G.R. No.

43351 February 26, 1937

Intestate estate of the deceased Baldomero Cosme.

ROSARIO COSME DE MENDOZA, administratrix-appellee,
vs.
JANUARIO PACHECO and RAYMUNDO CORDERO, sureties-appellants.

Vicente J. Francsico and Estanislao A. Fernandez, Jr. for appellants.

R. Gonzales Lloret for appellee.

LAUREL, J.:

The facts in this case are not disputed. Manuel Soriano was former administrator of the
estate of Baldomero Cosme in civil case No. 5494, Court of First Instance of Laguna. To
assure faithful performance of his duties as such administrator, he filed a bond for P5,000,
with the herein appellants, Januario Pacheco and Raymundo Cordero, as sureties.
Soriano's account, upon approval, showed him indebted to the estate in the sum of
P23,603.21. Unable to turn this amount over to the estate upon demand of Rosario
Cosme, the new administratrix, the lower court ordered the execution of his bond on
November 4, 1932, after notice duly served upon the sureties. Sometime later, the court
approved a settlement had between the adminstratrix and the ex-administrator, whereby
the latter ceded certain real properties to the estate reducing on that account his
indebtedness to the estate from P23,603.21 to P5,000. As to this last amount, "La
administradora se atiene a la orden de ejecucion de la fianza suscrita por los fiadores
Januario Pacheco y Raymundo Cordero" (Record on Appeal, p. 2). Subsequently, the
administratrix had the public sale thereof to collect this amount of P5,000. Separate
motions to he discharged from the bond were filed by sureties Pacheco and Cordero. Both
motions were denied. A motion by Cordero to reconsider the order of denial met a like fate.
Brought on appeal to this court, the appeal was dismissed. The dispositive part of the
decision of this court (G. R. No. 40998, Cosme de Mendoza vs. Pacheco and Cordero [60
Phil., 1057]) reads as follows:

The motion of October 1, 1933, was filed only on behalf of Raymundo Cordero who filed
no motion for reconsideration of the order of execution of November 4, 1932, and took no
appeal therefrom. Being of the opinion that the trial court correctly held that said order had
become final, the motion of October 31, 1933, for reconsideration (if such it may be called)
came too late. The judgment is therefore affirmed with costs against the appellants.

When the case was remanded to the lower court, the sureties filed a motion challenging,
for the first time, the jurisdiction of the trial court to issue the order of November 4, 1932,
executing the bond. The trial court denied the motion in view of the decision of this court.
The case is elevated here for the second time on appeal.
Appellants assign the following error:

The lower court erred in refusing: (a) To declare null and void its order of execution of the
ex-administrator's bond of November 4, 1932, as well as the writs of execution issued in
virtue thereof; (b) to accordingly vacate said order of November 4, 1932, and order the
release of the properties of the herein sureties-appellants attached in pursuance of the
writs of execution issued against them by virtue of said order; and (c) to order the
suspension of the execution of the said order of November 4, 1932, until this case is finally
decide.

In the discussion of the foregoing assignment of error in their brief (pp. 9-23), the
appellants take in six propositions. One question, however, — that of jurisdiction of the
Court of First Instance of Laguna to order the execution of the administrator's bond — is
decisive of this appeal. Appellants, sureties upon the bond, press the point that the order
in suit is an absolute nullity for lack of power in the issuing court. "In vain," they tell us,
"have we searched our statute books, especially the part of our Code of Civil Procedure
regarding probate jurisdiction, to find whether our Courts of First Instance, acting as
probate courts, have the power to order the execution of an administrator's bond." Neither
their failure to assail that jurisdiction when they ought nor the subsequent affirmance of
the order by this court, they say, could revive an order dead from its inception.

To begin with, it lies within discretion of the court to select an administrator of the estate of
a deceased person (Capistrano vs. Nadurata, 46 Phil., 726, 727). Before an administrator,
or an executor, enters upon the execution of his trust, and letters testamentary or of
administration are issued, the person to whom they are issued is required to give a bond
in such reasonable sum as the court directs, with one or more sufficient sureties,
conditioned upon the faithful performance of his trust (Code of Civil Procedure, sec. 643,
662). The administrator is accountable on his bond along with the sureties for the
performance of certain legal obligations. (Tan vs. Go Chiong Lee, 46 Phil., 200,
205. See also, Stovall vs. Banks, 10 Wall., 583, 588; 19 Law. ed., 1036; Long vs. O'Fallon,
19 How., 116; 15 Law. ed., 550.)

It is clear that a Court of First Instance, exercising probate jurisdiction, is empowered to

require the filing of the administrator's bond, to fix the amount thereof, and to hold it
accountable for any breach of the administrator's duty. Possessed, as it is, with an
all-embracing power over the administrator's bond and over administration proceedings, a
Court of First Instance in a probate proceeding cannot be devoid of legal authority to
execute and make that bond answerable for the very purpose for which it was filed. It is
true that the law does not say expressly or in so many words that such court has power to
execute the bond of an administrator, but by necessary and logical implication, the power
is there as eloquently as if it were phrased in unequivocal term. When the accountability of
an administrator's bond is spoken of in the very provisions dealing with and bearing
directly on administration proceedings, it would involve a strained construction to hold, as
appellants would have us do, that where an administrator is held liable for a devastravit for
having squandered and misapplied property which he was in duty bound to marshal and
conserve, the estate is without a remedy to go against the administrator's bond in the
same probate proceedings, but in an action outside of and separate from it. In this
connection, it should be observed that section 683 of the Code of Civil Procedure provides
that "Upon the settlement of the account of an executor or administrator, trustee, or
guardians, a person liable as surety in respect to such amount may, upon application, be
admitted as a party to such accounting, and may have the right to appeal as hereinafter
provided." There is here afforded to a person who may be held liable as surety in respect
to an administrator's account the right, upon application, to be admitted as a party to their
accounting, from which we may not unreasonably infer that a surety, like the appellants in
the case before us, may be charged with liability upon the bond during the process of
accounting, that is, within the recognized confines of probate proceedings, and not in an
action apart and distinct from such proceedings.

Appellants in their brief direct our attention to several cases decided by this court holding
that Courts of First Instance, as probate courts, have no power to adjudicate on claims of
other persons on property forming part of the estate, by title adverse to the deceased
(Guzman vs. Anog and Anog, 37 Phil., 61, 62); on the legal usufruct of the widow
(Sahagun vs. De Gorosita, 7 Phil., 347, 351), and on the validity of testamentary
dispositions (Castañeda vs.Alemany, 3 Phil., 426, 428). We have carefully examined
these cases in relation to the facts and circumstances of the case at bar. We take the view,
however, that the execution of an administrator's bond, unlike the questions involved in
the cited cases, clearly stands upon a different footing, and is as necessary a part and
incident of the administration proceeding as the filing of such bond or the fixing of its
amount. Particularly is this true in the present case where Soriano's indebtedness to the
sate in the amount of P23,603.21, subsequently reduced to P5,000, is conceded on all
sides, and all that the trial court had to do was to see that said amount was turned over to
the estate.

