they could not enter into their duties and responsibilities as special administrators in light of
the pendency of their motion for exemption. In other words, they could not yet submit an inventory and
render an account of the income of the estate since they had not yet posted their bonds.

Consequently, the RTC revoked respondents’ appointment as special administrators for failing to post
their administrators’ bond and to submit an inventory and accounting as required of them, tantamount
to failing to comply with its lawful orders. Inarguably, this was, again, a denial of respondents’ plea to
assume their office sans a bond. The RTC rightly did so.

Pursuant to Section 1 of Rule 81, the bond secures the performance of the duties and obligations of an
administrator namely: (1) to administer the estate and pay the debts; (2) to perform all judicial orders;
(3) to account within one (1) year and at any other time when required by the probate court; and (4) to
make an inventory within three (3) months. More specifically, per Section 4 of the same Rule, the bond
is conditioned on the faithful execution of the administration of the decedent’s estate requiring the
special administrator to (1) make and return a true inventory of the goods, chattels, rights, credits, and
estate of the deceased which come to his possession or knowledge; (2) truly account for such as
received by him when required by the court; and (3) deliver the same to the person appointed as
executor or regular administrator, or to such other person as may be authorized to receive them.

Verily, the administration bond is for the benefit of the creditors and the heirs, as it compels the
administrator, whether regular or special, to perform the trust reposed in, and discharge the obligations
incumbent upon, him. Its object and purpose is to safeguard the properties of the decedent, and,
therefore, the bond should not be considered as part of the necessary expenses chargeable against the
estate, not being included among the acts constituting the care, management, and settlement of the
estate. Moreover, the ability to post the bond is in the nature of a qualification for the office of
administration.41

Hence, the RTC revoked respondents’ designation as joint special administrators, especially
considering that respondents never denied that they have been in possession, charge, and actual
administration of the estate of Vicente and Maxima since 2002 up to the present, despite the
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assumption of Melinda as regular administratrix. In fact, respondents also admitted that, allegedly out
of good faith and sincerity to observe transparency, they had submitted a Statement of Cash
Distribution42 for the period covering April 2002 to June 2006,43 where they indicated that Renato had
received ₱4,241,676.00, Erlinda ₱4,164,526.96, and petitioners ₱2,486,656.60, and that the estate had
advanced ₱2,700,000.00 for the hospital and funeral expenses of Leonardo.44 The latter cash advance
was questioned by petitioners in their motion for revocation of special administration on account of the
demand letter45 dated June 20, 2007 of Asian Hospital and Medical Center addressed to Dalisay, stating
that there still remained unpaid hospital bills in the amount of ₱2,087,380.49 since January 2004.
Undeniably, respondents had already been distributing the incomes or fruits generated from the
properties of the decedents’ estate, yet they still failed to post their respective administrators’ bonds
despite collection of the advances from their supposed shares. This state of affairs continued even after
a considerable lapse of time from the appointment of Renato as a special administrator of the estate on
June 15, 2006 and from February 16, 2007 when the RTC substituted Erlinda, for Dalisay, as special
administratrix.

What is more, respondents’ insincerity in administering the estate was betrayed by the Deed of
Conditional Sale dated January 12, 200446 discovered by petitioners. This Deed was executed between
respondents, as the only heirs of Maxima, as vendors, thus excluding the representing heirs of
Leonardo, and Spouses Marcus Jose B. Brillantes and Amelita Catalan-Brillantes, incumbent lessors, as
vendees, over a real property situated in Biñan, Laguna, and covered by Transfer Certificate of Title
No. T-332305 of the Registry of Deeds of Laguna, for a total purchase price of ₱2,700,000.00. The
Deed stipulated for a payment of ₱1,500,000.00 upon the signing of the contract, and the balance of
₱1,200,000.00 to be paid within one (1) month from the receipt of title of the vendees. The contract
also stated that the previous contract of lease between the vendors and the vendees shall no longer be
effective; hence, the vendees were no longer obligated to pay the monthly rentals on the property. And
yet there is a purported Deed of Absolute Sale47 over the same realty between respondents, and
including Leonardo as represented by Dalisay, as vendors, and the same spouses, as vendees, for a
purchase price of only ₱1,500,000.00. Notably, this Deed of Absolute Sale already had the signatures
of respondents and vendee-spouses. Petitioners claimed that respondents were coaxing Dalisay into
signing the same, while respondents said that Dalisay already got a share from this transaction in the
amount of ₱500,000.00. It may also be observed that the time of the execution of this Deed of Absolute
Sale, although not notarized as the Deed of Conditional Sale, might not have been distant from the
execution of the latter Deed, considering the similar Community Tax Certificate Numbers of the parties
appearing in both contracts.

Given these circumstances, this Court finds no grave abuse of discretion on the part of the RTC when it
revoked the appointment of respondents as joint special administrators, the removal being grounded on
reason, equity, justice, and legal principle. Indeed, even if special administrators had already been
appointed, once the probate court finds the appointees no longer entitled to its confidence, it is justified
in withdrawing the appointment and giving no valid effect thereto.48

On the other hand, the Court finds the RTC’s designation of Melinda as regular administratrix improper
and abusive of its discretion.

In the determination of the person to be appointed as regular administrator, the following provisions of
Rule 78 of the Rules of Court, state –

Sec. 1. Who are incompetent to serve as executors or administrators. – No person is competent to serve
as executor or administrator who:
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(a) Is a minor;

(b) Is not a resident of the Philippines; and

(c) Is in the opinion of the court unfit to execute the duties of the trust by reason of drunkenness,
improvidence, or want of understanding or integrity, or by reason of conviction of an offense
involving moral turpitude.

xxxx

Sec. 6. When and to whom letters of administration granted. – If no executor is named in the will, or
the executor or executors are incompetent, refuse the trust, or fail to give bond, or a person dies
intestate, administration shall be granted:

(a) To the surviving husband or wife, as the case may be, or next of kin, or both, in the
discretion of the court, or to such person as such surviving husband or wife, or next of kin,
requests to have appointed, if competent and willing to serve;

(b) If such surviving husband or wife, as the case may be, or next of kin, or the person selected
by them, be incompetent or unwilling, or if the husband or widow, or next of kin, neglects for
thirty (30) days after the death of the person to apply for administration or to request that
administration be granted to some other person, it may be granted to one or more of the
principal creditors, if competent and willing to serve;

(c) If there is no such creditor competent and willing to serve, it may be granted to such other
person as the court may select.

Further, on the matter of contest for the issuance of letters of administration, the following provisions
of Rule 79 are pertinent –

Sec. 2. Contents of petition for letters of administration. – A petition for letters of administration must
be filed by an interested person and must show, so far as known to the petitioner:

(a) The jurisdictional facts;

(b) The names, ages, and residences of the heirs, and the names and residences of the creditors,
of the decedent;

(c) The probable value and character of the property of the estate;

(d) The name of the person for whom letters of administration are prayed.

But no defect in the petition shall render void the issuance of letters of administration.

Sec. 3. Court to set time for hearing. Notice thereof. – When a petition for letters of administration is
filed in the court having jurisdiction, such court shall fix a time and place for hearing the petition, and
shall cause notice thereof to be given to the known heirs and creditors of the decedent, and to any other
persons believed to have an interest in the estate, in the manner provided in Sections 3 and 4 of Rule
76.
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Sec. 4. Opposition to petition for administration. – Any interested person may, by filing a written
opposition, contest the petition on the ground of the incompetency of the person for whom letters are
prayed therein, or on the ground of the contestant’s own right to the administration, and may pray that
letters issue to himself, or to any competent person or persons named in the opposition.

Sec. 5. Hearing and order for letters to issue. – At the hearing of the petition, it must first be shown that
notice has been given as herein-above required, and thereafter the court shall hear the proofs of the
parties in support of their respective allegations, and if satisfied that the decedent left no will, or that
there is no competent and willing executor, it shall order the issuance of letters of administration to the
party best entitled thereto.1avvphi1

Admittedly, there was no petition for letters of administration with respect to Melinda, as the prayer for
her appointment as co-administrator was embodied in the motion for the termination of the special
administration. Although there was a hearing set for the motion on November 5, 2007, the same was
canceled and reset to February 8, 2008 due to the absence of the parties’ counsels. The February 8,
2008 hearing was again deferred to March 10, 2008 on account of the ongoing renovation of the Hall of
Justice. Despite the resetting, petitioners filed a Manifestation/Motion dated February 29,
2008,49 reiterating their prayer for partition or for the appointment of Melinda as regular administrator
and for the revocation of the special administration. It may be mentioned that, despite the filing by
respondents of their Opposition and Comment to the motion to revoke the special administration, the
prayer for the appointment of Melinda as regular administratrix of the estate was not specifically
traversed in the said pleading. Thus, the capacity, competency, and legality of Melinda’s appointment
as such was not properly objected to by respondents despite being the next of kin to the decedent
spouses, and was not threshed out by the RTC acting as a probate court in accordance with the above
mentioned Rules.

However, having in mind the objective of facilitating the settlement of the estate of Vicente and
Maxima, with a view to putting an end to the squabbles of the heirs, we take into account the fact that
Melinda, pursuant to the RTC Order dated March 13, 2008, already posted the required bond of
₱200,000.00 on March 26, 2008, by virtue of which, Letters of Administration were issued to her the
following day, and that she filed an Inventory of the Properties of the Estate dated April 15,
2008.50 These acts clearly manifested her intention to serve willingly as administratrix of the decedents’
estate, but her appointment should be converted into one of special administration, pending the
proceedings for regular administration. Furthermore, since it appears that the only unpaid obligation is
the hospital bill due from Leonardo’s estate, which is not subject of this case, judicial partition may
then proceed with dispatch.

WHEREFORE, the petition is PARTIALLY GRANTED. The Decision dated December 16, 2008 and
the Resolution dated April 30, 2009 of the Court of Appeals in CA-G.R. SP No. 104683 are
AFFIRMED with the MODIFICATION that the Order dated March 13, 2008 of the Regional Trial
Court, Branch 24, Biñan, Laguna, with respect to the revocation of the special administration in favor
of Renato M. Ocampo and Erlinda M. Ocampo, is REINSTATED. The appointment of Melinda Carla
E. Ocampo as regular administratrix is SET ASIDE. Melinda is designated instead as special
administratrix of the estate under the same administrator’s bond she had posted. The trial court is
directed to conduct with dispatch the proceedings for the appointment of the regular administrator and,
thereafter, to proceed with judicial partition. No costs.

SO ORDERED.

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ANTONIO EDUARDO B. NACHURA
Associate Justice

WE CONCUR:

ANTONIO T. CARPIO
Associate Justice
Chairperson

DIOSDADO M. PERALTA ROBERTO A. ABAD


Associate Justice Associate Justice

JOSE CATRAL MENDOZA


Associate Justice

ATTESTATION

I attest that the conclusions in the above Decision had been reached in consultation before the case was
assigned to the writer of the opinion of the Court’s Division.

ANTONIO T. CARPIO
Associate Justice
Chairperson, Second Division

CERTIFICATION

Pursuant to Section 13, Article VIII of the Constitution and the Division Chairperson's Attestation, I
certify that the conclusions in the above Decision had been reached in consultation before the case was
assigned to the writer of the opinion of the Court’s Division.

RENATO C. CORONA
Chief Justice

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DIGEST

Facts:

Petitioners Dalisay E. Ocampo (Dalisay), Vince E. Ocampo (Vince), Melinda Carla E. Ocampo
(Melinda), and Leonardo E. Ocampo, Jr. (Leonardo, Jr.) are the surviving wife and the children of
Leonardo Ocampo (Leonardo), who died on January 23, 2004. Leonardo and his siblings, respondents
Renato M. Ocampo (Renato) and Erlinda M. Ocampo (Erlinda) are the legitimate children and only
heirs of the spouses Vicente and Maxima Ocampo, who died intestate on December 19, 1972 and
February 19, 1996, respectively. Vicente and Maxima left several properties, mostly situated in Biñan,
Laguna. Vicente and Maxima left no will and no debts.

On June 24, 2004, five (5) months after the death of Leonardo, petitioners initiated a petition for
intestate proceedings, entitled In Re: Intestate Proceedings of the Estate of Sps. Vicente Ocampo and
Maxima Mercado Ocampo, and Leonardo M. Ocampo, in the RTC, Branch 24, Biñan, Laguna,
docketed as Spec. Proc. No. B-3089. The petition alleged that, upon the death of Vicente and Maxima,
respondents and their brother Leonardo jointly controlled, managed, and administered the estate of their
parents. Under such circumstance, Leonardo had been receiving his share consisting of one-third (1/3)
of the total income generated from the properties of the estate. However, when Leonardo died,
respondents took possession, control and management of the properties to the exclusion of petitioners.
The petition prayed for the settlement of the estate of Vicente and Maxima and the estate of Leonardo.
It, likewise, prayed for the appointment of an administrator to apportion, divide, and award the two
estates among the lawful heirs of the decedents.

After long side by side filing of motions, petitions and oppositions, Renato and Erlinda were
appointed as special administrators but refused to give an inventory of properties as petitioned by
herein petitioners until after the court ruled in their petition for exemption in posting a bond.
Meanwhile, petitioners subsequently learned that respondents has disposed of real properties for
P2,700,000.00 saying it was only for P1,500,000.00 then move the court through a petition in removing
the respondents as administrators and proceed to partitioning the estate. The RTC ruled in the
affirmative and appointed Melinda as regular administrator conditioned with the posting of
P200,000.00 as bond which the later complied. The respondents appealed in the CA and they received a
favorable decision reversing and setting aside the decision of the RTC.

Issue:

Whether the court should have acted with grave abuse of discretion in revoking and terminating
the appointment of Renato and Erlinda as joint special administrators, on account of their failure to
comply with its Order, particularly the posting of the required bond, and to enter their duties and
responsibilities as special administrators and in appointing Melinda as regular administratrix, subject to
the posting of a bond in the amount of P200,000.00.

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Ruling:

The court ruled that the trial court did not act with grave abuse of discretion in revoking the
appointment of the respondents as special administrators and otherwise in appointing Melinda as
regular administrator opining and ordering that she should instead be appointed as special
administration as according to the rules.

A special administrator is an officer of the court who is subject to its supervision and control,
expected to work for the best interest of the entire estate, with a view to its smooth administration and
speedy settlement. When appointed, he or she is not regarded as an agent or representative of the parties
suggesting the appointment. The principal object of the appointment of a temporary administrator is to
preserve the estate until it can pass to the hands of a person fully authorized to administer it for the
benefit of creditors and heirs, pursuant to Section 2 of Rule 80 of the Rules of Court.

While the RTC considered that respondents were the nearest of kin to their deceased parents in
their appointment as joint special administrators, this is not a mandatory requirement for the
appointment. It has long been settled that the selection or removal of special administrators is not
governed by the rules regarding the selection or removal of regular administrators. The probate court
may appoint or remove special administrators based on grounds other than those enumerated in the
Rules at its discretion, such that the need to first pass upon and resolve the issues of fitness or unfitness
and the application of the order of preference under Section 6 of Rule 78, as would be proper in the
case of a regular administrator, do not obtain. As long as the discretion is exercised without grave
abuse, and is based on reason, equity, justice, and legal principles, interference by higher courts is
unwarranted. The appointment or removal of special administrators, being discretionary, is thus
interlocutory and may be assailed through a petition for certiorari under Rule 65 of the Rules of Court.

