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FIRST DIVISION

G.R. Nos. 208828-29 August 13, 2014

RICARDO C. SILVERIO, SR., Petitioner,


vs.
RICARDO S. SILVERIO, JR., CITRINE HOLDINGS, INC., MONICA P. OCAMPO and ZEE2 RESOURCES,
INC.,Respondents.

DECISION

VILLARAMA, JR., J.:

Before the Court is a petition for review under Rule 45 of the 1997 Rules of Civil Procedure, as amended, to reverse
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and set aside the Decision dated March 8, 2013 of the Court of Appeals (CA) insofar as CA-G.R. SP Nos. 121173
2
and 122024 are concerned, and Resolution dated July 4, 2013 denying petitioner's Motion for Partial
Reconsideration. The CA nullified the preliminary injunction issued by the Regional Trial Court (RTC) of Makati City
("intestate court"), Branch 57 in Sp. Proc. No. M-2629 and reversed said court's Order dated August 18, 2011
declaring the sales and derivative titles over two properties subject of intestate proceedings as null and void.

The factual and procedural antecedents of the case, as summarized by the CA, are as follows: The late Beatriz S.
Silverio died without leaving a will on October 7, 1987. She was survived by her legal heirs, namely: Ricardo C.
Silverio, Sr. (husband), Edmundo S. Silverio (son), Edgardo S. Silverio (son), Ricardo S. Silverio, Jr. (son), Nelia
S.Silverio-Dee (daughter), and Ligaya S. Silverio (daughter). Subsequently, an intestate proceeding (SP PROC. NO.
M-2629) for the settlement of her estate was filed by SILVERIO, SR.

In the course of the proceedings, the parties filed different petitions and appeal challenging several orders ofthe
intestate court that went all the way up to the Supreme Court. To better understand the myriad of factual and
procedural antecedents leading to the instant consolidated case, this court will resolve the petitions in seriatim.

The Petitions

CA-G.R. SP No. 121172

The first petition of the three consolidated petitions is CA-G.R. SP No. 121172 wherein petitioner, RICARDO S.
SILVERIO JR. ("SILVERIO JR.") assails the Order ofthe intestate court dated 16 June 2011 reinstating RICARDO
SILVERIO SR. ("SILVERIO SR.") as administrator to the estate of the late Beatriz Silverio.

The administrator first appointed by the Court was EDGARDO SILVERIO ("EDGARDO"), but by virtue of a Joint
Manifestation dated 3 November 1999 filed by the heirs of BEATRIZ D. SILVERIO, the motion to withdraw as
administrator filed by EDGARDO was approved by the intestate court and in his stead, SILVERIO SR. was appointed
as the new administrator. Thereafter, an active exchange of pleadings to remove and appoint a new administrator
ensued between SILVERIO SR. and SILVERIO JR. The flip-flopping appointment of administrator is summarized
below:

In an Order dated 3 January 2005, SILVERIO SR. was removed as administrator and in his stead, SILVERIO, JR.
was designated as the new administrator. A motion for reconsideration was separately filed by SILVERIO SR. and
Nelia Silverio-Dee ("SILVERIO-DEE") and on 31 May 2005, the intestate court issued an Omnibus Order affirming
among others, the Order of 3 January 2005. Inthe same Order, the intestate court also granted the motion of
SILVERIO JR. to take his oath as administrator effective upon receipt of the order and expunged the inventory report
filed by SILVERIO SR.

On 12 December 2005 the intestate court acting on the motion filed by SILVERIO SR. recalled the Order granting
letters of administration to SILVERIO JR. and reinstated SILVERIO SR. as administrator. Then again, the intestate
court acting on the motion for partial consideration to the Order dated 12 December 2005 filed by SILVERIO JR.
issued an Omnibus Order dated 31 October 2006 upholding the grant of Letters of Administration to SILVERIO JR.
and removed SILVERIO SR., ad administrator for gross violation of his duties and functions under Section 1, Rule 81
of the Rules of Court.

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SILVERIO SR. moved for reconsideration of the above Order whereas SILVERIO-DEE on the other hand, filed a
Petition for Certiorari before the Court of Appeals docketed as CA-G.R. SP No. 97196. On 28 August 2008, the Court
of Appeals (Seventh Division) rendered a decision reinstating SILVERIO, SR. as administrator, the decretal portion of
the Order reads:

"WHEREFORE, the petition is GRANTED. The portions of the Omnibus Order upholding the grant of letters of
administration to and the taking of an oath of administration by Ricardo Silverio, Jr., as well as the removal of Ricardo
Silverio, Sr. as administrator to the Estate of Beatriz Silverio, are declared NULL and VOID. The writ of preliminary
injunction earlier issued is MADE PERMANENT in regard to the said portions. Respondent RTC is ORDERED to
reinstate Ricardo Silverio, Sr. as administrator to the Estate of Beatriz Silverio. Costs against the Private
Respondents.

SO ORDERED."

SILVERIO JR. filed a Petition for review on Certioraribefore the Supreme Court docketed as G.R. No. 185619
challenging the 28 Augsut 2008 decision of the Court of Appeals. On 11 February 2009, the Supreme Court issued a
resolution denying the petition for failure to sufficiently show any reversible error inthe assailed judgment to warrant
the exercise by the Court of discretionary appellate jurisdiction. Acting on SILVERIO JR.’s motion for reconsideration,
the Supreme Court on 11 February 2011, denied the motion with finality. An entry of judgment was made on 29
March 2011.

On 25 April 2011 SILVERIO SR. filed before the intestate court, an urgent motion to be reinstated as administrator of
the estate. Acting on the motion, the intestate court issued the now challenged Order dated 16 June 2011, the
pertinent portion of the Order reads:

xxxx

"WHEREFORE, upon posting of a bond in the sum of TEN MILLION PESOS, the same to be approved by this Court,
Mr. Ricardo C. Silverio, Sr. is hereby ordered reinstated as the Administrator to the estate of the late Beatriz Silverio
and to immediately take his oath as such, and exercise his duties and functions as are incumbent under the law upon
the said position. xxx."

xxxx

CA-G.R. SP No. 121173

xxxx

On 15 March 2011, heirs SILVERIO JR., EDMUNDO and LIGAYA represented by her legal guardian moved for the
disqualification and/or inhibition of JUDGE GUANLAO, JR. based on the following grounds: (1) Absence of the written
consent of all parties in interest allowing JUDGE GUANLAO, JR. to continue hearing the case considering that he
appeared once as counsel in the intestate proceedings; (2) JUDGE GUANLAO, JR. has shown bias and partiality in
favor of SILVERIO SR. by allowing the latter to pursue several motions and even issued a TRO in violation of the
rules against forum shopping; (3) Heir LIGAYA’s Petition for Support and Release of Funds for Medical Support has
not been resolved; and (4) It is in the best interest of all the heirs that the proceedings be presided and decided by
the cold neutrality of an impartial judge.

On 23 March 2011, JUDGE GUANLAO, JR. issued an order denying the Motion for Disqualification and/or Inhibition.
The movants filed a motion for reconsideration but the same was denied in an order dated 14 June 2011. Hence, the
instant petition.

xxxx

CA-G.R. SP NO. 122024

xxxx

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The intestate court in its Omnibus Order dated 31 October 2006, ordered among others, the sale of certain properties
belonging to the estate. The portion of the order which is pertinent to the present petition reads:

"WHEREFORE, above premises considered, this Court for the foregoing reasons resolves to grant the following:

(1) xxx

(2) xxx

(3) Allowing the sale of the properties located at (1) No. 82 Cambridge Circle, Forbes Park, Makati City,
covered by T.C.T. No. 137155 issued by Register of Deeds of Makati City; (2) No. 3 Intsia Road, Forbes
Park, Makati City covered by T.C.T. No. 4137154 issued by the Register of Deeds of Makati City; and (3)
No. 19 Taurus St., Bel-Air Subd. Makati City covered by TCT No. 137156 issued by the Register of Deeds of
Makati City to partially settle the intestate estate of the late Beatriz S. Silverio, and authorizing the
Administrator to undertake the proper procedure or transferring the titles involved to the name of the estate;
and

(4) To apply the proceeds of the sale mentioned in Number 3 above to the payment of taxes, interests,
penalties and other charges, if any, and todistribute the residue among the heirs Ricardo C. Silverio, Sr.,
Ricardo S. Silverio, Jr., Ligaya S. Silverio represented by Legal Guardian Nestor S. Dela Merced II,
Edmundo S. Silverio and Nelia S. SilverioDee in accordance with the law on intestacy.

SO ORDERED."

By virtue of the aforesaid Order, SILVERIO, JR. on 16 October 2007 executed a Deed of Absolute Salein favor of
CITRINE HOLDINGS, Inc. ("CITRINE") over the property located at No. 3 Intsia Road, Forbes Park, Makati City.
CITRINE became the registered owner thereof on 06 September 2010 as evidenced by TCT No. 006-201000063.

A Deed of Absolute Sale was likewise executed in favor of Monica P. Ocampo (notarized on September 16, 2010) for
the lot located at No. 82 Cambridge Circle, Forbes Park, Makati City. On 23 December 2010, TCT No. 006-
2011000050 was issued toMonica P. Ocampo. The latter subsequently sold said property to ZEE2 Resources, Inc.
(ZEE2) and TCT No. 006-2011000190 was issued on 11 February 2011 under its name.

In the interim, or on 12 December 2006 SILVERIO-DEE filed a petition for certioraribefore the Court of Appeals
docketed as CA-G.R. SP No. 97196 with prayer for injunctive relief. As prayed for, the Court of Appeals issued a
Temporary Restraining Order (TRO) on 5 February 2007. On 4 July 2007, the Court issueda Writ of Preliminary
Injunction conditioned upon the posting of the bond in the amount of two million pesos (Php2,000,000.00).
SILVERIO-DEE posted the required bond on February 5, 2007 but in an order dated 3 January 2008, the Court ruled
that the bond posted by SILVERIO-DEE failed to comply with A.M. No. 04-7-02-SC. The Court, however, did not
reverse the ruling granting the injunction but instead ordered SILVERIO-DEE to comply with A.M. No. 04-7-02-SC.
The Court also increased the bond from two million to ten million. On 29 February 2008, the Court issued a
Resolution approving the ten million bond and issued the Writ of Preliminary Injunction. Eventually, on 28 August
2008 the Court of Appeals (Seventh Division) issued a decision reinstating SILVERIO SR. as administrator and
declaring the Writ of Preliminary Injunction permanent in regard to the appointment of administrator.

On 04 February 2011 SILVERIO SR. filed an Urgent Application for the Issuance of Temporary Restraining
Order/Preliminary Prohibitory Injunction (With Motion For the Issuance of Subpoena Ad Testificandum and Subpoena
Duces Tecum) praying among others, that a TRO be issued restraining and/or preventing SILVERIO, JR., MONICA
OCAMPO, CITRINE HOLDINGS, INC. and their successors-in-interest from committing any act that would affect the
titles to the three properties.

On 14 February 2011, SILVERIO SR. filed an Urgent Omnibus Motion (a) To Declare as Null and Void the Deed of
Absolute Sale dated 16 September 2010; (b) To cancel the Transfer Certificate of Title No. 006-2011000050; and (c)
To reinstate the Transfer Certificate of Title No. 2236121 in the name of Ricardo C. SilverioSr. and the Intestate
Estate of the late Beatriz S. Silverio.

On 28 February 2011 the Intestate Court issued an Order granting a Temporary Restraining Order enjoining
SILVERIO JR., their agent or anybody acting in their behalf from committing any act that would affect the titles to the

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properties and enjoining the Register of Deeds of Makati City from accepting, admitting, approving, registering,
annotating or in any way giving due course to whatever deeds, instruments or any other documents involving
voluntary or involuntary dealings which may have the effect of transferring, conveying, encumbering, ceding, waiving,
alienating, or disposing in favor of any individual or any entity of the subject properties. Subpoena ad
testificandumand duces tecumwas also issued by the intestate court requiring SILVERIO, JR., MONICA OCAMPO
and ALEXANDRA GARCIA of CITRINE to testify and bring with them any books and documents under their control to
shed light on the circumstances surrounding the transaction involving the properties in question.

On 9 March 2011, SILVERIO Sr. filed a Supplement to the Urgent Omnibus Motion dated 14 February 2011. On 18
August 2011, the intestate court rendered the now assailed Order the decretal portion of the Order is quoted
hereunder:

"WHEREFORE, this Court hereby orders that:

1. The Deed of Absolute Sale dated 16 September 2010 as VOID:

2. The Transfer Certificate of Title No. 006-2011000050 in the name of defendant MONICA OCAMPO or any
of her successors-in-interestincluding all derivative titles, as NULL AND VOID;

3. The Transfer Certificate of Title TCT No. 006-2011000190 in the name of ZEE2 RESOURCES, INC. or
any of its successors-in-interest including all derivative titles, as NULL AND VOID;

4. (T)he Register of Deeds of Makati City to CANCEL Transfer Certificate of Title No. 006-2011000050,
Transfer Certificate of Title No. 006-2011000190 and all of its derivative titles; and 5. Reinstating the
Transfer Certificate of Title No. 2236121 in the name of RICARDO C. SILVERIO, SR. AND THE
INTESTATE ESTATE OF THE LATE BEATRIZ SILVERIO, and AS TO THE INTSIA PROPERTY:

1. The Register of Deeds ofMakati City to CANCEL Transfer Certificate ofTitle No. 006-
2010000063, in the name of CITRINE HOLDINGS, INC. and all of its derivative titles; and

2. The reinstatement of Transfer Certificate of Title No. 223612 in the name of RICARDO C.
SILVERIO, SR. and the INTESTATE ESTATE OF THE LATE BEATRIZ SILVERIO.

SO ORDERED."

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xxxx

The consolidated petitions for certiorari filed by respondent Ricardo S. Silverio, Jr. ("Silverio, Jr.") before the CA
questioned the following issuances of the intestate court: CA-G.R. SP No. 121172 – Order dated June 16, 2011
reinstating Silverio, Sr. as Administrator; CA-G.R. SP No. 121173 – (1) Order dated March 23,2011 granting Silverio,
Sr.’s application for preliminary injunction enjoining Silverio, Jr. or anyone acting on their behalf from committing any
act that would affect the titles to the subject properties and enjoining the Register of Deeds of Makati City from
accepting, admitting, approving, registering, annotating or in any way giving due course to whatever deeds,
instruments or any other documents involving the Cambridge and Intsia properties, (2) Order dated March 23, 2011
which denied Silverio, Jr.’s motion or disqualification and/or inhibition of Judge Guanlao, Jr., and (3) Order dated
June 14, 2011 denying the motion for reconsideration of the March 23, 2011 Order (granting application for
preliminary injunction); and in CA-G.R. SP No. 122024 – Order dated August 18, 2011 declaring the Deed of
Absolute Sale, TCT and all derivative titles over the Cambridge and Intsiaproperties as null and void.

On March 8, 2013, the CA rendered its Decision, the falloof which reads:

WHEREFORE, based on the foregoing premises, the Court hereby disposes and orders the following:

1. The petition in CA G.R. SP No. 121172is DENIEDfor lack of merit. Accordingly, the 16 June 2011 Order
of the Regional Trial Court of Makati City, Branch 57 reinstating MR. RICARDO C. SILVERIO, SR. as
Administrator is AFFIRMED.

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2. The petition in CA GR. S.P. No. 121173is partly DENIEDfor lack of merit insofar as it questions the 23
March 2011 Order denying RICARDO SILVERIO, JR’s Motion for Disqualification and/or Inhibition of Judge
Honorio E. Guanlao, Jr. The petition is partly GRANTEDin that the Preliminary Injunction issued by the
Regional Trial Court of Makati City, Branch 57 is herebydeclared NULL and VOID for being issued with
grave abuse of discretion.

3. The petition in CA G.R.-S.P. No. 122024is GRANTED. Accordingly, the 18 August 2011 Order declaring
the Deed of Absolute Sale, Transfer Certificate of Title and all derivative titles over the Cambridge and Intsia
Property null and void is hereby REVERSEDand SET ASIDE.

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SO ORDERED.

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Ricardo C. Silverio, Sr. (petitioner) filed a Motion for Partial Reconsideration "insofar as its ruling in CA-G.R. SP No.
122024" praying that the August 18, 2011 Order of the intestate court be affirmed. By Resolution dated July 4, 2013,
the CA denied his motion for partial reconsideration.

Hence, this petition contending thatthe CA committed a reversible error in upholding the validity of the Intsia and
Cambridgeproperties upon the ground that the intestate court cannotannul the sales as it has a limited jurisdiction
only and which does not includeresolving issues of ownership. It is asserted that the CA should nothave stopped
there and looked into the nature of the properties sold, which formed part of the conjugal partnership of Ricardo
Silverio, Sr. and Beatriz S. Silverio.

Petitioner seeks the reinstatement of the order of the intestate court annulling the sales of the Cambridge and Intsia
properties. In the alternative, should the said sales be upheld, petitioner prays that this Court (1) declare the sales to
be valid only to the extent of 50% net remainder share of the late Beatriz less the corresponding shares therefrom of
petitioner and the other legal compulsory heirs, and (2) order respondent Silverio, Jr. to account for the proceeds of
sales for distribution of the residue among the legal/compulsory heirs.

In their Comment, respondents Silverio, Jr., Monica Ocampo and Citrine Holdings, Inc. argued that the intestate court
should not have ruled on the validity of the sale of the subject properties to third parties after it itself had authorized
their disposal in partial settlementof the estate, especially so when separate actions assailing the new titles issued to
said third parties were already instituted by petitioner.

As to the issue of alleged lack ofprior consent of petitioner to the aforesaid sales as the surviving spouses with a 50%
conjugal share in the subject properties, respondents point out that such is belied by the October 31, 2006 Order of
the intestate court, which clearly showed that counsels of all the heirs were present at the hearing of June 16, 2006
and no objection was made by them to the sale of the properties and the partial settlement of the Estate of Beatriz S.
Silverio, together with the transfer of titles of these properties in the name of the Estate as prayed for in petitioner’s
Manifestation and Motion dated April 19, 2006. Petitioner had not challenged or appealed the said order authorizing
the sale of the subject properties. Thus, it is too late in the day for petitioner to raise this factual issue before this
Court, not to mention that it cannot be ventilated in the present appeal by certiorari as thisCourt is not a trier of facts.

Respondent ZEE2 Resources Corporation filed its Comment contending that the intestate court improperly nullified
the titles despite the fact that the present registered owners, who are indispensable parties, were not impleaded.
Indeed, a Torrens title cannot be collaterally attacked and may be cancelled only in a direct proceeding brought for
the purpose. Respondent points out that petitioner himself recognized thata direct action is required to annul a
Torrens title ashe initially instituted two civil complaints before the RTC of Makati City seeking to annul, among
others, the TCT’s issued to respondent Ocampo for the Cambridge property. After failing to secure restraining orders
in these two civil cases, petitioner filed in the intestate court his Urgent OmnibusMotion dated February 14, 2011 to
annul the said titles, including that of ZEE2. In any case, respondent maintains that it is a buyer of good faith and for
value, of which the intestate court never made a determination nor did the aforesaid Urgent Omnibus Motion and
Supplement to the Omnibus Motion dated March 4, 2011 contain allegations indicating that respondent ZEE2 was not
a buyer in good faith and for value.

According to respondent ZEE2, petitioner’s act of filing a separate complaint with application for a temporary
restraining order (TRO) and preliminary injunction on January 31, 2011 in another court (Civil Case Nos. 11-084 of
the RTC of Makati City, Branch 143) constitutes willful and deliberate forum shopping asthe former also prayedsimilar
primary reliefs and setting up the alleged nullity of the subject deeds of absolute sale as those raised in the Urgent
Omnibus Motion and Supplement to the Urgent Omnibus Motion filed in the intestate court.