It is the duty of courts of probate jurisdiction to guard jealously the estates of the deceased
person 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). "Probate and like courts have a special jurisdiction
only, and their powers as to ancillary or incidental questions must of necessity to exercise
within certain limitations; but such powers include the right to try questions which arise
incidentally in a cause over which such courts have jurisdiction and the determination of
which are necessary to a lawful exercise of the powers expressly conferred in arriving at a
decision. . . . There seems, however, to be a general tendency, in the absence of express
and specific restrictions to the contrary, to uphold the exercise by these court of such
incidental powers as are, within the purview of their grant of authority, reasonably
necessary to enable them to accomplish the objects for which they were invested with
jurisdiction and to perfect the same. And it has been held that statutes conferring
jurisdiction on such courts, being remedial and for the advancement of justice, should
receive a favorable construction, such as will give them the force and efficiency intended
by the legislature." (15 C. J., 813, 814.) The tendency in the United States indeed has
been towards the enlargement of the powers of probate courts. In the beginning these
courts were possessed but limited powers. Having originated from the ecclesiastical
courts of England, their jurisdiction, following their English patterns was practically limited
to the probate of wills, the granting of administrators, and the suing for legacies
(Plant vs. Harrion, 74 N. Y. Sup., 411, 441; 36 Misc. Rep., 649; Chadwick vs. Chadwick,
13 Pac., 385, 388; 6 Mont., 566; 3 Bl. Comm., pp. 95-98). But, though they still are often
unadvisedly described, particularly in Connecticut (Griffin vs. Pratt, 3 Conn., 513), as
courts of limited, inferior or special jurisdiction, they have outgrown their limitations and
have become courts with considerably increased powers (Woerner, The American Law of
Administration [2d], sec. 145; Plant vs. Harrison, supra).

What has been said sufficiently determinative of the appeal before us. We wish, however,
to say a word on a salutary consideration of policy which has been invariably followed by
this court in cases of this nature. We refer to the dispatch and economy with which
administration of the estates of deceased persons should be terminated and settled. It will
be recalled that the appellants could have raised the question of jurisdiction now pressed
upon us in civil case No. 5494 of the Court of First Instance of Laguna and on appeal of
that case to this court once before (G. R. No. 40998 [60 Phil., 1057]). They not failed to
avail of that right but failed to appeal from the order complained of (Vide, Decision of this
court in G. R. No. 40998, Cosme de Mendoza vs. Pacheco and Cordero). The questions
raised in the appeal at bar, appellant's second attempt to go about and frustrate the order
in question, could have been passed upon once for all in the case referred to. We cannot
encourage a practice that trenches violently upon the settled jurisprudence of this court
that the policy and purpose of administration proceedings is ". . . to close up, and not to
continue an estate . . ." (Lizarraga Hermanos vs. Abada, 40 Phil., 124, 133), and that ". . .
the State fails wretchedly in its duty to its citizens if the machinery furnished by it for the
division and distribution of the property of a decedent is so cumbersome, unwidely and
expensive that a considerable portion of the sate is absorbed in the process of such
division. Where administration is necessary, it ought to be accomplished consumes any
considerable portion of the property which it was designed to distribute is a failure. . . ."
(McMicking vs. Sy Conbieng, 21 Phil., 211, 220.)

The order appealed from is hereby affirmed, with costs against the appellants. So
ordered.
 G.R. No. L-6637. September 30, 1954.]

WARNER BARNES & CO., LTD., Plaintiff-Appellee, v. LUZON SURETY CO.,

INC., Defendant-Appellant.

Tolentino & Garcia, and Domingo R. Cruz, for Appellant.

Hilado & Hilado and Reyes & Castro, for Appellee.

SYLLABUS

1. DESCENT AND DISTRIBUTION; EXECUTOR AND ADMINISTRATOR; FORFEITURE OF ENFORCEMENT

OF BOND IN SEPARATE CIVIL ACTION. — Although the probate court has jurisdiction over the forfeiture

or enforcement of an administrator’s bond, the same matter may be litigated in an ordinary civil action

brought before the Court of First Instance.

2. ID.; ID.; ID.; PLEADING AND PRACTICE; SUMMARY JUDGMENTS; FACTUAL ALLEGATIONS IN

COMPLAINT NOT CONTROVERTED BY COUNTER-AFFIDAVITS. — The allegations in the complaint that

the administratrix failed to file an inventory, to pay the plaintiff’s claim, and to render a true and just

account of her administration, are factual and should be controverted by counter-affidavits if the

defendant desires to raise genuine issues as to any material fact.

3. ID.; ID.; ID.; ID.; ID.; ID.; SUPPORTING AFFIDAVIT SIGNED BY LAWYER, SUFFICIENT. — An affidavit

supporting a motion for summary judgment. signed by the lawyer who expressly stated that he had

personal knowledge of the facts alleged therein, is sufficient.

4. ID.; ID.; ID.; ENFORCEMENT OF BOND BY CREDITOR. — Although an administrator’s bond is executed

in favor of the Republic of the Philippines, as it is expressly for the benefit of the heirs, legatees and

creditors, a creditor may directly in his name enforce said bond in so far as he is concerned.

5. ID.; ID.; ID.; ID.; ENFORCEMENT OF ADMINISTRATOR’S BOND AGAINST SURETY IN ABSENCE OF

PROCEEDINGS FOR ADMINISTRATION OF ESTATE OF ADMINISTRATOR. — Where there are no

proceedings for the administration of the estate of the deceased administrator, the creditor may enforce

his bond against the surety which bound itself jointly and severally in the case where the bond was filed.

6. PLEADING AND PRACTICE; SUMMARY JUDGMENTS; EXCEPTION AS TO DAMAGES. — A summary

judgment may be rendered upon proper motion except as to the amount of damages.

7. ID.; ID.; ID.; NECESSITY OF PROOF FOR ATTORNEY’S FEES. — Although the Article 2208 of the New
Civil Code authorizes the collection of attorney’s fees in the cases contemplated therein, said provision

does not dispense with the necessity of proving the amount of attorney’s fees.

DECISION

PARAS, C.J. :

On September 17, 1952, the plaintiff, Warner, Barnes & Co., Ltd., filed a complaint in the Court of First

Instance of Negros Occidental against the defendant, Luzon Surety Co., Inc., for the recovery of the sum

of P6,000, plus the costs and P1,500 for attorney’s fees. The basis of the complaint was a bond in the sum

of P6,000 filed by Agueda Gonzaga as administratrix of the Intestate Estate of Agueda Gonzaga on or

about January 6, 1951, in Special Proceedings No. 452 of the Court of First Instance of Negros Occidental,

the condition being that said bond would be void if the administratrix "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

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." It was alleged in the complaint that the plaintiff had a duly approved claim against the

Estate if Arguedo Gonzaga in the sum of P6,485.02, plus 2 per cent annual interest compounded monthly

from October 1, 1941; that the administratrix violated the conditions of her bond" (a) by failing to file an

inventory of the assets and funds of the estate that had come into her hands, more particularly, the sum

of P67,861.22 that she had received from the United States Philippine War Damage Commission; (b) by

failing to pay or discharge the approved claim of the plaintiff; (c) by failing to render a true and just

account of her administration in general, and of the said war damage payments in particular" ; that the

defendant, as surety in the bond, failed to pay to the plaintiff, notwithstanding the latter’s demand, the

sum of P6,000, in partial satisfaction of plaintiff’s unpaid claim which, after deducting the sum of P3,000

previously paid upon account by the administratrix, amounted to P8,186.68 as of August 31, 1952.

The defendant filed an answer setting up the special defenses that the complaint did not state a cause of

action; that its maximum liability under the surety bond is P6,000; that if it were not for the untimely

death of the judicial administratrix, she would have been able to fully comply with her duties and

obligations; that the administratrix, up to her death, had not yet been authorized by the court in Special

Proceedings No. 452 to pay plaintiff’s claim; that the defendant’s liability had been extinguished; that

damages or attorney’s fees cannot be recovered under the surety bond.

On January 6, 1953, the plaintiff filed a motion for summary judgment, alleging that "the special

defenses relied upon by the defendant in her Answer raise only questions of law, and the plaintiff believes

that said defendant cannot produce counter-affidavits that would raise any ’genuine issues as to any

material facts.’" This motion was accompanied by Exhibits "A" to "H", Exhibits "A" being an affidavit of

Atty. Luis G. Hilado who signed the complaint.