Pursuant to Section 1 of Rule 81, the bond secures the performance of the duties and obligations
of an administrator namely: (1) to administer the estate and pay the debts; (2) to perform all judicial
orders; (3) to account within one (1) year and at any other time when required by the probate court; and
(4) to make an inventory within three (3) months. More specifically, per Section 4 of the same Rule, the
bond is conditioned on the faithful execution of the administration of the decedents estate requiring the
special administrator to (1) make and return a true inventory of the goods, chattels, rights, credits, and
estate of the deceased which come to his possession or knowledge; (2) truly account for such as
received by him when required by the court; and (3) deliver the same to the person appointed as
executor or regular administrator, or to such other person as may be authorized to receive them.

Verily, the administration bond is for the benefit of the creditors and the heirs, as it compels the
administrator, whether regular or special, to perform the trust reposed in, and discharge the obligations
incumbent upon, him. Its object and purpose is to safeguard the properties of the decedent, and,
therefore, the bond should not be considered as part of the necessary expenses chargeable against the
estate, not being included among the acts constituting the care, management, and settlement of the
estate. Moreover, the ability to post the bond is in the nature of a qualification for the office of
administration.

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Republic of the Philippines
SUPREME COURT
Manila

THIRD DIVISION

G.R. No. 193161 August 22, 2011

DIOSDADO S. MANUNGAS, Petitioner,


vs.
MARGARITA AVILA LORETO and FLORENCIA AVILA PARREÑO, Respondents.

DECISION

VELASCO, JR., J.:

The Case

This Petition for Review on Certiorari under Rule 45 seeks the reversal of the April 30, 2009
Decision1 and July 21, 2010 Resolution2 of the Court of Appeals (CA), in CA-G.R. SP No. 74531-
MIN, entitled Margarita Avila Loreto and Florencia Avila Parreño v. Hon. Erasto D. Salcedo, Acting
Presiding Judge, RTC (Branch 2), Tagum City, and Diosdado Salinas (Manungas). The CA Decision
set aside as null and void the Order dated November 4, 20023 of the Regional Trial Court (RTC),
Branch 2 in Tagum City, Davao del Norte, in Special Proceedings No. 708 entitled In the Matter of the
Intestate Estate of the Deceased Engracia N. Vda de Manungas, Diosdado Manungas, petitioner,
wherein the RTC reversed its appointment of respondent Florencia Avila Parreño (Parreño) as the
special administrator of the estate of Engracia Manungas and appointed petitioner Diosdado Salinas
Manungas (Diosdado) in her stead.

The Facts

Engracia Manungas was the wife of Florentino Manungas. They had no children. Instead, they adopted
Samuel David Avila (Avila) on August 12, 1968. Florentino Manungas died intestate on May 29, 1977,
while Avila predeceased his adoptive mother.4 Avila was survived by his wife Sarah Abarte Vda. de
Manungas.

Thereafter, Engracia Manungas filed a Motion for Partition of Estate on March 31, 1980 in the intestate
estate proceedings of Florentino Manungas, of which she was the administratrix. There, she stated that
there are no other legal and compulsory heirs of Florentino Manungas except for herself, Avila and a
Ramon Manungas whom she acknowledged as the natural son of Florentino Manungas.5 Meanwhile,
Avila’s widow executed a Waiver of Rights and Participation on October 29, 1980, renouncing her
rights over the separate property of her husband in favor of Engracia Manungas. Thereafter, a Decree of
Final Distribution was issued in the intestate estate proceedings of Florentino Manungas distributing
the properties to Engracia Manungas and Ramon Manungas, the surviving heirs.6

On October 25, 1995, the RTC, Branch 4 in Panabo City, appointed Parreño, the niece of Engracia
Manungas, as the Judicial Guardian of the properties and person of her incompetent aunt.7

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Engracia Manungas, through Parreño, then instituted Civil Case No. 5196-96 against the spouses
Diosdado Salinas Manungas and Milagros Pacifico for illegal detainer and damages with the Municipal
Trial Court (MTC) in Panabo City. In their answer, the spouses Salinas claimed that Diosdado is the
illegitimate son of Florentino Manungas. However, the answer was filed beyond the reglementary
period and was not considered by the MTC. Thus, the MTC issued a summary judgment in favor of
Engracia Manungas, ordering the spouses to vacate the premises and to restore possession to Engracia
Manungas. The Decision was appealed by the spouses Salinas to the RTC of Tagum, Davao City which
affirmed in toto the Decision of the MTC.8 On appeal to this Court, defendants’ petition was denied for
having been filed out of time in a Resolution which became final on April 20, 1998.9

Thereafter, on August 7, 1998, Diosdado instituted a petition for the issuance of letters of
administration over the Estate of Engracia Manungas (Estate of Manungas) in his favor before the
RTC, Branch 2 in Tagum City, Davao. He alleged that he, being an illegitimate son of Florentino
Manungas, is an heir of Engracia Manungas.10 The petition was opposed by Margarita Avila Loreto
(Loreto) and Parreño alleging that Diosdado was incompetent as an administrator of the Estate of
Manungas claiming that he was not a Manungas, that he was not an heir of Engracia Manungas, he was
not a creditor of Engracia Manungas or her estate and that he was in fact a debtor of the estate having
been found liable to Engracia Manungas for PhP 177,000 by virtue of a Decision issued by the MTC in
Civil Case No. 5196-96. On May 15, 2002, the RTC issued an Order appointing Parreño as the
administrator of the Estate of Manungas, the dispositive portion of which reads:

WHEREFORE, in view of the foregoing, Florencia A. Parreño is hereby appointed as Special


Administrator of the property of the late Engracia N. Vda. de Manungas. The Special Administrator is
hereby directed to post a bond in the amount of P200,000.00 pursuant to Sec. 4 of Rule 81.

SO ORDERED.11

Diosdado filed a Motion for Reconsideration with a Prayer for Temporary Restraining Order and
Preliminary Injunction.12 In his motion, Diosdado argued that Parreño’s appointment as special
administrator of the Estate of Manungas was by virtue of her being the judicial guardian of the latter
but which relation ceased upon Engracia Manungas’ death, concluding that her appointment as special
administrator was without basis. He added that Parreño was not fit to become a special administrator
having already been fined by the court for failing to render a timely accounting of Engracia Manungas’
property as her judicial guardian. Diosdado also reasoned that Parreño is a mere niece, a collateral
relative, of Engracia Manungas, while he is the illegitimate son of Florentino Manungas.

On November 4, 2002, the RTC issued an Order reversing itself and ordering the revocation of its
earlier appointment of Parreño as the administrator of the Estate of Manungas while appointing
Diosdado as the Special Administrator.13

Parreño and Loreto appealed the ruling of the RTC to the CA. The CA issued its assailed April 30,
2009 Decision finding that the RTC acted with grave abuse of discretion in revoking its earlier
appointment of Parreño as the administrator of the Estate of Manungas and appointing Diosdado
instead. The CA further reinstated Parreño as the special administrator of the estate. The dispositive
portion reads:

WHEREFORE, premises considered, the petition is GRANTED. The Order dated November 4, 2002
setting aside the appointment of Florencia Parreño as special administrator of the estate of the late
Engracia Vda. de Manungas, and denying the property bond posted by Florencia Parreño [is] hereby
70 | P a g e
declared NULL and VOID and SET ASIDE as having been issued by Public Respondent Judge of the
Regional Trial Court, Branch 2, Tagum City, Davao del Norte with grave abuse of discretion
amounting to lack or excess of jurisdiction.

SO ORDERED.14

Diosdado assailed the CA Decision in a Motion for Reconsideration dated May 15, 200915 which the
CA denied in the July 21, 2010 Resolution.

Hence, We have this petition.

The Issues

Diosdado raises the following issues:

The Court a Quo utterly disregarded the jurisprudence that certiorari cannot be a substitute for an
appeal where the latter remedy is available.16

The Court a Quo in denying petitioner’s Motion for Reconsideration grossly violated the rule that once
a decision or order is final and executory, it becomes immutable and unalterable.17

The Court a Quo committed a grave error when it ruled to annul the appointment of petitioner,
Diosdado Manungas as judicial administrator and reinstating the appointment of Florencia Parreño as
special administrator.18

The Court a Quo gravely erred in [giving] due course to oppositors’ petition that is flawed.19

The Court’s Ruling

The petition must be denied.

The RTC Order dated November 4, 2002 is an interlocutory order

The first two issues raised by Diosdado revolve around the issue of whether the RTC Order dated
November 4, 2002 is an interlocutory order.

Diosdado alleges that, following the ruling of this Court that Certiorari cannot be the substitute for a
lost appeal, Parreño should have appealed the RTC Order dated November 4, 2002 to the CA through a
petition for review on certiorari under Rule 45 of the Rules of Court. Diosdado contends that the Order
dated November 4, 2002 became final and executory, Parreño having failed to file the petition within
the reglementary period; thus, the Order cannot be the subject of review even by this Court. However,
Diosdado’s position assumes that the RTC Order dated November 4, 2002 is a final order instead of an
interlocutory order.

In Philippine Business Bank v. Chua,20 the Court stated what an interlocutory order is:

Conversely, an order that does not finally dispose of the case, and does not end the Court’s task of
adjudicating the parties’ contentions and determining their rights and liabilities as regards each other,
but obviously indicates that other things remain to be done by the Court, is "interlocutory", e.g., an
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order denying a motion to dismiss under Rule 16 of the Rules x x x. Unlike a final judgment or order,
which is appealable, as above pointed out, an interlocutory order may not be questioned on appeal
except only as part of an appeal that may eventually be taken from the final judgment rendered in the
case.

The Court has considered an appointment of a special administrator as an interlocutory or preliminary


order to the main case for the grant of letters of administration in a testate or intestate proceeding. In
Ocampo v. Ocampo,21 the Court succinctly held, "The appointment or removal of special
administrators, being discretionary, is thus interlocutory and may be assailed through a petition for
certiorari under Rule 65 of the Rules of Court."

With such categorical ruling of the Court, the Order dated November 4, 2002 is clearly an interlocutory
order. As such, the order cannot be the subject of an appeal under Rule 45 of the Rules of Court as
argued by petitioner. The proper remedy is the filing of a Petition for Certiorari under Rule 65. Thus,
Section 1(c) of Rule 41 states:

Section 1. Subject of appeal.

An appeal may be taken from a judgment or final order that completely disposes of the case, or of a
particular matter therein when declared by these Rules to be appealable.

No appeal may be taken from:

xxxx

(c) An interlocutory order;

xxxx

In all the above instances where the judgment or final order is not appealable, the aggrieved party may
file an appropriate special civil action under Rule 65.

Verily, respondents made use of the proper mode of review by filing a petition for certiorari under Rule
65 with the CA. Respondents filed the petition well within the prescribed period under this rule.

There was no necessity to file a motion for reconsideration

As properly noted by petitioner, the general rule is that a motion for reconsideration is required before a
decision may be appealed through a petition for certiorari under Rule 65. Under the rule, there must be
no other plain, speedy and adequate remedy in the ordinary course of law, such as a motion for
reconsideration, to justify the filing of a petition for certiorari. Thus, petitioner argues that respondent’s
failure to move for the reconsideration of the Order dated November 4, 2002 is fatal to an appeal from
it. Such general rule, however, admits of exceptions as explained in Delos Reyes v. Flores:22

We have held in a litany of cases that the extraordinary remedies of certiorari and mandamus are
available only when there is no other plain, speedy, and adequate remedy in the ordinary course of law,
such as a motion for reconsideration. The writ of certiorari does not lie where another adequate remedy
is available for the correction of the error. x x x However, there are several exceptions where a petition
for certiorari will lie without the prior filing of a motion for reconsideration, to wit:
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xxxx

i. where the issue raised is one purely of law or where public interest is involved. (Emphasis supplied.)

The instant case is clearly an exception to the general rule. An examination of the issues raised by
respondents in appealing the Order dated November 4, 2002, reveals that the issues are only questions
of law. Ergo, there is no need for a motion for reconsideration.

In addition, the Court has even allowed the filing of a petition for certiorari despite the existence of an
appeal or other appropriate remedy in several instances, including when the court a quo acted with
grave abuse of discretion amounting to lack of or in excess of jurisdiction in issuing the assailed
order.23

Thus, while respondent failed to move for the reconsideration of the November 4, 2002 Order of the
RTC, a petition for certiorari may still prosper, as in this case.

The RTC acted with grave abuse of discretion

The lower court stated in its November 4, 2002 Order that:

After carefully scrutinizing the arguments and grounds raised by both petitioner and oppositors, this
Court finds merit in the contention of petitioner. In the case of Gonzales vs. Court of Appeals, 298
SCRA 324, the Supreme Court ruled:

The presence of illegitimate children precludes succession by collateral relatives to his estate;

Diosdado Manungas, being the illegitimate son of Florentino Manungas inherits the latter’s property by
operation of law;

WHEREFORE, in view of the foregoing the order appointing Florencia Parreño as special
administrator of the estate of the late Engracia Vda. de Manungas is ordered set aside.

Such reasoning is a non sequitur.

The fact that Diosdado is an heir to the estate of Florentino Manungas does not mean that he is entitled
or even qualified to become the special administrator of the Estate of Manungas.

Jurisprudence teaches us that the appointment of a special administrator lies within the discretion of the
court. In Heirs of Belinda Dahlia A. Castillo v. Lacuata-Gabriel,24 it was stated that:

It is well settled that the statutory provisions as to the prior or preferred right of certain persons to the
appointment of administrator under Section 1, Rule 81, as well as the statutory provisions as to causes
for removal of an executor or administrator under section 653 of Act No. 190, now Section 2, Rule 83,
do not apply to the selection or removal of special administrator. x x x As the law does not say who
shall be appointed as special administrator and the qualifications the appointee must have, the judge or
court has discretion in the selection of the person to be appointed, discretion which must be sound, that
is, not whimsical or contrary to reason, justice or equity. (Emphasis supplied; citation omitted.)

This principle was reiterated in the Ocampo case, where the Court ruled that:
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While the RTC considered that respondents were the nearest of kin to their deceased parents in their
appointment as joint special administrators, this is not a mandatory requirement for the appointment. It
has long been settled that the selection or removal of special administrators is not governed by the rules
regarding the selection or removal of regular administrators. The probate court may appoint or remove
special administrators based on grounds other than those enumerated in the Rules at its discretion, such
that the need to first pass upon and resolve the issues of fitness or unfitness and the application of the
order of preference under Section 6 of Rule 78, as would be proper in the case of a regular
administrator, do not obtain. As long as the discretion is exercised without grave abuse, and is based on
reason, equity, justice, and legal principles, interference by higher courts is unwarranted.25 (Emphasis
supplied.)

While the trial court has the discretion to appoint anyone as a special administrator of the estate, such
discretion must be exercised with reason, guided by the directives of equity, justice and legal principles.
It may, therefore, not be remiss to reiterate that the role of a special administrator is to preserve the
estate until a regular administrator is appointed. As stated in Sec. 2, Rule 80 of the Rules:

Section 2. Powers and duties of special adminsitrator. — Such special administrator shall take
possession and charge of the goods, chattels, rights, credits, and estate of the deceased and preserve the
same for the executors or administrator afterwards appointed, and for that purpose may commence and
maintain suits as administrator. He may sell only such perishable and other property as the court orders
sold. A special administrator shall not be liable to pay any debts of the deceased unless so ordered by
the court.1avvphi1

Given this duty on the part of the special administrator, it would, therefore, be prudent and reasonable
to appoint someone interested in preserving the estate for its eventual distribution to the heirs. Such
choice would ensure that such person would not expose the estate to losses that would effectively
diminish his or her share. While the court may use its discretion and depart from such reasoning, still,
there is no logical reason to appoint a person who is a debtor of the estate and otherwise a stranger to
the deceased. To do so would be tantamount to grave abuse of discretion.