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At the outset, we emphasize that the probate court having jurisdiction over properties under administration has the
authority not only to approve any disposition or conveyance, but also to annul an unauthorized sale by the
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prospective heirs or administrator. Thus we held in Lee v. Regional Trial Court of Quezon City, Branch 85 :

Juliana Ortañez and Jose Ortañez sold specific properties of the estate, without court approval. It is well-settled that
court approval is necessary for the validity of any disposition of the decedent’s estate. In the early case of Godoy vs.
Orellano, we laid down the rule that the sale of the property of the estate by an administrator without the order of the
probate court is void and passes no title to the purchaser. And in the case of Dillena vs. Court of Appeals, we ruled
that: x x x x

It being settled that property under administration needs the approval of the probate court before it can be disposed
of, any unauthorized disposition does not bind the estate and is null and void. Asearly as 1921 in the case of Godoy
vs. Orellano(42 Phil 347), We laid down the rule that a sale by an administrator of property of the deceased, which is
not authorized by the probate court is null and void and title does not pass to the purchaser.

There is hardly any doubt that the probate court can declare null and void the disposition of the property under
administration, made by private respondent, the same having been effected without authority from said court. It is the
probate court that has the power to authorize and/or approve the sale (Section 4 and 7, Rule 89), hence, a fortiori, it
is said court that can declare it null and void for as long as the proceedings had not been closed or terminated. To
uphold petitioner’s contention that the probate court cannot annul the unauthorized sale, would render meaningless
the power pertaining to the said court. (Bonga vs. Soler, 2 SCRA 755). (italics ours) Our jurisprudence is therefore
clear that (1) any disposition of estate property by an administrator or prospective heir pending final adjudication
requires court approval and (2) any unauthorized disposition of estate property can be annulled by the probate court,
there being no need for a separate action to annul the unauthorized disposition. (Emphasis supplied.)

In this case, the sale of the subject properties was executed by respondent Silverio, Jr. with prior approval of the
intestate court under its Omnibus Order dated October 31, 2006. Subsequently, however, the sale was annulled by
the said court on motion by petitioner.

In reversing the intestate court’s order annulling the sale of the subject properties, the CA noted that said ruling is
anchored on the fact that the deeds of sale were executed at the time when the TRO and writ of preliminary injunction
issued in CA-G.R. SP No. 97196 was still in effect. It then concluded that the eventual decision in the latter case
making the writ of preliminary injunction permanent only with respect to the appointment of petitioner as administrator
and not to the grant of authority to sell mooted the issue of whether the sale was executed at the time when the TRO
and writ of preliminary injunction were in effect.

The CA’s ruling on this issue is hereunder quoted:

The more crucial question that needs to be addressed is: Whether the authority to sell the properties in question
granted under the October 31, 2006 Omnibus Order, was nullified by the decision of the Court of Appeals in CA-G.R.
SP No. 97196. A look at the dispositive portion of the decision in CA-G.R. SP No. 97196 would lead us to reasonably
conclude that the grant of authority to sell is still good and valid. The fallo of the decision reads:

"WHEREFORE, the petition is GRANTED. The portions of the Omnibus Order upholding the grant of letters of
administration to and the taking of an oath of administration by Ricardo Silverio, Jr., as well as the removal of Ricardo
Silverio, Sr. as administrator to the Estate of Beatriz Silverio, are declared NULL and VOID. The writ of preliminary
injunction earlier issued is made permanent in regard to the said portions. Respondent RTC is ORDERED to
reinstate Ricardo Silverio, Sr. as administrator of the Estate of Beatriz Silverio. Costs against the Private
Respondents.

SO ORDERED."

The October 31, 2006 Omnibus Order of the testate [sic] court in so far as it authorizes the saleof the three properties
in question was not declared by the Court of Appeals, Seventh Division as null and void.It is axiomatic that it is the
dispositive portion of the decision that finally invests rights upon the parties, sets conditions for the exercise of those
rights, and imposes the corresponding duties or obligations.

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From all the foregoing, We declare that it was grave abuse of discretion on the part of the intestate court when it
ordered the sale of the Cambridge Property and Intsia Property as NULL and VOID citing as justification the decision
of the Court of Appeals, Seventh Division in CAG.R. SP No. 97196. To reiterate, the injunction order which was made
permanent by the Court of Appeals (Seventh Division) was declared to be limited only to the portion ofthe Omnibus
Order that upheld the grant of letters of administrationby SILVERIO, JR. and the removal of SILVERIO, SR. as
administrator and nothing else.

Anent the preliminary injunction issued by the intestate court in its Order dated 23 March 2011 and challenged by
SILVERIO JR. in CA-G.R. SP No. 121173, we find that it was issued with grave abuse of discretion as it was directed
against acts which were already [fait]accompli. The preliminary injunction sought to: 1) restrain SILVERIO JR., their
agents, or anybody acting in their behalf or any person from committing any act that would affect the titles to the
subject properties belonging to the Intestate Estate of the late Beatriz Silverio and (2) enjoining the Register of Deeds
of Makati City from accepting, admitting, approving, registering, annotating or in any giving due course to whatever
deeds, instruments or any other documents involving voluntary or involuntary dealings which may have the effect of
transferring, conveying, encumbering, ceding, waiving, alienating or disposing in favor of any individual or any entity
the above-enumerated properties belonging to the Intestate Estate of the late Beatriz Silverio. However, the records
show that when the preliminary injunction was issued on 23 March 2011 new titles over the disputed properties were
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already issued to CITRINE HOLDINGS, INC. and ZEE2 RESOURCES INC. (Emphasis supplied.)

We affirm the CA.

It bears to stress that the October 31, 2006 Omnibus Order was issued by the intestate court acting upon pending
motions filed by petitioner and respondent Silverio, Jr., father and son, respectively, who are the central figures in the
now decade-old controversy over the Intestate Estate of the late Beatriz S. Silverio. The intestate court flip-flopped in
appointing as administrator of the estate petitioner and respondent Silverio, Jr., their personal conflicts becoming
more evident to the intestate court as the proceedings suffered delays. At the hearing of the urgent motion filed by
Edmundo Silverio to sell the subject properties and partially settle the estate, the much awaited opportunity came
when the heirs represented by their respective counsels interposed no objection to the same.

While it is true that petitioner was eventually reinstated as Administrator pursuant to the August 28, 2008 decision in
CA-G.R. SP No. 97196 (petition for certiorari filed by Nelia Silverio-Dee), weagree with the CA that the permanent
injunction issued under the said decision, as explicitly stated in its fallo, pertained only to the portions of the October
31, 2006 Omnibus Order upholding the grant of letters of administration to and taking of an oath of administration by
respondent Silverio, Jr., as otherwise the CA would have expressly set aside as well the directive in the same
Omnibus Order allowing the sale of the subject properties. Moreover, the CA Decision attained finality only on
February 11, 2011 when this Court denied with finality respondent Silverio, Jr.’s motion for reconsideration of the
February 11, 2009 Resolution denyinghis petition for review (G.R. No. 185619).1âwphi1

The CA therefore did not err in reversing the August 18, 2011 Order of the intestate court annulling the sale of the
subject properties grounded solely on the injunction issued in CA-G.R. SP No. 97196. Respondents Ocampo, Citrine
and ZEE2 should not be prejudiced by the flip-flopping appointment of Administrator by the intestate court, having
relied in good faith that the sale was authorized and with prior approval of the intestate court under its Omnibus Order
dated October 31, 2006 which remained valid and subsisting insofar as it allowed the aforesaid sale.

WHEREFORE, the petition is DENIED. The Decision dated March 8, 2013 and Resolution dated July 4, 2013 of the
Court of Appeals in CAG.R. SP Nos. 121173 and 122024 are AFFIRMED.

With costs against the petitioner.

SO ORDERED.

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THIRD DIVISION
G.R. No. 133743 February 6, 2007
EDGAR SAN LUIS, Petitioner,
vs.
FELICIDAD SAN LUIS, Respondent.
x ---------------------------------------------------- x
G.R. No. 134029 February 6, 2007
RODOLFO SAN LUIS, Petitioner,
vs.
FELICIDAD SAGALONGOS alias FELICIDAD SAN LUIS, Respondent.
DECISION

YNARES-SANTIAGO, J.:

1
Before us are consolidated petitions for review assailing the February 4, 1998 Decision of the Court of Appeals in
2 3
CA-G.R. CV No. 52647, which reversed and set aside the September 12, 1995 and January 31, 1996 Resolutions
of the Regional Trial Court of Makati City, Branch 134 in SP. Proc. No. M-3708; and its May 15, 1998
4
Resolution denying petitioners’ motion for reconsideration.

The instant case involves the settlement of the estate of Felicisimo T. San Luis (Felicisimo), who was the former
governor of the Province of Laguna. During his lifetime, Felicisimo contracted three marriages. His first marriage was
with Virginia Sulit on March 17, 1942 out of which were born six children, namely: Rodolfo, Mila, Edgar, Linda, Emilita
and Manuel. On August 11, 1963, Virginia predeceased Felicisimo.

Five years later, on May 1, 1968, Felicisimo married Merry Lee Corwin, with whom he had a son, Tobias. However,
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on October 15, 1971, Merry Lee, an American citizen, filed a Complaint for Divorce before the Family Court of the
First Circuit, State of Hawaii, United States of America (U.S.A.), which issued a Decree Granting Absolute Divorce
6
and Awarding Child Custody on December 14, 1973.

On June 20, 1974, Felicisimo married respondent Felicidad San Luis, then surnamed Sagalongos, before Rev. Fr.
7
William Meyer, Minister of the United Presbyterian at Wilshire Boulevard, Los Angeles, California, U.S.A. He had no
children with respondent but lived with her for 18 years from the time of their marriage up to his death on December
18, 1992.

Thereafter, respondent sought the dissolution of their conjugal partnership assets and the settlement of Felicisimo’s
8
estate. On December 17, 1993, she filed a petition for letters of administration before the Regional Trial Court of
Makati City, docketed as SP. Proc. No. M-3708 which was raffled to Branch 146 thereof.

Respondent alleged that she is the widow of Felicisimo; that, at the time of his death, the decedent was residing at
100 San Juanico Street, New Alabang Village, Alabang, Metro Manila; that the decedent’s surviving heirs are
respondent as legal spouse, his six children by his first marriage, and son by his second marriage; that the decedent
left real properties, both conjugal and exclusive, valued at ₱30,304,178.00 more or less; that the decedent does not
have any unpaid debts. Respondent prayed that the conjugal partnership assets be liquidated and that letters of
administration be issued to her.

On February 4, 1994, petitioner Rodolfo San Luis, one of the children of Felicisimo by his first marriage, filed a motion
9
to dismiss on the grounds of improper venue and failure to state a cause of action. Rodolfo claimed that the petition
for letters of administration should have been filed in the Province of Laguna because this was Felicisimo’s place of
residence prior to his death. He further claimed that respondent has no legal personality to file the petition because
she was only a mistress of Felicisimo since the latter, at the time of his death, was still legally married to Merry Lee.

10
On February 15, 1994, Linda invoked the same grounds and joined her brother Rodolfo in seeking the dismissal of
11
the petition. On February 28, 1994, the trial court issued an Order denying the two motions to dismiss.

12
Unaware of the denial of the motions to dismiss, respondent filed on March 5, 1994 her opposition thereto. She
submitted documentary evidence showing that while Felicisimo exercised the powers of his public office in Laguna,
he regularly went home to their house in New Alabang Village, Alabang, Metro Manila which they bought sometime in
1982. Further, she presented the decree of absolute divorce issued by the Family Court of the First Circuit, State of
Hawaii to prove that the marriage of Felicisimo to Merry Lee had already been dissolved. Thus, she claimed that

8
13
Felicisimo had the legal capacity to marry her by virtue of paragraph 2, Article 26 of the Family Code and the
14
doctrine laid down in Van Dorn v. Romillo, Jr.

Thereafter, Linda, Rodolfo and herein petitioner Edgar San Luis, separately filed motions for reconsideration from the
15
Order denying their motions to dismiss. They asserted that paragraph 2, Article 26 of the Family Code cannot be
given retroactive effect to validate respondent’s bigamous marriage with Felicisimo because this would impair vested
16
rights in derogation of Article 256 of the Family Code.

On April 21, 1994, Mila, another daughter of Felicisimo from his first marriage, filed a motion to disqualify Acting
Presiding Judge Anthony E. Santos from hearing the case.

17
On October 24, 1994, the trial court issued an Order denying the motions for reconsideration. It ruled that
respondent, as widow of the decedent, possessed the legal standing to file the petition and that venue was properly
18
laid. Meanwhile, the motion for disqualification was deemed moot and academic because then Acting Presiding
Judge Santos was substituted by Judge Salvador S. Tensuan pending the resolution of said motion.

19
Mila filed a motion for inhibition against Judge Tensuan on November 16, 1994. On even date, Edgar also filed a
20
motion for reconsideration from the Order denying their motion for reconsideration arguing that it does not state the
facts and law on which it was based.

21
On November 25, 1994, Judge Tensuan issued an Order granting the motion for inhibition. The case was re-raffled
to Branch 134 presided by Judge Paul T. Arcangel.

22
On April 24, 1995, the trial court required the parties to submit their respective position papers on the twin issues of
23
venue and legal capacity of respondent to file the petition. On May 5, 1995, Edgar manifested that he is adopting
the arguments and evidence set forth in his previous motion for reconsideration as his position paper. Respondent
24 25
and Rodolfo filed their position papers on June 14, and June 20, 1995, respectively.

On September 12, 1995, the trial court dismissed the petition for letters of administration. It held that, at the time of
his death, Felicisimo was the duly elected governor and a resident of the Province of Laguna. Hence, the petition
should have been filed in Sta. Cruz, Laguna and not in Makati City. It also ruled that respondent was without legal
capacity to file the petition for letters of administration because her marriage with Felicisimo was bigamous, thus, void
ab initio. It found that the decree of absolute divorce dissolving Felicisimo’s marriage to Merry Lee was not valid in the
Philippines and did not bind Felicisimo who was a Filipino citizen. It also ruled that paragraph 2, Article 26 of the
Family Code cannot be retroactively applied because it would impair the vested rights of Felicisimo’s legitimate
children.

26 27
Respondent moved for reconsideration and for the disqualification of Judge Arcangel but said motions were
28
denied.

Respondent appealed to the Court of Appeals which reversed and set aside the orders of the trial court in its assailed
Decision dated February 4, 1998, the dispositive portion of which states:

WHEREFORE, the Orders dated September 12, 1995 and January 31, 1996 are hereby REVERSED and SET
ASIDE; the Orders dated February 28 and October 24, 1994 are REINSTATED; and the records of the case is
29
REMANDED to the trial court for further proceedings.

The appellante court ruled that under Section 1, Rule 73 of the Rules of Court, the term "place of residence" of the
decedent, for purposes of fixing the venue of the settlement of his estate, refers to the personal, actual or physical
habitation, or actual residence or place of abode of a person as distinguished from legal residence or domicile. It
noted that although Felicisimo discharged his functions as governor in Laguna, he actually resided in Alabang,
Muntinlupa. Thus, the petition for letters of administration was properly filed in Makati City.

The Court of Appeals also held that Felicisimo had legal capacity to marry respondent by virtue of paragraph 2,
30 31
Article 26 of the Family Code and the rulings in Van Dorn v. Romillo, Jr. and Pilapil v. Ibay-Somera. It found that
the marriage between Felicisimo and Merry Lee was validly dissolved by virtue of the decree of absolute divorce
issued by the Family Court of the First Circuit, State of Hawaii. As a result, under paragraph 2, Article 26, Felicisimo
was capacitated to contract a subsequent marriage with respondent. Thus –

9
With the well-known rule – express mandate of paragraph 2, Article 26, of the Family Code of the Philippines, the
doctrines in Van Dorn, Pilapil, and the reason and philosophy behind the enactment of E.O. No. 227, — there is no
justiciable reason to sustain the individual view — sweeping statement — of Judge Arc[h]angel, that "Article 26, par. 2
of the Family Code, contravenes the basic policy of our state against divorce in any form whatsoever." Indeed, courts
cannot deny what the law grants. All that the courts should do is to give force and effect to the express mandate of
32
the law. The foreign divorce having been obtained by the Foreigner on December 14, 1992, the Filipino divorcee,
"shall x x x have capacity to remarry under Philippine laws". For this reason, the marriage between the deceased and
petitioner should not be denominated as "a bigamous marriage.

Therefore, under Article 130 of the Family Code, the petitioner as the surviving spouse can institute the judicial
33
proceeding for the settlement of the estate of the deceased. x x x

34
Edgar, Linda, and Rodolfo filed separate motions for reconsideration which were denied by the Court of Appeals.

35
On July 2, 1998, Edgar appealed to this Court via the instant petition for review on certiorari. Rodolfo later filed a
36
manifestation and motion to adopt the said petition which was granted.

In the instant consolidated petitions, Edgar and Rodolfo insist that the venue of the subject petition for letters of
administration was improperly laid because at the time of his death, Felicisimo was a resident of Sta. Cruz, Laguna.
37
They contend that pursuant to our rulings in Nuval v. Guray and Romualdez v. RTC, Br. 7, Tacloban
38
City, "residence" is synonymous with "domicile" which denotes a fixed permanent residence to which when absent,
one intends to return. They claim that a person can only have one domicile at any given time. Since Felicisimo never
changed his domicile, the petition for letters of administration should have been filed in Sta. Cruz, Laguna.

Petitioners also contend that respondent’s marriage to Felicisimo was void and bigamous because it was performed
during the subsistence of the latter’s marriage to Merry Lee. They argue that paragraph 2, Article 26 cannot be
retroactively applied because it would impair vested rights and ratify the void bigamous marriage. As such,
respondent cannot be considered the surviving wife of Felicisimo; hence, she has no legal capacity to file the petition
for letters of administration.

The issues for resolution: (1) whether venue was properly laid, and (2) whether respondent has legal capacity to file
the subject petition for letters of administration.

The petition lacks merit.

39
Under Section 1, Rule 73 of the Rules of Court, the petition for letters of administration of the estate of Felicisimo
should be filed in the Regional Trial Court of the province "in which he resides at the time of his death." In the case of
40
Garcia Fule v. Court of Appeals, we laid down the doctrinal rule for determining the residence – as
contradistinguished from domicile – of the decedent for purposes of fixing the venue of the settlement of his estate:

[T]he term "resides" connotes ex vi termini "actual residence" as distinguished from "legal residence or domicile." This
term "resides," like the terms "residing" and "residence," is elastic and should be interpreted in the light of the object
or purpose of the statute or rule in which it is employed. In the application of venue statutes and rules – Section 1,
Rule 73 of the Revised Rules of Court is of such nature – residence rather than domicile is the significant factor. Even
where the statute uses the word "domicile" still it is construed as meaning residence and not domicile in the technical
sense. Some cases make a distinction between the terms "residence" and "domicile" but as generally used in
statutes fixing venue, the terms are synonymous, and convey the same meaning as the term "inhabitant." In other
words, "resides" should be viewed or understood in its popular sense, meaning, the personal, actual or physical
habitation of a person, actual residence or place of abode. It signifies physical presence in a place and actual stay
thereat. In this popular sense, the term means merely residence, that is, personal residence, not legal residence or
domicile. Residence simply requires bodily presence as an inhabitant in a given place, while domicile requires bodily
presence in that place and also an intention to make it one’s domicile. No particular length of time of residence is
41
required though; however, the residence must be more than temporary. (Emphasis supplied)

It is incorrect for petitioners to argue that "residence," for purposes of fixing the venue of the settlement of the estate
of Felicisimo, is synonymous with "domicile." The rulings in Nuval and Romualdez are inapplicable to the instant case
because they involve election cases. Needless to say, there is a distinction between "residence" for purposes of
election laws and "residence" for purposes of fixing the venue of actions. In election cases, "residence" and "domicile"
are treated as synonymous terms, that is, the fixed permanent residence to which when absent, one has the intention

10
42
of returning. However, for purposes of fixing venue under the Rules of Court, the "residence" of a person is his
personal, actual or physical habitation, or actual residence or place of abode, which may not necessarily be his legal
43
residence or domicile provided he resides therein with continuity and consistency. Hence, it is possible that a
person may have his residence in one place and domicile in another.