As the defendant did not file counter-affidavits so as to raise genuine issues as to any material fact,

although a copy of the motion for summary judgment was served upon it eleven days prior to the date

of the hearing thereon, the Court of First Instance of Negros Occidental rendered on January 17, 1953,

a summary judgment sentencing the defendant to pay to the plaintiff the sum of P6,000, P900 for

attorney’s fees, plus the costs. From this judgment the defendant appealed.

Under the first assignment of error, the appellant contends that the lower court had no jurisdiction to

pass upon its liability under the bond in question, because it is only the probate court that can hold a

surety accountable for any breach by the administratrix of her duty, citing the case of Mendoza v.

Pacheco, 64 Phil., 134. It is, however, noteworthy that while the citation is to the effect that the probate

court can has jurisdiction over the forfeiture or enforcement of an administrator’s bond, it was not held

therein that the same matter may not be litigated in an ordinary civil action brought before the court of

first instance.

Under the second assignment of error, the appellant claims that there are genuine controversies between

the parties litigant, and that, contrary to the allegations of the complaint, the administratrix made a

return to the court of the war damage payments she received; the administratrix cannot be charged with

having failed to pay plaintiff’s claim because there is no showing that she was ever authorized to pay

approved claims; the administratrix may be presumed to have rendered an accounting of her

administration, likely in 1948, in accordance with section 8 of Rule 86 of the Rules of Court. In answer,

it is sufficient to state that the allegations that the administratrix failed to file an inventory, to pay the

plaintiff’s claim, and to render a true and just account of her administration, are factual and remained

uncontroverted by counter-affidavits which the appellant could have easily filed.

It is also argued for the appellant that the supporting affidavit Exhibit "A" is insufficient, being signed

merely by the lawyer, and not by a party to the case or an officer of the plaintiff firm. This is without merit,

since Exhibit A contains an express statement that the affiant, Atty. Luis G. Hilado, had "personal

knowledge of the facts" alleged therein; and this cannot be negatived by appellant’s speculation to the

contrary.

Under the third and fourth assignments of error, it is insisted for the appellant that the bond in question

was executed in favor of the Republic of the Philippines and that the proper procedure would seem to be

that it might be enforced in the administration proceedings where it was filed. This view is likewise not

tenable. Though nominally payable to the Republic of the Philippines, the bond is expressly for the benefit

of the heirs, legatees and creditors of the Estate of the deceased Arguedo Gonzaga. There is no valid
reason why a creditor may not directly in his name enforce said bond in so far as he is concerned.

Under the fifth assignment of error, it is alleged that the plaintiff should have first filed a claim against the

Estate of the deceased administratrix Agueda Gonzaga, in conformity with section 6 of Rule 87 of the

Rules of Court providing that "Where the obligation of the decedent is joint and several with another

debtor, the claim shall be filed against the decedent as if he were the only debtor, without prejudice to

the right of the estate to recover contribution from the other debtor." Apart from the fact that his defense

was not pleaded either in a motion to dismiss or in the answer and was therefore waived (section 10, Rule

9 of the Rules of Court), it appears that even as late as September 17, 1952, when the present complaint

was filed, (more than two years after the death of Agueda Gonzaga), there were no proceedings for the

administration of her estate, with the result that section 6 of Rule 87 loses its applicability. Moreover, it

is to be noted that the appellant had also chosen to file a third-party complaint in the present case against

Romualdo Araneta, joint and several counter-guarantor of the deceased administratrix, instead of

presenting a claim against the latter’s estate.

In its sixth assignment of error, the lower court is alleged to have erred in sentencing the appellant to pay

attorney’s fees in the sum of P900, in excess of the limit of its bond. This contention is tenable. Under

section 3 of Rule 36 of the Rules of Court, a summary judgment may be rendered upon proper motion

except as to the amount of damages.

There being no proof regarding the amount of attorney’s fees claimed by the plaintiff, no judgment

thereon may be rendered herein. It is, however, argued by the counsel for appellee that said fees are in

pursuance of article 2208 of the Civil Code, providing that attorney’s fees cannot be recovered except

"where the defendant acted in gross and evident bad faith in refusing to satisfy the plaintiff’s plainly valid,

just and demandable claim" ; and it alleged in the complaint that the appellant had so acted in this case.

While the provision cited authorizes the collection of attorney’s fees under the situation contemplated

herein, it does not dispense with the effect of section 3 of Rule 36.

Wherefore, it being understood that the defendant-appellant is sentenced to pay to the plaintiff-appellee

only the sum of P6,000, plus the cost, the same is hereby affirmed.

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.).

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 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.

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).

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.
G.R. No. L-6363 September 15, 1955

In the matter of the testate estate of Dr. Maximo Borromeo. JOHANNA HOFER
BORROMEO, widow-appelle,
vs.
CANUTO O. BORROMEO, executor-appellant.

Borromeo, Yat and Borromeo for appellant.

Tañada, Pelaez and Teehankee for appellee.

BENGZON, Acting C. J.:

In July 1948, Dr. Maximo Borromeo, a resident of Cebu City, died without ascendants or
descendants, but leaving his widow Johanna Hofer Borromeo, and a will wherein he
designated the Borromeo Bros. Estate Inc. as his sole heir, even as he named his brother
Canuto O. Borromeo as the executor. The said corporation is owned entirely by the
deceased and his brothers and sisters.

Proceedings having been instituted, the court of first instance of that province probated
the will in due course, and granted letters testamentary to Canuto O. Borromeo, who duly
qualified as such executor.

Thereafter, on July 11, 1949, the attorneys for the widow submitted an "Urgent Motion"
whereby they prayed for the removal of the executor on the grounds of negligence in the
performance of his duties and unfitness to continue discharging the powers of the office.

This motion was scheduled to be heard on July 13, 1949 but it was postponed upon
representations by the executor of possible amicable settlement between the opposing
parties. No settlement was carried out nor even attempted. However, taking advantage of
the postponement and after a subpoena had been served on the Bank of the Philippine
Islands seeking information on the cash deposits therein of the deceased Maximo
Borromeo, the executor withdrew, without any authority from the court, the total amount of
P23,930.39 from a joint current account, in said Bank, of Canuto Borromeo and Maximo
Borromeo, and then deposited P22,244.39 of the sum thus withdrawn in the joint account
of said Canuto Borromeo and his brother Exequiel.

In time the petition was heard, and voluminous evidence, oral and documentary, was
submitted. Thereafter on February 21, 1951 the Honorable Edmundo Piccio, Judge, for
several reasons, one of them the above withdrawal of funds, decreed the removal of the
executor. On motion for reconsideration the executor's attorney prayed that the order be
revoked or that at least, the executor be permitted to resign. (Record on Appeal p. 251.)
On March 29, 1951 obviously to accommodate the executor—there being no practical
difference between removal and resignation—His Honor modified his order in the sense
that said executor was "relieved of (instead of removed from) his commitments as such
executor". Notwithstanding such modification the executor appealed, contending that the
modified order should be revoked.

There is no question that the order removing the executor or administrator is

appealable.1 But we fail to perceive the utility of the instant appeal,2 inasmuch as the
executor begged to be permitted to resign and the court all but granted his request
explaining, specifically, that the executor was not removed but only relieved of his
commitment—which is one way of accepting the proffered resignation. The executor got
substantially what he wanted.

Granting that the modified order was not literally what he desired, still the error, if any, did
not affect his substantial rights, and could not justify reversal under the Rules. (cf. Rule 53
sec. 3.)