Hence, the CA ruled that the trial court erred in issuing the November 4, 2002 Order, acting with grave
abuse of discretion in appointing Diosdado as the special administrator of Engracia Manungas’ estate:

In any case, the trial court erred in revoking the appointment of Florencia Avila Parreño as Special
Administrator on the ground that it found merit in Diosdado’s contention that he is the illegitimate child
of the late Florentino Manangus. The evidence on record shows that Diosdado is not related to the late
Engracia and so he is not interested in preserving the latter’s estate. On the other hand, Florencia, who
is a former Judicial guardian of Engracia when she was still alive and who is also the niece of the latter,
is interested in protecting and preserving the estate of her late aunt Engracia, as by doing so she would
reap the benefit of a wise administration of the decedent’s estate. Hence, the Order of the lower court
revoking the appointment of Florencia Avila Parreño as special administrator constitutes not only a
reversible error, but also a grave abuse of discretion amounting to lack or excess of jurisdiction. In the
instant case, the lower court exercised its power in a despotic, arbitrary or capricious manner, as to
amount to an evasion of positive duty or to a virtual refusal to perform the duty enjoined or to act at all
in contemplation of law.26 (Emphasis supplied.)

To reiterate, the subject of the intestate proceedings is the estate of Engracia Manungas. It must be
remembered that the estate of Florentino Manungas was already the subject of intestate proceedings
that have long been terminated with the proceeds distributed to the heirs with the issuance of a Decree
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of Final Distribution.27 With the termination of the intestate estate proceedings of Florentino
Manungas, Diosdado, as an illegitimate heir of Florentino Manungas, is still not an heir of Engracia
Manungas and is not entitled to receive any part of the Estate of Manungas. In fact, Diosdado is a
debtor of the estate and would have no interest in preserving its value. There is no reason to appoint
him as its special administrator. The trial court acted with grave abuse of discretion in appointing
Diosdado as special administrator of the Estate of Manungas. The CA correctly set aside the November
4, 2002 Order of the RTC.

Consequently, with the setting aside of the November 4, 2002 Order of the trial court, reversing its May
15, 2002 Order and appointing Diosdado as the special administrator of Engracia Manungas’ estate, the
May 15, 2002 Order is necessarily reinstated and Parreño’s appointment as special administrator is
revived.

WHEREFORE, the petition is hereby DENIED. The CA’s April 30, 2009 Decision and July 21, 2010
Resolution in CA-G.R. SP No. 74531-MIN declaring as null and void the November 4, 2002 Order of
the RTC in Special Proceedings No. 708 are AFFIRMED. Consequently, the Order dated May 15, 2002
of the RTC is hereby REINSTATED and Florencia Avila Parreño is REINSTATED as the special
administrator of the estate of Engracia Manungas.

SO ORDERED.

PRESBITERO J. VELASCO, JR.


Associate Justice

WE CONCUR:

DIOSDADO M. PERALTA
Associate Justice

ROBERTO A. ABAD JOSE CATRAL MENDOZA


Associate Justice Associate Justice

MARIA LOURDES P. A. SERENO*


Associate Justice

ATTESTATION

I attest that the conclusions in the above Decision had been reached in consultation before the case was
assigned to the writer of the opinion of the Court’s Division.

PRESBITERO J. VELASCO, JR.


Associate Justice
Chairperson

CERTIFICATION

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Pursuant to Section 13, Article VIII of the Constitution, and the Division Chairperson’s Attestation, I
certify that the conclusions in the above Decision had been reached in consultation before the case was
assigned to the writer of the opinion of the Court’s Division.

RENATO C. CORONA
Chief Justice

DIGEST

FACTS:

1. Engracia Manungas was the wife of Florentino Manungas (no children of their own).
2. They adopted Samuel David Avila (Avila) on August 12, 1968.
3. Florentino Manungas died intestate on May 29, 1977, while Avila predeceased his adoptive
mother.
4. Avila was survived by his wife Sarah Abarte Vda. de Manungas.
5. Engracia Manungas (administatrix) filed a Motion for Partition of Estate on March 31, 1980 in
the intestate estate proceedings of Florentino Manungas (she stated herself, Avila and Ramon
Manungas [natural son of Florentino] as forced heirs). Avila’s widow executed a Waiver of
Rights and Participation on October 29, 1980.
6. Decree of Final Distribution was issued in the intestate estate proceedings (distributing the
properties to Engracia Manungas and Ramon Manungas).
7. October 25, 1995, the RTC of Panabo City, appointed Parreño, the niece of Engracia
Manungas, as the Judicial Guardian of the properties and person of her incompetent aunt.
8. Engracia Manungas, through Parreño, instituted a Civil Case against the spouses Diosdado
Salinas Manungas and Milagros Pacifico for illegal detainer and damages with the Municipal
Trial Court (MTC) in Panabo City (they’re occupying the property because they said Diosdado
is an illegitimate son of Florentino). Answer was filed beyond the reglementary period, not
considered by the MTC = summary judgment was issued in favor of Engracia. Spouses Salinas
appealed in the RTC of Davao City(affirmed decision of MTC).
9. August 7, 1998, Diosdado instituted a petition for the issuance of letters of administration over
the Estate of Engracia Manungas (Estate of Manungas) in his favor before the RTC, Branch 2
in Tagum City, Davao (Diosdado is Florentino’s illegitimate son = Engracia’s heir).
10. Petition was opposed by Margarita Avila Loreto (Loreto) and Parreño alleging that Diosdado
was incompetent as an administrator of the Estate of Manungas claiming that a) he was not a
Manungas, b) that he was not an heir of Engracia Manungas, c) he was not a creditor of
Engracia Manungas or her estate and d) that he was in fact a debtor of the estate (liable to
Engracia Manungas for PhP 177,000 because of the MTC decision).
11. RTC appointed Parreno AGAIN as the administrator of the Manunga Estate.
12. Diosdado filed a Motion for Reconsideration with a Prayer for Temporary Restraining Order
and Preliminary Injunction. Parreño’s appointment as special administrator of the Estate of
Manungas a) ceased upon Engracia Manungas’ death (her appointment as special administrator
was without basis),

76 | P a g e
b) Parreño was not fit to become a special administrator (already been fined by the court for
failing to render a timely accounting of Engracia Manungas’ property as her judicial guardian),
c) Parreño is a mere niece, a collateral relative, of Engracia Manungas, while he is the
illegitimate son of Florentino Manungas.
13. RTC reversed decision, appointed Diosdado as administrator. CA reversed RTC, appointed
Parreno as Administrator.

ISSUE:

WON Diosdado should be an administrator of the Manungas Estate (on the basis that he’s an
illegitimate child of Florentino).

HELD:

NO. The mere fact that Diosdado is an heir to the estate of Florentino Manungas does not mean that he
is entitled or even qualified to become the special administrator of the Estate of Manungas.
RATIO: Jurisprudence teaches us that the appointment of a special administrator lies within the
discretion of the court. In Heirs of Belinda Dahlia A. Castillo v. Lacuata-Gabriel,[24] it was stated that:

It is well settled that the statutory provisions as to the prior or preferred right of
certain persons to the appointment of administrator under Section 1, Rule 81, as well as
the statutory provisions as to causes for removal of an executor or administrator under
section 653 of Act No. 190, now Section 2, Rule 83, do not apply to the selection or
removal of special administrator. x x x As the law does not say who shall be
appointed as special administrator and the qualifications the appointee must have,
the judge or court has discretion in the selection of the person to be appointed,
discretion which must be sound, that is, not whimsical or contrary to reason, justice
or equity.

While the trial court has the discretion to appoint anyone as a special administrator of the estate,
such discretion must be exercised with reason, guided by the directives of equity, justice and legal
principles. It may, therefore, not be remiss to reiterate that the role of a special administrator is to
preserve the estate until a regular administrator is appointed. As stated in Sec. 2, Rule 80 of the Rules:

Section 2. Powers and duties of special adminsitrator. — Such special


administrator shall take possession and charge of the goods, chattels, rights, credits, and
estate of the deceased andpreserve the same for the executors or administrator
afterwards appointed, and for that purpose may commence and maintain suits as
administrator. He may sell only such perishable and other property as the court orders
sold. A special administrator shall not be liable to pay any debts of the deceased unless
so ordered by the court.

Given this duty on the part of the special administrator, it would, therefore, be prudent and
reasonable to appoint someone interested in preserving the estate for its eventual distribution to the
heirs. Such choice would ensure that such person would not expose the estate to losses that would
effectively diminish his or her share. While the court may use its discretion and depart from such

77 | P a g e
reasoning, still, there is no logical reason to appoint a person who is a debtor of the estate and otherwise
a stranger to the deceased. To do so would be tantamount to grave abuse of discretion.
Hence, the CA ruled that the trial court erred in issuing the November 4, 2002 Order, acting
with grave abuse of discretion in appointing Diosdado as the special administrator of Engracia
Manungas’ estate:

In any case, the trial court erred in revoking the appointment of Florencia Avila
Parreño as Special Administrator on the ground that it found merit in Diosdado’s
contention that he is the illegitimate child of the late Florentino Manangus. The
evidence on record shows that Diosdado is not related to the late Engracia and so
he is not interested in preserving the latter’s estate. On the other hand, Florencia,
who is a former Judicial guardian of Engracia when she was still alive and who is also
the niece of the latter, is interested in protecting and preserving the estate of her late aunt
Engracia, as by doing so she would reap the benefit of a wise administration of the
decedent’s estate. Hence, the Order of the lower court revoking the appointment of
Florencia Avila Parreño as special administrator constitutes not only a reversible
error, but also a grave abuse of discretion amounting to lack or excess of
jurisdiction. In the instant case, the lower court exercised its power in a despotic,
arbitrary or capricious manner, as to amount to an evasion of positive duty or to a
virtual refusal to perform the duty enjoined or to act at all in contemplation of law.

To reiterate, the subject of the intestate proceedings is the estate of Engracia Manungas. It must be
remembered that the estate of Florentino Manungas was already the subject of intestate proceedings
that have long been terminated with the proceeds distributed to the heirs with the issuance of a Decree
of Final Distribution.[27] With the termination of the intestate estate proceedings of Florentino
Manungas, Diosdado, as an illegitimate heir of Florentino Manungas, is still not an heir of Engracia
Manungas and is not entitled to receive any part of the Estate of Manungas. In fact, Diosdado is a
debtor of the estate and would have no interest in preserving its value. There is no reason to appoint
him as its special administrator. The trial court acted with grave abuse of discretion in appointing
Diosdado as special administrator of the Estate of Manungas. The CA correctly set aside the November
4, 2002 Order of the RTC.

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Republic of the Philippines
SUPREME COURT
Manila

SECOND DIVISION

G.R. No. L-40517 January 31, 1984

LUZON SURETY COMPANY, INC., plaintiff-appellee,


vs.
PASTOR T. QUEBRAR and FRANCISCO KILAYKO, defendants-appellants.

Tolentino & Garcia & D. R. Cruz for plaintiff-appellee.

Zoilo V. dela Cruz, Jr. for defendants-appellants.

MAKASIAR, J.:

This is an appeal from the judgement of the Court of First Instance of Manila in Civil Case No. 52790
dated November 3, 1964 which was certified to this Court by the Court of Appeals in its resolution
dated March 20, 1975.

On August 9, 1954, plaintiff-appellee issued two administrator's bond in the amount of P15,000.00
each, in behalf of the defendant-appellant Pastor T. Quebrar, as administrator in Special Proceedings
Nos. 3075 and 3076 of the Court of First Instance of Negros Occidental, entitled " Re Testate Estate of
A. B. Chinsuy," and Re Testate Estate of Cresenciana Lipa," respectively, (pp. 8-12, 17-21, ROA; p. 9
rec.). In consideration of the suretyship wherein the plaintiff-appellee Luzon Surety Company, Inc. was
bound jointly and severally with the defendant appellant Pastor T. Quebrar, the latter, together with
Francisco Kilayko, executed two indemnity agreements, where among other things, they agreed jointly
and severally to pay the plaintiff-appellee "the sum of Three Hundred Pesos (P300.00) in advance as
premium thereof for every 12 months or fraction thereof, this ... or any renewal or substitution thereof
is in effect" and to indemnify plaintiff-appellee against any and all damages, losses, costs, stamps taxes,
penalties, charges and expenses, whatsoever, including the 15% of the amount involved in any
litigation, for attomey's fees (pp. 12-16, 21-25. ROA; p. 9, rec.).

For the first year, from August 9, 1954 to August 9, 1955, the defendants-appellants paid P304.50
under each indemnity agreement or a total of P609.00 for premiums and documentary stamps.

On June 6, 1957, the Court of First Instance of Negros Occidental approved the amended Project of
Partition and Accounts of defendant-appellant (p. 87, ROA; p. 9, rec.).

On May 8, 1962, the plaintiff-appellee demanded from the defendants-appellants the payment of the
premiums and documentary stamps from August 9,1955.

On October 17, 1962, the defendants-appellants ordered a motion for cancellation and/or reduction of
executor's bonds on the ground that "the heirs of these testate estates have already received their
respective shares" (pp. 69-70, ROA, p. 9, rec.).
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On October 20, 1962, the Court of First Instance of Negros Occidental acting on the motions filed by
the defendants-appellants ordered the bonds cancelled.

Plaintiff-appellee's demand amounted to P2,436.00 in each case, hence, a total of P4,872.00 for the
period of August 9, 1955 to October 20, 1962. The defendants-appellants to pay the said amount of
P4,872.00.

On January 8, 1963, the plaintiff-appellee filed the case with the Court of First Instance of Manila
During the pre-trial the parties presented their documentary evidences and agreed on the ultimate issue
- "whether or not the administrator's bonds were in force and effect from and after the year that they
were filed and approved by the court up to 1962, when they were cancelled." The defendants-appellants
offered P1,800.00 by way of amicable settlement which the plaintiff-appellee refused.

The lower court allowed the plaintiff to recover from the defendants-appellants, holding that:

We find for the plaintiff it is clear from the terms of the Order of the Court in which
these bond were filed, that the same were in force and effect from and after filling
thereof up to and including 20 October, 1962, when the same werecancelled. It follows
that the defendants are liable under the terms of the Indemnity Agreements,
notwithstanding that they have not expressly sought the renewal of these bonds bemuse
the same were in force and effect until they were cancelled by order of the Court. The
renewal of said bonds is presumed from the fact that the defendants did not ask for the
cancellation of the same; and their liability springs from the fact that defendant
Administrator Pastor Quebrar, benefited from the bonds during their lifetime.

We find no merit in defendants' claim that the Administrator's bonds in question are not
judicial bonds but legal or conventional bonds only, since they were constituted by
virtue of Rule 82, Sec. 1 of the Old Rule of Court. Neither is there merit in defendants,
claim that payments of premiums and documentary stamps were conditions precedent to
the effectivity of the bonds, since it was the defendants' duty to pay for the premiums as
long as the bonds were in force and effect. Finally, defendants' claim that they are not
liable under the Indemnity Agreements is also without merit since the under of
defendants under said Indemnity Agreements; includes the payment of yearly pre for the
bonds.

WHEREFORE, judgment is hereby rendered in favor of the plaintiff and against the
defendants, ordering the tsn the defendant to pay the plaintiff, jointly and severally, the
amount of P6,649.36 plus interest at the legal rate from 27 July 1964 until fully paid and
the sum equivalent to 10% of the total amount due as and or attorney's fees, and costs
(pp. 92-94, ROA; p. 9, rec.).

Defendants-appellants appealed to the Court of Appeals. On March 20, 1975, the Court of Appeals in a
resolution certified the herein case to this Court after finding that this case involves only errors or
questions of law.