In the instant case, while petitioners established that Felicisimo was domiciled in Sta. Cruz, Laguna, respondent
proved that he also maintained a residence in Alabang, Muntinlupa from 1982 up to the time of his death.
44
Respondent submitted in evidence the Deed of Absolute Sale dated January 5, 1983 showing that the deceased
45
purchased the aforesaid property. She also presented billing statements from the Philippine Heart Center and
Chinese General Hospital for the period August to December 1992 indicating the address of Felicisimo at "100 San
Juanico, Ayala Alabang, Muntinlupa." Respondent also presented proof of membership of the deceased in the Ayala
46 47 48
Alabang Village Association and Ayala Country Club, Inc., letter-envelopes from 1988 to 1990 sent by the
49
deceased’s children to him at his Alabang address, and the deceased’s calling cards stating that his home/city
address is at "100 San Juanico, Ayala Alabang Village, Muntinlupa" while his office/provincial address is in "Provincial
Capitol, Sta. Cruz, Laguna."

From the foregoing, we find that Felicisimo was a resident of Alabang, Muntinlupa for purposes of fixing the venue of
the settlement of his estate. Consequently, the subject petition for letters of administration was validly filed in the
50
Regional Trial Court which has territorial jurisdiction over Alabang, Muntinlupa. The subject petition was filed on
December 17, 1993. At that time, Muntinlupa was still a municipality and the branches of the Regional Trial Court of
the National Capital Judicial Region which had territorial jurisdiction over Muntinlupa were then seated in Makati City
51
as per Supreme Court Administrative Order No. 3. Thus, the subject petition was validly filed before the Regional
Trial Court of Makati City.

Anent the issue of respondent Felicidad’s legal personality to file the petition for letters of administration, we must first
resolve the issue of whether a Filipino who is divorced by his alien spouse abroad may validly remarry under the Civil
Code, considering that Felicidad’s marriage to Felicisimo was solemnized on June 20, 1974, or before the Family
Code took effect on August 3, 1988. In resolving this issue, we need not retroactively apply the provisions of the
Family Code, particularly Art. 26, par. (2) considering that there is sufficient jurisprudential basis allowing us to rule in
the affirmative.

52
The case of Van Dorn v. Romillo, Jr. involved a marriage between a foreigner and his Filipino wife, which marriage
was subsequently dissolved through a divorce obtained abroad by the latter. Claiming that the divorce was not valid
under Philippine law, the alien spouse alleged that his interest in the properties from their conjugal partnership should
be protected. The Court, however, recognized the validity of the divorce and held that the alien spouse had no
interest in the properties acquired by the Filipino wife after the divorce. Thus:

In this case, the divorce in Nevada released private respondent from the marriage from the standards of American
law, under which divorce dissolves the marriage. As stated by the Federal Supreme Court of the United States in
Atherton vs. Atherton, 45 L. Ed. 794, 799:

"The purpose and effect of a decree of divorce from the bond of matrimony by a competent jurisdiction are to change
the existing status or domestic relation of husband and wife, and to free them both from the bond. The marriage tie,
when thus severed as to one party, ceases to bind either. A husband without a wife, or a wife without a husband, is
unknown to the law. When the law provides, in the nature of a penalty, that the guilty party shall not marry again, that
party, as well as the other, is still absolutely freed from the bond of the former marriage."

Thus, pursuant to his national law, private respondent is no longer the husband of petitioner. He would have no
standing to sue in the case below as petitioner’s husband entitled to exercise control over conjugal assets. As he is
bound by the Decision of his own country’s Court, which validly exercised jurisdiction over him, and whose decision
he does not repudiate, he is estopped by his own representation before said Court from asserting his right over the
53
alleged conjugal property.

As to the effect of the divorce on the Filipino wife, the Court ruled that she should no longer be considered married to
the alien spouse. Further, she should not be required to perform her marital duties and obligations. It held:

To maintain, as private respondent does, that, under our laws, petitioner has to be considered still marriedto
private respondent and still subject to a wife's obligations under Article 109, et. seq. of the Civil Code cannot
be just. Petitioner should not be obliged to live together with, observe respect and fidelity, and render support to

11
private respondent. The latter should not continue to be one of her heirs with possible rights to conjugal property. She
54
should not be discriminated against in her own country if the ends of justice are to be served. (Emphasis
added)

55
This principle was thereafter applied in Pilapil v. Ibay-Somera where the Court recognized the validity of a divorce
obtained abroad. In the said case, it was held that the alien spouse is not a proper party in filing the adultery suit
against his Filipino wife. The Court stated that "the severance of the marital bond had the effect of dissociating the
56
former spouses from each other, hence the actuations of one would not affect or cast obloquy on the other."

57
Likewise, in Quita v. Court of Appeals, the Court stated that where a Filipino is divorced by his naturalized foreign
58
spouse, the ruling in Van Dorn applies. Although decided on December 22, 1998, the divorce in the said case was
obtained in 1954 when the Civil Code provisions were still in effect.

The significance of the Van Dorn case to the development of limited recognition of divorce in the Philippines cannot
be denied. The ruling has long been interpreted as severing marital ties between parties in a mixed marriage and
capacitating the Filipino spouse to remarry as a necessary consequence of upholding the validity of a divorce
obtained abroad by the alien spouse. In his treatise, Dr. Arturo M. Tolentino cited Van Dorn stating that "if the
foreigner obtains a valid foreign divorce, the Filipino spouse shall have capacity to remarry under Philippine
59 60 61
law." In Garcia v. Recio, the Court likewise cited the aforementioned case in relation to Article 26.

62
In the recent case of Republic v. Orbecido III, the historical background and legislative intent behind paragraph 2,
Article 26 of the Family Code were discussed, to wit:

Brief Historical Background

On July 6, 1987, then President Corazon Aquino signed into law Executive Order No. 209, otherwise known as the
"Family Code," which took effect on August 3, 1988. Article 26 thereof states:

All marriages solemnized outside the Philippines in accordance with the laws in force in the country where they were
solemnized, and valid there as such, shall also be valid in this country, except those prohibited under Articles 35, 37,
and 38.

On July 17, 1987, shortly after the signing of the original Family Code, Executive Order No. 227 was likewise signed
into law, amending Articles 26, 36, and 39 of the Family Code. A second paragraph was added to Article 26. As so
amended, it now provides:

ART. 26. All marriages solemnized outside the Philippines in accordance with the laws in force in the country where
they were solemnized, and valid there as such, shall also be valid in this country, except those prohibited under
Articles 35(1), (4), (5) and (6), 36, 37 and 38.

Where a marriage between a Filipino citizen and a foreigner is validly celebrated and a divorce is thereafter validly
obtained abroad by the alien spouse capacitating him or her to remarry, the Filipino spouse shall have capacity to
remarry under Philippine law. (Emphasis supplied)

xxxx
Legislative Intent

Records of the proceedings of the Family Code deliberations showed that the intent of Paragraph 2 of Article 26,
according to Judge Alicia Sempio-Diy, a member of the Civil Code Revision Committee, is to avoid the absurd
situation where the Filipino spouse remains married to the alien spouse who, after obtaining a divorce, is no longer
married to the Filipino spouse.

Interestingly, Paragraph 2 of Article 26 traces its origin to the 1985 case of Van Dorn v. Romillo, Jr. The Van
Dorn case involved a marriage between a Filipino citizen and a foreigner. The Court held therein that a
divorce decree validly obtained by the alien spouse is valid in the Philippines, and consequently, the Filipino
63
spouse is capacitated to remarry under Philippine law. (Emphasis added)

12
As such, the Van Dorn case is sufficient basis in resolving a situation where a divorce is validly obtained abroad by
the alien spouse. With the enactment of the Family Code and paragraph 2, Article 26 thereof, our lawmakers codified
the law already established through judicial precedent.1awphi1.net

Indeed, when the object of a marriage is defeated by rendering its continuance intolerable to one of the parties and
64
productive of no possible good to the community, relief in some way should be obtainable. Marriage, being a
mutual and shared commitment between two parties, cannot possibly be productive of any good to the society where
one is considered released from the marital bond while the other remains bound to it. Such is the state of affairs
where the alien spouse obtains a valid divorce abroad against the Filipino spouse, as in this case.

65 66
Petitioners cite Articles 15 and 17 of the Civil Code in stating that the divorce is void under Philippine law insofar
as Filipinos are concerned. However, in light of this Court’s rulings in the cases discussed above, the Filipino spouse
67
should not be discriminated against in his own country if the ends of justice are to be served. In Alonzo v.
68
Intermediate Appellate Court, the Court stated:

But as has also been aptly observed, we test a law by its results; and likewise, we may add, by its purposes. It is a
cardinal rule that, in seeking the meaning of the law, the first concern of the judge should be to discover in its
provisions the intent of the lawmaker. Unquestionably, the law should never be interpreted in such a way as to cause
injustice as this is never within the legislative intent. An indispensable part of that intent, in fact, for we presume the
good motives of the legislature, is to render justice.

Thus, we interpret and apply the law not independently of but in consonance with justice. Law and justice are
inseparable, and we must keep them so. To be sure, there are some laws that, while generally valid, may seem
arbitrary when applied in a particular case because of its peculiar circumstances. In such a situation, we are not
bound, because only of our nature and functions, to apply them just the same, in slavish obedience to their language.
What we do instead is find a balance between the word and the will, that justice may be done even as the law is
obeyed.

As judges, we are not automatons. We do not and must not unfeelingly apply the law as it is worded, yielding like
robots to the literal command without regard to its cause and consequence. "Courts are apt to err by sticking too
closely to the words of a law," so we are warned, by Justice Holmes again, "where these words import a policy that
goes beyond them."

xxxx

More than twenty centuries ago, Justinian defined justice "as the constant and perpetual wish to render every one his
due." That wish continues to motivate this Court when it assesses the facts and the law in every case brought to it for
decision. Justice is always an essential ingredient of its decisions. Thus when the facts warrants, we interpret the law
in a way that will render justice, presuming that it was the intention of the lawmaker, to begin with, that the law be
69
dispensed with justice.

Applying the above doctrine in the instant case, the divorce decree allegedly obtained by Merry Lee which absolutely
allowed Felicisimo to remarry, would have vested Felicidad with the legal personality to file the present petition as
Felicisimo’s surviving spouse. However, the records show that there is insufficient evidence to prove the validity of
the divorce obtained by Merry Lee as well as the marriage of respondent and Felicisimo under the laws of the U.S.A.
70
In Garcia v. Recio, the Court laid down the specific guidelines for pleading and proving foreign law and divorce
judgments. It held that presentation solely of the divorce decree is insufficient and that proof of its authenticity and
due execution must be presented. Under Sections 24 and 25 of Rule 132, a writing or document may be proven as a
public or official record of a foreign country by either (1) an official publication or (2) a copy thereof attested by the
officer having legal custody of the document. If the record is not kept in the Philippines, such copy must be (a)
accompanied by a certificate issued by the proper diplomatic or consular officer in the Philippine foreign service
71
stationed in the foreign country in which the record is kept and (b) authenticated by the seal of his office.

With regard to respondent’s marriage to Felicisimo allegedly solemnized in California, U.S.A., she submitted
72
photocopies of the Marriage Certificate and the annotated text of the Family Law Act of California which purportedly
show that their marriage was done in accordance with the said law. As stated in Garcia, however, the Court cannot
73
take judicial notice of foreign laws as they must be alleged and proved.

13
Therefore, this case should be remanded to the trial court for further reception of evidence on the divorce decree
obtained by Merry Lee and the marriage of respondent and Felicisimo.

Even assuming that Felicisimo was not capacitated to marry respondent in 1974, nevertheless, we find that the latter
has the legal personality to file the subject petition for letters of administration, as she may be considered the co-
owner of Felicisimo as regards the properties that were acquired through their joint efforts during their cohabitation.

74
Section 6, Rule 78 of the Rules of Court states that letters of administration may be granted to the surviving spouse
of the decedent. However, Section 2, Rule 79 thereof also provides in part:

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, as far as known to the petitioner: x x x.

An "interested person" has been defined as one who would be benefited by the estate, such as an heir, or one who
has a claim against the estate, such as a creditor. The interest must be material and direct, and not merely indirect or
75
contingent.

In the instant case, respondent would qualify as an interested person who has a direct interest in the estate of
Felicisimo by virtue of their cohabitation, the existence of which was not denied by petitioners. If she proves the
validity of the divorce and Felicisimo’s capacity to remarry, but fails to prove that her marriage with him was validly
76
performed under the laws of the U.S.A., then she may be considered as a co-owner under Article 144 of the Civil
Code. This provision governs the property relations between parties who live together as husband and wife without
the benefit of marriage, or their marriage is void from the beginning. It provides that the property acquired by either or
both of them through their work or industry or their wages and salaries shall be governed by the rules on co-
ownership. In a co-ownership, it is not necessary that the property be acquired through their joint labor, efforts and
industry. Any property acquired during the union is prima facie presumed to have been obtained through their joint
77
efforts. Hence, the portions belonging to the co-owners shall be presumed equal, unless the contrary is proven.

Meanwhile, if respondent fails to prove the validity of both the divorce and the marriage, the applicable provision
would be Article 148 of the Family Code which has filled the hiatus in Article 144 of the Civil Code by expressly
regulating the property relations of couples living together as husband and wife but are incapacitated to
78 79
marry. In Saguid v. Court of Appeals, we held that even if the cohabitation or the acquisition of property occurred
80
before the Family Code took effect, Article 148 governs. The Court described the property regime under this
provision as follows:

The regime of limited co-ownership of property governing the union of parties who are not legally capacitated to
marry each other, but who nonetheless live together as husband and wife, applies to properties acquired during said
cohabitation in proportion to their respective contributions. Co-ownership will only be up to the extent of the proven
actual contribution of money, property or industry. Absent proof of the extent thereof, their contributions and
corresponding shares shall be presumed to be equal.

xxxx

In the cases of Agapay v. Palang, and Tumlos v. Fernandez, which involved the issue of co-ownership of properties
acquired by the parties to a bigamous marriage and an adulterous relationship, respectively, we ruled that proof of
actual contribution in the acquisition of the property is essential. x x x

As in other civil cases, the burden of proof rests upon the party who, as determined by the pleadings or the nature of
the case, asserts an affirmative issue. Contentions must be proved by competent evidence and reliance must be had
81
on the strength of the party’s own evidence and not upon the weakness of the opponent’s defense. x x x

In view of the foregoing, we find that respondent’s legal capacity to file the subject petition for letters of administration
may arise from her status as the surviving wife of Felicisimo or as his co-owner under Article 144 of the Civil Code or
Article 148 of the Family Code.

WHEREFORE, the petition is DENIED. The Decision of the Court of Appeals reinstating and affirming the February
28, 1994 Order of the Regional Trial Court which denied petitioners’ motion to dismiss and its October 24, 1994 Order

14
which dismissed petitioners’ motion for reconsideration is AFFIRMED. Let this case be REMANDED to the trial court
for further proceedings.

SO ORDERED.

15
SECOND DIVISION

EDUARDO G. AGTARAP, G.R. No. 177099


Petitioner,

- versus -

SEBASTIAN AGTARAP, JOSEPH AGTARAP, TERESA


AGTARAP, WALTER DE SANTOS, and ABELARDO
DAGORO,
Respondents.

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

SEBASTIAN G. AGTARAP,
Petitioner, G.R. No. 177192

Present:

- versus - CARPIO, J.,


Chairperson,
NACHURA,
PERALTA,
ABAD, and
EDUARDO G. AGTARAP, JOSEPH AGTARAP, TERESA MENDOZA, JJ.
AGTARAP, WALTER DE SANTOS, and ABELARDO
DAGORO, Promulgated:
Respondents.
June 8, 2011

x------------------------------------------------------------------------------------x
DECISION

NACHURA, J.:

[1]
Before us are the consolidated petitions for review on certiorari of petitioners Sebastian G. Agtarap (Sebastian) and
[2] [3]
Eduardo G. Agtarap (Eduardo), assailing the Decision dated November 21, 2006 and the Resolution dated March
[4]
27, 2007 of the Court of Appeals (CA) in CA-G.R. CV No. 73916.

The antecedent facts and proceedings

On September 15, 1994, Eduardo filed with the Regional Trial Court (RTC), Branch 114, Pasay City, a verified
petition for the judicial settlement of the estate of his deceased father Joaquin Agtarap (Joaquin). It was docketed as
Special Proceedings No. 94-4055.

The petition alleged that Joaquin died intestate on November 21, 1964 in Pasay City without any known debts or
[5]
obligations. During his lifetime, Joaquin contracted two marriages, first with Lucia Garcia (Lucia), and second with
Caridad Garcia (Caridad). Lucia died on April 24, 1924. Joaquin and Lucia had three childrenJesus (died without
[6] [7]
issue), Milagros, and Jose (survived by three children, namely, Gloria, Joseph, and Teresa ). Joaquin married
Caridad on February 9, 1926. They also had three childrenEduardo, Sebastian, and Mercedes (survived by her
daughter Cecile). At the time of his death, Joaquin left two parcels of land with improvements in Pasay City, covered
by Transfer Certificates of Title (TCT) Nos. 873-(38254) and 874-(38255). Joseph, a grandson of Joaquin, had been
leasing and improving the said realties and had been appropriating for himself P26,000.00 per month since April
1994.

Eduardo further alleged that there was an imperative need to appoint him as special administrator to take possession
and charge of the estate assets and their civil fruits, pending the appointment of a regular administrator. In addition,
he prayed that an order be issued (a) confirming and declaring the named compulsory heirs of Joaquin who would be
entitled to participate in the estate; (b) apportioning and allocating unto the named heirs their aliquot shares in the

16
estate in accordance with law; and (c) entitling the distributees the right to receive and enter into possession those
parts of the estate individually awarded to them.

On September 26, 1994, the RTC issued an order setting the petition for initial hearing and directing Eduardo to
cause its publication.

On December 28, 1994, Sebastian filed his comment, generally admitting the allegations in the petition, and
conceding to the appointment of Eduardo as special administrator.

Joseph, Gloria, and Teresa filed their answer/opposition. They alleged that the two subject lots belong to the conjugal
partnership of Joaquin with Lucia, and that, upon Lucias death in April 1924, they became the pro indiviso owners of
the subject properties. They said that their residence was built with the exclusive money of their late father Jose, and
the expenses of the extensions to the house were shouldered by Gloria and Teresa, while the restaurant (Manongs
Restaurant) was built with the exclusive money of Joseph and his business partner. They opposed the appointment
of Eduardo as administrator on the following grounds: (1) he is not physically and mentally fit to do so; (2) his interest
in the lots is minimal; and (3) he does not possess the desire to earn. They claimed that the best interests of the
estate dictate that Joseph be appointed as special or regular administrator.

On February 16, 1995, the RTC issued a resolution appointing Eduardo as regular administrator of Joaquins
estate. Consequently, it issued him letters of administration.

On September 16, 1995, Abelardo Dagoro filed an answer in intervention, alleging that Mercedes is survived not only
by her daughter Cecile, but also by him as her husband. He also averred that there is a need to appoint a special
administrator to the estate, but claimed that Eduardo is not the person best qualified for the task.

After the parties were given the opportunity to be heard and to submit their respective proposed projects of partition,
[8]
the RTC, on October 23, 2000, issued an Order of Partition, with the following disposition

In the light of the filing by the heirs of their respective proposed projects of partition and the payment of inheritance
taxes due the estate as early as 1965, and there being no claim in Court against the estate of the deceased, the
estate of JOAQUIN AGTARAP is now consequently ripe for distribution among the heirs minus the surviving spouse
Caridad Garcia who died on August 25, 1999.

Considering that the bulk of the estate property were acquired during the existence of the second marriage as shown
by TCT No. (38254) and TCT No. (38255) which showed on its face that decedent was married to Caridad Garcia,
which fact oppositors failed to contradict by evidence other than their negative allegations, the greater part of the
estate is perforce accounted by the second marriage and the compulsory heirs thereunder.