In any event, supposing he was removed, there were in our opinion sufficient grounds
therefor. Take the matter of withdrawals above described. Attempting to justify his attitude,
the executor point out that, according to the joint deposit agreement Exhibit H signed by
Canuto and Maximo Borromeo.

We, the undersigned, agree with one another and with the Bank of the Philippine Islands
hereinafter called the Bank, that all moneys heretofore, now, or hereafter deposited, by us,
or any of us, to the credit of this Savings Account or Current Account, are and shall be
received and held by the Bank with the understanding, and upon the condition that said
money deposited, without reference to previous ownerships, and all interest, dividends
and credits thereon shall be the property of all of us, during our lifetimes and after the
death of any one of us shall be the sole property of and payable to the survivors, or
survivor, provided that this last deposition is not contrary to provisions of laws now in force
or may hereafter be in force in the Philippine Islands.(Emphasis our.)

He claims, in effect, that the money deposited was his at the time he withdrew it. But
would the Bank have allowed him to withdraw the whole amount if he were not the
executor? He got it then as executor. Instead, he deposited it in a joint account with his
brother Exequiel, thereby placing it at the latter's disposal, and hiding it from the widow.

Furthermore, and this is important, the agreement says "provided that this last disposition
is not contrary to provisions of laws now in force . . . in the P.I." The question arises: may a
husband validly agree that upon his death certain conjugal money deposited in the bank
shall belong to his brother, and thereby deprive his wife of her share in the conjugal
partnership?
According to Art. 1413 of the Civil Code, no alienation or agreement which the husband
may make with respect to conjugal property in fraud of the wife shall prejudice her or her
heirs.3

There is at least some ground to doubt whether the stipulation could deprive the wife of
her share in the conjugal assets. The validity of the agreement could properly be the
subject of debate in court; yet this executor avoided or bypassed judicial adjudication by
getting the money, specially at a time when his actuations were already being questioned,
and his appointment as executor in danger of revocation. And his conduct is aggravated
by the circumstance that he took advantage of a postponement, asked by him on the false
pretense of possible amicable settlement, in order to vest in himself money on which the
corporate heir and the widow might have a claim.

Another reason for the withdrawal is the fact that in his Report for March 1949 the
executor omitted to include, as income of the estate, the sum of P6,000 which he had
received from Hacienda Plaridel of the decedent. This in itself might be involuntary error,
as claimed by him. But considering that he received other sums of P13,010 and
P10,559.40 as proceeds from the farm of the deceased, but instead of depositing them in
his name as executor, placed them in his joint account with his brother Exequiel Borromeo,
it is not unreasonable to suspect a plan—inconsistent with his trusteeship—to conceal the
money of the deceased to back up his assertion, in objecting to the widow's allowance,
that the estate had no funds.

A third reason is that the executor claimed as his own certain shares of the Interisland
Gas Service, in the name of Maximo Borromeo, valued at P12,000; he asserted that
Maximo was merely his "dummy". If we had any doubts about the rightness of the trial
judges determination, this circumstance should finally tip the judicial balance on the side
of removal or resignation. Conflict between the interest of the executor and the interest of
the deceased is ground for removal or resignation of the former, who was thereby become
insuitable to discharge the trust. (Section 2, Rule 83.)

An executor or administrator should be removed where his personal interests conflict with
his official duties, but a mere hostile feeling towards persons interested in the estate is not
ground for removal unless it prevents the management of the estate according to the
dictates of prudence. (33 C. J. S. P. 1036.) (Citing many cases.)

Reasons for rule.—"An executor is a quasi trustee, who should be indifferent between the
estate and claimant of the property, except to preserve it for due administration, and when
his interest conflicts with such right and duty the country court, in the exercise of a sound
discretion, may remove him." (In re Manser, 60 Or. 240, 246, 118, p. 1024.)
An executor will be removed where it appears that he asserts claims against the estate of
the testator to the extent of two-thirds of the value of the estate, and such claims are
disputed by the beneficiary under the will." (Henry's Est., 54 Pa. Super. 274.)

Claim of gifts from decedents.—Where an executor, in answer to a petition for his removal
on the ground of maladministration in claiming property of the estate, alleged a gift by
decedent to him of the property, he manifested an interest adverse to the beneficiaries,
authorizing his removal; but the country court had no jurisdiction to determine the question
of gift. (In re Manser, 60 Or, 240, 118, p. 1024.)

It becomes unnecessary to examine the other reasons which induced the trial court to let
this executor go. The record discloses sufficient data justifying the decree of separation or
vindicating the judge's exercise of discretion. This, apart from the principle supported by
the weight of authorities that, "An appellate court is disinclined to interfere with the action
taken by the probate court in the matter of the removal of an executor or administrator
unless positive error or gross abuse of discretion is shown." (33 C. J. S. p. 1048.) (Citing
many cases.) 1âwphïl.nê t

Wherefore, the appealed order should be, as it is hereby, affirmed with double costs
against appellant. It should be stated in this connection that the obvious reasons, no
petition for extension of the time to file a motion for reconsideration will be favorably
entertained. So ordered.

DALISAY E. OCAMPO, VINCE E. G.R. No. 187879

OCAMPO, MELINDA CARLA E.

OCAMPO, and LEONARDO E. Present:

OCAMPO, JR.,
CARPIO, J.,
Petitioners,
Chairperson,

NACHURA,

PERALTA,
- versus -
ABAD, and
 MENDOZA, JJ.

RENATO M. OCAMPO and ERLINDA Promulgated:

M. OCAMPO,

Respondents. July 5, 2010

x--------------------------------------------------------------------------------

----x

DECISION

NACHURA, J.:

This petition[1] for review on certiorari under Rule 45 of the Rules

of Court seeks to reverse and set aside the Decision[2] dated December 16,

2008 and the Resolution[3] 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, 2008[4] of the Regional Trial Court (RTC), Branch

24, Bian, 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 Bian, 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, Bian,

Laguna, docketed as Spec. Proc. No. B-3089.[5] 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.

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-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 Bian 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 P200,000.00 each.[12]

Respondents filed a Motion for Reconsideration dated August 1,

2006[13] 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 Dalisays

appointment as special administrator was already deemed abandoned

upon their nomination of the Bian 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.

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

Bond[18] 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 P2,700,000.00, which the latter represented to petitioners to have been

sold only for P1,500,000.00, 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 Comment[22] on March 10, 2008,

to which, in turn, petitioners filed their Reply to

Opposition/Comment[23] 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 P200,000.00, 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 certiorari[25] 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 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 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 administrators bond

of P200,000.00. 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 Bian Rural Bank as special

administrator, the RTC, on February 16, 2007, revoked Dalisays

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 unfitness[37] 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.[39] 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.[40]

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 P200,000.00 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 RTCs 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

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.[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

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 Distribution[42] for

the period covering April 2002 to June 2006,[43] where they indicated that

Renato had received P4,241,676.00, Erlinda P4,164,526.96, and

petitioners P2,486,656.60, and that the estate had

advanced P2,700,000.00 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 letter[45] 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 P2,087,380.49

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,

2004[46] 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 Bian, Laguna, and covered by Transfer Certificate of

Title No. T-332305 of the Registry of Deeds of Laguna, for a total

purchase price of P2,700,000.00. The Deed stipulated for a payment

of P1,500,000.00 upon the signing of the contract, and the balance

of P1,200,000.00 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 Sale[47] 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 P1,500,000.00. 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 P500,000.00. 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 RTCs 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:

(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.

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
contestants 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.

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 Melindas 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 P200,000.00 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 Leonardos 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, Bian, 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 administrators 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.
G.R. No. L-23419 June 27, 1975

INTESTATE ESTATE OF THE DECEASED GELACIO SEBIAL. BENJAMINA

SEBIAL, petitioner-appellee,
vs.
ROBERTA SEBIAL, JULIANO SEBIAL and HEIRS OF BALBINA
SEBIAL, oppositors-appellants.