1. The proper determination of the liability of the surety and of the principal on the bond must depend
primarily upon the language of the bond itself. The bonds herein were required by Section 1 of Rule 81
of the Rules of Court. While a bond is nonetheless a contract because it is required by statute (Midland
Co. vs. Broat 52 NW 972), said statutory bonds are construed in the light of the statute creating the
80 | P a g e
obligation secured and the purposes for which the bond is required, as expressed in the statute (Michael
vs. Logan, 52 NW 972; Squires vs. Miller, 138 NW 1062). The statute which requires the giving of a
bond becomes a part of the bond and imparts into the bond any conditions prescribed by the statute
(Scott vs. United States Fidelity Co., 252 Ala 373, 41 So 2d 298; Employer's Liability Assurance Corp.
vs. Lunt, 82 Ariz 320, 313 P2d 393).

The bonds in question herein contain practically the very same conditions in Sec. 1, Rule 81 of the
Rules of Court. Pertinent provision of the administrator's bonds is as follows:

Therefore, if the said Pastor T. Quebrar faithfully prepares and presents to the Court,
within three months from the date of his appointment, a correct inventory of all the
property of the deceased which may have come into his possession or into the
possession of any other person representing him according to law, if he administers all
the property of the deceased which at any time comes into his possession or into the
possession of any other person representing him; faithfully pays all the debts, legacies,
and bequests which encumber said estate, pays whatever dividends which the Court may
decide should be paid, and renders a just and true account of his administrations to the
Court within a year or at any other date that he may be required so to do, and faithfully
executes all orders and decrees of said Court, then in this case this obligation shall be
void, otherwise it shall remain full force and effect (p. 9, 18, ROA p. 9, rec.).

Section 1 of Rule 81 of the Rules of Court requires the administrator/executor to put up a bond for the
purpose of indemnifying the creditors, heirs, legatees and the estate. It is conditioned upon the faithful
performance of the administrator's trust (Mendoza vs. Pacheco, 64 Phil. 134).

Having in mind the purpose and intent of the law, the surety is then liable under the administrator's
bond, for as long as the administrator has duties to do as such administrator/executor. Since the liability
of the sureties is co-extensive with that of the administrator and embraces the performance of every
duty he is called upon to perform in the course of administration (Deobold vs. Oppermann, 111 NY
531, 19 NE 94), it follows that the administrator is still duty bound to respect the indemnity agreements
entered into by him in consideration of the suretyship

It is shown that the defendant-appellant Pastor T. Quebrar, still had something to do as an


administrator/executor even after the approval of the amended project of partition and accounts on June
6, 1957.

The contention of the defendants-appellants that the administrator's bond ceased to be of legal force and
effect with the approval of the project of partition and statement of accounts on June 6, 1957 is without
merit. The defendant-appellant Pastor T. Quebrar did not cease as administrator after June 6, 1957, for
administration is for the purpose of liquidation of the estate and distribution of the residue among the
heirs and legatees. And liquidation means the determination of all the assets of the estate and payment
of all the debts and expenses (Flores vs. Flores, 48 Phil. 982). It appears that there were still debts and
expenses to be paid after June 6, 1957.

And in the case of Montemayor vs. Gutierrez (114 Phil. 95), an estate may be partitioned even before
the termination of the administration proceedings. Hence, the approval of the project of partition did
not necessarily terminate the administration proceedings. Notwithstanding the approval of the partition,
the Court of First Instance of Negros Occidental still had jurisdiction over the administration
proceedings of the estate of A.B. Chinsuy and Cresenciana Lipa.
81 | P a g e
2. The sureties of an administration bond are liable only as a rule, for matters occurring during the term
covered by the bond. And the term of a bond does not usually expire until the administration has been
closed and terminated in the manner directed by law (Hartford Accident and Indemnity Co. vs. White,
115 SW 2d 249). Thus, as long as the probate court retains jurisdiction of the estate, the bond
contemplates a continuing liability (Deobold vs. Oppermann, supra) notwithstanding the non-renewal
of the bond by the defendants-appellants.

It must be remembered that the probate court possesses an all-embracing power over the administrator's
bond and over the administration proceedings and it cannot be devoid of legal authority to execute and
make that bond answerable for the every purpose for which it was filed (Mendoza vs. Pacheco, 64 Phil.
1-05). It is the duty of the courts of probate jurisdiction to guard jealously the estate of the deceased
persons by intervening in the administration thereof in order to remedy or repair any injury that may be
done thereto (Dariano vs. Fernandez Fidalgo, 14 Phil. 62, 67; Sison vs. Azarraga, 30 Phil. 129, 134).

3. In cases like these where the pivotal point is the interpretation of the contracts entered into, it is
essential to scrutinize the very language used in the contracts. The two Indemnity Agreements provided
that:

The undersigned, Pastor T. Quebrar and Dr. Francisco Kilayko, jointly and severally,
bind ourselves unto the Luzon Surety Co., Inc. ... in consideration of it having become
SURETY upon Civil Bond in the sum of Fifteen Thousand Pesos (P15,000.00) ... in
favor of the Republic of the Philippines in Special Proceeding ... dated August 9, 1954, a
copy of which is hereto attached and made an integral part hereof (emphasis supplied;
pp. 12-13, 21, ROA p. 9, rec.),

To separately consider these two agreements would then be contrary to the intent of the parties in
making them integrated as a whole.

The contention then of the defendants-appellants that both the Administrator's Bonds and the Indemnity
Agreements ceased to have any force and effect, the former since June 6, 1957 with the approval of the
project of partition and the latter since August 9, 1955 with the non-payment of the stated premiums, is
without merit. Such construction of the said contracts entered into would render futile the purpose for
which they were made.

To allow the defendants-appellants to evade their liability under the Indemnity Agreements by non-
payment of the premiums would ultimately lead to giving the administrator the power to diminish or
reduce and altogether nullify his liability under the Administrator's Bonds. As already stated, this is
contrary to the intent and purpose of the law in providing for the administrator's bonds for the
protection of the creditors, heirs, legatees, and the estate.

4. Moreover, the lower court was correct in holding that there is no merit in the defendants' claim that
payments of premiums and documentary stamps are conditions precedent to the effectivity of the
bonds.

It is worthy to note that there is no provision or condition in the bond to the effect that it will terminate
at the end of the first year if the premium for continuation thereafter is not paid. And there is no clause
by which its obligation is avoided or even suspended by the failure of the obligee to pay an annual
premium (U.S. vs. Maryland Casualty Co. DCMD 129 F. Supp; Dale vs. Continental Insurance Co., 31
SW 266; Equitable Insurance C. vs. Harvey, 40 SW 1092).
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It was held in the case of Fourth and First Bank and Trust Co. vs. Fidelity and Deposit Co. (281 SW
785), that "at the end of the first year, the bond went on, whether or not the premium was paid or not ...
Even on a failure to pay an annual premium, the contract ran on until affirmative action was taken to
avoid it. The obligation of the bond was therefore continuous." And in United States vs. American
Surety Co. of New York (172 F2d 135), it was held that "under a surety bond securing faithful
performance of duties by postal employee, liability for default of employee occurring in any one year
would continue, whether or not a renewal premium was paid for a later year."

The payment of the annual premium is to be enforced as part of the consideration, and not as a
condition Woodfin vs. Asheville Mutual Insurance Co., 51 N.C. 558); for the payment was not made a
condition to the attaching or continuing of the contract (National Bank vs. National Surety Co., 144 A
576). The premium is the consideration for furnishing the bonds and the obligation to pay the same
subsists for as long as the liability of the surety shall exist (Reparations Commission vs. Universal
Deep-Sea Fishing Corp., L-21996, 83 SCRA 764, June 27, 1978). And in Arranz vs. Manila Fidelity
and Surety Co., Inc. (101 Phil. 272), the "premium is the consideration for furnishing the bond or the
guaranty. While the liability of the surety subsists the premium is collectible from the principal. Lastly,
in Manila Surety and Fidelity Co., Inc. vs. Villarama (107 Phil. 891), it was held that "the one-year
period mentioned therein refers not to the duration or lifetime of the bond, but merely to the payment of
premiums, and, consequently, does not affect at all the effectivity or efficacy of such bond. But such
non- payment alone of the premiums for the succeeding years ... does not necessarily extinguish or
terminate the effectivity of the counter-bond in the absence of an express stipulation in the contract
making such non-payment of premiums a cause for the extinguishment or termination of the
undertaking. ...There is no necessity for an extension or renewal of the agreement because by specific
provision thereof, the duration of the counter-bond was made dependent upon the existence of the
original bond."

5. It is true that in construing the liability of sureties, the principle of strictissimi juris applies (Asiatic
Petroleum Co. vs, De Pio, 46 Phil. 167; Standard Oil Co. of N.Y. vs. Cho Siong, 53 Phil. 205); but with
the advent of corporate surety, suretyship became regarded as insurance where, usually, provisions are
interpreted most favorably to the insured and against the insurer because ordinarily the bond is prepared
by the insurer who then has the opportunity to state plainly the term of its obligation (Surety Co. vs.
Pauly, 170 US 133, 18 S. Ct. 552.,42 L. Ed. 972).

This rule of construction is not applicable in the herein case because there is no ambiguity in the
language of the bond and more so when the bond is read in connection with the statutory provision
referred to.

With the payment of the premium for the first year, the surety already assumed the risk involved, that
is, in case defendant-appellant Pastor T. Quebrar defaults in his administrative duties. The surety
became liable under the bond for the faithful administration of the estate by the administrator/executor.
Hence, for as long as defendant-appellant Pastor T. Quebrar was administrator of the estates, the bond
was held liable and inevitably, the plaintiff-appellee's liability subsists since the liability of the sureties
is co-extensive with that of the administrator.

WHEREFORE, THE DECISION OF THE COURT OF FIRST INSTANCE OF MANILA DATED


NOVEMBER 3, 1964 IS HEREBY AFFIRMED. WITH COSTS AGAINST DEFENDANTS-
APPELLANTS.

Concepcion, Jr., Guerrero, Abad Santos, De Castro and Escolin, JJ., concur. Aquino, J., took no part.
83 | P a g e
DIGEST

Facts of the Case:

Luzon Surety issued two administrator's bond in behalf of defendant Quebrar as administrator of 2
estates (Chinsuy and Lipa). The plaintiff and both Quebrar and Kilayko bound themselves solidarily
after executing an indemnity agreement where both the defendants agreed to pay the premiums every
ear. In the years 1954-55, the defendants paid the premiums and the documentary stamps. In 1957, the
Court approved the project of partition while in 1962, Luzon Surety demanded payments of premiums
from 1955 onwards. It was also in the same year when the court granted the motion of the defendants to
have both bonds cancelled. Hence, plaintiff file a case in the CFI. The court (CFI) allowed the plaintiff
to recover since the bonds were in force and effect from the filing until 1962. The Court of Appeals
certified the case to the Supreme Court on questions of law.

Issue: Are the bonds still in force and effect from 1955 to 1962?

Ruling:

YES. Under Rule 81 (Sec. 1) of the Rules of Court- the administrator is required to put up a bond for
the purpose of indemnifying creditors, heirs, legatees and the estate. It is conditioned upon the faithful
performance of the administrator's trust. Hence, the surety is then liable under the administrator's bond.

Even after the approved project of partition, Quebrar as administrator still had something to do. The
administration is for the purpose of liquidation of the estate and the distribution of the residue among
the heirs and legatees. Liquidation means the determination of all the assets of the estate and the
payment of all debts and expenses. It appears that there are still debts and expenses to be paid after
1957.

Moreover, the bond stipulation did not provide that it will terminate at the end of the 1st year if the
premium remains unpaid. Hence, it does not necessarily extinguish or terminate the effectivity of the
counter bond in the absence of an express stipulation to this effect. As such, as long as the defendant
remains the administrator of the estate, the bond will be held liable and the plaintiff's liabilities subsist
being the coextensive with the administrator.

84 | P a g e
Republic of the Philippines
SUPREME COURT
Manila

EN BANC

G.R. No. L-2804 September 20, 1949

In re Petition for probate and administration of the will of Paula Tiangco, deceased. MANUEL
EUGENIO,petitioner-appellant,
vs.
JOSE TIANGCO, oppositor-appellee.

Mario Bengzon for appellant.


Tomas Yumol for appellee.

OZAETA, J.:

Paula Tiangco died in Malabon, Rizal, on September 27, 1947, leaving properties allegedly worth less
than P30,000. She is survived by her husband Dr. Benito Cruz, a sister, and nine nephews and nieces.

In or about October, 1947, Jose Tiangeo, one of the surviving nephews, instituted intestate proceeding
No. 442 in the Court of First Instance of Rizal and applied for letters of administration of the estate of
the deceased. Manuel Eugenio, Purificacion Eugenia, Abelardo Eugenia and Milagros Eugenio, other
nephews and nieces of the deceased, opposed Tiangco's petition for letters of administration, alleging
that the deceased in her lifetime had executed a will which, according to their knowledge, information,
and belief, was then in the possession of the surviving husband, Dr. Benito, Cruz, and prayed that the
latter be required to produce the last will and testament of the deceased for probate by the court.

In view of that allegation, Judge Oscar Castelo ordered Dr. Benito Cruz to appear before the court on
November 27, 1947, at nine a. m., and to produce the last will and testament of Paula Tiangco. In
compliance with that order Dr. Benito Cruz appeared before the court and manifested that he had no
knowledge of the existence of the alleged will and that he never had it in his possession. In view of that
manifestation the court ordered the oppositor Manuel Eugenio to present evidence of the existence and
due execution of the alleged will.

After hearing the evidence adduced by the oppositor, Judge Castelo entered an order on December 20,
1947, declaring that it had not been proven that the deceased Paula Tiangco had left a will and
appointing Jose Tiangco administrator of the properties left by her.

Instead of appealing from said order Manuel Eugenio, on January 24, 1948, filed a petition in the same
court for the "probate and administration of the will of Paula Tiangco," alleging that the deceased
executed a last will and testament sometime in the year 1943 and that said last will and testament "has
been and still is in the possession of her surviving husband, Dr. Benito Cruz," and praying that the latter
be ordered to produce and present to the court the last will and testament of the deceased Paula Tiangco
so that it might be probated, and that letters testamentary be issued to the petitioner, In view of that
petition Judge Ambrosio Santos ordered Dr. Benito Cruz to deliver said last will and testament to the
clerk of court within five days.

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The respondent Dr. Benito Cruz informed the court in writing that he had no knowledge of the
existence of the alleged will and that he never had it in his custody; that the nonexistence of said will
was res judicata, the same question having been submitted to and decided by the court in intestate
proceeding No. 442, from which decision or order the petitioner Manuel Eugenio had not appealed. In
view thereof, respondent Benito Cruz asked for the dismissal of the petition for probate. To said
petition for dismissal the respondent attached the pleadings, the transcript of the evidence, and the order
of Judge Castelo in intestate proceeding No. 442.

After considering the written arguments of both parties on the motion for dismissal, Judge Ambrosio
Santos entered an order sustaining said motion and dismissing the petition for probate. The case is now
before us on appeal from said order.

Appellant contends that the trial court erred in dismissing his petition for probate, and cites section 1 of
Rule 83, which reads as follows:

SECTION 1. Administration revoked if will discovered. Proceedings thereupon. — If after


letters of administration have been granted on the estate of decedent as if he had died intestate,
his will is proved and allowed by the court, the letters of administration shall be revoked and all
powers thereunder cease, and the administrator shall forthwith surrender the letters to the court,
and render his account within such time as the court directs. Proceedings for the issuance of
letters testamentary or of administration under the will shall be as hereinbefore provided.

There can be no question that under the above-quoted provision of the Rules of Court, if the appellant
had found the alleged will and had proved its due execution, the letters of administration issued to the
herein appellee Jose Tiangco in intestate proceedings No. 442 would have been revoked and said
intestate proceeding would have been converted into a testamentary proceeding. But appellant had not
done so. He did not even allege that he had found the supposed will. In his petition for probate he
merely repeated and sought to litigate anew his contention in intestate proceeding No. 442 that the
surviving husband, Benito Cruz, had the alleged will in his possession and again asked the court to
order him to produce it.