The Administrator, Eduardo Agtarap rendered a true and just accounting of his administration from his date of
assumption up to the year ending December 31, 1996 per Financial and Accounting Report dated June 2, 1997 which
was approved by the Court. The accounting report included the income earned and received for the period and the
expenses incurred in the administration, sustenance and allowance of the widow. In accordance with said Financial
and Accounting Report which was duly approved by this Court in its Resolution dated July 28, 1998 the deceased
JOAQUIN AGTARAP left real properties consisting of the following:

I LAND:

Two lots and two buildings with one garage quarter located at #3030 Agtarap St., Pasay City, covered by Transfer
Certificate of Title Nos. 38254 and 38255 and registered with the Registry of Deeds of Pasay City, Metro Manila,
described as follows:

TCT NO. LOT NO. AREA/SQ.M. ZONAL VALUE AMOUNT


38254 745-B-1 1,335 sq. m. P5,000.00 P6,675,000.00
38255 745-B-2 1,331 sq. m. P5,000.00 P6,655,000.00
TOTAL-------------------------------------------------------------P13,330,000.00

II BUILDINGS AND IMPROVEMENTS:

BUILDING I (Lot # 745-B-1) ------------------------------ P350,000.00


BUILDING II (Lot # 745-B-2) ----------------------------- 320,000.00
Building Improvements -------------------------------------- 97,500.00

17
Restaurant ------------------------------------------------------ 80,000.00
TOTAL --------------------------------------------------------- P847,500.00

TOTAL NET WORTH ----------------------------------------- P14,177,500.00

WHEREFORE, the net assets of the estate of the late JOAQUIN AGTARAP with a total value of P14,177,500.00,
together with whatever interest from bank deposits and all other incomes or increments thereof accruing after the
Accounting Report of December 31, 1996, after deducting therefrom the compensation of the administrator and other
expenses allowed by the Court, are hereby ordered distributed as follows:

TOTAL ESTATE P14,177,500.00


CARIDAD AGTARAP of the estate as her conjugal share P7,088,750.00, the other half of P7,088,750.00 to be
divided among the compulsory heirs as follows:

1) JOSE (deceased) - P1,181,548.30


2) MILAGROS (deceased) - P1,181,548.30
3) MERCEDES (deceased) - P1,181,548.30
4) SEBASTIAN - P1,181,548.30
5) EDUARDO - P1,181,548.30
6) CARIDAD - P1,181,548.30

The share of Milagros Agtarap as compulsory heir in the amount of P1,181,548.30 and who died in 1996 will go to
Teresa Agtarap and Joseph Agtarap, Walter de Santos and half brothers Eduardo and Sebastian Agtarap in equal
proportions.

TERESA AGTARAP - P236,291.66


JOSEPH AGTARAP - P236,291.66
WALTER DE SANTOS - P236,291.66
SEBASTIAN AGTARAP - P236,291.66
EDUARDO AGTARAP - P236,291.66

Jose Agtarap died in 1967. His compulsory heirs are as follows:

COMPULSORY HEIRS:
1) GLORIA (deceased) represented by Walter de Santos
- P295,364.57
2) JOSEPH AGTARAP - P295,364.57
3) TERESA AGTARAP - P295,364.57
4) PRISCILLA AGTARAP - P295,364.57

Hence, Priscilla Agtarap will inherit P295,364.57.

Adding their share from Milagros Agtarap, the following heirs of the first marriage stand to receive the total amount of:

HEIRS OF THE FIRST MARRIAGE:

1) JOSEPH AGTARAP - P236,291.66 share from Milagros Agtarap


P295,364.57 as compulsory heir of
P531,656.23 Jose Agtarap

2) TERESA AGTARAP - P236,291.66 share from Milagros Agtarap


P295,364.57 as compulsory heir of
P531,656.23 Jose Agtarap

3) WALTER DE SANTOS - P236,291.66 share from Milagros Agtarap


P295,364.57 as compulsory heir of
P531,656.23 Jose Agtarap

HEIRS OF THE SECOND MARRIAGE:

a) CARIDAD AGTARAP - died on August 25, 1999


P7,088,750.00 - as conjugal share

18
P1,181,458.30 - as compulsory heir
Total of P8,270,208.30

b) SEBASTIAN AGTARAP - P1,181,458.38 as compulsory heir


P 236,291.66 share from Milagros

c) EDUARDO AGTARAP - P1,181,458.38 as compulsory heir


P 236,291.66 share from Milagros

d) MERCEDES - as represented by Abelardo Dagoro as the


surviving spouse of a compulsory heir
P1,181,458.38

REMAINING HEIRS OF CARIDAD AGTARAP:

1) SEBASTIAN AGTARAP
2) EDUARDO AGTARAP
MERCEDES AGTARAP (Predeceased Caridad Agtarap)

In sum, Sebastian Agtarap and Eduardo Agtarap stand to inherit:

SEBASTIAN P4,135,104.10 share from Caridad Garcia


P1,181,458.30 as compulsory heir
P 236,291.66 share from Milagros
P5,522,854.06

EDUARDO P4,135,104.10 share from Caridad Garcia


P1,181,458.30 as compulsory heir
P 236,291.66 share from Milagros
P5,522,854.06
[9]
SO ORDERED.

Eduardo, Sebastian, and oppositors Joseph and Teresa filed their respective motions for reconsideration.
[10]
On August 27, 2001, the RTC issued a resolution denying the motions for reconsideration of Eduardo and
Sebastian, and granting that of Joseph and Teresa.It also declared that the real estate properties belonged to the
conjugal partnership of Joaquin and Lucia. It also directed the modification of the October 23, 2000 Order of Partition
to reflect the correct sharing of the heirs. However, before the RTC could issue a new order of partition, Eduardo and
Sebastian both appealed to the CA.

On November 21, 2006, the CA rendered its Decision, the dispositive portion of which reads

WHEREFORE, premises considered, the instant appeals are DISMISSED for lack of merit. The assailed Resolution
dated August 27, 2001 is AFFIRMED and pursuant thereto, the subject properties (Lot No. 745-B-1 [TCT No. 38254]
and Lot No. 745-B-2 [TCT No. 38255]) and the estate of the late Joaquin Agtarap are hereby partitioned as follows:

The two (2) properties, together with their improvements, embraced by TCT No. 38254 and TCT No. 38255,
respectively, are first to be distributed among the following:

Lucia Mendietta - of the property. But since she is deceased, her share shall be inherited by Joaquin, Jesus, Milagros
and Jose in equal shares.

Joaquin Agtarap - of the property and of the other half of the property which pertains to Lucia Mendiettas share.

Jesus Agtarap - of Lucia Mendiettas share. But since he is already deceased (and died without issue), his inheritance
shall, in turn, be acquired by Joaquin Agtarap.

Milagros Agtarap - of Lucia Mendiettas share. But since she died in 1996 without issue, 5/8 of her inheritance shall be
inherited by Gloria (represented by her husband Walter de Santos and her daughter Samantha), Joseph Agtarap and

19
Teresa Agtarap, (in representation of Milagros brother Jose Agtarap) and 1/8 each shall be inherited by Mercedes
(represented by her husband Abelardo Dagoro and her daughter Cecile), Sebastian Eduardo, all surnamed Agtarap.

Jose Agtarap - of Lucia Mendiettas share. But since he died in 1967, his inheritance shall be acquired by his wife
Priscilla, and children Gloria (represented by her husband Walter de Santos and her daughter Samantha), Joseph
Agtarap and Teresa in equal shares.

Then, Joaquin Agtaraps estate, comprising three-fourths (3/4) of the subject properties and its improvements, shall
be distributed as follows:

Caridad Garcia - 1/6 of the estate. But since she died in 1999, her share shall be inherited by her children namely
Mercedes Agtarap (represented by her husband Abelardo Dagoro and her daughter Cecilia), Sebastian Agtarap and
Eduardo Agtarap in their own right, dividing the inheritance in equal shares.

Milagros Agtarap - 1/6 of the estate. But since she died in 1996 without issue, 5/8 of her inheritance shall be inherited
by Gloria (represented by her husband Walter de Santos and her daughter Samantha), Joseph Agtarap and Teresa
Agtarap, (in representation of Milagros brother Jose Agtarap) and 1/8 each shall be inherited by Mercedes
(represented by her husband Abelardo Dagoro and her daughter Cecile), Sebastian and Eduardo, all surnamed
Agtarap.

Jose Agtarap - 1/6 of the estate. But since he died in 1967, his inheritance shall be acquired by his wife Priscilla, and
children Gloria (represented by her husband Walter de Santos and her daughter Samantha), Joseph Agtarap and
Teresa Agtarap in equal shares.

Mercedes Agtarap - 1/6 of the estate. But since she died in 1984, her inheritance shall be acquired by her husband
Abelardo Dagoro and her daughter Cecile in equal shares.

Sebastian Agtarap - 1/6 of the estate.

Eduardo Agtarap - 1/6 of the estate.


[11]
SO ORDERED.

Aggrieved, Sebastian and Eduardo filed their respective motions for reconsideration.

In its Resolution dated March 27, 2007, the CA denied both motions. Hence, these petitions ascribing to the appellate
court the following errors:

G.R. No. 177192


[12]
1. The Court of Appeals erred in not considering the aforementioned important facts which alter its Decision;

2. The Court of Appeals erred in not considering the necessity of hearing the issue of legitimacy of respondents as
heirs;

3. The Court of Appeals erred in allowing violation of the law and in not applying the doctrines of collateral attack,
[13]
estoppel, and res judicata.

G.R. No. 177099

THE COURT OF APPEALS (FORMER TWELFTH DIVISION) DID NOT ACQUIRE JURISDICTION OVER THE
ESTATE OF MILAGROS G. AGTARAP AND ERRED IN DISTRIBUTING HER INHERITANCE FROM THE ESTATE
OF JOAQUIN AGTARAP NOTWITHSTANDING THE EXISTENCE OF HER LAST WILL AND TESTAMENT IN
VIOLATION OF THE DOCTRINE OF PRECEDENCE OF TESTATE PROCEEDINGS OVER INTESTATE
PROCEEDINGS.

II.

THE COURT OF APPEALS (FORMER TWELFTH DIVISION) ERRED IN DISMISSING THE DECISION APPEALED
FROM FOR LACK OF MERIT AND IN AFFIRMING THE ASSAILED RESOLUTION DATED AUGUST 27, 2001 OF
THE LOWER COURT HOLDING THAT THE PARCELS OF LAND COVERED BY TCT NO. 38254 AND TCT (NO.)
38255 OF THE REGISTRY OF DEEDS FOR THE CITY OF PASAY BELONG TO THE CONJUGAL PARTNERSHIP

20
OF JOAQUIN AGTARAP MARRIED TO LUCIA GARCIA MENDIETTA NOTWITHSTANDING THEIR
REGISTRATION UNDER THEIR EXISTING CERTIFICATES OF TITLE AS REGISTERED IN THE NAME OF
JOAQUIN AGTARAP, CASADO CON CARIDAD GARCIA. UNDER EXISTING JURISPRUDENCE, THE PROBATE
COURT HAS NO POWER TO DETERMINE THE OWNERSHIP OF THE PROPERTY DESCRIBED IN THESE
CERTIFICATES OF TITLE WHICH SHOULD BE RESOLVED IN AN APPROPRIATE SEPARATE ACTION FOR A
TORRENS TITLE UNDER THE LAW IS ENDOWED WITH INCONTESTABILITY UNTIL IT HAS BEEN SET ASIDE
[14]
IN THE MANNER INDICATED IN THE LAW ITSELF.

As regards his first and second assignments of error, Sebastian contends that Joseph and Teresa failed to establish
by competent evidence that they are the legitimate heirs of their father Jose, and thus of their grandfather
Joaquin. He draws attention to the certificate of title (TCT No. 8026) they submitted, stating that the wife of their
father Jose is Presentacion Garcia, while they claim that their mother is Priscilla. He avers that the marriage contracts
proffered by Joseph and Teresa do not qualify as the best evidence of Joses marriage with Priscilla, inasmuch as
they were not authenticated and formally offered in evidence. Sebastian also asseverates that he actually questioned
the legitimacy of Joseph and Teresa as heirs of Joaquin in his motion to exclude them as heirs, and in his reply to
their opposition to the said motion. He further claims that the failure of Abelardo Dagoro and Walter de Santos to
oppose his motion to exclude them as heirs had the effect of admitting the allegations therein. He points out that his
motion was denied by the RTC without a hearing.

With respect to his third assigned error, Sebastian maintains that the certificates of title of real estate properties
subject of the controversy are in the name of Joaquin Agtarap, married to Caridad Garcia, and as such are conclusive
proof of their ownership thereof, and thus, they are not subject to collateral attack, but should be threshed out in a
separate proceeding for that purpose. He likewise argues that estoppel applies against the children of the first
marriage, since none of them registered any objection to the issuance of the TCTs in the name of Caridad and
Joaquin only. He avers that the estate must have already been settled in light of the payment of the estate and
inheritance tax by Milagros, Joseph, and Teresa, resulting to the issuance of TCT No. 8925 in Milagros name and of
TCT No. 8026 in the names of Milagros and Jose. He also alleges that res judicata is applicable as the court order
directing the deletion of the name of Lucia, and replacing it with the name of Caridad, in the TCTs had long become
final and executory.

In his own petition, with respect to his first assignment of error, Eduardo alleges that the CA erroneously settled,
together with the settlement of the estate of Joaquin, the estates of Lucia, Jesus, Jose, Mercedes, Gloria, and
Milagros, in contravention of the principle of settling only one estate in one proceeding. He particularly questions the
distribution of the estate of Milagros in the intestate proceedings despite the fact that a proceeding was conducted in
another court for the probate of the will of Milagros, bequeathing all to Eduardo whatever share that she would
receive from Joaquins estate. He states that this violated the rule on precedence of testate over intestate
proceedings.

Anent his second assignment of error, Eduardo contends that the CA gravely erred when it affirmed that the bulk of
the realties subject of this case belong to the first marriage of Joaquin to Lucia, notwithstanding that the certificates of
title were registered in the name of Joaquin Agtarap casado con (married to) Caridad Garcia.According to him, the
RTC, acting as an intestate court with limited jurisdiction, was not vested with the power and authority to determine
questions of ownership, which properly belongs to another court with general jurisdiction.

The Courts Ruling

As to Sebastians and Eduardos common issue on the ownership of the subject real properties, we hold that the RTC,
as an intestate court, had jurisdiction to resolve the same.

The general rule is that the jurisdiction of the trial court, either as a probate or an intestate court, relates only to
matters having to do with the probate of the will and/or settlement of the estate of deceased persons, but does not
[15]
extend to the determination of questions of ownership that arise during the proceedings. The patent rationale for
[16] [17]
this rule is that such court merely exercises special and limited jurisdiction. As held in several cases, a probate
court or one in charge of estate proceedings, whether testate or intestate, cannot adjudicate or determine title to
properties claimed to be a part of the estate and which are claimed to belong to outside parties, not by virtue of any
right of inheritance from the deceased but by title adverse to that of the deceased and his estate. All that the said
court could do as regards said properties is to determine whether or not they should be included in the inventory of
properties to be administered by the administrator. If there is no dispute, there poses no problem, but if there is, then
the parties, the administrator, and the opposing parties have to resort to an ordinary action before a court exercising
general jurisdiction for a final determination of the conflicting claims of title.

21
However, this general rule is subject to exceptions as justified by expediency and convenience.
First, the probate court may provisionally pass upon in an intestate or a testate proceeding the question of inclusion
in, or exclusion from, the inventory of a piece of property without prejudice to the final determination of ownership in a
[18]
separate action. Second, if the interested parties are all heirs to the estate, or the question is one of collation or
advancement, or the parties consent to the assumption of jurisdiction by the probate court and the rights of third
[19]
parties are not impaired, then the probate court is competent to resolve issues on ownership. Verily, its jurisdiction
extends to matters incidental or collateral to the settlement and distribution of the estate, such as the determination of
the status of each heir and whether the property in the inventory is conjugal or exclusive property of the deceased
[20]
spouse.

We hold that the general rule does not apply to the instant case considering that the parties are all heirs of Joaquin
and that no rights of third parties will be impaired by the resolution of the ownership issue. More importantly, the
determination of whether the subject properties are conjugal is but collateral to the probate courts jurisdiction to settle
the estate of Joaquin.

It should be remembered that when Eduardo filed his verified petition for judicial settlement of Joaquins estate, he
alleged that the subject properties were owned by Joaquin and Caridad since the TCTs state that the lots were
registered in the name of Joaquin Agtarap, married to Caridad Garcia. He also admitted in his petition that Joaquin,
prior to contracting marriage with Caridad, contracted a first marriage with Lucia. Oppositors to the petition, Joseph
and Teresa, however, were able to present proof before the RTC that TCT Nos. 38254 and 38255 were derived from
a mother title, TCT No. 5239, dated March 17, 1920, in the name of FRANCISCO VICTOR BARNES Y JOAQUIN
AGTARAP, el primero casado con Emilia Muscat, y el Segundo con Lucia Garcia Mendietta (FRANCISCO VICTOR
BARNES y JOAQUIN AGTARAP, the first married to Emilia Muscat, and the second married to Lucia Garcia
[21]
Mendietta). When TCT No. 5239 was divided between Francisco Barnes and Joaquin Agtarap, TCT No. 10864, in
the name of Joaquin Agtarap, married to Lucia Garcia Mendietta, was issued for a parcel of land, identified as Lot No.
745 of the Cadastral Survey of Pasay, Cadastral Case No. 23, G.L.R.O. Cadastral Record No. 1368, consisting of
[22]
8,872 square meters. This same lot was covered by TCT No. 5577 (32184) issued on April 23, 1937, also in the
name of Joaquin Agtarap, married to Lucia Garcia Mendietta.

The findings of the RTC and the CA show that Lucia died on April 24, 1924, and subsequently, on February 9, 1926,
Joaquin married Caridad. It is worthy to note that TCT No. 5577 (32184) contained an annotation, which reads

Ap-4966 NOTA: Se ha enmendado el presente certificado de titulo, tal como aparece, tanchando las palabras con
Lucia Garcia Mendiet[t]a y poniendo en su lugar, entre lineas y en tinta encarnada, las palabras en segundas nupcias
con Caridad Garcia, en complimiento de un orden de fecha 28 de abril de 1937, dictada por el Hon. Sixto de la
Costa, juez del Juzgado de Primera Instancia de Rizal, en el expediente cadastal No. 23, G.L.R.O. Cad. Record No.
1368; copia de cual orden has sido presentada con el No. 4966 del Libro Diario, Tomo 6.0 y, archivada en el Legajo
T-No. 32184.
[23]
Pasig, Rizal, a 29 abril de 1937.

Thus, per the order dated April 28, 1937 of Hon. Sixto de la Costa, presiding judge of the Court of First Instance of
Rizal, the phrase con Lucia Garcia Mendiet[t]awas crossed out and replaced by en segundas nuptias con Caridad
Garcia, referring to the second marriage of Joaquin to Caridad. It cannot be gainsaid, therefore, that prior to the
replacement of Caridads name in TCT No. 32184, Lucia, upon her demise, already left, as her estate, one-half (1/2)
conjugal share in TCT No. 32184.Lucias share in the property covered by the said TCT was carried over to the
properties covered by the certificates of title derivative of TCT No. 32184, now TCT Nos. 38254 and 38255. And as
found by both the RTC and the CA, Lucia was survived by her compulsory heirs Joaquin, Jesus, Milagros, and Jose.

Section 2, Rule 73 of the Rules of Court provides that when the marriage is dissolved by the death of the husband or
the wife, the community property shall be inventoried, administered, and liquidated, and the debts thereof paid; in the
testate or intestate proceedings of the deceased spouse, and if both spouses have died, the conjugal partnership
shall be liquidated in the testate or intestate proceedings of either. Thus, the RTC had jurisdiction to determine
whether the properties are conjugal as it had to liquidate the conjugal partnership to determine the estate of the
decedent. In fact, should Joseph and Teresa institute a settlement proceeding for the intestate estate of Lucia, the
[24]
same should be consolidated with the settlement proceedings of Joaquin, being Lucias spouse. Accordingly, the
CA correctly distributed the estate of Lucia, with respect to the properties covered by TCT Nos. 38254 and 38255
subject of this case, to her compulsory heirs.