C. de la Victoria & L. de la Victoria for appellants.

Robustiano D. Dejaresco for appellee.

AQUINO, J.:

Gelacio Sebial died intestate in 1943 in Pinamungajan Cebu. According to the appellants,
Gelacio Sebial, by his first wife Leoncia Manikis, who allegedly died in 1919, begot three
children named Roberta, Balbina and Juliano. By his second wife, Dolores Enad, whom
he allegedly married in 1927, he supposedly begot six children named Benjamina,
Valentina, Ciriaco, Gregoria, Esperanza and Luciano.

On June 17, 1960 Benjamina Sebial filed in the Court of First Instance of Cebu a verified
petition for the settlement of Gelacio Sebial's estate. She prayed that she be appointed
administratrix thereof (Spec. Proc. No. 2049-R). Roberta Sebial opposed the petition on
the ground that the estate of Gelacio Sebial had already been partitioned among his
children and that, if an administration proceeding was necessary, she, Roberta Sebial, a
resident of Guimbawian, a remote mountain barrio of Pinamungajan, where the
decedent's estate was supposedly located, should be the one appointed administratrix
and not Benjamina Sebial, a housemaid working at Talisay, Cebu which is about seventy
kilometers away from Pinamungajan. In a supplemental opposition the children of the first
marriage contended that the remedy of Benjamina Sebial was an action to rescind the
partition.

After hearing, the lower court in its order of January 16, 1961 appointed Benjamina Sebial
as administratrix. It found that the decedent left an estate consisting of lands with an area
of twenty-one hectares, valued at more than six thousand pesos, and that the alleged
partition of the decedent's estate was invalid and ineffective.

Letters of administration were issued to Benjamina Sebial on January 19, 1961. On the
same date, a notice to creditors was issued. The oppositors moved for the reconsideration
of the order appointing Benjamina Sebial as administratrix. They insisted that the
decedent's estate had been partitioned on August 29, 1945, as shown in Exhibits 5, 6, 7
and I, and that the action to rescind the partition had already prescribed. The lower court
denied the motion in its order of February 11, 1961.

The oppositors filed on March 16, 1961 a motion to terminate the administration
proceeding on the grounds that the decedent's estate was valued at less than six
thousand pesos and that it had already been partitioned and, therefore, there was no
necessity for the administration proceeding.

On April 27, 1961 Benjamina Sebial filed an inventory and appraisal of the decedent's
estate allegedly consisting of seven unregistered parcels of land, covered by Tax
Declarations Nos. 04477, 04478, 04490, 04491, 04492, 04493 and 04500, with a total
value of nine thousand pesos, all located at Barrio Guimbawian, Pinamungajan. The
oppositors registered their opposition to the inventory on the ground that the seven
parcels of land enumerated in the inventory no longer formed part of the decedent's
estate.

On May 6, 1961, the administratrix filed a motion to require Lorenzo Rematado, Demetrio
Camillo and the spouses Roberta Sebial and Lazaro Recuelo to deliver to her the parcels
of land covered by Tax Declarations Nos. 04478, 04490,04491 and 04493.

On June 24, 1961 the probate court issued an order suspending action on the pending
incidents in view of the possibility of an amicable settlement. It ordered the parties to
prepare a complete list of the properties belonging to the decedent, with a segregation of
the properties belonging to each marriage. Orders of the same tenor were issued by the
lower court on July 8 and October 28, 1961.

On November 11, 1961 the oppositors, Roberta Sebial, Juliano Sebial and the heirs of
Balbina Sebial, submitted their own inventory of the conjugal assets of Gelacio Sebial and
Leoncia Manikis, consisting of two parcels of land acquired in 1912 and 1915. They
alleged that the conjugal estate of Gelacio Sebial and Dolores Enad consisted of only one
parcel of land, containing an area of seven hectares, allegedly purchased with money
coming from the conjugal assets of Gelacio Sebial and Leoncia Manikis. They further
alleged that the said seven- hectare land was sold by the children of the second marriage
to Eduardo Cortado (Tax Declaration No. 2591). 1äwphï1. ñët

The oppositors claimed that the aforementioned two parcels of land acquired during the
first marriage were partitioned in 1945 among (1) Roberta Sebial, (2) Juliano Sebial, (3)
Francisco Sebial as the representative of the estate of Balbina Sebial and (4) Valentina
Sebial as the representative of the six children of the second marriage, some of whom
were minors. They clarified that under that partition the three children of the first marriage
received a three-fourths share while the six children of second marriage received a
one-fourth share (Tax Declaration No. 06500). They also alleged that Eduardo Cortado,
Emilio Sialongo, Lorenzo Rematado and Lazaro Recuelo were the third persons involved
in the transfer of the lands pertaining to the estate of Gelacio Sebial (Tax Declarations
Nos. 04493, 06571 and 04471). To the inventory submitted by the oppositors, the
administratrix filed an opposition dated November 18, 1961.

In an order dated November 11, 1961 the lower court inexplicably required the
administratrix to submit another inventory. In compliance with that order she submitted an
inventory dated November 17, 1961, wherein she reproduced her inventory dated April 17,
1961 and added two other items, namely, two houses allegedly valued at P8,000 and the
fruits of the properties amounting to P5,000 allegedly received by the children of the first
marriage. The oppositor interposed an opposition to the said inventory.

On November 24, 1961 the oppositors filed a "motion for revision of partition" which was
based on their own inventory dated November 7, 1961.

The lower court in its order of December 11, 1961 approved the second inventory dated
November, 7, 1961 because there was allegedly a "prima facie evidence to show that" the
seven parcels of land and two houses listed therein belonged to the decedent's estate. In
another order also dated December 11, 1961 the lower court granted the motion of the
administratrix dated May 4, 1961 for the delivery to her of certain parcels of land and it
directed that the heirs of Gelacio Sebial, who are in possession of the parcels of land
covered by Tax Declarations Nos. 04493, 04491, 04490 and 04478, should deliver those
properties to the administratrix and should not disturb her in her possession and
administration of the same. The lower court denied the oppositors' motion dated
November 20, 1961 for "revision of partition".

On December 29, 1961 Roberta Sebial moved for the reconsideration of the two orders on
the grounds (1) that the court had no jurisdiction to approve an inventory filed beyond the
three-month period fixed in section 1, Rule 84 of the Rules of Court; (2) that the said
inventory is not supported by any documentary evidence because there is no tax
declaration at all in Gelacio Sebial's name; (3) that the two houses mentioned in the
inventory were nonexistent because they were demolished by the Japanese soldiers in
1943 and the materials thereof were appropriated by the administratrix and her brothers
and sisters; (4) that the valuation of P17,000 indicated in the inventory was fake, fictitious
and fantastic since the total value of the seven parcels of land amounted only to P3,080;
(5) that Gelacio Sebial's estate should be settled summarily because of its small value as
provided in section 2, Rule 74 of the Rules of Court and (6) that an ordinary action is
necessary to recover the lands in the possession of third persons.

The oppositors without awaiting the resolution of their motion for reconsideration filed a
notice of appeal from the two orders both dated December 11, 1961. The notice of appeal
was filed "without prejudice to the motion for reconsideration". Benjamina Sebial opposed
the motion for reconsideration. The lower court in its order of January 18, 1962 denied
oppositors' motion for reconsideration. It approved Roberta Sebial's amended record on
appeal. The case was elevated to the Court of Appeals.