Having been raised in issue and finally decided adversely to the herein appellant in intestate proceeding
No. 442, that same question of whether or not Benito Cruz had the alleged will in his possession cannot
be litigated anew. To countenance the procedure adopted by the appellant would be to permit him to
trifle with the court and harass his opponent.

There is no analogy between the present case and that of Cartajena vs. Lijauco and Zaballa, 38 Phil.,
620, cited and relied upon by the appellant. The question presented in that case, as stated by the Court,
was: "May an administrator of an estate of a deceased person continue to administer the estate after a
will of such deceased is proved and allowed?" In that case, pending petition by Lijauco and Zaballa for
the appointment of an administrator of the estate of the deceased Tomasa Nepomuceno, Cartajena
presented a will in the court and asked that it be admitted to probate. Lijauco and Zaballa were
appointed administrators, but after the will was admitted to probate the letters of administration
theretofore granted to Lijauco and Zaballa were revoked, in conformity with section 657 of the Code of
Civil Procedure, now section 1 of Rule 83.

Counsel for the appellant has misunderstood the abovecited rule. Applied to this case, it clearly means
that notwithstanding the letters of administration issued in intestate proceedings No. 442, if the
appellant or any other interested party could produce a will of the deceased and could prove its due
86 | P a g e
execution, letters testamentary or of administration would be issued and the appointment of appellee
Jose Tiangco as administrator would be revoked. The order appealed from is affirmed, with costs.

Moran, C.J., Paras, Feria, Padilla, Tuason, Montemayor and Reyes, JJ., concur.

NO CASE DIGEST

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Republic of the Philippines
SUPREME COURT
Manila

FIRST DIVISION

G.R. No. 156407 January 15, 2014

THELMA M. ARANAS, Petitioner,


vs.
TERESITA V. MERCADO, FELIMON V. MERCADO, CARMENCITA M. SUTHERLAND,
RICHARD V. MERCADO, MA. TERESITA M. ANDERSON, and FRANKLIN L.
MERCADO, Respondents.

DECISION

BERSAMIN, J.:

The probate court is authorized to determine the issue of ownership of properties for purposes of their
inclusion or exclusion from the inventory to be submitted by the administrator, but its determination
shall only be provisional unless the interested parties are all heirs of the decedent, or the question is one
of collation or advancement, or the parties consent to the assumption of jurisdiction by the probate
court and the rights of third parties are not impaired. Its jurisdiction extends to matters incidental or
collateral to the settlement and distribution of the estate, such as the determination of the status of each
heir and whether property included in the inventory is the conjugal or exclusive property of the
deceased spouse.

Antecedents

Emigdio S. Mercado (Emigdio) died intestate on January 12, 1991, survived by his second wife,
Teresita V. Mercado (Teresita), and their five children, namely: Allan V. Mercado, Felimon V.
Mercado, Carmencita M. Sutherland, Richard V. Mercado, and Maria Teresita M. Anderson; and his
two children by his first marriage, namely: respondent Franklin L. Mercado and petitioner Thelma M.
Aranas (Thelma).

Emigdio inherited and acquired real properties during his lifetime. He owned corporate shares in
Mervir Realty Corporation (Mervir Realty) and Cebu Emerson Transportation Corporation (Cebu
Emerson). He assigned his real properties in exchange for corporate stocks of Mervir Realty, and sold
his real property in Badian, Cebu (Lot 3353 covered by Transfer Certificate of Title No. 3252) to
Mervir Realty.

On June 3, 1991, Thelma filed in the Regional Trial Court (RTC) in Cebu City a petition for the
appointment of Teresita as the administrator of Emigdio’s estate (Special Proceedings No. 3094-
CEB).1 The RTC granted the petition considering that there was no opposition. The letters of
administration in favor of Teresita were issued on September 7, 1992.

As the administrator, Teresita submitted an inventory of the estate of Emigdio on December 14, 1992
for the consideration and approval by the RTC. She indicated in the inventory that at the time of his
death, Emigdio had "left no real properties but only personal properties" worth ₱6,675,435.25 in all,
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consisting of cash of ₱32,141.20; furniture and fixtures worth ₱20,000.00; pieces of jewelry valued at
₱15,000.00; 44,806 shares of stock of Mervir Realty worth ₱6,585,585.80; and 30 shares of stock of
Cebu Emerson worth ₱22,708.25.2

Claiming that Emigdio had owned other properties that were excluded from the inventory, Thelma
moved that the RTC direct Teresita to amend the inventory, and to be examined regarding it. The RTC
granted Thelma’s motion through the order of January 8, 1993.

On January 21, 1993, Teresita filed a compliance with the order of January 8, 1993,3 supporting her
inventory with copies of three certificates of stocks covering the 44,806 Mervir Realty shares of
stock;4 the deed of assignment executed by Emigdio on January 10, 1991 involving real properties with
the market value of ₱4,440,651.10 in exchange for 44,407 Mervir Realty shares of stock with total par
value of ₱4,440,700.00;5 and the certificate of stock issued on January 30, 1979 for 300 shares of stock
of Cebu Emerson worth ₱30,000.00.6

On January 26, 1993, Thelma again moved to require Teresita to be examined under oath on the
inventory, and that she (Thelma) be allowed 30 days within which to file a formal opposition to or
comment on the inventory and the supporting documents Teresita had submitted.

On February 4, 1993, the RTC issued an order expressing the need for the parties to present evidence
and for Teresita to be examined to enable the court to resolve the motion for approval of the inventory.7

On April 19, 1993, Thelma opposed the approval of the inventory, and asked leave of court to examine
Teresita on the inventory.

With the parties agreeing to submit themselves to the jurisdiction of the court on the issue of what
properties should be included in or excluded from the inventory, the RTC set dates for the hearing on
that issue.8

Ruling of the RTC

After a series of hearings that ran for almost eight years, the RTC issued on March 14, 2001 an order
finding and holding that the inventory submitted by Teresita had excluded properties that should be
included, and accordingly ruled:

WHEREFORE, in view of all the foregoing premises and considerations, the Court hereby denies the
administratrix’s motion for approval of inventory. The Court hereby orders the said administratrix to
re-do the inventory of properties which are supposed to constitute as the estate of the late Emigdio S.
Mercado by including therein the properties mentioned in the last five immediately preceding
paragraphs hereof and then submit the revised inventory within sixty (60) days from notice of this
order.

The Court also directs the said administratrix to render an account of her administration of the estate of
the late Emigdio S. Mercado which had come to her possession. She must render such accounting
within sixty (60) days from notice hereof.

SO ORDERED.9

89 | P a g e
On March 29, 2001, Teresita, joined by other heirs of Emigdio, timely sought the reconsideration of the
order of March 14, 2001 on the ground that one of the real properties affected, Lot No. 3353 located in
Badian, Cebu, had already been sold to Mervir Realty, and that the parcels of land covered by the deed
of assignment had already come into the possession of and registered in the name of Mervir
Realty.10 Thelma opposed the motion.

On May 18, 2001, the RTC denied the motion for reconsideration,11 stating that there was no cogent
reason for the reconsideration, and that the movants’ agreement as heirs to submit to the RTC the issue
of what properties should be included or excluded from the inventory already estopped them from
questioning its jurisdiction to pass upon the issue.

Decision of the CA

Alleging that the RTC thereby acted with grave abuse of discretion in refusing to approve the
inventory, and in ordering her as administrator to include real properties that had been transferred to
Mervir Realty, Teresita, joined by her four children and her stepson Franklin, assailed the adverse
orders of the RTC promulgated on March 14, 2001 and May 18, 2001 by petition for certiorari, stating:

THE HONORABLE RESPONDENT JUDGE HAS COMMITTED GRAVE ABUSE OF


JURISDICTION (sic) AMOUNTING TO LACK OR EXCESS OF JURISDICTION IN HOLDING
THAT THE REAL PROPERTY WHICH WAS SOLD BY THE LATE EMIGDIO S. MERCADO
DURING HIS LIFETIME TO A PRIVATE CORPORATION (MERVIR REALTY CORPORATION)
BE INCLUDED IN THE INVENTORY OF THE ESTATE OF THE LATE EMIGDIO S. MERCADO.

II

THE HONORABLE RESPONDENT JUDGE HAS COMMITTED GRAVE ABUSE OF


JURISDICTION (sic) AMOUNTING TO LACK OR EXCESS OF JURISDICTION IN HOLDING
THAT REAL PROPERTIES WHICH ARE IN THE POSSESSION OF AND ALREADY
REGISTERED IN THE NAME (OF) PRIVATE CORPORATION (MERVIR REALTY
CORPORATION) BE INCLUDED IN THE INVENTORY OF THE ESTATE OF THE LATE
EMIGDIO S. MERCADO.

III

THE HONORABLE RESPONDENT JUDGE HAS COMMITTED GRAVE ABUSE OF


DISCRETION AMOUNTING TO LACK OR EXCESS OF JURISDICTION IN HOLDING THAT
PETITIONERS ARE NOW ESTOPPED FROM QUESTIONING ITS JURISDICTION IN PASSING
UPON THE ISSUE OF WHAT PROPERTIES SHOULD BE INCLUDED IN THE INVENTORY OF
THE ESTATE OF THE LATE EMIGDIO MERCADO.12

On May 15, 2002, the CA partly granted the petition for certiorari, disposing as follows:13

WHEREFORE, FOREGOING PREMISES CONSIDERED, this petition is GRANTED partially. The


assailed Orders dated March 14, 2001 and May 18, 2001 are hereby reversed and set aside insofar as
the inclusion of parcels of land known as Lot No. 3353 located at Badian, Cebu with an area of 53,301
square meters subject matter of the Deed of Absolute Sale dated November 9, 1989 and the various
90 | P a g e
parcels of land subject matter of the Deeds of Assignment dated February 17, 1989 and January 10,
1991 in the revised inventory to be submitted by the administratrix is concerned and affirmed in all
other respects.

SO ORDERED.

The CA opined that Teresita, et al. had properly filed the petition for certiorari because the order of the
RTC directing a new inventory of properties was interlocutory; that pursuant to Article 1477 of the
Civil Code, to the effect that the ownership of the thing sold "shall be transferred to the vendee" upon
its "actual and constructive delivery," and to Article 1498 of the Civil Code, to the effect that the sale
made through a public instrument was equivalent to the delivery of the object of the sale, the sale by
Emigdio and Teresita had transferred the ownership of Lot No. 3353 to Mervir Realty because the deed
of absolute sale executed on November 9, 1989 had been notarized; that Emigdio had thereby ceased to
have any more interest in Lot 3353; that Emigdio had assigned the parcels of land to Mervir Realty as
early as February 17, 1989 "for the purpose of saving, as in avoiding taxes with the difference that in
the Deed of Assignment dated January 10, 1991, additional seven (7) parcels of land were included";
that as to the January 10, 1991 deed of assignment, Mervir Realty had been "even at the losing end
considering that such parcels of land, subject matter(s) of the Deed of Assignment dated February 12,
1989, were again given monetary consideration through shares of stock"; that even if the assignment
had been based on the deed of assignment dated January 10, 1991, the parcels of land could not be
included in the inventory "considering that there is nothing wrong or objectionable about the estate
planning scheme"; that the RTC, as an intestate court, also had no power to take cognizance of and
determine the issue of title to property registered in the name of third persons or corporation; that a
property covered by the Torrens system should be afforded the presumptive conclusiveness of title; that
the RTC, by disregarding the presumption, had transgressed the clear provisions of law and infringed
settled jurisprudence on the matter; and that the RTC also gravely abused its discretion in holding that
Teresita, et al. were estopped from questioning its jurisdiction because of their agreement to submit to
the RTC the issue of which properties should be included in the inventory.

The CA further opined as follows:

In the instant case, public respondent court erred when it ruled that petitioners are estopped from
questioning its jurisdiction considering that they have already agreed to submit themselves to its
jurisdiction of determining what properties are to be included in or excluded from the inventory to be
submitted by the administratrix, because actually, a reading of petitioners’ Motion for Reconsideration
dated March 26, 2001 filed before public respondent court clearly shows that petitioners are not
questioning its jurisdiction but the manner in which it was exercised for which they are not estopped,
since that is their right, considering that there is grave abuse of discretion amounting to lack or in
excess of limited jurisdiction when it issued the assailed Order dated March 14, 2001 denying the
administratrix’s motion for approval of the inventory of properties which were already titled and in
possession of a third person that is, Mervir Realty Corporation, a private corporation, which under the
law possessed a personality distinct and separate from its stockholders, and in the absence of any
cogency to shred the veil of corporate fiction, the presumption of conclusiveness of said titles in favor
of Mervir Realty Corporation should stand undisturbed.

Besides, public respondent court acting as a probate court had no authority to determine the
applicability of the doctrine of piercing the veil of corporate fiction and even if public respondent court
was not merely acting in a limited capacity as a probate court, private respondent nonetheless failed to
adjudge competent evidence that would have justified the court to impale the veil of corporate fiction
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because to disregard the separate jurisdictional personality of a corporation, the wrongdoing must be
clearly and convincingly established since it cannot be presumed.14

On November 15, 2002, the CA denied the motion for reconsideration of Teresita, et al.15

Issue

Did the CA properly determine that the RTC committed grave abuse of discretion amounting to lack or
excess of jurisdiction in directing the inclusion of certain properties in the inventory notwithstanding
that such properties had been either transferred by sale or exchanged for corporate shares in Mervir
Realty by the decedent during his lifetime?

Ruling of the Court

The appeal is meritorious.

Was certiorari the proper recourse


to assail the questioned orders of the RTC?

The first issue to be resolved is procedural. Thelma contends that the resort to the special civil action
for certiorari to assail the orders of the RTC by Teresita and her co-respondents was not proper.

Thelma’s contention cannot be sustained.

The propriety of the special civil action for certiorari as a remedy depended on whether the assailed
orders of the RTC were final or interlocutory in nature. In Pahila-Garrido v. Tortogo,16 the Court
distinguished between final and interlocutory orders as follows:

The distinction between a final order and an interlocutory order is well known. The first disposes of the
subject matter in its entirety or terminates a particular proceeding or action, leaving nothing more to be
done except to enforce by execution what the court has determined, but the latter does not completely
dispose of the case but leaves something else to be decided upon. An interlocutory order deals with
preliminary matters and the trial on the merits is yet to be held and the judgment rendered. The test to
ascertain whether or not an order or a judgment is interlocutory or final is: does the order or judgment
leave something to be done in the trial court with respect to the merits of the case? If it does, the order
or judgment is interlocutory; otherwise, it is final.

The order dated November 12, 2002, which granted the application for the writ of preliminary
injunction, was an interlocutory, not a final, order, and should not be the subject of an appeal. The
reason for disallowing an appeal from an interlocutory order is to avoid multiplicity of appeals in a
single action, which necessarily suspends the hearing and decision on the merits of the action during
the pendency of the appeals. Permitting multiple appeals will necessarily delay the trial on the merits of
the case for a considerable length of time, and will compel the adverse party to incur unnecessary
expenses, for one of the parties may interpose as many appeals as there are incidental questions raised
by him and as there are interlocutory orders rendered or issued by the lower court. An interlocutory
order may be the subject of an appeal, but only after a judgment has been rendered, with the ground for
appealing the order being included in the appeal of the judgment itself.
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The remedy against an interlocutory order not subject of an appeal is an appropriate special civil action
under Rule 65, provided that the interlocutory order is rendered without or in excess of jurisdiction or
with grave abuse of discretion. Then is certiorari under Rule 65 allowed to be resorted to.