Therefore, in light of the foregoing evidence, as correctly found by the RTC and the CA, the claim of Sebastian and
Eduardo that TCT Nos. 38254 and 38255 conclusively show that the owners of the properties covered therein were

22
Joaquin and Caridad by virtue of the registration in the name of Joaquin Agtarap casado con (married to) Caridad
Garcia, deserves scant consideration. This cannot be said to be a collateral attack on the said TCTs. Indeed, simple
[25]
possession of a certificate of title is not necessarily conclusive of a holders true ownership of property. A certificate
of title under the Torrens system aims to protect dominion; it cannot be used as an instrument for the deprivation of
[26]
ownership. Thus, the fact that the properties were registered in the name of Joaquin Agtarap, married to Caridad
[27]
Garcia, is not sufficient proof that the properties were acquired during the spouses coverture. The phrase married
to Caridad Garcia in the TCTs is merely descriptive of the civil status of Joaquin as the registered owner, and does
[28]
not necessarily prove that the realties are their conjugal properties.

Neither can Sebastians claim that Joaquins estate could have already been settled in 1965 after the payment of the
inheritance tax be upheld. Payment of the inheritance tax, per se, does not settle the estate of a deceased person. As
provided in Section 1, Rule 90 of the Rules of Court
SECTION 1. When order for distribution of residue made. -- When the debts, funeral charges, and expenses of
administration, the allowance to the widow, and inheritance tax, if any, chargeable to the estate in accordance with
law, have been paid, the court, on the application of the executor or administrator, or of a person interested in the
estate, and after hearing upon notice, shall assign the residue of the estate to the persons entitled to the same,
naming them and the proportions, or parts, to which each is entitled, and such persons may demand and recover
their respective shares from the executor or administrator, or any other person having the same in his possession. If
there is a controversy before the court as to who are the lawful heirs of the deceased person or as to the distributive
share to which each person is entitled under the law, the controversy shall be heard and decided as in ordinary
cases.

No distribution shall be allowed until the payment of the obligations above mentioned has been made or provided for,
unless the distributees, or any of them, give a bond, in a sum to be fixed by the court, conditioned for the payment of
said obligations within such time as the court directs.

Thus, an estate is settled and distributed among the heirs only after the payment of the debts of the estate, funeral
charges, expenses of administration, allowance to the widow, and inheritance tax. The records of these cases do not
show that these were complied with in 1965.

As regards the issue raised by Sebastian on the legitimacy of Joseph and Teresa, suffice it to say that both the RTC
and the CA found them to be the legitimate children of Jose. The RTC found that Sebastian did not present clear and
convincing evidence to support his averments in his motion to exclude them as heirs of Joaquin, aside from his
negative allegations. The RTC also noted the fact of Joseph and Teresa being the children of Jose was never
questioned by Sebastian and Eduardo, and the latter two even admitted this in their petitions, as well as in the
[29]
stipulation of facts in the August 21, 1995 hearing. Furthermore, the CA affirmed this finding of fact in its November
[30]
21, 2006 Decision.

Also, Sebastians insistence that Abelardo Dagoro and Walter de Santos are not heirs to the estate of Joaquin cannot
be sustained. Per its October 23, 2000 Order of Partition, the RTC found that Gloria Agtarap de Santos died on May
4, 1995, and was later substituted in the proceedings below by her husband Walter de Santos.Gloria begot a
daughter with Walter de Santos, Georgina Samantha de Santos. The RTC likewise noted that, on September 16,
1995, Abelardo Dagoro filed a motion for leave of court to intervene, alleging that he is the surviving spouse of
Mercedes Agtarap and the father of Cecilia Agtarap Dagoro, and his answer in intervention.The RTC later granted
[31]
the motion, thereby admitting his answer on October 18, 1995. The CA also noted that, during the hearing of the
motion to intervene on October 18, 1995, Sebastian and Eduardo did not interpose any objection when the
[32]
intervention was submitted to the RTC for resolution.

Indeed, this Court is not a trier of facts, and there appears no compelling reason to hold that both courts erred in
ruling that Joseph, Teresa, Walter de Santos, and Abelardo Dagoro rightfully participated in the estate of Joaquin. It
was incumbent upon Sebastian to present competent evidence to refute his and Eduardos admissions that Joseph
and Teresa were heirs of Jose, and thus rightful heirs of Joaquin, and to timely object to the participation of Walter de
Santos and Abelardo Dagoro. Unfortunately, Sebastian failed to do so. Nevertheless, Walter de Santos and Abelardo
Dagoro had the right to participate in the estate in representation of the Joaquins compulsory heirs, Gloria and
[33]
Mercedes, respectively.

This Court also differs from Eduardos asseveration that the CA erred in settling, together with Joaquins estate, the
respective estates of Lucia, Jesus, Jose, Mercedes, and Gloria. A perusal of the November 21, 2006 CA Decision
would readily show that the disposition of the properties related only to the settlement of the estate of
Joaquin. Pursuant to Section 1, Rule 90 of the Rules of Court, as cited above, the RTC was specifically granted
jurisdiction to determine who are the lawful heirs of Joaquin, as well as their respective shares after the payment of
the obligations of the estate, as enumerated in the said provision. The inclusion of Lucia, Jesus, Jose, Mercedes, and

23
Gloria in the distribution of the shares was merely a necessary consequence of the settlement of Joaquins estate,
they being his legal heirs.

However, we agree with Eduardos position that the CA erred in distributing Joaquins estate pertinent to the share
allotted in favor of Milagros. Eduardo was able to show that a separate proceeding was instituted for the probate of
[34]
the will allegedly executed by Milagros before the RTC, Branch 108, Pasay City. While there has been no showing
that the alleged will of Milagros, bequeathing all of her share from Joaquins estate in favor of Eduardo, has already
been probated and approved, prudence dictates that this Court refrain from distributing Milagros share in Joaquins
estate.
[35]
It is also worthy to mention that Sebastian died on January 15, 2010, per his Certificate of Death. He is survived by
his wife Teresita B. Agtarap (Teresita) and his children Joaquin Julian B. Agtarap (Joaquin Julian) and Ana Ma.
Agtarap Panlilio (Ana Ma.).

Henceforth, in light of the foregoing, the assailed November 21, 2006 Decision and the March 27, 2007 Resolution of
the CA should be affirmed with modifications such that the share of Milagros shall not yet be distributed until after the
final determination of the probate of her purported will, and that Sebastian shall be represented by his compulsory
heirs.

WHEREFORE, the petition in G.R. No. 177192 is DENIED for lack of merit, while the petition in G.R. No. 177099
is PARTIALLY GRANTED, such that the Decision dated November 21, 2006 and the Resolution dated March 27,
2007 of the Court of Appeals are AFFIRMED with the following MODIFICATIONS: that the share awarded in favor of
Milagros Agtarap shall not be distributed until the final determination of the probate of her will, and that petitioner
Sebastian G. Agtarap, in view of his demise on January 15, 2010, shall be represented by his wife Teresita B.
Agtarap and his children Joaquin Julian B. Agtarap and Ana Ma. Agtarap Panlilio.

These cases are hereby remanded to the Regional Trial Court, Branch 114, Pasay City, for further proceedings in the
settlement of the estate of Joaquin Agtarap. No pronouncement as to costs.

SO ORDERED.

24
SECOND DIVISION

[G.R. No. 132524. December 29, 1998]


*
FEDERICO C. SUNTAY, petitioner, vs. ISABEL COJUANGCO-SUNTAY and HON. GREGORIO S. SAMPAGA,
Presiding Judge, Branch 78, Regional Trial Court, Malolos, Bulacan, respondents.

DECISION

MARTINEZ, J.:

Which should prevail between the ration decidendi and the fallo of a decision is the primary issue in this petition
for certiorari under Rule 65 filed by petitioner Federico C. Suntay who opposes respondent Isabels petition for
appointment as administratrix of her grandmothers estate by virtue of her right of representation.

The suit stemmed from the following:

On July 9, 1958, Emilio Aguinaldo Suntay (son of petitioner Federico Suntay) and Isabel Cojuangco-Suntay were
married in the Portuguese Colony of Macao. Out of this marriage, three children were born namely: Margarita
Guadalupe, Isabel Aguinaldo and Emilio Aguinaldo all surnamed Cojuangco Suntay. After 4 years, the marriage
[1]
soured so that in 1962, Isabel Cojuanco-Suntay filed a criminal case against her husband Emilio Aguinaldo
[2]
Suntay. In retaliation, Emilio Aguinaldo filed before the then Court of First Instance (CFI) a complaint for legal
separation against his wife, charging her, among others, with infidelity and praying for the custody and care of their
[3]
children who were living with their mother. The suit was docketed as civil case number Q-7180.

On October 3, 1967, the trial court rendered a decision the dispositive portion which reads:

WHEREFORE, the marriage celebrated between Emilio Aguinaldo Suntay and Isabel Cojuangco-Suntay on July 9,
1958 is hereby declared null and void and of no effect as between the parties.It being admitted by the parties and
shown by the records that the question of the case and custody of the three children have been the subject of another
case between the same parties in another branch of this Court in Special Proceeding No. 6428, the same cannot be
litigated in this case.

With regard to counterclaim, in view of the manifestation of counsel that the third party defendants are willing to
pay P50,000.00 for damages and that defendant is willing to accept the offer instead of her original demand
for P130,000.00, the defendant is awarded the sum of P50,000.00 as her counterclaim and to pay attorneys fees in
the amount of P5,000.00.
[4]
SO ORDERED. (Emphasis supplied)

As basis thereof, the CFI said:

From February 1965 thru December 1965 plaintiff was confined in the Veterans Memorial Hospital. Although at the
time of the trial of parricide case (September 8, 1967) the patient was already out of the hospital he continued to be
under observation and treatment.

It is the opinion of Dr. Aramil that the symptoms of the plaintiffs mental aberration classified as schizophernia (sic)
had made themselves manifest even as early as 1955; that the disease worsened with time, until 1965 when he was
actually placed under expert neuro-psychiatrist (sic) treatment; that even if the subject has shown marked progress,
the remains bereft of adequate understanding of right and wrong.

There is no controversy that the marriage between the parties was effected on July 9, 1958, years after plaintiffs
mental illness had set in. This fact would justify a declaration of nullity of the marriage under Article 85 of the Civil
Code which provides:

Art. 95. (sic) A marriage may be annulled for nay of the following causes after (sic) existing at the time of the
marriage:

xxx xxx xxx

(3) That either party was of unsound mind, unless such party, after coming to reason, freely cohabited with the other
as husband or wife.

25
There is a dearth of proof at the time of the marriage defendant knew about the mental condition of the plaintiff; and
there is proof that plaintiff continues to be without sound reason. The charges in this very complaint add emphasis to
the findings of the neuro-psychiatrist handling the patient, that plaintiff really lives more in fancy that in reality, a
[5]
strong indication of schizophernia (sic). (emphasis supplied)

On June 1, 1979, Emilio Aguinaldo Suntay predeceased his mother, the decedent Cristina Aguinaldo-Suntay. The
[6]
latter is respondent Isabels paternal grandmother. The decedent died on June 4, 1990 without leaving a will.

Five years later or on October 26 1995, respondent Isabel Aguinaldo Cojuangco Suntay filed before the Regional
[7]
Trial Court (RTC) a petition for issuance in her favor of Letters of Administration of the Intestate Estate of her late
grandmother Cristina Aguinaldo Suntay which case was docketed as Special Proceeding Case No. 117-M-95. In her
petition, she alleged among others, that she is one of the legitimate grandchildren of the decedent and prayed that
[8]
she be appointed as administratrix of the estate.

On December 15, 1995, petitioner filed an Opposition claiming that he is the surviving spouse of the decedent, that
he has been managing the conjugal properties even while the decedent has been alive and is better situated to
protect the integrity of the estate than the petitioner, that petitioner and her family have been alienated from the
decedent and the Oppositor for more than thirty (30) years and thus, prayed that Letters of Administration be issued
[9]
instead to him.

On September 22, 1997 or almost two years after filing an opposition, petitioner moved to dismiss the special
proceeding case alleging in the main that respondent Isabel should not be appointed as administratrix of the
decedents estate. In support thereof, petitioner argues that under Article 992 of the Civil Code an illegitimate child
has no right to succeed by right of representation the legitimate relatives of her father or mother. Emilio Aguinaldo
Suntay, respondent Isabels father predeceased his mother, the late Cristina Aguinaldo Suntay and thus, opened
succession by representation. Petitioner contends that as a consequence of the declaration by the then CFI of Rizal
that the marriage of the respondent Isabels parents is null and void, the latter is an illegitimate child, and has no right
[10]
nor interest in the estate of her paternal grandmother the decedent. On October 16, 1997, the trial court issued the
[11]
assailed order denying petitioners Motion to Dismiss. When his motion for reconsideration was denied by the trial
[12]
court in an order dated January 9, 1998, petitioner, as mentioned above filed this petition.

Petitioner imputes grave abuse of discretion to respondent court in denying his motion to dismiss as well as his
motion for reconsideration on the grounds that: (a) a motion to dismiss is appropriate in a special proceeding for the
settlement of estate of a deceased person; (b) the motion to dismiss was timely filed; (c) the dispositive portion of the
decision declaring the marriage of respondent Isabels parents null and void must be upheld; and (d) said decision
had long become final and had, in fact, been executed.

On the other hand, respondent Isabel asserts that petitioners motion to dismiss was late having been filed after the
opposition was already filed in court, the counterpart of an answer in an ordinary civil action and that petitioner in his
opposition likewise failed to specifically deny respondent Isabels allegation that she is a legitimate child of Emilio
Aguinaldo Suntay, the decedents son. She further contends that petitioner proceeds from a miscomprehension of the
judgment in Civil Case No. Q-7180 and the erroneous premise that there is a conflict between the body of the
decision and its dispositive portion because in an action for annulment of a marriage, the court either sustains the
validity of marriage or nullifies it. It does not, after hearing a marriage voidable otherwise, the court will fail to decide
and lastly, that the status of marriages under Article 85 of the Civil Code before they are annulled is voidable.

The petition must fail.

Certiorari as a special civil action can be availed of only if there is concurrence of the essential requisites, to wit: (a)
the tribunal, board or officer exercising judicial functions has acted without or in excess of jurisdiction or with grave
abuse of discretion amounting to lack or in excess or jurisdiction, and (b) there is no appeal, nor any plain, speedy
[13]
and adequate remedy in the ordinary course of law for the purpose of annulling or modifying the proceeding. There
[14]
must be a capricious, arbitrary and whimsical exercise of power for it to prosper.

A reading of the assailed order, however, shows that the respondent court did not abuse its discretion in denying
petitioners motion to dismiss, pertinent portions of which are quoted hereunder. To with:

The arguments of both parties judiciously and objectively assessed and the pertinent laws applied, the Court finds
that a motion to dismiss at this juncture is inappropriate considering the peculiar nature of this special proceeding as
distinguished from an ordinary civil action. At the outset, this proceeding was not adversarial in nature and the
petitioner was not called upon to assert a cause of action against a particular defendant. Furthermore, the State has a

26
vital interest in the maintenance of the proceedings, not only because of the taxes due it, but also because if no heirs
qualify, the State shall acquire the estate by escheat.

xxx xxx xxx

The court rules, for the purpose of establishing the personality of the petitioner to file ad maintain this special
proceedings, that in the case at bench, the body of the decision determines the nature of the action which is for
annulment, not declaration of nullity.

The oppositors contention that the fallo of the questioned decision (Annex A Motion) prevails over the body thereof is
not of a final decision is definite, clear and unequivocal and can be wholly given effect without need of interpretation
or construction.

Where there is ambiguity or uncertainty, the opinion or body of the decision may be referred to for purposes of
construing the judgement (78 SCRA 541 citing Morelos v. Go Chin Ling; and Heirs of Juan Presto v. Galang). The
reason is that the dispositive portion must find support from the decisions ratio decidendi.

Per decision of the Court of First Instance Branch IX of Quezon City, marked as Annex A of oppositors motion, the
marriage of Emilio Aguinaldo Suntay and Isabel Cojuangco-Suntay was annulled on the basis of Art. 85 par. 3 of the
Civil Code which refers to marriages which are considered voidable. Petitioner being conceived and born of a
voidable marriage before the decree of annulment, she is considered legitimate (Art. 89, par. 2, Civil Code of the
[15]
Phils.).

The trial court correctly ruled that a motion to dismiss at this juncture is inappropriate. The 1997 Rules of Civil
[16]
Procedure governs the procedure to be observed in actions, civil or criminal and special proceedings. The Rules
do not only apply to election cases, land registration, cadastral, naturalization and insolvency proceedings, and other
cases not therein provided for.

Special proceedings being one of the actions under the coverage of the Rules on Civil Procedure, a motion to dismiss
filed thereunder would fall under Section 1, Rule 16 thereof. Said rule provides that the motion to dismiss may be
filed within the time for but before filing the answer to the complaint. Clearly, the motion should have been filed on
[17]
or before the filing of petitioners opposition. which is the counterpart of an answer in ordinary civil actions.

Not only was petitioners motion to dismiss filed out of time, it was filed almost two years after respondent Isabel was
already through with the presentation of her witnesses and evidence and petitioner had presented two witnesses. The
filing of the motion to dismiss is not only improper but also dilatory.

The respondent court, far from deviating or straying off course from established jurisprudence on this matter, as
petitioner asserts, had in fact faithfully observed the law and legal precedents in this case. In fact, the alleged conflict
between the body of the decision and the dispositive portion thereof which created the ambiguity or uncertainty in the
decision of the CFI of Rizal is reconcilable. The legal basis for setting aside the marriage of respondent Isabels
parents is clear under paragraph 3, Article 85 of the New Civil Code, the law in force prior to the enactment of the
Family Code.

Petitioner, however, strongly insists that the dispositive portion of the CFI decision has categorically declared that the
marriage of respondent Isabels parents is null and void and that the legal effect of such declaration is that the
marriage from its inception is void and the children born out of said marriage is illegitimate. Such argument cannot be
[18]
sustained. Articles 80, 81, 82 and 83 of the New Civil Code classify what marriages are void while Article 85
[19]
enumerates the causes for which a marriage may be annulled.

The fundamental distinction between void and voidable marriages is that void marriage is deemed never to have
taken place at all. The effects of void marriages, with respect to property relations of the spouses are provided for
under Article 144 of the Civil Code. Children born of such marriages who are called natural children by legal fiction
[20]
have the same status, rights and obligations as acknowledged natural children under Article 89 irrespective of
whether or not the parties to the void marriage are in good faith or in bad faith.

On the other hand, a voidable marriage, is considered valid and produces all its civil effects, until it is set aside by
final judgment of a competent court in an action for annulment. Juridically, the annulment of a marriage dissolves the
special contract as if it had never been entered into but the law makes express provisions to prevent the effects of the
marriage from being totally wiped out. The status of children born in voidable marriages is governed by the second
paragraph of Article 89 which provides that:

27
Children conceived of voidable marriages before the decree of annulment shall be considered legitimate; and children
conceived thereafter shall have the same status, rights and obligations as acknowledged natural children, and are
[21]
also called natural children by legal fiction. (Emphasis supplied)

Stated otherwise, the annulment of the marriage by the court abolishes the legal character of the society formed by
the putative spouses, but it cannot destroy the juridical consequences which the marital union produced during its
[22]
continuance.

Indeed, the terms annul and null and void have different legal connotations and implications. Annul means to reduce
[23]
to nothing; annihilate; obliterate; to make void or of no effect; to nullify; to abolish; to do away with whereas null and
void is something that does not exist from the beginning. A marriage that is annulled presupposes that it subsists but
later ceases to have legal effect when it is terminated through a court action. But in nullifying a marriage, the court
simply declares a status condition which already exists from the very beginning.

There is likewise no merit in petitioners argument that it is the dispositive portion of the decision which must control
as to whether or not the marriage of respondent Isabels parents was void or voidable. Such argument springs from a
miscomprehension of the judgment of the Civil Case No. Q-7180 and the erroneous premise that there is a conflict
between the body of the decision and its dispositive portion.