The Court of Appeals in its resolution of July 31, 1964 in CA-G.R. No. 31978.-R certified
the case to this Court because in its opinion the appeal involves only the legal issues of (1)
the construction to be given to section 2, Rule 74 and section 1, Rule 84 (now Rule 83) of
the Rules of Court and (2) whether an ordinary civil action for recovery of property and not
an administration proceeding is the proper remedy, considering oppositors' allegation that
the estate of Gelacio Sebial was partitioned in 1945 and that some of his heirs had
already sold their respective shares (Per Angeles, Gatmaitan and Concepcion Jr., JJ.)

The Clerk of Court of the lower court in his letter of January 15, 1963, transmitting the
amended record on appeal, said "there was no presentation of evidence by either parties
concerning the two orders appealed from".

This case involves the conflicting claims of some humble folks from a remote rural area in
Cebu regarding some unregistered farm lands. Because of her poverty Roberta Sebial
wanted to appeal in forma pauperis. Her husband Lazaro Recuelo and her nephew,
Candelario Carrillo, in order to justify the filing of a mimeographed brief, swore that their
families subsisted on root crops because they could not afford to buy corn grit or rice.

Oppositors' contention in their motion for reconsideration (not in their brief) that the
probate court had no jurisdiction to approve the inventory dated November 17, 1961
because the administratrix filed it after three months from the date of her appointment is
not well-taken. The three-month period prescribed in section 1, Rule 83 (formerly Rule 84)
of the Rules of Court is not mandatory. After the filing of a petition for the issuance of
letters of administration and the publication of the notice of hearing, the proper Court of
First Instance acquires jurisdiction over a decedent's estate and retains that jurisdiction
until the proceeding is closed. The fact that an inventory was filed after the three-month
period would not deprive the probate court of jurisdiction to approve it. However, an
administrator's unexplained delay in filing the inventory may be a ground for his removal
(Sec. 2, Rule 82, Rules of Court).

The other contention of the oppositors that inasmuch as the value of the decedent's estate
is less than five thousand pesos and he had no debts, the estate could be settled
summarily under section 2, Rule 74 of the Rules of Court or that an administration
proceeding was not necessary (the limit of six thousand pesos was increased to ten
thousand pesos in section 2, Rule 74 effective on January 1, 1964) rests on a
controversial basis. While in the verified petition for the issuance of letters of
administration, it was alleged that the gross value of the decedent's estate was "not more
than five thousand pesos", in the amended inventory the valuation was P17,000. Indeed,
one of the lower court's omissions was its failure to ascertain by preponderance of
evidence the actual value of the estate, if there was still an estate to be administered. The
approval of the amended inventory was not such a determination.

Anyway, in the present posture of the proceeding, no useful purpose would be served by
dismissing the petition herein and ordering that a new petition for summary settlement be
filed. Inasmuch as a regular administrator had been appointed and a notice to creditors
had been issued and no claims were filed, the probate court could still proceed summarily
and expeditiously to terminate the proceeding. With the cooperation of the lawyers of the
parties, it should strive to effect an amicable settlement of the case (See arts. 222 and
2029, Civil Code).

If the efforts to arrive at an amicable settlement prove fruitless, then the probate court
should ascertain what assets constituted the estate of Gelacio Sebial, what happened to
those assets and whether the children of the second marriage (the petitioner was a child
of the second marriage and the principal oppositor was a child of first marriage) could still
have a share, howsoever small, in the decedent's estate.

The lower court's order of December 11, 1961, approving the amended inventory of
November 11, 1961, is not a conclusive determination of what assets constituted the
decedent's estate and of the valuations thereof. Such a determination is only provisional
in character and is without prejudice to a judgment in a separate action on the issue of title
or ownership (3 Moran's Comments on the Rules of Court, 1970 Ed., 448-449). 1äwp hï1. ñët

The other order dated December 11, 1961 requires the delivery to the administratrix of (1)
two parcels of land covered by Tax Declarations Nos. 04491 and 04493 in the possession
of the spouses Lazaro Recuelo and Roberta Sebial, an oppositor-appellant; (2) the parcel
of land covered by Tax Declaration No. 04490 in the possession of Lorenzo Rematado
and (3) the parcel of land described under Tax Declaration No. 04478 in the possession of
Demetrio Camillo (Canillo), a child of the deceased Balbina Sebial, one of the three
children of the first marriage.

We hold that the said order is erroneous and should be set aside because the probate
court failed to receive evidence as to the ownership of the said parcels of land. The
general rule is that questions of title to property cannot be passed upon in a testate or
intestate proceeding. However, when the parties are all heirs of the decedent, it is optional
upon them to submit to the probate court the question of title to property and, when so
submitted, the probate court may definitely pass judgment thereon (3 Moran's Comment's
on the Rules of Court, 1970 Ed., pp. 448, 473; Alvarez vs. Espiritu, L-18833, August 14,
1965, 14 SCRA 892).
Lorenzo Rematado and Lazaro Recuelo are not heirs of the decedent. They are third
persons. The rule is that matters affecting property under administration may be taken
cognizance of by the probate court in the course of the intestate proceedings provided
that the interests of third persons are not prejudiced (Cunanan vs. Amparo, 80 Phil.
227; Ibid, 3 Moran 473).

However, third persons to whom the decedent's assets had been fraudulently conveyed
may be cited to appear in court and be examined under oath as to how they came into the
possession of the decedent's assets (Sec. 6, Rule 87, Rules of Court) but a separate
action would be necessary to recover the said assets (Chanco vs. Madrilejos, 12 Phil. 543;
Guanco vs. Philippine National Bank, 54 Phil. 244).

The probate court should receive evidence on the discordant contentions of the parties as
to the assets of decedent's estate, the valuations thereof and the rights of the transferees
of some of the assets. The issue of prescription should also be considered (see p. 84,
Record on Appeal). Generally prescription does not run in favor of a coheir as long as he
expressly or impliedly recognizes the coownership (Art. 494, Civil Code). But from the
1äwphï1. ñët

moment that a coheir claims absolute and exclusive ownership of the hereditary
properties and denies the others any share therein, the question involved is no longer one
of partition but that of ownership (Bargayo vs. Camumot, 40 Phil. 857).

At the hearing of the petition for letters of administration some evidence was already
introduced on the assets constituting the estate of Gelacio Sebial. The petitioner testified
and presented Exhibits A to J and X to Y-3. The oppositor also testified and presented
Exhibits 2 to 10-A. The stenographic notes for the said hearing should be transcribed. In
addition to that evidence. The probate court should require the parties to present further
proofs on the ownership of the seven parcels of land and the materials of the two houses
enumerated in the amended inventory of November 17, 1961, on the alleged partition
effected in 1945 and on the allegations in oppositors' inventory dated November 7, 1961.

After receiving evidence, the probate court should decide once and for all whether there
are still any assets of the estate that can be partitioned and, if so, to effect the requisite
partition and distribution. If the estate has no more assets and if a partition had really been
made or the action to recover the lands transferred to third person had prescribed, it
should dismiss the intestate proceeding.

WHEREFORE, (a) the probate court's order of December 11, 1961, granting the
administratrix's motion of May 4, 1961 for the delivery to her of certain properties is set
aside; (b) its other order of December 11, 1961 approving the amended inventory should
not be considered as a final adjudication on the ownership of the properties listed in the
inventory and (c) this case is remanded to the lower court for further proceedings in
accordance with the guidelines laid down in this decision. No costs.
SO ORDERED.

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.

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 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.

G.R. No. L-51291 May 29, 1984

FRANCISCO CUIZON, ROSITA CUIZON, PURIFICATION C. GUIDO married to

TEODORO GUIDO, and JUAN ARCHE, petitioners,
vs.
HON. JOSE R. RAMOLETE, Presiding Judge of the Court of First Instance of Cebu,
Branch III, DOMINGO L. ANTIGUA and SEGUNDO ZAMBO, respondents.