The assailed order of March 14, 2001 denying Teresita’s motion for the approval of the inventory and
the order dated May 18, 2001 denying her motion for reconsideration were interlocutory. This is
because the inclusion of the properties in the inventory was not yet a final determination of their
ownership. Hence, the approval of the inventory and the concomitant determination of the ownership as
basis for inclusion or exclusion from the inventory were provisional and subject to revision at anytime
during the course of the administration proceedings.

In Valero Vda. De Rodriguez v. Court of Appeals,17 the Court, in affirming the decision of the CA to
the effect that the order of the intestate court excluding certain real properties from the inventory was
interlocutory and could be changed or modified at anytime during the course of the administration
proceedings, held that the order of exclusion was not a final but an interlocutory order "in the sense that
it did not settle once and for all the title to the San Lorenzo Village lots." The Court observed there that:

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).18 (Bold
emphasis supplied)

To the same effect was De Leon v. Court of Appeals,19 where the Court declared that a "probate court,
whether in a testate or intestate proceeding, can only pass upon questions of title provisionally," and
reminded, citing Jimenez v. Court of Appeals, that 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." Indeed, in the cited case of
Jimenez v. Court of Appeals,20 the Court pointed out:

All that the said court could do as regards the 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. (Bold emphasis supplied)

On the other hand, an appeal would not be the correct recourse for Teresita, et al. to take against the
assailed orders. The final judgment rule embodied in the first paragraph of Section 1, Rule 41, Rules of
Court,21 which also governs appeals in special proceedings, stipulates that only the judgments, final
orders (and resolutions) of a court of law "that completely disposes of the case, or of a particular matter
therein when declared by these Rules to be appealable" may be the subject of an appeal in due course.
The same rule states that an interlocutory order or resolution (interlocutory because it deals with
preliminary matters, or that the trial on the merits is yet to be held and the judgment rendered) is
expressly made non-appealable.

Multiple appeals are permitted in special proceedings as a practical recognition of the possibility that
material issues may be finally determined at various stages of the special proceedings. Section 1, Rule

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109 of the Rules of Court enumerates the specific instances in which multiple appeals may be resorted
to in special proceedings, viz:

Section 1. Orders or judgments from which appeals may be taken. - An interested person may appeal in
special proceedings from an order or judgment rendered by a Court of First Instance or a Juvenile and
Domestic Relations Court, where such order or judgment:

(a) Allows or disallows a will;

(b) Determines who are the lawful heirs of a deceased person, or the distributive share of the
estate to which such person is entitled;

(c) Allows or disallows, in whole or in part, any claim against the estate of a deceased person,
or any claim presented on behalf of the estate in offset to a claim against it;

(d) Settles the account of an executor, administrator, trustee or guardian;

(e) Constitutes, in proceedings relating to the settlement of the estate of a deceased person, or
the administration of a trustee or guardian, a final determination in the lower court of the rights
of the party appealing, except that no appeal shall be allowed from the appointment of a special
administrator; and

(f) Is the final order or judgment rendered in the case, and affects the substantial rights of the
person appealing, unless it be an order granting or denying a motion for a new trial or for
reconsideration.

Clearly, the assailed orders of the RTC, being interlocutory, did not come under any of the instances in
which multiple appeals are permitted.

II

Did the RTC commit grave abuse of discretion


in directing the inclusion of the properties
in the estate of the decedent?

In its assailed decision, the CA concluded that the RTC committed grave abuse of discretion for
including properties in the inventory notwithstanding their having been transferred to Mervir Realty by
Emigdio during his lifetime, and for disregarding the registration of the properties in the name of
Mervir Realty, a third party, by applying the doctrine of piercing the veil of corporate fiction.

Was the CA correct in its conclusion?

The answer is in the negative. It is unavoidable to find that the CA, in reaching its conclusion, ignored
the law and the facts that had fully warranted the assailed orders of the RTC.

Under Section 6(a), Rule 78 of the Rules of Court, the letters of administration may be granted at the
discretion of the court to the surviving spouse, who is competent and willing to serve when the person
dies intestate. Upon issuing the letters of administration to the surviving spouse, the RTC becomes
duty-bound to direct the preparation and submission of the inventory of the properties of the estate, and
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the surviving spouse, as the administrator, has the duty and responsibility to submit the inventory
within three months from the issuance of letters of administration pursuant to Rule 83 of the Rules of
Court, viz:

Section 1. Inventory and appraisal to be returned within three months. – Within three (3) months after
his appointment every executor or administrator shall return to the court a true inventory and appraisal
of all the real and personal estate of the deceased which has come into his possession or knowledge. In
the appraisement of such estate, the court may order one or more of the inheritance tax appraisers to
give his or their assistance.

The usage of the word all in Section 1, supra, demands the inclusion of all the real and personal
properties of the decedent in the inventory.22 However, the word all is qualified by the phrase which
has come into his possession or knowledge, which signifies that the properties must be known to the
administrator to belong to the decedent or are in her possession as the administrator. Section 1 allows
no exception, for the phrase true inventory implies that no properties appearing to belong to the
decedent can be excluded from the inventory, regardless of their being in the possession of another
person or entity.

The objective of the Rules of Court in requiring the inventory and appraisal of the estate of the
decedent is "to aid the court in revising the accounts and determining the liabilities of the executor or
the administrator, and in making a final and equitable distribution (partition) of the estate and otherwise
to facilitate the administration of the estate."23Hence, the RTC that presides over the administration of
an estate is vested with wide discretion on the question of what properties should be included in the
inventory. According to Peralta v. Peralta,24 the CA cannot impose its judgment in order to supplant
that of the RTC on the issue of which properties are to be included or excluded from the inventory in
the absence of "positive abuse of discretion," for in the administration of the estates of deceased
persons, "the judges enjoy ample discretionary powers and the appellate courts should not interfere
with or attempt to replace the action taken by them, unless it be shown that there has been a positive
abuse of discretion."25 As long as the RTC commits no patently grave abuse of discretion, its orders
must be respected as part of the regular performance of its judicial duty.

There is no dispute that the jurisdiction of the trial court as an intestate court is special and limited. The
trial court cannot adjudicate title to properties claimed to be a part of the estate but are claimed to
belong to third parties by title adverse to that of the decedent and the estate, not by virtue of any right of
inheritance from the decedent. All that the trial court can do regarding said properties is to determine
whether or not they should be included in the inventory of properties to be administered by the
administrator. Such determination is provisional and may be still revised. As the Court said in Agtarap
v. Agtarap:26

The general rule is that the jurisdiction of the trial court, either as a probate court or an intestate court,
relates only to matters having to do with the probate of the will and/or settlement of the estate of
deceased persons, but does not extend to the determination of questions of ownership that arise during
the proceedings. The patent rationale for this rule is that such court merely exercises special and limited
jurisdiction. As held in several cases, a probate court or one in charge of estate proceedings, whether
testate or intestate, cannot adjudicate or determine title to properties claimed to be a part of the estate
and which are claimed to belong to outside parties, not by virtue of any right of inheritance from the
deceased but by title adverse to that of the deceased and his estate. All that the said court could do as
regards said properties is to determine whether or not they should be included in the inventory of
properties to be administered by the administrator. If there is no dispute, there poses no problem, but if
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there is, then the parties, the administrator, and the opposing parties have to resort to an ordinary action
before a court exercising general jurisdiction for a final determination of the conflicting claims of title.

However, this general rule is subject to exceptions as justified by expediency and convenience.

First, the probate court may provisionally pass upon in an intestate or a testate proceeding the question
of inclusion in, or exclusion from, the inventory of a piece of property without prejudice to final
determination of ownership in a separate action. Second, if the interested parties are all heirs to the
estate, or the question is one of collation or advancement, or the parties consent to the assumption of
jurisdiction by the probate court and the rights of third parties are not impaired, then the probate court
is competent to resolve issues on ownership. Verily, its jurisdiction extends to matters incidental or
collateral to the settlement and distribution of the estate, such as the determination of the status of each
heir and whether the property in the inventory is conjugal or exclusive property of the deceased
spouse.27 (Italics in the original; bold emphasis supplied)

It is clear to us that the RTC took pains to explain the factual bases for its directive for the inclusion of
the properties in question in its assailed order of March 14, 2001, viz:

In the first place, the administratrix of the estate admitted that Emigdio Mercado was one of the heirs of
Severina Mercado who, upon her death, left several properties as listed in the inventory of properties
submitted in Court in Special Proceedings No. 306-R which are supposed to be divided among her
heirs. The administratrix admitted, while being examined in Court by the counsel for the petitioner, that
she did not include in the inventory submitted by her in this case the shares of Emigdio Mercado in the
said estate of Severina Mercado. Certainly, said properties constituting Emigdio Mercado’s share in the
estate of Severina Mercado should be included in the inventory of properties required to be submitted
to the Court in this particular case.

In the second place, the administratrix of the estate of Emigdio Mercado also admitted in Court that she
did not include in the inventory shares of stock of Mervir Realty Corporation which are in her name
and which were paid by her from money derived from the taxicab business which she and her husband
had since 1955 as a conjugal undertaking. As these shares of stock partake of being conjugal in
character, one-half thereof or of the value thereof should be included in the inventory of the estate of
her husband.

In the third place, the administratrix of the estate of Emigdio Mercado admitted, too, in Court that she
had a bank account in her name at Union Bank which she opened when her husband was still alive.
Again, the money in said bank account partakes of being conjugal in character, and so, one-half thereof
should be included in the inventory of the properties constituting as estate of her husband.

In the fourth place, it has been established during the hearing in this case that Lot No. 3353 of Pls-657-
D located in Badian, Cebu containing an area of 53,301 square meters as described in and covered by
Transfer Certificate of Title No. 3252 of the Registry of Deeds for the Province of Cebu is still
registered in the name of Emigdio S. Mercado until now. When it was the subject of Civil Case No.
CEB-12690 which was decided on October 19, 1995, it was the estate of the late Emigdio Mercado
which claimed to be the owner thereof. Mervir Realty Corporation never intervened in the said case in
order to be the owner thereof. This fact was admitted by Richard Mercado himself when he testified in
Court. x x x So the said property located in Badian, Cebu should be included in the inventory in this
case.

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Fifthly and lastly, it appears that the assignment of several parcels of land by the late Emigdio S.
Mercado to Mervir Realty Corporation on January 10, 1991 by virtue of the Deed of Assignment
signed by him on the said day (Exhibit N for the petitioner and Exhibit 5 for the administratrix) was a
transfer in contemplation of death. It was made two days before he died on January 12, 1991. A transfer
made in contemplation of death is one prompted by the thought that the transferor has not long to live
and made in place of a testamentary disposition (1959 Prentice Hall, p. 3909). Section 78 of the
National Internal Revenue Code of 1977 provides that the gross estate of the decedent shall be
determined by including the value at the time of his death of all property to the extent of any interest
therein of which the decedent has at any time made a transfer in contemplation of death. So, the
inventory to be approved in this case should still include the said properties of Emigdio Mercado which
were transferred by him in contemplation of death. Besides, the said properties actually appeared to be
still registered in the name of Emigdio S. Mercado at least ten (10) months after his death, as shown by
the certification issued by the Cebu City Assessor’s Office on October 31, 1991 (Exhibit O).28

Thereby, the RTC strictly followed the directives of the Rules of Court and the jurisprudence relevant
to the procedure for preparing the inventory by the administrator. The aforequoted explanations
indicated that the directive to include the properties in question in the inventory rested on good and
valid reasons, and thus was far from whimsical, or arbitrary, or capricious.

Firstly, the shares in the properties inherited by Emigdio from Severina Mercado should be included in
the inventory because Teresita, et al. did not dispute the fact about the shares being inherited by
Emigdio.

Secondly, with Emigdio and Teresita having been married prior to the effectivity of the Family Code in
August 3, 1988, their property regime was the conjugal partnership of gains.29 For purposes of the
settlement of Emigdio’s estate, it was unavoidable for Teresita to include his shares in the conjugal
partnership of gains. The party asserting that specific property acquired during that property regime did
not pertain to the conjugal partnership of gains carried the burden of proof, and that party must prove
the exclusive ownership by one of them by clear, categorical, and convincing evidence.30 In the absence
of or pending the presentation of such proof, the conjugal partnership of Emigdio and Teresita must be
provisionally liquidated to establish who the real owners of the affected properties were,31 and which of
the properties should form part of the estate of Emigdio. The portions that pertained to the estate of
Emigdio must be included in the inventory.

Moreover, although the title over Lot 3353 was already registered in the name of Mervir Realty, the
RTC made findings that put that title in dispute. Civil Case No. CEB-12692, a dispute that had involved
the ownership of Lot 3353, was resolved in favor of the estate of Emigdio, and

Transfer Certificate of Title No. 3252 covering Lot 3353 was still in Emigdio’s name.1âwphi1 Indeed,
the RTC noted in the order of March 14, 2001, or ten years after his death, that Lot 3353 had remained
registered in the name of Emigdio.

Interestingly, Mervir Realty did not intervene at all in Civil Case No. CEB-12692. Such lack of interest
in Civil Case No. CEB-12692 was susceptible of various interpretations, including one to the effect that
the heirs of Emigdio could have already threshed out their differences with the assistance of the trial
court. This interpretation was probable considering that Mervir Realty, whose business was managed
by respondent Richard, was headed by Teresita herself as its President. In other words, Mervir Realty
appeared to be a family corporation.

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Also, the fact that the deed of absolute sale executed by Emigdio in favor of Mervir Realty was a
notarized instrument did not sufficiently justify the exclusion from the inventory of the properties
involved. A notarized deed of sale only enjoyed the presumption of regularity in favor of its execution,
but its notarization did not per se guarantee the legal efficacy of the transaction under the deed, and
what the contents purported to be. The presumption of regularity could be rebutted by clear and
convincing evidence to the contrary.32 As the Court has observed in Suntay v. Court of Appeals:33

x x x. Though the notarization of the deed of sale in question vests in its favor the presumption of
regularity, it is not the intention nor the function of the notary public to validate and make binding an
instrument never, in the first place, intended to have any binding legal effect upon the parties thereto.
The intention of the parties still and always is the primary consideration in determining the true nature
of a contract. (Bold emphasis supplied)

It should likewise be pointed out that the exchange of shares of stock of Mervir Realty with the real
properties owned by Emigdio would still have to be inquired into. That Emigdio executed the deed of
assignment two days prior to his death was a circumstance that should put any interested party on his
guard regarding the exchange, considering that there was a finding about Emigdio having been sick of
cancer of the pancreas at the time.34 In this regard, whether the CA correctly characterized the exchange
as a form of an estate planning scheme remained to be validated by the facts to be established in court.