Parenthetically, it is an elementary principle of procedure that the resolution of the court in a given issue as embodied
in the dispositive part of a decision or order is the controlling factor as to settlement of rights of the parties and the
questions presented, notwithstanding statement in the body of the decision or order which may be somewhat
[24]
confusing, the same is not without qualification. The foregoing rule holds true only when the dispositive part of a
final decision or order is definite, clear and unequivocal and can be wholly given effect without need of interpretation
or construction which usually is the case where the order or decision in question is that of a court not of record which
[25]
is not constitutionally required to state the facts and the law on which the judgment is based.

Assuming that a doubt or uncertainty exists between the dispositive portion and the body of the decision, effort must
be made to harmonize the whole body of the decision in order to give effect to the intention, purpose and judgment of
[26]
the court. In Republic v. delos Angeles the Court said:

Additionally, Article 10 of the Civil Code states that [i]n case of doubt in the interpretation or application of laws, it is
presumed that the lawmaking body intended right and justice to prevail.This mandate of law, obviously cannot be any
less binding upon the courts in relation to its judgments.

x x x The judgment must be read in its entirety, and must be construed as a whole so as to bring all of its parts into
harmony as far as this can be done by fair and reasonable interpretation and so as to give effect to every word and
part if possible, and to effectuate the intention and purpose of the Court, consistent with the provisions of the organic
law. (49 C.J.S., pp. 863-864 [Emphasis supplied]

Thus, a reading of the pertinent portions of the decision of the CFI of Rizal quoted earlier shows that the marriage is
voidable:

It is the opinion of Dr. Aramil that the symptoms of the plaintiffs mental aberration classified as schizophernia (sic)
had made themselves manifest even as early as 1955; that the disease worsened with time, until 1965 when he was
actually placed under expert neuro-psychiatrict (sic) treatment; that even if the subject has shown marked progress,
he remains bereft of adequate understanding of right and wrong.

There is no controversy that the marriage between the parties was effected on July 9, 1958, years after plaintiffs
mental illness had set in. This fact would justify a declaration of nullity of the marriage under Article 85 of the Civil
Code which provides:

Art. 95 (sic) A marriage may be annulled for any of the following causes, existing at the time of the marriage:

xxx xxx xxx

(3) That either party was of unsound mind, unless such party, after coming to reason, freely cohabited with the other
as husband and wife;

xxx xxx xxx

There is a dearth of proof at the time of the marriage defendant knew about the mental condition of plaintiff; and there
is proof that plaintiff continues to be without sound reason. The charges in this very complaint add emphasis to the

28
finding of the neuro-psychiatrist handling the patient, that plaintiff really lives more in fancy than in reality, a strong
[27]
indication of schizophernia (sic).

Inevitably, the decision of the CFI of Rizal declared null and void the marriage of respondent Isabels parents based
on paragraph 3, Article 85 of the New Civil Code. The legal consequences as to the rights of the children are
therefore governed by the first clause of the second paragraph of Article 89. A contrary interpretation would be
anathema to the rule just above-mentioned. Based on said provision the children of Emilio Aguinaldo Suntay and
Isabel Cojuangco-Suntay who were conceived and born prior to the decree of the trial court setting aside their
marriage on October 3, 1967 are considered legitimate. For purposes of seeking appointment as estate
administratrix, the legitimate grandchildren, including respondent Isabel, may invoke their successional right of
representation in the estate of their grandmother Cirstina Aguinaldo Suntay after their father, Emilio Aguinaldo
Suntay, had predeceased their grandmother. This is, however, without prejudice to a determination by the courts of
whether Letters of Administration may be granted to her. Neither do the Court adjudged herein the successional
rights of the personalities involved over the decedents estate.

It would not therefore be amiss to reiterate at this point what the Court, speaking through Chief Justice Ruiz Castro,
emphasized to all magistrates of all levels of the judicial hierarchy that extreme degree of care should be exercised in
the formulation of the dispositive portion of a decision, because it is this portion that is to be executed once the
decision becomes final. The adjudication of the rights and obligations of thoe parties, and the dispositions made as
well as the directions and instructions given by the court in the premises in conformity with the body of the decision,
must all be spelled out clearly, distinctly and unequivocally leaving absolutely no room for dispute, debate or
[28]
interpretation.

WHEREFORE, finding no grave abuse of discretion, the instant petition is DISMISSED.

SO ORDERED.

29
THIRD DIVISION

[G.R. No. 146006. February 23, 2004]

JOSE C. LEE AND ALMA AGGABAO, in their capacities as President and Corporate Secretary, respectively,
of Philippines Internationl Life Insurance Company, and FILIPINO LOAN ASSISTANCE GROUP, petitioners,

vs. REGIONAL TRIAL COURT OF QUEZON CITY BRANCH 85 presided by JUDGE PEDRO M. AREOLA,
BRANCH CLERK OF COURT JANICE Y. ANTERO, DEPUTY SHERIFFS ADENAUER G. RIVERA and PEDRO L.
BORJA, all of the Regional Trial Court of Quezon City Branch 85, MA. DIVINA ENDERES claiming to be
Special Administratrix, and other persons/ public officers acting for and in their behalf, respondents.

DECISION

CORONA, J.:
[1]
This is a petition for review under Rule 45 of the Rules of Court seeking to reverse and set aside the decision of the
Court of Appeals, First Division, dated July 26, 2000, in CA G.R. 59736, which dismissed the petition for certiorari
filed by petitioners Jose C. Lee and Alma Aggabao (in their capacities as president and secretary, respectively, of
Philippine International Life Insurance Company) and Filipino Loan Assistance Group.

The antecedent facts follow.

Dr. Juvencio P. Ortaez incorporated the Philippine International Life Insurance Company, Inc. on July 6, 1956. At the
time of the companys incorporation, Dr. Ortaez owned ninety percent (90%) of the subscribed capital stock.

On July 21, 1980, Dr. Ortaez died. He left behind a wife (Juliana Salgado Ortaez), three legitimate children (Rafael,
Jose and Antonio Ortaez) and five illegitimate children by Ligaya Novicio (herein private respondent Ma. Divina
[2]
Ortaez-Enderes and her siblings Jose, Romeo, Enrico Manuel and Cesar, all surnamed Ortaez).

On September 24, 1980, Rafael Ortaez filed before the Court of First Instance of Rizal, Quezon City Branch (now
Regional Trial Court of Quezon City) a petition for letters of administration of the intestate estate of Dr. Ortaez,
docketed as SP Proc. Q-30884 (which petition to date remains pending at Branch 85 thereof).

Private respondent Ma. Divina Ortaez-Enderes and her siblings filed an opposition to the petition for letters of
administration and, in a subsequent urgent motion, prayed that the intestate court appoint a special administrator.

On March 10, 1982, Judge Ernani Cruz Pao, then presiding judge of Branch 85, appointed Rafael and Jose Ortaez
joint special administrators of their fathers estate. Hearings continued for the appointment of a regular administrator
(up to now no regular administrator has been appointed).

As ordered by the intestate court, special administrators Rafael and Jose Ortaez submitted an inventory of the estate
[3]
of their father which included, among other properties, 2,029 shares of stock in Philippine International Life
Insurance Company (hereafter Philinterlife), representing 50.725% of the companys outstanding capital stock.
[4]
On April 15, 1989, the decedents wife, Juliana S. Ortaez, claiming that she owned 1,014 Philinterlife shares of stock
as her conjugal share in the estate, sold said shares with right to repurchase in favor of herein petitioner Filipino Loan
Assistance Group (FLAG), represented by its president, herein petitioner Jose C. Lee. Juliana Ortaez failed to
repurchase the shares of stock within the stipulated period, thus ownership thereof was consolidated by petitioner
FLAG in its name.

On October 30, 1991, Special Administrator Jose Ortaez, acting in his personal capacity and claiming that he owned
[5]
the remaining 1,011 Philinterlife shares of stocks as his inheritance share in the estate, sold said shares with right to
repurchase also in favor of herein petitioner FLAG, represented by its president, herein petitioner Jose C. Lee. After
one year, petitioner FLAG consolidated in its name the ownership of the Philinterlife shares of stock when Jose
Ortaez failed to repurchase the same.

It appears that several years before (but already during the pendency of the intestate proceedings at the Regional
Trial Court of Quezon City, Branch 85), Juliana Ortaez and her two children, Special Administrators Rafael and Jose
Ortaez, entered into a memorandum of agreement dated March 4, 1982 for the extrajudicial settlement of the estate
of Dr. Juvencio Ortaez, partitioning the estate (including the Philinterlife shares of stock) among themselves. This was
the basis of the number of shares separately sold by Juliana Ortaez on April 15, 1989 (1,014 shares) and by Jose
Ortaez on October 30, 1991 (1,011 shares) in favor of herein petitioner FLAG.

30
On July 12, 1995, herein private respondent Ma. Divina OrtaezEnderes and her siblings (hereafter referred to as
private respondents Enderes et al.) filed a motion for appointment of special administrator of Philinterlife shares of
stock. This move was opposed by Special Administrator Jose Ortaez.

On November 8, 1995, the intestate court granted the motion of private respondents Enderes et al. and appointed
private respondent Enderes special administratrix of the Philinterlife shares of stock.

On December 20, 1995, Special Administratrix Enderes filed an urgent motion to declare void ab initio the
memorandum of agreement dated March 4, 1982. On January 9, 1996, she filed a motion to declare the partial nullity
of the extrajudicial settlement of the decedents estate. These motions were opposed by Special Administrator Jose
Ortaez.

On March 22, 1996, Special Administratrix Enderes filed an urgent motion to declare void ab initio the deeds of sale
of Philinterlife shares of stock, which move was again opposed by Special Administrator Jose Ortaez.

On February 4, 1997, Jose Ortaez filed an omnibus motion for (1) the approval of the deeds of sale of the Philinterlife
shares of stock and (2) the release of Ma. Divina Ortaez-Enderes as special administratrix of the Philinterlife shares
of stock on the ground that there were no longer any shares of stock for her to administer.

On August 11, 1997, the intestate court denied the omnibus motion of Special Administrator Jose Ortaez for the
approval of the deeds of sale for the reason that:

Under the Godoy case, supra, it was held in substance that a sale of a property of the estate without an Order of the
probate court is void and passes no title to the purchaser. Since the sales in question were entered into by Juliana S.
Ortaez and Jose S. Ortaez in their personal capacity without prior approval of the Court, the same is not binding upon
the Estate.

WHEREFORE, the OMNIBUS MOTION for the approval of the sale of Philinterlife shares of stock and release of Ma.
[6]
Divina Ortaez-Enderes as Special Administratrix is hereby denied.

On August 29, 1997, the intestate court issued another order granting the motion of Special Administratrix Enderes
for the annulment of the March 4, 1982 memorandum of agreement or extrajudicial partition of estate. The court
reasoned that:

In consonance with the Order of this Court dated August 11, 1997 DENYING the approval of the sale of Philinterlife
shares of stocks and release of Ma. Divina Ortaez-Enderes as Special Administratrix, the Urgent Motion to Declare
Void Ab Initio Memorandum of Agreement dated December 19, 1995. . . is hereby impliedly partially resolved insofar
as the transfer/waiver/renunciation of the Philinterlife shares of stock are concerned, in particular, No. 5, 9(c), 10(b)
and 11(d)(ii) of the Memorandum of Agreement.

WHEREFORE, this Court hereby declares the Memorandum of Agreement dated March 4, 1982 executed by Juliana
S. Ortaez, Rafael S. Ortaez and Jose S. Ortaez as partially void ab initioinsofar as the transfer/waiver/renunciation of
[7]
the Philinterlife shares of stocks are concerned.

Aggrieved by the above-stated orders of the intestate court, Jose Ortaez filed, on December 22, 1997, a petition for
certiorari in the Court of Appeals. The appellate court denied his petition, however, ruling that there was no legal
justification whatsoever for the extrajudicial partition of the estate by Jose Ortaez, his brother Rafael Ortaez and
mother Juliana Ortaez during the pendency of the settlement of the estate of Dr. Ortaez, without the requisite
approval of the intestate court, when it was clear that there were other heirs to the estate who stood to be prejudiced
thereby. Consequently, the sale made by Jose Ortaez and his mother Juliana Ortaez to FLAG of the shares of stock
[8]
they invalidly appropriated for themselves, without approval of the intestate court, was void.

Special Administrator Jose Ortaez filed a motion for reconsideration of the Court of Appeals decision but it was
denied. He elevated the case to the Supreme Court via petition for review under Rule 45 which the Supreme Court
dismissed on October 5, 1998, on a technicality. His motion for reconsideration was denied with finality on January
13, 1999. On February 23, 1999, the resolution of the Supreme Court dismissing the petition of Special Administrator
Jose Ortaez became final and was subsequently recorded in the book of entries of judgments.

Meanwhile, herein petitioners Jose Lee and Alma Aggabao, with the rest of the FLAG-controlled board of directors,
increased the authorized capital stock of Philinterlife, diluting in the process the 50.725% controlling interest of the
[9]
decedent, Dr. Juvencio Ortaez, in the insurance company. This became the subject of a separate action at the
Securities and Exchange Commission filed by private respondent-Special Administratrix Enderes against petitioner
Jose Lee and other members of the FLAG-controlled board of Philinterlife on November 7, 1994. Thereafter, various

31
cases were filed by Jose Lee as president of Philinterlife and Juliana Ortaez and her sons against private respondent-
[10]
Special Administratrix Enderes in the SEC and civil courts. Somehow, all these cases were connected to the core
dispute on the legality of the sale of decedent Dr. Ortaezs Philinterlife shares of stock to petitioner FLAG, represented
by its president, herein petitioner Jose Lee who later became the president of Philinterlife after the controversial sale.

On May 2, 2000, private respondent-Special Administratrix Enderes and her siblings filed a motion for execution of
the Orders of the intestate court dated August 11 and August 29, 1997 because the orders of the intestate court
nullifying the sale (upheld by the Court of Appeals and the Supreme Court) had long became final. Respondent-
Special Administratrix Enderes served a copy of the motion to petitioners Jose Lee and Alma Aggabao as president
[11]
and secretary, respectively, of Philinterlife, but petitioners ignored the same.

On July 6, 2000, the intestate court granted the motion for execution, the dispositive portion of which read:

WHEREFORE, premises considered, let a writ of execution issue as follows:

1. Confirming the nullity of the sale of the 2,029 Philinterlife shares in the name of the Estate of Dr. Juvencio Ortaez
to Filipino Loan Assistance Group (FLAG);

2. Commanding the President and the Corporate Secretary of Philinterlife to reinstate in the stock and transfer book
of Philinterlife the 2,029 Philinterlife shares of stock in the name of the Estate of Dr. Juvencio P. Ortaez as the owner
thereof without prejudice to other claims for violation of pre-emptive rights pertaining to the said 2,029 Philinterlife
shares;

3. Directing the President and the Corporate Secretary of Philinterlife to issue stock certificates of Philinterlife for
2,029 shares in the name of the Estate of Dr. Juvencio P. Ortaez as the owner thereof without prejudice to other
claims for violations of pre-emptive rights pertaining to the said 2,029 Philinterlife shares and,

4. Confirming that only the Special Administratrix, Ma. Divina Ortaez-Enderes, has the power to exercise all the rights
appurtenant to the said shares, including the right to vote and to receive dividends.

5. Directing Philinterlife and/or any other person or persons claiming to represent it or otherwise, to acknowledge and
allow the said Special Administratrix to exercise all the aforesaid rights on the said shares and to refrain from
resorting to any action which may tend directly or indirectly to impede, obstruct or bar the free exercise thereof under
pain of contempt.

6. The President, Corporate Secretary, any responsible officer/s of Philinterlife, or any other person or persons
claiming to represent it or otherwise, are hereby directed to comply with this order within three (3) days from receipt
hereof under pain of contempt.

7. The Deputy Sheriffs Adenauer Rivera and Pedro Borja are hereby directed to implement the writ of execution with
dispatch to forestall any and/or further damage to the Estate.
[12]
SO ORDERED.

In the several occasions that the sheriff went to the office of petitioners to execute the writ of execution, he was
barred by the security guard upon petitioners instructions. Thus, private respondent-Special Administratrix Enderes
filed a motion to cite herein petitioners Jose Lee and Alma Aggabao (president and secretary, respectively, of
[13]
Philinterlife) in contempt.

Petitioners Lee and Aggabao subsequently filed before the Court of Appeals a petition for certiorari, docketed as CA
G.R. SP No. 59736. Petitioners alleged that the intestate court gravely abused its discretion in (1) declaring that the
ownership of FLAG over the Philinterlife shares of stock was null and void; (2) ordering the execution of its order
declaring such nullity and (3) depriving the petitioners of their right to due process.

On July 26, 2000, the Court of Appeals dismissed the petition outright:

We are constrained to DISMISS OUTRIGHT the present petition for certiorari and prohibition with prayer for a
temporary restraining order and/or writ of preliminary injunction in the light of the following considerations:

1. The assailed Order dated August 11, 1997 of the respondent judge had long become final and executory;

2. The certification on non-forum shopping is signed by only one (1) of the three (3) petitioners in violation of the
Rules; and

32
3. Except for the assailed orders and writ of execution, deed of sale with right to repurchase, deed of sale of shares of
stocks and omnibus motion, the petition is not accompanied by such pleadings, documents and other material
portions of the record as would support the allegations therein in violation of the second paragraph, Rule 65 of the
1997 Rules of Civil Procedure, as amended.

Petition is DISMISSED.
[14]
SO ORDERED.

The motion for reconsideration filed by petitioners Lee and Aggabao of the above decision was denied by the Court of
Appeals on October 30, 2000:

This resolves the urgent motion for reconsideration filed by the petitioners of our resolution of July 26, 2000
dismissing outrightly the above-entitled petition for the reason, among others, that the assailed Order dated August
11, 1997 of the respondent Judge had long become final and executory.

Dura lex, sed lex.

WHEREFORE, the urgent motion for reconsideration is hereby DENIED, for lack of merit.
[15]
SO ORDERED.

On December 4, 2000, petitioners elevated the case to the Supreme Court through a petition for review under Rule
45 but on December 13, 2000, we denied the petition because there was no showing that the Court of Appeals in CA
G.R. SP No. 59736 committed any reversible error to warrant the exercise by the Supreme Court of its discretionary
[16]
appellate jurisdiction.

However, upon motion for reconsideration filed by petitioners Lee and Aggabao, the Supreme Court granted the
motion and reinstated their petition on September 5, 2001. The parties were then required to submit their respective
memoranda.

Meanwhile, private respondent-Special Administratrix Enderes, on July 19, 2000, filed a motion to direct the branch
clerk of court in lieu of herein petitioners Lee and Aggabao to reinstate the name of Dr. Ortaez in the stock and
transfer book of Philinterlife and issue the corresponding stock certificate pursuant to Section 10, Rule 39 of the
Rules of Court which provides that the court may direct the act to be done at the cost of the disobedient party by
some other person appointed by the court and the act when so done shall have the effect as if done by the party.
Petitioners Lee and Aggabao opposed the motion on the ground that the intestate court should refrain from acting on
the motion because the issues raised therein were directly related to the issues raised by them in their petition for
certiorari at the Court of Appeals docketed as CA-G.R. SP No. 59736. On October 30, 2000, the intestate court
granted the motion, ruling that there was no prohibition for the intestate court to execute its orders inasmuch as the
appellate court did not issue any TRO or writ of preliminary injunction.

On December 3, 2000, petitioners Lee and Aggabao filed a petition for certiorari in the Court of Appeals, docketed as
CA-G.R. SP No. 62461, questioning this time the October 30, 2000 order of the intestate court directing the branch
clerk of court to issue the stock certificates. They also questioned in the Court of Appeals the order of the intestate
court nullifying the sale made in their favor by Juliana Ortaez and Jose Ortaez. On November 20, 2002, the Court of
Appeals denied their petition and upheld the power of the intestate court to execute its order. Petitioners Lee and
Aggabao then filed motion for reconsideration which at present is still pending resolution by the Court of Appeals.