Eliseo C. Alinsug for petitioners.

Loreto M. Pono for respondents Domingo Antigua and Segundo Zambo.

GUTIERREZ, JR., J.:

The sole issue in this petition for certiorari is whether or not a probate court has
jurisdiction over parcels of land already covered by a Transfer Certificate of Title issued in
favor of owners who are not parties to the intestate proceedings if the said parcels have
been included in the inventory of properties of the estate prepared by the administrator.

For a clearer understanding of the present case, the background facts may be
appreciated. As far back as 1961, Marciano Cuizon applied for the registration of several
parcels of land located at Opao, Mandaue City then covered by certificates of Tax
Declaration in Land Registration Case No. N-179. In 1970, he distributed his property
between his two children, Rufina and Irene. Part of the property given to Irene consisted
largely of salt beds which eventually became the subject of this controversy.

On December 29, 1971, Irene Cuizon executed a Deed of Sale with Reservation of
Usufruct involving the said salt beds in favor of the petitioners Francisco, Rosita and
Purificacion, all surnamed Cuizon. At that time, Francisco and Rosita were minors and
assisted by their mother, Rufina, only sister of Irene. However, the sale was not registered
because the petitioners felt it was unnecessary due to the lifetime usufructuary rights of
Irene.
Although the decision in L.R. Case No. N-179 was rendered way back in 1962, the decree
of registration No. N-161246 and the corresponding Original Certificate of Title No. 0171
was issued only in 1976 in the name of Marciano Cuizon. In that same year, Transfer
Certificate of Title No. 10477 covering the property in question was issued by the Register
of Deeds to Irene Cuizon. The latter died in 1978. In the extrajudicial settlement of the
estate, her alleged half sister and sole heir Rufina adjudicated to herself all the property of
the decedent including the property in question. After the notice of the extrajudicial
settlement was duly published in a newspaper of general circulation, Rufina thereafter,
executed a deed of Confirmation of Sale wherein she confirmed and ratified the deed of
sale of December 29, 1971 executed by the late Irene and renounced and waived
whatever rights, interest, and participation she may have in the property in question in
favor of the petitioners. The deed was duly registered with the Registry of Deeds and
annotated at the back of TCT No. 10477. Subsequently, TCT No. 12665 was issued in
favor of the petitioners.

On September 28, 1978, a petition for letters of administrator was filed before the Court of
First Instance of Cebu (Sp. Proc. No. 3864-R) by respondent Domingo Antigua, allegedly
selected by the heirs of Irene numbering seventeen (17) in all to act as administrator of
the estate of the decedent. The petition was granted.

Respondent Antigua as administrator filed an inventory of the estate of Irene. He included

in the inventory the property in question which was being administered by Juan Arche,
one of the petitioners. On June 27, 1979, respondent Antigua filed a motion asking the
court for authority to sell the salt from the property and praying that petitioner Arche be
ordered to deliver the salt to the administrator. The motion was granted and respondent
court issued the following order:

The administrator, thru this motion, informs the Court that the estate owns some beds and
fish pond located in Opao, Mandaue City that these salt beds are producing salt which are
now in the warehouse in Mandaue City, under the custody of Juan Arche that the value of
the salt in the warehouse is estimated to be worth P5,000.00 are beginning to melt and,
unless they are sold as soon as possible, they may depreciate in value. It is likewise
prayed in this motion that Juan Arche be ordered to deliver the salt in question to the
administrator such other products of the land now in his (Juan Arche) possession.

xxx xxx xxx

Let this motion be, as it is hereby GRANTED. The administrator is hereby authorized to
sell the salt now in the custody of Juan Arche and the latter (Juan Arche) is hereby
ordered to deliver the salt in question to the administrator in order to effect the sale thereof
and he is likewise directed to deliver such other products of the land to the administrator.
Subsequently, on three different occasions, respondent Segundo Zambo with the aid of
several men, sought to enforce the order of the respondent court, compelling the
petitioners to come to us on certiorari. On September 14, 1979, we issued a restraining
order enjoining the respondents from enforcing the above order of the respondent court
and from further interfering with the petitioners in their peaceful possession and cultivation
of the property in question.

The thrust of the petitioners' argument is that the respondent court, as a court handling
only the intestate proceedings, had neither the authority to adjudicate controverted rights
nor to divest them of their possession and ownership of the property in question and hand
over the same to the administrator. Petitioners further contend that the proper remedy of
the respondent administrator is to file a separate civil action to recover the same.

On the other hand, the respondent administrator banked on the failure of the petitioners to
first apply for relief in the court of origin before filing the present petition. According to him
this was a fatal defect. In addition, the administrator stated that the deed of sale of
December 29, 1971 lost its efficacy upon the rendition of judgment and issuance of the
decree in favor of Irene Cuizon.

It is a well-settled rule that a probate court or one in charge of proceedings whether

testate or intestate cannot adjudicate or determine title to properties claimed to be a part
of the estate and which are equally (claimed to belong to outside parties. All that the said
court could do as regards said properties is to 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 no dispute, well and good; but if there is, then the parties, the administrator, and
the opposing parties have to resort to an ordinary action for a final determination of the
conflicting claims of title because the probate court cannot do so (Mallari v. Mallari, 92 Phil.
694; Baquial v. Amihan, 92 Phil. 501).

Similarly, in Valero Vda. de Rodriguez vs. CA., (91 SCRA 540) we held 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 a petition 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 v. Salas, L-42257, June 14, 1976, 71 SCRA 262,
266).

In the instant case, the property involved is not only claimed by outside parties but it, was
sold seven years before the death of the decedent and is duly titled in the name of the
vendees who are not party to the proceedings. In Bolisay vs. Alcid, (85 SCRA 213), this
Court was confronted with a similar situation. The petitioners therein sought to annul the
order of the respondent court in a special proceeding which in effect ruled that
notwithstanding that the subject property was duly titled in the name of petitioners, the
administratrix of the intestate estate involved in said proceeding had the right to collect the
rentals of said property over the objection of the titled owners just because it was included
in the inventory of said estate and there was an ordinary action in the regular court over
the ownership thereof and the estate was one of the parties therein. This Court viewed the
petition as one seeking for a prima facie determination and not a final resolution of the
claim of ownership.

We held that:

... Considering that as aforestated the said property is titled under the Torrens System in
the names of the petitioners, it does appear strange, in the light of the probate court's own
ruling that it has no jurisdiction to pass on the issue of ownership, that the same court
deemed the same as part of the estate under administration just because the
administratrix, alleges it is still owned by the estate and has in fact listed it in the inventory
submitted by her to the court.

It does not matter that respondent - administratrix has evidence purporting to support her
claim of ownership, for, on the other hand, petitioners have a Torrens title in their favor,
which under the law is endowed with incontestability until after it has been set aside in the
manner indicated in the law itself, which, of course, does not include, bringing up the
matter as a mere incident in special proceedings for the settlement of the estate of
deceased persons. In other words, in Our considered view, the mere inclusion in the
inventory submitted by the administrator of the estate of a deceased person of a given
property does not of itself deprive the probate court of authority to inquire into the property
of such inclusion in case an heir or a third party claims adverse title thereto. To hold
otherwise would render inutile the power of that court to make a prima facie determination
of the issue of ownership recognized in the above quoted precedents. The correct rule is
that the probate court should resolve the issue before it provisionally, as basis for its
inclusion in or exclusion from the inventory. It does not even matter that the issue is raised
after approval of the inventory because "apparently, it is not necessary that the inventory
and appraisal be approved by the Court." (Francisco on the Rules of Court Vol. V-B, p. 99,
citing Siy Chong Keng vs. Collector of Internal Revenue, 60 Phil. 494)

In regard to such incident of inclusion or exclusion, We hold that if a property covered by

Torrens Title is involved, the presumptive conclusiveness of such title should be given due
weight, and in the absence of strong compelling evidence to the contrary, the holder
thereof should be considered as the owner of the property in controversy until his title is
nullified or modified in an appropriate ordinary action, particularly, when as in the case at
bar, possession of the property itself is in the persons named in the title.
Having been apprised of the fact that the property in question was in the possession of
third parties and more important, covered by a transfer certificate of title issued in the
name of such third parties, the respondent court should have denied the motion of the
respondent administrator and excluded the property in question from the inventory of the
property of the estate. It had no authority to deprive such third persons of their possession
and ownership of the property. Respondent court was clearly without jurisdiction to issue
the order of June 27, 1979. Thus, it was unnecessary for the petitioners to first apply for
relief with the intestate court.