The fact that the properties were already covered by Torrens titles in the name of Mervir Realty could
not be a valid basis for immediately excluding them from the inventory in view of the circumstances
admittedly surrounding the execution of the deed of assignment. This is because:

The Torrens system is not a mode of acquiring titles to lands; it is merely a system of registration of
titles to lands.1âwphi1However, justice and equity demand that the titleholder should not be made to
bear the unfavorable effect of the mistake or negligence of the State’s agents, in the absence of proof of
his complicity in a fraud or of manifest damage to third persons. The real purpose of the Torrens
system is to quiet title to land and put a stop forever to any question as to the legality of the title, except
claims that were noted in the certificate at the time of registration or that may arise subsequent thereto.
Otherwise, the integrity of the Torrens system shall forever be sullied by the ineptitude and inefficiency
of land registration officials, who are ordinarily presumed to have regularly performed their duties.35

Assuming that only seven titled lots were the subject of the deed of assignment of January 10, 1991,
such lots should still be included in the inventory to enable the parties, by themselves, and with the
assistance of the RTC itself, to test and resolve the issue on the validity of the assignment. The limited
jurisdiction of the RTC as an intestate court might have constricted the determination of the rights to
the properties arising from that deed,36 but it does not prevent the RTC as intestate court from ordering
the inclusion in the inventory of the properties subject of that deed. This is because the RTC as intestate
court, albeit vested only with special and limited jurisdiction, was still "deemed to have all the
necessary powers to exercise such jurisdiction to make it effective."37

Lastly, the inventory of the estate of Emigdio must be prepared and submitted for the important
purpose of resolving the difficult issues of collation and advancement to the heirs. Article 1061 of the
Civil Code required every compulsory heir and the surviving spouse, herein Teresita herself, to "bring
into the mass of the estate any property or right which he (or she) may have received from the decedent,
during the lifetime of the latter, by way of donation, or any other gratuitous title, in order that it may be
computed in the determination of the legitime of each heir, and in the account of the partition." Section
2, Rule 90 of the Rules of Court also provided that any advancement by the decedent on the legitime of
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an heir "may be heard and determined by the court having jurisdiction of the estate proceedings, and the
final order of the court thereon shall be binding on the person raising the questions and on the heir."
Rule 90 thereby expanded the special and limited jurisdiction of the RTC as an intestate court about the
matters relating to the inventory of the estate of the decedent by authorizing it to direct the inclusion of
properties donated or bestowed by gratuitous title to any compulsory heir by the decedent.38

The determination of which properties should be excluded from or included in the inventory of estate
properties was well within the authority and discretion of the RTC as an intestate court. In making its
determination, the RTC acted with circumspection, and proceeded under the guiding policy that it was
best to include all properties in the possession of the administrator or were known to the administrator
to belong to Emigdio rather than to exclude properties that could turn out in the end to be actually part
of the estate. As long as the RTC commits no patent grave abuse of discretion, its orders must be
respected as part of the regular performance of its judicial duty. Grave abuse of discretion means either
that the judicial or quasi-judicial power was exercised in an arbitrary or despotic manner by reason of
passion or personal hostility, or that the respondent judge, tribunal or board evaded a positive duty, or
virtually refused to perform the duty enjoined or to act in contemplation of law, such as when such
judge, tribunal or board exercising judicial or quasi-judicial powers acted in a capricious or whimsical
manner as to be equivalent to lack of jurisdiction.39

In light of the foregoing, the CA's conclusion of grave abuse of discretion on the part of the RTC was
unwarranted and erroneous.

WHEREFORE, the Court GRANTS the petition for review on certiorari; REVERSES and SETS
ASIDE the decision promulgated on May 15, 2002; REINSTATES the orders issued on March 14,
2001 and May 18, 2001 by the Regional Trial Court in Cebu; DIRECTS the Regional Trial Court in
Cebu to proceed with dispatch in Special Proceedings No. 3094-CEB entitled Intestate Estate of the late
Emigdio Mercado, Thelma Aranas, petitioner, and to resolve the case; and ORDERS the respondents to
pay the costs of suit.

SO ORDERED.

LUCAS P. BERSAMIN
Associate Justice

WE CONCUR:

MARIA LOURDES P. A. SERENO


Chief Justice

TERESITA J. LEONARDO-DE CASTRO MARTIN S. VILLARAMA, JR.


Associate Justice Associate Justice

BIENVENIDO L. REYES
Associate Justice

CERTIFICATION

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Pursuant to Section 13, Article VIII of the Constitution, I certify that the conclusions in the above
Decision had been reached in consultation before the case was assigned to the writer of the opinion of
the Court's Division.

MARIA LOURDES P. A. SERENO


Chief Justice

DIGEST

FACTS:

Emigdio S. Mercado (Emigdio) died intestate on January 12, 1991, survived by his second wife,
Teresita V. Mercado (Teresita), and their five children, namely: Allan V. Mercado, Felimon V.
Mercado, Carmencita M. Sutherland, Richard V. Mercado, and Maria Teresita M. Anderson; and his
two children by his first marriage, namely: respondent Franklin L. Mercado and petitioner Thelma M.
Aranas (Thelma).

Emigdio inherited and acquired real properties during his lifetime. He owned corporate shares
in Mervir Realty Corporation (Mervir Realty) and Cebu Emerson Transportation Corporation (Cebu
Emerson). He assigned his real properties in exchange for corporate stocks of Mervir Realty, and sold
his real property in Badian, Cebu (Lot 3353 covered by Transfer Certificate of Title No. 3252) to
Mervir Realty.

Thelma filed in the Regional Trial Court (RTC) in Cebu City a petition for the appointment of
Teresita as the administrator of Emigdio's estate. The RTC granted the petition considering that there
was no opposition. The letters of administration in favor of Teresita.

As the administrator, Teresita submitted an inventory of the estate of Emigdio for the
consideration and approval by the RTC. She indicated in the inventory that at the time of his death,
Emigdio had "left no real properties but only personal properties" worth P6,675,435.25 in all,
consisting of cash of P32,141.20; furniture and fixtures worth P20,000.00; pieces of jewelry valued at
P15,000.00; 44,806 shares of stock of Mervir Realty worth P6,585,585.80; and 30 shares of stock of
Cebu Emerson worth P22,708.25.

Claiming that Emigdio had owned other properties that were excluded from the inventory,
Thelma moved that the RTC direct Teresita to amend the inventory, and to be examined regarding it.
Teresita filed a compliance with the order of January 8, 1993, 3 supporting her inventory with copies of
three certificates of stocks covering the 44,806 Mervir Realty shares of stock; 4 the deed of assignment
executed by Emigdio on January 10, 1991 involving real properties with the market value of
P4,440,651.10 in exchange for 44,407 Mervir Realty shares of stock with total par value of
P4,440,700.00; 5 and the certificate of stock issued on January 30, 1979 for 300 shares of stock of Cebu
Emerson worth P30,000.00.

Thelma again moved to require Teresita to be examined under oath on the inventory. The RTC
issued an order expressing the need for the parties to present evidence and for Teresita to be examined
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to enable the court to resolve the motion for approval of the inventory. Thelma opposed the approval of
the inventory, and asked leave of court to examine Teresita on the inventory.

The RTC issued on March 14, 2001 an order finding and holding that the inventory submitted
by Teresita had excluded properties that should be included. The RTC denied the administratrix's
motion for approval of inventory and orders the said administratrix to re-do the inventory of properties
which are supposed to constitute as the estate of the late Emigdio S. Mercado. The RTC also directed
the administratrix to render an account of her administration of the estate of the late Emigdio S.
Mercado which had come to her possession.

Teresita, joined by other heirs of Emigdio, timely sought the reconsideration of the order of
March 14, 2001 on the ground that one of the real properties affected, Lot No. 3353 located in Badian,
Cebu, had already been sold to Mervir Realty,

On appeal, the CA reversed the RTC decision insofar as the inclusion of the inclusion of parcels
of land known as Lot No. 3353 located at Badian, Cebu with an area of 53,301 square meters subject
matter of the Deed of Absolute Sale dated November 9, 1989 and the various parcels of land subject
matter of the Deeds of Assignment dated February 17, 1989 and January 10, 1991 in the revised
inventory to be submitted by the administratrix is concerned.

ISSUE:

Whether or not he RTC committed grave abuse of discretion amounting to lack or excess of
jurisdiction in directing the inclusion of certain properties in the inventory notwithstanding that such
properties had been either transferred by sale or exchanged for corporate shares in Mervir Realty by the
decedent during his lifetime?

RULING:

No. The CA's conclusion of grave abuse of discretion on the part of the RTC was unwarranted
and erroneous.

WHEREFORE, the Court GRANTS the petition for review on certiorari; REVERSES and
SETS ASIDE the decision promulgated on May 15, 2002; REINSTATES the orders issued on March
14, 2001 and May 18, 2001 by the Regional Trial Court in Cebu; DIRECTS the Regional Trial Court in
Cebu to proceed with dispatch in Special Proceedings No. 3094-CEB entitled Intestate Estate of the late
Emigdio Mercado, Thelma Aranas, petitioner, and to resolve the case; and ORDERS the respondents to
pay the costs of suit.

RATIO:

The probate court is authorized to determine the issue of ownership of properties for purposes
of their inclusion or exclusion from the inventory to be submitted by the administrator, but its
determination shall only be provisional unless the interested parties are all heirs of the decedent, or the
question is one of collation or advancement, or the parties consent to the assumption of jurisdiction by
the probate court and the rights of third parties are not impaired. Its jurisdiction extends to matters
incidental or collateral to the settlement and distribution of the estate, such as the determination of the
status of each heir and whether property included in the inventory is the conjugal or exclusive property
of the deceased spouse.
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Under Section 6 (a), Rule 78 of the Rules of Court, the letters of administration may be granted
at the discretion of the court to the surviving spouse, who is competent and willing to serve when the
person dies intestate. Upon issuing the letters of administration to the surviving spouse, the RTC
becomes duty-bound to direct the preparation and submission of the inventory of the properties of the
estate, and the surviving spouse, as the administrator, has the duty and responsibility to submit the
inventory within three months from the issuance of letters of administration pursuant to Rule 83 of the
Rules of Court, viz.:
Section 1. Inventory and appraisal to be returned within three months. —
Within three (3) months after his appointment every executor or
administrator shall return to the court a true inventory and appraisal of all
the real and personal estate of the deceased which has come into his
possession or knowledge. In the appraisement of such estate, the court
may order one or more of the inheritance tax appraisers to give his or
their assistance.
The usage of the word all in Section 1, supra, demands the inclusion of all the real and personal
properties of the decedent in the inventory. However, the word all is qualified by the phrase which has
come into his possession or knowledge, which signifies that the properties must be known to the
administrator to belong to the decedent or are in her possession as the administrator. Section 1 allows
no exception, for the phrase true inventory implies that no properties appearing to belong to the
decedent can be excluded from the inventory, regardless of their being in the possession of another
person or entity.
The objective of the Rules of Court in requiring the inventory and appraisal of the estate of the
decedent is "to aid the court in revising the accounts and determining the liabilities of the executor or
the administrator, and in malting a final and equitable distribution (partition) of the estate and otherwise
to facilitate the administration of the estate." Hence, the RTC that presides over the administration of an
estate is vested with wide discretion on the question of what properties should be included in the
inventory. According to Peralta v. Peralta, the CA cannot impose its judgment in order to supplant that
of the RTC on the issue of which properties are to be included or excluded from the inventory in the
absence of "positive abuse of discretion," for in the administration of the estates of deceased persons,
"the judges enjoy ample discretionary powers and the appellate courts should not interfere with or
attempt to replace the action taken by them, unless it be shown that there has been a positive abuse of
discretion." As long as the RTC commits no patently grave abuse of discretion, its orders must be
respected as part of the regular performance of its judicial duty.
There is no dispute that the jurisdiction of the trial court as an intestate court is special and
limited. The trial court cannot adjudicate title to properties claimed to be a part of the estate but are
claimed to belong to third parties by title adverse to that of the decedent and the estate, not by virtue of
any right of inheritance from the decedent. All that the trial court can do regarding said properties is to
determine whether or not they should be included in the inventory of properties to be administered by
the administrator. Such determination is provisional and may be still revised. As the Court said in
Agtarap v. Agtarap:
The general rule is that the jurisdiction of the trial court, either as a probate court or an intestate
court, relates only to matters having to do with the probate of the will and/or settlement of the estate of
deceased persons, but does not extend to the determination of questions of ownership that arise during
the proceedings. The patent rationale for this rule is that such court merely exercises special and limited

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jurisdiction. As held in several cases, a probate court or one in charge of estate proceedings, whether
testate or intestate, cannot adjudicate or determine title to properties claimed to be a part of the estate
and which are claimed to belong to outside parties, not by virtue of any right of inheritance from the
deceased but by title adverse to that of the deceased and his estate. All that the said court could do as
regards said properties is to determine whether or not they should be included in the inventory of
properties to be administered by the administrator. If there is no dispute, there poses no problem, but if
there is, then the parties, the administrator, and the opposing parties have to resort to an ordinary action
before a court exercising general jurisdiction for a final determination of the conflicting claims of title.
However, this general rule is subject to exceptions as justified by expediency and convenience.
The probate court may provisionally pass upon in an intestate or a testate proceeding the
question of inclusion in, or exclusion from, the inventory of a piece of property without prejudice to
final determination of ownership in a separate action. Second, if the interested parties are all heirs to the
estate, or the question is one of collation or advancement, or the parties consent to the assumption of
jurisdiction by the probate court and the rights of third parties are not impaired, then the probate court
is competent to resolve issues on ownership. Verily, its jurisdiction extends to matters incidental or
collateral to the settlement and distribution of the estate, such as the determination of the status of each
heir and whether the property in the inventory is conjugal or exclusive property of the deceased spouse.

The inventory of the estate of Emigdio must be prepared and submitted for the important
purpose of resolving the difficult issues of collation and advancement to the heirs. Article 1061 of the
Civil Code required every compulsory heir and the surviving spouse, herein Teresita herself, to "bring
into the mass of the estate any property or right which he (or she) may have received from the decedent,
during the lifetime of the latter, by way of donation, or any other gratuitous title, in order that it may be
computed in the determination of the legitime of each heir, and in the account of the partition." Section
2, Rule 90 of the Rules of Court also provided that any advancement by the decedent on the legitime of
an heir "may be heard and determined by the court having jurisdiction of the estate proceedings, and the
final order of the court thereon shall be binding on the person raising the questions and on the heir."
Rule 90 thereby expanded the special and limited jurisdiction of the RTC as an intestate court about the
matters relating to the inventory of the estate of the decedent by authorizing it to direct the inclusion of
properties donated or bestowed by gratuitous title to any compulsory heir by the decedent.
The determination of which properties should be excluded from or included in the inventory of
estate properties was well within the authority and discretion of the RTC as an intestate court. In
making its determination, the RTC acted with circumspection, and proceeded under the guiding policy
that it was best to include all properties in the possession of the administrator or were known to the
administrator to belong to Emigdio rather than to exclude properties that could turn out in the end to be
actually part of the estate. As long as the RTC commits no patent grave abuse of discretion, its orders
must be respected as part of the regular performance of its judicial duty. Grave abuse of discretion
means either that the judicial or quasi-judicial power was exercised in an arbitrary or despotic manner
by reason of passion or personal hostility, or that the respondent judge, tribunal or board evaded a
positive duty, or virtually refused to perform the duty enjoined or to act in contemplation of law, such
as when such judge, tribunal or board exercising judicial or quasi-judicial powers acted in a capricious
or whimsical manner as to be equivalent to lack of jurisdiction.

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Republic of the Philippines
SUPREME COURT
Manila

EN BANC

G.R. No. L-40921 August 31, 1934

In the matter of the intestate estate of Tomas Siy Cong Bieng (alias Siy Chong Lin), deceased.
SIY CHONG KENG, administrator-appellee,
vs.
THE COLLECTOR OF INTERNAL REVENUE OF THE PHILIPPINE ISLANDS, claimant-
appellant.

Office of the Solicitor General Hilado for appellant.


Feria and La O for appellee.

BUTTE, J.:

This is an appeal by the Collector of Internal Revenue from an order of the Court of First Instance of
Manila dated October 2, 1933, in special proceedings No. 41435, directing the administrator of the
estate of Tomas Siy Cong Bieng (alias Siy Chong Lin), deceased, to pay an inheritance tax to be based
on the value of the property of the estate as appraised by the commissioners on claims and appraisals.