Petitioners Jose Lee and Alma Aggabao (president and secretary, respectively, of Philinterlife) and FLAG now raise
the following errors for our consideration:

THE COURT OF APPEALS COMMITTED GRAVE REVERSIBLE ERROR:

A. IN FAILING TO RECONSIDER ITS PREVIOUS RESOLUTION DENYING THE PETITION DESPITE THE FACT
THAT THE APPELLATE COURTS MISTAKE IN APPREHENDING THE FACTS HAD BECOME PATENT AND
EVIDENT FROM THE MOTION FOR RECONSIDERATION AND THE COMMENT OF RESPONDENT ENDERES
WHICH HAD ADMITTED THE FACTUAL ALLEGATIONS OF PETITIONERS IN THE PETITION AS WELL AS IN
THE MOTION FOR RECONSIDERATION. MOREOVER, THE RESOLUTION OF THE APPELLATE COURT
DENYING THE MOTION FOR RECONSIDERATION WAS CONTAINED IN ONLY ONE PAGE WITHOUT EVEN
TOUCHING ON THE SUBSTANTIVE MERITS OF THE EXHAUSTIVE DISCUSSION OF FACTS AND
SUPPORTING LAW IN THE MOTION FOR RECONSIDERATION IN VIOLATION OF THE RULE ON
ADMINISTRATIVE DUE PROCESS;

33
B. IN FAILING TO SET ASIDE THE VOID ORDERS OF THE INTESTATE COURT ON THE ERRONEOUS
GROUND THAT THE ORDERS WERE FINAL AND EXECUTORY WITH REGARD TO PETITIONERS EVEN AS
THE LATTER WERE NEVER NOTIFIED OF THE PROCEEDINGS OR ORDER CANCELING ITS OWNERSHIP;

C. IN NOT FINDING THAT THE INTESTATE COURT COMMITTED GRAVE ABUSE OF DISCRETION
AMOUNTING TO EXCESS OF JURISDICTION (1) WHEN IT ISSUED THE OMNIBUS ORDER NULLIFYING THE
OWNERSHIP OF PETITIONER FLAG OVER SHARES OF STOCK WHICH WERE ALLEGED TO BE PART OF THE
ESTATE AND (2) WHEN IT ISSUED A VOID WRIT OF EXECUTION AGAINST PETITIONER FLAG AS PRESENT
OWNER TO IMPLEMENT MERELY PROVISIONAL ORDERS, THEREBY VIOLATING FLAGS CONSTITUTIONAL
RIGHT AGAINST DEPRIVATION OF PROPERTY WITHOUT DUE PROCESS;

D. IN FAILING TO DECLARE NULL AND VOID THE ORDERS OF THE INTESTATE COURT WHICH NULLIFIED
THE SALE OF SHARES OF STOCK BETWEEN THE LEGITIMATE HEIR JOSE S. ORTAEZ AND PETITIONER
FLAG BECAUSE OF SETTLED LAW AND JURISPRUDENCE, I.E., THAT AN HEIR HAS THE RIGHT TO DISPOSE
OF THE DECEDENTS PROPERTY EVEN IF THE SAME IS UNDER ADMINISTRATION PURSUANT TO CIVIL
CODE PROVISION THAT POSSESSION OF HEREDITARY PROPERTY IS TRANSMITTED TO THE HEIR THE
MOMENT OF DEATH OF THE DECEDENT (ACEDEBO VS. ABESAMIS, 217 SCRA 194);

E. IN DISREGARDING THE FINAL DECISION OF THE SUPREME COURT IN G.R. NO. 128525 DATED
DECEMBER 17, 1999 INVOLVING SUBSTANTIALLY THE SAME PARTIES, TO WIT, PETITIONERS JOSE C. LEE
AND ALMA AGGABAO WERE RESPONDENTS IN THAT CASE WHILE RESPONDENT MA. DIVINA ENDERES
WAS THE PETITIONER THEREIN. THAT DECISION, WHICH CAN BE CONSIDERED LAW OF THE CASE,
RULED THAT PETITIONERS CANNOT BE ENJOINED BY RESPONDENT ENDERES FROM EXERCISING THEIR
POWER AS DIRECTORS AND OFFICERS OF PHILINTERLIFE AND THAT THE INTESTATE COURT IN CHARGE
OF THE INTESTATE PROCEEDINGS CANNOT ADJUDICATE TITLE TO PROPERTIES CLAIMED TO BE PART
[17]
OF THE ESTATE AND WHICH ARE EQUALLY CLAIMED BY PETITIONER FLAG.

The petition has no merit.

Petitioners Jose Lee and Alma Aggabao, representing Philinterlife and FLAG, assail before us not only the validity of
the writ of execution issued by the intestate court dated July 7, 2000 but also the validity of the August 11, 1997 order
of the intestate court nullifying the sale of the 2,029 Philinterlife shares of stock made by Juliana Ortaez and Jose
Ortaez, in their personal capacities and without court approval, in favor of petitioner FLAG.

We cannot allow petitioners to reopen the issue of nullity of the sale of the Philinterlife shares of stock in their favor
because this was already settled a long time ago by the Court of Appeals in its decision dated June 23, 1998 in CA-
G.R. SP No. 46342. This decision was effectively upheld by us in our resolution dated October 9, 1998 in G.R. No.
135177 dismissing the petition for review on a technicality and thereafter denying the motion for reconsideration on
[18]
January 13, 1999 on the ground that there was no compelling reason to reconsider said denial. Our decision
became final on February 23, 1999 and was accordingly entered in the book of entry of judgments. For all intents and
purposes therefore, the nullity of the sale of the Philinterlife shares of stock made by Juliana Ortaez and Jose Ortaez
in favor of petitioner FLAG is already a closed case. To reopen said issue would set a bad precedent, opening the
door wide open for dissatisfied parties to relitigate unfavorable decisions no end. This is completely inimical to the
orderly and efficient administration of justice.

The said decision of the Court of Appeals in CA-G.R. SP No. 46342 affirming the nullity of the sale made by Jose
Ortaez and his mother Juliana Ortaez of the Philinterlife shares of stock read:

Petitioners asseverations relative to said [memorandum] agreement were scuttled during the hearing before this
Court thus:

JUSTICE AQUINO:

Counsel for petitioner, when the Memorandum of Agreement was executed, did the children of Juliana Salgado know
already that there was a claim for share in the inheritance of the children of Novicio?

ATTY. CALIMAG:

Your Honor please, at that time, Your Honor, it is already known to them.

JUSTICE AQUINO:

34
What can be your legal justification for extrajudicial settlement of a property subject of intestate proceedings when
there is an adverse claim of another set of heirs, alleged heirs? What would be the legal justification for extra-
judicially settling a property under administration without the approval of the intestate court?

ATTY. CALIMAG:

Well, Your Honor please, in that extra-judicial settlement there is an approval of the honorable court as to the
propertys partition x x x. There were as mentioned by the respondents counsel, Your Honor.

ATTY. BUYCO:

No

JUSTICE AQUINO:

The point is, there can be no adjudication of a property under intestate proceedings without the approval of the court.
That is basic unless you can present justification on that. In fact, there are two steps: first, you ask leave and then
execute the document and then ask for approval of the document executed. Now, is there any legal justification to
exclude this particular transaction from those steps?

ATTY. CALIMAG:

None, Your Honor.

ATTY BUYCO:

With that admission that there is no legal justification, Your Honor, we rest the case for the private respondent. How
can the lower court be accused of abusing its discretion? (pages 33-35, TSN of January 29, 1998).

Thus, We find merit in the following postulation by private respondent:

What we have here is a situation where some of the heirs of the decedent without securing court approval have
appropriated as their own personal property the properties of [the] Estate, to the exclusion and the extreme prejudice
of the other claimant/heirs. In other words, these heirs, without court approval, have distributed the asset of the estate
among themselves and proceeded to dispose the same to third parties even in the absence of an order of distribution
by the Estate Court. As admitted by petitioners counsel, there was absolutely no legal justification for this action by
the heirs. There being no legal justification, petitioner has no basis for demanding that public respondent [the
intestate court] approve the sale of the Philinterlife shares of the Estate by Juliana and Jose Ortaez in favor of the
Filipino Loan Assistance Group.

It is an undisputed fact that the parties to the Memorandum of Agreement dated March 4, 1982 (see Annex 7 of the
Comment). . . are not the only heirs claiming an interest in the estate left by Dr. Juvencio P. Ortaez. The records of
this case. . . clearly show that as early as March 3, 1981 an Opposition to the Application for Issuance of Letters of
Administration was filed by the acknowledged natural children of Dr. Juvencio P. Ortaez with Ligaya Novicio. . . This
claim by the acknowledged natural children of Dr. Juvencio P. Ortaez is admittedly known to the parties to the
Memorandum of Agreement before they executed the same. This much was admitted by petitioners counsel during
the oral argument. xxx

Given the foregoing facts, and the applicable jurisprudence, public respondent can never be faulted for not approving.
. . the subsequent sale by the petitioner [Jose Ortaez] and his mother [Juliana Ortaez] of the Philinterlife shares
belonging to the Estate of Dr. Juvencio P. Ortaez. (pages 3-4 of Private Respondents Memorandum; pages 243-244
of the Rollo)

Amidst the foregoing, We found no grave abuse of discretion amounting to excess or want of jurisdiction committed
[19]
by respondent judge.

From the above decision, it is clear that Juliana Ortaez, and her three sons, Jose, Rafael and Antonio, all surnamed
Ortaez, invalidly entered into a memorandum of agreement extrajudicially partitioning the intestate estate among
themselves, despite their knowledge that there were other heirs or claimants to the estate and before final settlement
of the estate by the intestate court. Since the appropriation of the estate properties by Juliana Ortaez and her children
(Jose, Rafael and Antonio Ortaez) was invalid, the subsequent sale thereof by Juliana and Jose to a third party
(FLAG), without court approval, was likewise void.

35
An heir can sell his right, interest, or participation in the property under administration under Art. 533 of the Civil Code
which provides that possession of hereditary property is deemed transmitted to the heir without interruption from the
[20]
moment of death of the decedent. However, an heir can only alienate such portion of the estate that may be
allotted to him in the division of the estate by the probate or intestate court after final adjudication, that is, after all
[21]
debtors shall have been paid or the devisees or legatees shall have been given their shares. This means that an
heir may only sell his ideal or undivided share in the estate, not any specific property therein. In the present case,
Juliana Ortaez and Jose Ortaez sold specific properties of the estate (1,014 and 1,011 shares of stock in Philinterlife)
in favor of petitioner FLAG. This they could not lawfully do pending the final adjudication of the estate by the intestate
court because of the undue prejudice it would cause the other claimants to the estate, as what happened in the
present case.

Juliana Ortaez and Jose Ortaez sold specific properties of the estate, without court approval. It is well-settled that
court approval is necessary for the validity of any disposition of the decedents estate. In the early case of Godoy vs.
[22]
Orellano, we laid down the rule that the sale of the property of the estate by an administrator without the order of
[23]
the probate court is void and passes no title to the purchaser. And in the case of Dillena vs. Court of Appeals, we
ruled that:

[I]t must be emphasized that the questioned properties (fishpond) were included in the inventory of properties of the
estate submitted by then Administratrix Fausta Carreon Herrera on November 14, 1974. Private respondent was
appointed as administratrix of the estate on March 3, 1976 in lieu of Fausta Carreon Herrera. On November 1, 1978,
the questioned deed of sale of the fishponds was executed between petitioner and private respondent without notice
and approval of the probate court. Even after the sale, administratrix Aurora Carreon still included the three fishponds
as among the real properties of the estate in her inventory submitted on August 13, 1981. In fact, as stated by the
Court of Appeals, petitioner, at the time of the sale of the fishponds in question, knew that the same were part of the
estate under administration.

xxxxxxxxx

The subject properties therefore are under the jurisdiction of the probate court which according to our settled
jurisprudence has the authority to approve any disposition regarding properties under administration. . . More
emphatic is the declaration We made in Estate of Olave vs. Reyes (123 SCRA 767) where We stated that when the
estate of the deceased person is already the subject of a testate or intestate proceeding, the administrator cannot
enter into any transaction involving it without prior approval of the probate court.

Only recently, in Manotok Realty, Inc. vs. Court of Appeals (149 SCRA 174), We held that the sale of an immovable
property belonging to the estate of a decedent, in a special proceedings, needs court approval. . . This
pronouncement finds support in the previous case of Dolores Vda. De Gil vs. Agustin Cancio (14 SCRA 797) wherein
We emphasized that it is within the jurisdiction of a probate court to approve the sale of properties of a deceased
person by his prospective heirs before final adjudication. x x x

It being settled that property under administration needs the approval of the probate court before it can be disposed
of, any unauthorized disposition does not bind the estate and is null and void. As early as 1921 in the case of Godoy
vs. Orellano (42 Phil 347), We laid down the rule that a sale by an administrator of property of the deceased, which is
not authorized by the probate court is null and void and title does not pass to the purchaser.

There is hardly any doubt that the probate court can declare null and void the disposition of the property under
administration, made by private respondent, the same having been effected without authority from said court. It is the
probate court that has the power to authorize and/or approve the sale (Section 4 and 7, Rule 89), hence, a fortiori, it
is said court that can declare it null and void for as long as the proceedings had not been closed or terminated. To
uphold petitioners contention that the probate court cannot annul the unauthorized sale, would render meaningless
the power pertaining to the said court. (Bonga vs. Soler, 2 SCRA 755). (emphasis ours)

Our jurisprudence is therefore clear that (1) any disposition of estate property by an administrator or prospective heir
pending final adjudication requires court approval and (2) any unauthorized disposition of estate property can be
annulled by the probate court, there being no need for a separate action to annul the unauthorized disposition.

The question now is: can the intestate or probate court execute its order nullifying the invalid sale?

We see no reason why it cannot. The intestate court has the power to execute its order with regard to the nullity of an
unauthorized sale of estate property, otherwise its power to annul the unauthorized or fraudulent disposition of estate
property would be meaningless. In other words, enforcement is a necessary adjunct of the intestate or probate courts

36
power to annul unauthorized or fraudulent transactions to prevent the dissipation of estate property before final
adjudication.

Moreover, in this case, the order of the intestate court nullifying the sale was affirmed by the appellate courts (the
Court of Appeals in CA-G.R. SP No. 46342 dated June 23, 1998 and subsequently by the Supreme Court in G.R. No.
135177 dated October 9, 1998). The finality of the decision of the Supreme Court was entered in the book of entry of
judgments on February 23, 1999. Considering the finality of the order of the intestate court nullifying the sale, as
affirmed by the appellate courts, it was correct for private respondent-Special Administratrix Enderes to thereafter
move for a writ of execution and for the intestate court to grant it.

Petitioners Jose Lee, Alma Aggabao and FLAG, however, contend that the probate court could not issue a writ of
execution with regard to its order nullifying the sale because said order was merely provisional:

The only authority given by law is for respondent judge to determine provisionally whether said shares are included or
excluded in the inventory In ordering the execution of the orders, respondent judge acted in excess of his jurisdiction
and grossly violated settled law and jurisprudence, i.e., that the determination by a probate or intestate court of
whether a property is included or excluded in the inventory of the estate being provisional in nature, cannot be the
[24]
subject of execution. (emphasis ours)

Petitioners argument is misplaced. There is no question, based on the facts of this case, that the Philinterlife shares
of stock were part of the estate of Dr. Juvencio Ortaez from the very start as in fact these shares were included in the
inventory of the properties of the estate submitted by Rafael Ortaez after he and his brother, Jose Ortaez, were
[25]
appointed special administrators by the intestate court.

The controversy here actually started when, during the pendency of the settlement of the estate of Dr. Ortaez, his
wife Juliana Ortaez sold the 1,014 Philinterlife shares of stock in favor petitioner FLAG without the approval of the
intestate court. Her son Jose Ortaez later sold the remaining 1,011 Philinterlife shares also in favor of FLAG without
the approval of the intestate court.

We are not dealing here with the issue of inclusion or exclusion of properties in the inventory of the estate because
there is no question that, from the very start, the Philinterlife shares of stock were owned by the decedent, Dr.
Juvencio Ortaez. Rather, we are concerned here with the effect of the sale made by the decedents heirs,
Juliana Ortaez and Jose Ortaez, without the required approval of the intestate court. This being so, the
contention of petitioners that the determination of the intestate court was merely provisional and should have been
threshed out in a separate proceeding is incorrect.

The petitioners Jose Lee and Alma Aggabao next contend that the writ of execution should not be executed against
them because they were not notified, nor they were aware, of the proceedings nullifying the sale of the shares of
stock.

We are not persuaded. The title of the purchaser like herein petitioner FLAG can be struck down by the intestate
court after a clear showing of the nullity of the alienation. This is the logical consequence of our ruling in Godoy and in
[26]
several subsequent cases. The sale of any property of the estate by an administrator or prospective heir
without order of the probate or intestate court is void and passes no title to the purchaser. Thus, in Juan Lao
et al. vs. Hon. Melencio Geneto, G.R. No. 56451, June 19, 1985, we ordered the probate court to cancel the transfer
certificate of title issued to the vendees at the instance of the administrator after finding that the sale of real property
under probate proceedings was made without the prior approval of the court. The dispositive portion of our decision
read:

IN VIEW OF THE FOREGOING CONSIDERATIONS, the assailed Order dated February 18, 1981 of the respondent
Judge approving the questioned Amicable Settlement is declared NULL and VOID and hereby SET ASIDE.
Consequently, the sale in favor of Sotero Dioniosio III and by the latter to William Go is likewise declared NULL and
VOID. The Transfer Certificate of Title issued to the latter is hereby ordered cancelled.

It goes without saying that the increase in Philinterlifes authorized capital stock, approved on the vote of petitioners
non-existent shareholdings and obviously calculated to make it difficult for Dr. Ortaezs estate to reassume its
controlling interest in Philinterlife, was likewise void ab initio.

Petitioners next argue that they were denied due process.

We do not think so.

37
The facts show that petitioners, for reasons known only to them, did not appeal the decision of the intestate court
nullifying the sale of shares of stock in their favor. Only the vendor, Jose Ortaez, appealed the case. A careful review
of the records shows that petitioners had actual knowledge of the estate settlement proceedings and that they knew
private respondent Enderes was questioning therein the sale to them of the Philinterlife shares of stock.

It must be noted that private respondent-Special Administratrix Enderes filed before the intestate court (RTC of
Quezon City, Branch 85) a Motion to Declare Void Ab InitioDeeds of Sale of Philinterlife Shares of Stock on March
22, 1996. But as early as 1994, petitioners already knew of the pending settlement proceedings and that the shares
they bought were under the administration by the intestate court because private respondent Ma. Divina Ortaez-
Enderes and her mother Ligaya Novicio had filed a case against them at the Securities and Exchange Commission
on November 7, 1994, docketed as SEC No. 11-94-4909, for annulment of transfer of shares of stock, annulment of
sale of corporate properties, annulment of subscriptions on increased capital stocks, accounting, inspection of
corporate books and records and damages with prayer for a writ of preliminary injunction and/or temporary restraining
[27]
order. In said case, Enderes and her mother questioned the sale of the aforesaid shares of stock to petitioners.
The SEC hearing officer in fact, in his resolution dated March 24, 1995, deferred to the jurisdiction of the intestate
court to rule on the validity of the sale of shares of stock sold to petitioners by Jose Ortaez and Juliana Ortaez:

Petitioners also averred that. . . the Philinterlife shares of Dr. Juvencio Ortaez who died, in 1980, are part of his estate
which is presently the subject matter of an intestate proceeding of the RTC of Quezon City, Branch 85. Although,
private respondents [Jose Lee et al.] presented the documents of partition whereby the foregoing share of stocks
were allegedly partitioned and conveyed to Jose S. Ortaez who allegedly assigned the same to the other private
respondents, approval of the Court was not presented. Thus, the assignments to the private respondents [Jose Lee
et al.] of the subject shares of stocks are void.

xxxxxxxxx

With respect to the alleged extrajudicial partition of the shares of stock owned by the late Dr. Juvencio Ortaez, we
rule that the matter properly belongs to the jurisdiction of the regular court where the intestate proceedings are
[28]
currently pending.

With this resolution of the SEC hearing officer dated as early as March 24, 1995 recognizing the jurisdiction of the
intestate court to determine the validity of the extrajudicial partition of the estate of Dr. Ortaez and the subsequent
sale by the heirs of the decedent of the Philinterlife shares of stock to petitioners, how can petitioners claim that they
were not aware of the intestate proceedings?