Even assuming the truth of the private respondents' allegations that the sale of December
29, 1971 was effected under suspicious circumstances and tainted with fraud and that the
right of Rufina as alleged half-sister and sole heir of Irene remains open to question, these
issues may only be threshed out in a separate civil action filed by the respondent
administrator against the petitioners and not in the intestate proceedings.

WHEREFORE, the petition for certiorari is GRANTED and the respondent court's order
dated June 27, 1979 is hereby set aside and declared void as issued in excess of its
jurisdiction. Our restraining order enjoining the enforcement of the June 27, 1979 order
and the respondents from further interfering, through the intestate proceedings, in the
peaceful possession and cultivation of the land in question by the petitioners is hereby
made PERMANENT.

SO ORDERED.

G.R. No. L-23035 October 13, 1925

In re will of Ignacio Abuton y Poncol, deceased.

TEODORA GUINGUING, petitioner-appellee,
vs.
AGAPITO ABUTON and CALIXTO ABUTON, opponents-appellants.

M. Abejuela for appellants.

No appearance for appellee.

STREET, J.:

In the course of the administration of the estate of Ignacio Abuton, deceased, resident of
Oroquieta, Province of Misamis, it appeared that the deceased died testate on March 8,
1916, leaving two sets of children by two different wives, the first of whom was Dionisia
Olarte, who died about twenty years ago, and by whom the deceased had twelve, children,
three of whom died without issue. The second wife was Teodora Guinguing, to whom the
testator was married on July 14, 1906, and by whom he had four children, all still living. A
will of the testator, executed on November 25, 1914, was probated in court and allowed on
October 9, 1917 (Exhibit A); and one Gabriel Binaoro was appointed administrator. In due
course of proceeding Binaoro submitted to the court an inventory of the properties
belonging to the deceased at the time of his death. In this inventory he included only the
lands which the testator had devised to the children of the second marriage, omitting other
lands possessed by him at the time of his death and which were claimed by the children of
the first marriage as having been derived from their mother. Accordingly, on March 14,
1922, Teodoro Guinguing, in representation of herself and her four minor children,
presented a motion in court, asking that the administrator be required to amend his
inventory and to include therein all property pertaining to the conjugal partnership of
Ignacio Abuton and Dionisia Olarte, including property actually in the hands of his children
by her which (the motion alleged) had been delivered to said children as an advancement.
The purpose of the motion was to force the first set of children to bring into collation the
properties that had been received by them, in conformity with article 1035 of the Civil
Code; and the motion was based partly on the supposition that Ignacio Abuton had never
in fact effected a liquidation of the conjugal property pertaining to himself and Dionisia
Olarte. This motion was formally opposed by two of the children of the first marriage,
namely, Agapito and Calixto Abuton y Olarte.

Upon hearing the proof the trial judge found that no property had been acquired by the
testator during his second marriage and that the administration was concerned only with
property that had been acquired before the death of the first wife. The trial judge further
found that after the death of the first wife the testator had liquidated the ganacial estate
pertaining to them and had divided among the first set of children all of the property that
pertained to the first wife in the division, with the exception of the home-place in
the poblacion, in which the testator had continued to reside till death. The share pertaining
to the testator in said division was, so the court found, retained in his own hands; and this
property constituted the proper subject matter of the present administration proceedings.
Accordingly an order was entered to the effect that the administrator should include in the
inventory of the estate of Agapito Abuton all of the property of which the testator was
possessed at the time of his death. From this order the two opponents of the motion
appealed.

We entertain serious doubts as to whether the order in question here was really such a
final order as to be appealable under section 783 of the Code of Civil Procedure, since the
making of the inventory is necessarily of a preliminary and provisional nature, and the
improper inclusion of property therein or the improper omission of property therefrom is
not absolutely decisive of the rights of persons in interest. But, passing this point without
decision, we proceed to consider whether there is any merit in the errors assigned to the
order which is the subject of the appeal. 1awph!l.n et
The contention made in the first assignment of error, to the effect that an order of the
character of that appealed from cannot be made by a court without formal notice being
given to all persons in interest, in the same manner as if a new action had been begun, is
clearly untenable, since all the heirs are already virtually represented in the administration
and are bound by all proper orders made therein, so far and so far only as such orders
have legal effect. This is not inconsistent with the proposition that contested claims of
ownership between the administrator and third persons should be tried in separate
proceedings, which is entirely true. The question here is merely between some of the
heirs and the administrator, as representative of all persons in interest. Besides, it should
be pointed out, the inclusion of a property in the inventory does not deprive the occupant
of possession; and if it is finally determined that the property has been properly included in
the estate, the occupant heir is liable for the fruits and interest only from the date when the
succession was opened (art. 1049, Civ. Code). The provisions of the Civil Code with
reference to collation clearly contemplate that disputes between heirs with respect to the
obligation to collate may be determined in the course of the administration proceedings.

The second and third assignments are directed to the supposed errors of the court in
having based its findings as to the property belonging to the estate of Agapito Abuton in
part upon the recitals of his legalized will (Exhibit A) and in part upon the recitals of a
previous will (Exhibit 1), which had been superseded by the last. This older will appears to
have been produced by the representatives of the first set of children in the proceedings
for the probate of the will which was admitted, and was attached to that expediente. It is
said in appellants' brief that this document was not introduced in evidence at the hearing
of the present controversy.

It was not error, in our opinion, for the trial court to look to the recitals of the legalized will
for the purpose of determining prima facie whether a certain piece of property should or
should not be included in the inventory, without prejudice of course to any person who
may have an adverse title to dispute the point of ownership. The use made of the
superseded will (Exhibit 1) in the appealed order is of more questionable propriety, but we
are of the opinion that the facts stated by the court can be sufficiently made out from the
other evidence submitted at the hearing.

As we gather from the record, the crux of the controversy consists in the fact that among
the properties remaining in possession of Ignacio Abuton at the time of his death was a
piece of land covered by a composition title No. 11658, issued in 1894 in the name of
Dionisia Olarte. At the same time that this title was issued, Agapito Abuton procured two
other titles, Nos. 11651 and 11654, covering adjacent properties to be issued in his own
name. From the circumstance that title No. 11658 was issued in the name of Dionisia
Olarte the opponents appear to believe that this land was her particular property and
should now vest exclusively in her heirs. This conclusion is erroneous. There is nothing to
show that the land covered by title No. 11658 was not acquired by the spouses during
their marriage, and the circumstance that the title was taken in the name of the wife does
not defeat its presumed character as ganacial property. Therefore, in liquidating the
ganacial property of the first marriage it was within the power of the surviving husband to
assign other property to the first set of children as their participation in the estate of their
mother and to retain in his own hands the property for which a composition title had been
issued in the name of the wife.

Upon the whole we are unable to discover any reversible error in the appealed order, and
the same is accordingly affirmed, with costs. So ordered.