The Collector of Internal Revenue, through the Solicitor-General, filed in said special proceedings a
motion for the reconsideration of said order, which is as follows:

Comes now the Collector off Internal Revenue by the undersigned Solicitor-General and
respectfully prays that the order of this court dated October 2, 1933, be reconsidered on the
following grounds:

That on October 2, 1933, this court issued an order requiring the administrator to pay the
corresponding inheritance tax in this case based on the value of the properties of the estate as
appraised by the commissioners of claims and appraisals in their report;

That the court issued said order upon the theory that the Collector of Internal Revenue can no
longer question the value given by the commissioners to said properties for the purpose of
assessing that inheritance tax, in view of the fact that the report of said commissioners and the
project of partition in this case had been approved by this court;

That the Bureau of Internal Revenue has never been notified of the report submitted by the
commissioners in this case, and that said report, in so far as the value of the properties fixed by
the commissioners is concerned, is not binding upon the Collector of Internal Revenue;

That the law governing the determination of the value of the property of a deceased, for
purposes of taxation, is section 1542 of the Administrative Code, which provides that the
assesses value of the property as shown by the tax rolls shall be taken as the minimum, in
relation with regulations No. 42, section 7, of the Department of Finance, promulgated in
accordance with the Inheritance Tax Law, which reads:
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As a general rule the valuation of the estate given by the committee of appraisals and
allowance may be taken as the fair market value of the estate unless otherwise shown by
proper evidence that such is not the case. The administrator or the heirs shall show that
the said valuation is true and correct, or adduce proof that it is not so and prove the true
valuation, the Collector of Internal Revenue reserving the right to accept either or
substitute his own valuation upon which the taxes shall be based. For this purpose,
however, the assessed value of the estate as shown by the tax rolls shall be taken as the
minimum." (Emphasis ours.)

That when the Collector of Internal REvenue was informed by the administrator in this case of
the order of this court requiring the latter to pay the inheritance tax that may be due from the
estate in these proceedings, said Collector immediately proceeded to assess the corresponding
inheritance tax as required by law;

That the inheritance tax assessed by the Collector of Internal Revenue in this case is P57,914.81
as evidenced by the proof of debt subscribed and sworn to be the Collector of Internal Revenue
hereto attached and made a part hereof as Exhibit A;

That the administrator had already been notified by the Collector of Internal REvenue of the
inheritance tax assessed against the estate as stated in the preceding paragraph but failed to pay
the same;

That said tax of P57,914.81 bears an interest of 1 per cent per month from February 24, 1933,
the date the administrator was notified of its assessment, to the date of payment.

Wherefore, the undersigned prays that the order of this court dated October 2, 1933, be
reconsidered and the administrator be ordered to pay said sum of P57,914.81 as inheritance tax,
plus 25 per cent surcharge thereon of P14,478.70, and 1 per cent monthly interest on said sum
of P57,914.81 from February 24, 1933, to the date of payment.

Manila, October 31, 1933.

To this motion is attached a sworn proof of debt in which the Collector of Internal Revenue certifies
that the estate of the said deceased is debted to the Government of the Philippine Islands for inheritance
tax, surcharge and interest, upon the following valuations of the estate:

Real property P65,221.00


Personal property 481,569.89
Total inventoried property
... 564,790.89
Total deduction . . . . . . . . .
... 59,823.31

Net inventoried property . .


486,967.58
...
===========

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The report of the commissioners on claims and appraisals shows the net value of the estate to be
P170,397.06.

The court having denied the motion of the Solicitor-General for reconsideration of the order of October
2, 1933, he appeals to this court making the following assignments of error:

1. The lower court erred in holding that the inheritance tax should be determined by taking as a
basis the value of the estate of the deceased as appraised by the commissioners on claims and
appraisals.

2. The lower court erred in holding that the Collector of Internal Revenue had been the
commissioners on claims and appraisals in these proceedings, or that said collector should have
taken official notice of the submission of said report;

3. The lower court erred in ordering the judicial administrator to pay the inheritance tax in
accordance with the value of the estate as appraised by the commissioners on claims and
appraisals.

It appears from the record that the commissioners on claims and appraisals in the said special
proceedings No. 41435, rendered their report on December 7, 1932, and on December 28, 1932, the
administrator submitted a project of partition. On December 31, 1932, the court approved the final
account of the administrator and his project of partition and likewise ordered him to make the
corresponding distribution of the estate, subject, however, to prior payment of the inheritance tax.

On January 20, 1933, the court issued an order requiring the administrator to appear immediately and
show cause why he should not be disciplined for having failed to comply with the said order of
December 31, 1932. On January 26, 1933, he reported that he requested his attorneys to prepare the
inheritance tax return which he presented to the Collector of Internal Revenue tendering at the same
time a check for the amount shown to be due said return but that the Collector of Internal Revenue
refused to accept the check until he had verified the correctness of the items and the valuations which
were stated in said return. On February 2, 1933, the court extended the time for compliance with the
order of December 31, 1932, to February 25, 1933. On February 24, 1933, the administrator prayed for
another extension alleging that the Collector of Internal Revenue had not yet completed his
investigation and the court granted an extension to March 10, 1933. On May 17, 1933, the court issued
an order on the administrator to show cause why she should not be punished for contempt for failure to
comply with the previous orders of the court within the time limited. On May 27, 1933, the
administrator filed another statement to the effect that he could not comply with the orders requiring
him to produce the inheritance tax receipts because he and the Collector of Internal Revenue could not
agree as to the value of the properties belonging to the estate. Nothing further was done in the case after
May 27, 1933, until the court, apparently on its own motion, entered the order of October 2, 1933,
which is the subject matter of this appeal. This order is as follows:

Se halla pendiente de resolucion un incidente que se refiere al pago de impuesto de herencia.


Despues de considerar el escrito del administrator judicial asi como la carta del Director de
Rentas Internas, somos de opinion que, bajo las disposiciones de la ley, el impuesto de herencia
debe tomar por basse el avaluo hecho por la Commission de Avaluo y Reclamaciones. En virtud
de la notification dela aviso que se sirve a la Oficina de Rentas Internas en estos asuntos, dicha
Oficina debe tener conocimiento del report de la Comision y es valor de los bienes, pero no en
el presente momento en que ha sido ya aprobado el proyecto de particion en estas acuationes.
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Por tanto, se ordena el administrador judicial que pague el impuesto de herencia de acuerdo con
los valores que resulten del informe de la Comision de Avaluo y Reclama ciones.

There is no provision of law which makes it the duty of the Collector of Internal Revenue to take part in
the deliberations of the commissioners on claims and appraisals nor is he required to take exceptions to
the report of such a committee and appeal to the court for a revision of its appraisals. The statute
provides that the committee, after being sworn to make a true appraisal, shall appraise the value of the
estate in money and return their warrants with such appraisal to the executor or administrator. (Section
670, Code of Civil Procedure.) Apparently the statute does not require approval of the committee's
appraisals by the court; but doubtless exceptions thereto might be taken by the executor or
administrator upon whom a copy was served. The purpose of the inventory and appraisal of the estate
of the decedent is to aid to the court in revising the accounts and determining the liabilities of the
executor or administrator and in making a final and equitable distribution (partition) of the state and
otherwise to facilitate the administration of the estate. Although by Act No. 3606, which amends
section 1544 of the Administrative Code, relating to taxes on inheritance, legacies and other
acquisitions mortis causa, it is provided that a certified copy of letters testamentary or of administration
as well as certified copies of the schedule of partition and the order of the court approving the same
shall be furnished to the Collector of Internal Revenue by the clerk of the court within thirty days after
the issuance of such letters testamentary or of administration or after the promulgation of such orders,
these provisions do not in any sense make the Collector of Internal Revenue a party in all of the cases
of testate or intestate successions pending in these Islands. The object of these notices is to inform the
collector of estates that might be subject to inheritance taxes and to enable him to perform his duty as
such collector to make the assessments, and perform the specific duties as prescribed in section 1544 of
the Administrative Code, as amended by said Act No. 3606, particularly paragraph (b) thereof, and
section 1545 of the Administrative Code.

Section 7 of regulations No. 42 of the Department of Finance provides:

As general rule the valuation of the estate given by the Committee of Appraisals and
Allowances may be taken as the fair market value of the estate unless otherwise shown by the
proper evidence that such is not the case. The administrator or the heirs shall show that the said
valuation is true and correct, or adduce proof that it is not so and prove the true valuation, the
Collector of Internal Revenue reserving the right to accept either or substitute his own valuation
upon which the taxes shall be based. For this purpose, however, the assessed value of the estate
as shown by the tax rolls shall be taken as the minimum.

This regulation is in harmony with section 1542 of the Administrative Code.

In accordance with this regulations, the value of the estate given by the commisioners on claims and
appraisals may be taken by the collector as the basis for determination of the inheritance tax provided it
is not less than the assessed value of the estate. If it is less, the assessed value as shown by the tax rolls
must be taken as the minimum. The Collector of Internal Revenue is not bound by the appraisals made
by the commissioners on claims and appraisals, in which he took no part, and the lower court erred in
denying the motion for reconsideration of its order of October 2, 1933, filed by the Solicitor-General on
behalf of the Collector of Internal Revenue.

The order of October 2,1933, appealed from is therefore reversed and the cause is remanded with
instructions to the trial court to determine the true and correct amount of inheritance tax due and owing

107 | P a g e
in this case after hearing, upon due notice, at which the administrator and the Collector of Internal
Revenue may present their respective claims. Without special pronouncement as to costs.

Malcolm, Villa-Real, Imperial and Goddard, JJ., concur.

NO CASE DIGEST

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Republic of the Philippines
SUPREME COURT
Manila

EN BANC

G.R. No. L-45430 April 15, 1939

In the matter of the estate of the deceased Paulina Vasquez Vda. de Garcia.
TERESA GARCIA, plaintiff-appellant,
vs.
LUISA GARCIA, MARIETA GARCIA, and PURIFICACION GARCIA, and BRAULIO DE
VERA, guardian of the minors Antonio, Lourdes and Ramon, surnamed De Vera, defendants-
appellees.

Anastasio R. Teodoro and Andres S. Nicolas for appellant.


Pablo Lorenzo, Delfin Joven and Eulalio Chaves for appellee.

VILLA-REAL, J.:

After Luisa Garcia was appointed special administratrix of the properties left by the deceased Paulina
Vasquez Vda. de Garcia, she filed with the competent court an inventory thereof on May 13, 1936.

On May 23, 1936, the heir Teresa Garcia objected to said inventory, taking exception to various items
therein.

On June 20, 1936, the court issued the following order:

Without prejudice to the filing of an ordinary action by the heir Teresa Garcia de Bartolome, the
petition to include in the inventory certain properties of the estate, filed by Teresa Garcia and
others with the conformity of counsel for the administratrix, is denied.

On July 28, 1936, Teresa Garcia filed a motion asking that she be appointed special administratrix of
the intestate for the sole purpose of bringing any action which she may believe necessary to recover for
the benefit of the intestate the properties and credits set out in her motion, as well as other properties
which might be discovered from time to time belonging to the said intestate.

After hearing said motion and the administratrix' opposition thereto, the Court of First Instance of
Manila denied the motion by its order of August 19, 1936.

On motion for reconsideration filed by Teresa Garcia, which was opposed by the administratrix, the
court issued the following order of September 28, 1936:

This is a motion for reconsideration of the order of this Court of the 19th day of August last,
denying the petition of Teresa Garcia, one of the daughter of the deceased, wherein she asked to
be appointed special administratrix in order that she might bring an action for the recovery of
certain properties which she claims belong to the estate and are in the possession of the regular
administratrix and her other sisters.

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Before this petition was filed a hearing had been held to determine the ownership of these
properties as a direct result of Teresa Garcia's objection to the inventory filed by the
administratrix in which, it was alleged, those properties should be included. Now the same party
upon whose complaint that hearing was conducted repudiates the steps taken by the court on the
ground on the grounds of alleged lack of jurisdiction.

The interrupted proceeding which the motion under consideration would have set aside was by
no means irregular. It is in accordance with the general practice constantly followed in this
jurisdiction. The jurisdiction to try controversies between heirs of a deceased person regarding
the ownership of properties alleged to belong to his estate is vested in probate courts. In the last
analysis, the purpose of intestate proceeding is the distribution of the decedent's estate among
the persons entitled to succeed him. It is in the nature of an action of partition, and in a suit of
partition it is proper that each party be required to bring into the mass whatever community
property he or she may have in his or her 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.

The cases relied upon by the movant have no bearing on the present case. In the cases cited, not
only were the persons alleged to have in their possession properties of the estate strangers to the
intestate, but their appearance had been ordered under different provisions and for a different
purpose. The court was not aware of the fact that a proceeding under section 709 of the Code of
Civil Procedure is no t to try title to property.

However that may be, the jurisdiction involved here is one over the person, not over the subject-
matter; and it is a well-established rule that such jurisdiction may be acquired by consent. A
general appearance, let alone going into trial without objection, has been always held to
constitute a waiver of the party's right to object to the authority of the court over his person. The
administratrix and other heirs have not objected.

The motion for reconsideration is denied. The movant may however ask, if she cares to do so,
that this proceeding be reset for the continuation of the hearing of her inventory of the
administratrix and the determination of whether the properties in question belong to the estate
and should be included in the said inventory for disposition according to law.

So ordered.

From the foregoing order Teresa Garcia took this appeal, assigning our alleged errors committed by the
lower Court in its order, which errors boil down to the proposition of whether or not a court has
jurisdiction to hear and pass upon the exceptions which an heir takes to an inventory of the properties
left by a deceased referring to the inclusion or exclusion of certain properties and credits.

It is the duty of every administrator, whether special or regular, imposed by section 668 of the Code of
Civil Procedure, to return to the court within three months after his appointment a true inventory of the
real estate and all the goods, chattels, right, and credits of the deceased which come into his possession
or knowledge, unless he is residuary legatee and has given the prescribed bond. The court which
acquires jurisdiction over the properties of a deceased person through the filing of the corresponding
proceedings, has supervision and control over the said properties, and under the said power, it is its
110 | P a g e
inherent duty to see that the inventory submitted by the administrator appointed by it contains all the
properties, rights and credits which the law requires the administrator to set out in his inventory. In
compliance with this duty the court has also inherent power to determine what properties, rights and
credits of the deceased should be included in or excluded from the inventory. Should an heir or person
interested in the properties of a deceased persons duly call the court's attention to the fact that certain
properties, rights or credits have been left out in the inventory, it is likewise the court's duty to hear the
observations, with power to determine if such observations should be attended to or not and if the
properties referred to therein belong prima facie to the intestate, but no such determination is final and
ultimate in nature as to the ownership of the said properties (23 C.J., p. 1163, par. 381).

The lower court, therefore, had jurisdiction to hear the opposition of the heir Teresa Garcia to the
inventory filed by the special administratrix Luisa Garcia, as well as the observations made by the
former as to certain properties and credits, and to determine for purposes of the inventory alone if they
should be included therein or excluded therefrom. As Teresa Garcia withdrew her opposition after
evidence was adduced tending to show whether or not certain properties belonged to the intestate and,
hence, whether they should be included in the inventory, alleging that the lower court had no
jurisdiction to do so, she cannot be heard to complain that the court suspended the trial of her
opposition.

In the view of the foregoing, we are of the opinion and so hold, that a court takes cognizance of testate
on intestate proceedings has power and jurisdiction to determine whether or not the properties included
therein or excluded therefrom belong prima facie to the deceased, although such a determination is not
final or ultimate in nature, and without prejudice to the right of the interested parties, in a proper action,
to raise the question bearing on the ownership or existence of the right or credit.

Wherefore, the appealed order is affirmed, reserving to Teresa Garcia the right to ask for the reopening
of the hearing of her opposition to the inventory, as well as to ask for the appointment of a special
administratrix in accordance with law, with the costs to the appellant. So ordered.

Avanceña, C.J., Imperial, Diaz, Laurel, Concepcion and Moran, JJ., concur.

NO CASE DIGEST

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