Futhermore, when the resolution of the SEC hearing officer reached the Supreme Court in 1996 (docketed as G.R.
128525), herein petitioners who were respondents therein filed their answer which contained statements showing that
they knew of the pending intestate proceedings:

[T]he subject matter of the complaint is not within the jurisdiction of the SEC but with the Regional Trial Court; Ligaya
Novicio and children represented themselves to be the common law wife and illegitimate children of the late Ortaez;
that on March 4, 1982, the surviving spouse Juliana Ortaez, on her behalf and for her minor son Antonio, executed a
Memorandum of Agreement with her other sons Rafael and Jose, both surnamed Ortaez, dividing the estate of the
deceased composed of his one-half (1/2) share in the conjugal properties; that in the said Memorandum of
Agreement, Jose S. Ortaez acquired as his share of the estate the 1,329 shares of stock in Philinterlife; that on March
4, 1982, Juliana and Rafael assigned their respective shares of stock in Philinterlife to Jose; that contrary to the
contentions of petitioners, private respondents Jose Lee, Carlos Lee, Benjamin Lee and Alma Aggabao became
stockholders of Philinterlife on March 23, 1983 when Jose S. Ortaez, the principal stockholder at that time, executed
a deed of sale of his shares of stock to private respondents; and that the right of petitioners to question the
[29]
Memorandum of Agreement and the acquisition of shares of stock of private respondent is barred by prescription.

Also, private respondent-Special Administratrix Enderes offered additional proof of actual knowledge of the
settlement proceedings by petitioners which petitioners never denied: (1) that petitioners were represented by Atty.
Ricardo Calimag previously hired by the mother of private respondent Enderes to initiate cases against petitioners
Jose Lee and Alma Aggaboa for the nullification of the sale of the shares of stock but said counsel made a conflicting
turn-around and appeared instead as counsel of petitioners, and (2) that the deeds of sale executed between
petitioners and the heirs of the decedent (vendors Juliana Ortaez and Jose Ortaez) were acknowledged before Atty.
Ramon Carpio who, during the pendency of the settlement proceedings, filed a motion for the approval of the sale of
Philinterlife shares of stock to the Knights of Columbus Fraternal Association, Inc. (which motion was, however, later
[30]
abandoned). All this sufficiently proves that petitioners, through their counsels, knew of the pending settlement
proceedings.

38
Finally, petitioners filed several criminal cases such as libel (Criminal Case No. 97-7179-81), grave coercion (Criminal
Case No. 84624) and robbery (Criminal Case No. Q-96-67919) against private respondents mother Ligaya Novicio
[31]
who was a director of Philinterlife, all of which criminal cases were related to the questionable sale to petitioners of
the Philinterlife shares of stock.

Considering these circumstances, we cannot accept petitioners claim of denial of due process. The essence of due
process is the reasonable opportunity to be heard. Where the opportunity to be heard has been accorded, there is no
[32]
denial of due process. In this case, petitioners knew of the pending instestate proceedings for the settlement of Dr.
Juvencio Ortaezs estate but for reasons they alone knew, they never intervened. When the court declared the nullity
of the sale, they did not bother to appeal. And when they were notified of the motion for execution of the Orders of the
intestate court, they ignored the same. Clearly, petitioners alone should bear the blame.

Petitioners next contend that we are bound by our ruling in G.R. No. 128525 entitled Ma. Divina Ortaez-Enderes vs.
Court of Appeals, dated December 17, 1999, where we allegedly ruled that the intestate court may not pass upon the
title to a certain property for the purpose of determining whether the same should or should not be included in the
inventory but such determination is not conclusive and is subject to final decision in a separate action regarding
ownership which may be constituted by the parties.

We are not unaware of our decision in G.R. No. 128525. The issue therein was whether the Court of Appeals erred in
affirming the resolution of the SEC that Enderes et al. were not entitled to the issuance of the writ of preliminary
injunction. We ruled that the Court of Appeals was correct in affirming the resolution of the SEC denying the issuance
of the writ of preliminary injunction because injunction is not designed to protect contingent rights. Said case
did not rule on the issue of the validity of the sale of shares of stock belonging to the decedents estate without court
approval nor of the validity of the writ of execution issued by the intestate court. G.R. No. 128525 clearly involved a
different issue and it does not therefore apply to the present case.

Petitioners and all parties claiming rights under them are hereby warned not to further delay the execution of the
Orders of the intestate court dated August 11 and August 29, 1997.

WHEREFORE, the petition is hereby DENIED. The decision of the Court of Appeals in CA-G.R. S.P. No. 59736
dated July 26, 2000, dismissing petitioners petition for certiorari and affirming the July 6, 2000 order of the trial court
which ordered the execution of its (trial courts) August 11 and 29, 1997 orders, is hereby AFFIRMED.

SO ORDERED.

39
SECOND DIVISION

[G.R. No. 118671. January 29, 1996]

THE ESTATE OF HILARIO M. RUIZ, EDMOND RUIZ, Executor, petitioner, vs. THE COURT OF APPEALS
(Former Special Sixth Division), MARIA PILAR RUIZ-MONTES, MARIA CATHRYN RUIZ, CANDICE ALBERTINE
RUIZ, MARIA ANGELINE RUIZ and THE PRESIDING JUDGE OF THE REGIONAL TRIAL COURT OF PASIG,
BRANCH 156, respondents.

DECISION

PUNO, J.:

This petition for review on certiorari seeks to annul and set aside the decision dated November 10, 1994 and the
resolution dated January 5, 1995 of the Court of Appeals in CA-G.R. SP No. 33045.
1
The facts show that on June 27, 1987, Hilario M. Ruiz executed a holographic will naming as his heirs his only son,
Edmond Ruiz, his adopted daughter, private respondent Maria Pilar Ruiz Montes, and his three granddaughters,
private respondents Maria Cathryn, Candice Albertine and Maria Angeline, all children of Edmond Ruiz. The testator
bequeathed to his heirs substantial cash, personal and real properties and named Edmond Ruiz executor of his
2
estate.

On April 12, 1988, Hilario Ruiz died. Immediately thereafter, the cash component of his estate was distributed among
Edmond Ruiz and private respondents in accordance with the decedents will. For unbeknown reasons, Edmond, the
named executor, did not take any action for the probate of his fathers holographic will.

On June 29, 1992, four years after the testators death, it was private respondent Maria Pilar Ruiz Montes who filed
before the Regional Trial Court, Branch 156, Pasig, a petition for the probate and approval of Hilario Ruizs will and for
3
the issuance of letters testamentary to Edmond Ruiz. Surprisingly, Edmond opposed the petition on the ground that
the will was executed under undue influence.

On November 2, 1992, one of the properties of the estate - the house and lot at No. 2 Oliva Street, Valle Verde
4
IV, Pasig which the testator bequeathed to Maria Cathryn, Candice Albertine and Maria Angeline - was leased out by
Edmond Ruiz to third persons.

On January 19, 1993, the probate court ordered Edmond to deposit with the Branch Clerk of Court the rental deposit
and payments totalling P540,000.00 representing the one-year lease of the Valle Verde property. In compliance,
on January 25, 1993, Edmond turned over the amount of P348,583.56, representing the balance of the rent after
5
deducting P191,416.14 for repair and maintenance expenses on the estate.

In March 1993, Edmond moved for the release of P50,000.00 to pay the real estate taxes on the real properties of the
6
estate. The probate court approved the release of P7,722.00

On May 14, 1993, Edmond withdrew his opposition to the probate of the will. Consequently, the probate
court, on May 18, 1993, admitted the will to probate and ordered the issuance of letters testamentary
to Edmond conditioned upon the filing of a bond in the amount of P50,000.00. The letters testamentary were issued
on June 23, 1993.

On July 28, 1993, petitioner Testate Estate of Hilario Ruiz as executor, filed an Ex-Parte Motion for Release of Funds.
It prayed for the release of the rent payments deposited with the Branch Clerk of Court. Respondent Montes opposed
the motion and concurrently filed a Motion for Release of Funds to Certain Heirs and Motion for Issuance of
Certificate of Allowance of Probate Will. Montes prayed for the release of the said rent payments to Maria Cathryn,
Candice Albertine and Maria Angeline and for the distribution of the testators properties, specifically the Valle Verde
property and the Blue Ridge apartments, in accordance with the provisions of the holographic will.

On August 26, 1993, the probate court denied petitioners motion for release of funds but granted respondent Montes
motion in view of petitioners lack of opposition. It thus ordered the release of the rent payments to the decedents
three granddaughters. It further ordered the delivery of the titleds to and possession of the properties bequeathed to
the three granddaughters and respondent Montes upon the filing of a bond of P50,000.00.

Petitioner moved for reconsideration alleging that he actually filed his opposition to respondent Montes motion for
release of rent payments which opposition the court failed to consider. Petitioner likewise reiterated his previous
motion for release of funds.

40
On November 23, 1993, petitioner, through counsel, manifested that he was withdrawing his motion for release of
7
funds in view of the fact that the lease contract over Valle Verde property had been renewed for another year.

Despite petitioners manifestation, the probate court, on December 22, 1993, ordered the release of the funds to
Edmond but only such amount as may be necessary to cover the espenses of administration and allowanceas for
support of the testators three granddaughters subject to collation and deductible from their share in the
inheritance.The court, however, held in abeyance the release of the titles to respondent Montes and the three
8
granddaughters until the lapse of six months from the date of firast publication of the notice to creditors. The Court
stated thus:

xxx xxx xxx

After consideration of the arguments set forth thereon by the parties, the court resolves to allow Administrator
Edmond M. Ruiz to take possession of the rental payments deposited with the Clerk of Court, Pasig Regional Trial
Court, but only such amount as may be necessary to cover the expenses of administration and allowances for
support of Maria Cathryn Veronique, Candice Albertine and Maria Angeli, which are subject to collation and
deductible from the share in the inheritance of said heirs and insofar as they exceed the fruits or rents pertaining to
them.

As to the release of the titles bequeathed to petitioner Maria Pilar Ruiz-Montes and the above-named heirs, the same
is hereby reconsidered and held in abeyance until the lapse of six (6) months from the date of first publication of
Notice to Creditors.

WHEREFORE, Administrator Edmond M. Ruiz is hereby ordered to submit an accounting of the expenses necessary
for administration including provisions for the support Of Maria Cathryn Veronique Ruiz, Candice Albertine Ruiz and
Maria Angeli Ruiz before the amount required can be withdrawn and cause the publication of the notice to
9
creditors with reasonable dispatch.

Petitioner assailed this order before the Court of Appeals. Finding no grave abuse of discretion on the part of
respondent judge, the appellate court dismissed the petition and sustained the probate courts order in a decision
10 11
dated November 10, 1994 and a resolution dated January 5, 1995.

Hence, this petition.

Petitioner claims that:

THE PUBLIC RESPONDENT COURT OF APPEALS COMMITTED GRAVE ABUSE OF DISCRETION AMOUNTING
TO LACK OR EXCESS OF JURISDICTION IN AFFIRMING AND CONFIRMING THE ORDER OF RESPONDENT
REGIONAL TRIAL COURT OF PASIG, BRANCH 156, DATED DECEMBER 22, 1993, WHICH WHEN GIVEN DUE
COURSE AND IS EFFECTED WOULD: (1) DISALLOW THE EXECUTOR/ADMINISTRATOR OF THE ESTATE OF
THE LATE HILARIO M. RUIZ TO TAKE POSSESSION OF ALL THE REAL AND PERSONAL PROPERTIES OF
THE ESTATE; (2) GRANT SUPPORT, DURING THE PENDENCY OF THE SETTLEMENT OF AN ESTATE, TO
CERTAIN PERSONS NOT ENTITLED THERETO; AND (3) PREMATURELY PARTITION AND DISTRIBUTE THE
ESTATE PURSUANT TO THE PROVISIONS OF THE HOLOGRAPHIC WILL EVEN BEFORE ITS INTRINSIC
VALIDITY HAS BEEN DETERMINED, AND DESPITE THE EXISTENCE OF UNPAID DEBTS AND OBLIGATIONS
12
OF THE ESTATE.

The issue for resolution is whether the probate court, after admitting the will to probate but before payment of the
estates debts and obligations, has the authority: (1) to grant an allowance from the funds of the estate for the support
of the testators grandchildren; (2) to order the release of the titles to certain heirs; and (3) to grant possession of all
properties of the estate to the executor of the will.

On the matter of allowance, Section 3 of Rule 83 of the Revised Rules of Court provides:

Sec. 3. Allowance to widow and family. - The widow and minor or incapacitated children of a deceased person, during
the settlement of the estate, shall receive therefrom under the direction of the court, such allowance as are provided
by law.

Petitioner alleges that this provision only gives the widow and the minor or incapacitated children of the deceased the
right to receive allowances for support during the settlement of estate proceedings. He contends that the testators
three granddaughters do not qualify for an allowance because they are not incapacitated and are no longer minors
but of legal age, married and gainfully employed. In addition, the provision expressly states children of the deceased
which excludes the latters grandchildren.

41
It is settled that allowances for support under Section 3 of Rule 83 should not be limited to the minor or incapacitated
13
children of the deceased. Article 188 of the Civil Code of the Philippines, the substantive law in force at the time of
the testators death, provides that during the liquidation of the conjugal partnership, the deceaseds legitimate spouse
and children, regardless of their age, civil status or gainful employment, are entitled to provisional support from the
14
funds of the estate. The law is rooted on the fact that the right and duty to support, especially the right to education,
15
subsist even beyond the age of majority.

Be that as it may, grandchildren are not entitled to provisional support from the funds of the decedents estate. The
law clearly limits the allowance to widow and children and does not extend it to the deceaseds grandchildren,
16
regardless of their minority or incapacity. It was error, therefore, for the appellate court to sustain the probate courts
order granting an allowance to the grandchildren of the testator pending settlement of his estate.

Respondent courts also erred when they ordered the release of the titles of the bequeathed properties to private
respondents six months after the date of first publication of notice to creditors. An order releasing titles to properties
of the estate amounts to an advance distribution of the estate which is allowed only under the following conditions:

Sec. 2. Advance distribution in special proceedings. - Nothwithstanding a pending controversy or appeal in


proceedings to settle the estate of a decedent, the court may, in its discretion and upon such terms as it may deem
proper and just, permit that such part of the estate as may not be affected by the controversy or appeal be distributed
17
among the heirs or legatees, upon compliance with the conditions set forth in Rule 90 of these Rules.

And Rule 90 provides that:

Sec. 1. When order for distribution of residue made. - When the debts, funeral charges, and expenses of
administration, the allowance to the widow, and inheritance tax, if any, chargeable to the estate in accordance with
law, have been paid, the court, on the application of the executor or administrator, or of a person interested in the
estate, and after hearing upon notice, shall assign the residue of the estate to the persons entitled to the same,
naming them and the proportions, or parts, to which each is entitled, and such persons may demand and recover
their respective shares from the executor or administrator, or any other person having the same in his possession. If
there is a controversy before the court as to who are the lawful heirs of the deceased person or as to the distributive
shares to which each person is entitled under the law, the controversy shall be heard and decided as in ordinary
cases.

No distribution shall be allowed until the payment of the obligations above-mentioned has been made or
provided for, unless the distributees, or any of them, give a bond, in a sum to be fixed by the court,
18
conditioned for the payment of said obligations within such time as the court directs.

In settlement of estate proceedings, the distribution of the estate properties can only be made: (1) after all the debts,
funeral charges, expenses of administration, allowance to the widow, and estate tax have been paid; or (2) before
payment of said obligations only if the distributees or any of them gives a bond in a sum fixed by the court
conditioned upon the payment of said obligations within such time as the court directs, or when provision is made to
19
meet those obligations.

In the case at bar, the probate court ordered the release of the titles to the Valle Verde property and the Blue
Ridge apartments to the private respondents after the lapse of six months from the date of first publication of the
notice to creditors. The questioned order speaks of notice to creditors, not payment of debts and obligations. Hilario
Ruiz allegedly left no debts when he died but the taxes on his estate had not hitherto been paid, much less
ascertained. The estate tax is one of those obligations that must be paid before distribution of the estate. If not yet
paid, the rule requires that the distributees post a bond or make such provisions as to meet the said tax obligation in
20
proportion to their respective shares in the inheritance. Notably, at the time the order was issued the properties of
the estate had not yet been inventoried and appraised.

It was also too early in the day for the probate court to order the release of the titles six months after admitting the will
21
to probate. The probate of a will is conclusive as to its due execution and extrinsic validity and settles only the
question of whether the testator, being of sound mind, freely executed it in accordance with the formalities prescribed
22
by law. Questions as to the intrinsic validity and efficacy of the provisions of the will, the legality of any devise or
23
legacy may be raised even after the will has been authenticated.

The intrinsic validity of Hilarios holographic will was controverted by petitioner before the probate court in his Reply to
24
Montes Opposition to his motion for release of funds and his motion for reconsideration of the August 26, 1993 order
25
of the said court. Therein, petitioner assailed the distributive shares of the devisees and legatees inasmuch as his
fathers will included the estate of his mother and allegedly impaired his legitime as an intestate heir of his mother.

42
The Rules provide that if there is a controversy as to who are the lawful heirs of the decedent and their distributive
26
shares in his estate, the probate court shall proceed to hear and decide the same as in ordinary cases.

Still and all, petitioner cannot correctly claim that the assailed order deprived him of his right to take possession of all
the real and personal properties of the estate. The right of an executor or administrator to the possession and
management of the real and personal properties of the deceased is not absolute and can only be exercised so long
27
as it is necessary for the payment of the debts and expenses of administration, Section 3 of Rule 84 of the Revised
Rules of Court explicitly provides:

Sec. 3. Executor or administrator to retain whole estate to pay debts, and to administer estate not willed. - An
executor or administrator shall have the right to the possession and management of the real as well as the personal
estate of the deceased so long as it is necessary for the payment of the debts and expenses for
28
administration.

When petitioner moved for further release of the funds deposited with the clerk of court, he had been previously
granted by the probate court certain amounts for repair and maintenance expenses on the properties of the estate,
and payment of the real estate taxes thereon. But petitioner moved again for the release of additional funds for the
same reasons he previously cited. It was correct for the probate court to require him to submit an accounting of
the necessary expenses for administration before releasing any further money in his favor.

It was relevantly noted by the probate court that petitioner had deposited with it only a portion of the one-year rental
income from the Valle Verde property. Petitioner did not deposit its succeeding rents after renewal of the
29
lease. Neither did he render an accounting of such funds.

Petitioner must be reminded that his right of ownership over the properties of his father is merely inchoate as long as
30
the estate has not been fully settled and partitioned. As executor, he is a mere trustee of his fathers estate. The
funds of the estate in his hands are trust funds and he is held to the duties and responsibilities of a trustee of the
31
highest order. He cannot unilaterally assign to himself and possess all his parents properties and the fruits thereof
without first submitting an inventory and appraisal of all real and personal properties of the deceased, rendering a
true account of his administration, the expenses of administration, the amount of the obligations and estate tax, all of
32
which are subject to a determination by the court as to their veracity, propriety and justness.

IN VIEW WHEREOF, the decision and resolution of the Court of Appeals in CA-G.R. SP No. 33045 affirming the
order dated December 22, 1993 of the Regional Trial Court, Branch 156, Pasig in SP Proc. No. 10259 are affirmed
with the modification that those portions of the order granting an allowance to the testators grandchildren and
ordering the release of the titles to the private respondents upon notice to creditors are annulled and set aside.

Respondent judge is ordered to proceed with dispatch in the proceedings below.

SO ORDERED.

43
SECOND DIVISION
[G.R. No. 149926. February 23, 2005]

UNION BANK OF THE PHILIPPINES, petitioner, vs. EDMUND SANTIBAEZ and FLORENCE SANTIBAEZ
ARIOLA, respondents.

DECISION

CALLEJO, SR., J.:

Before us is a petition for review on certiorari under Rule 45 of the Revised Rules of Court which seeks the reversal
[1] [2]
of the Decision of the Court of Appeals dated May 30, 2001 in CA-G.R. CV No. 48831 affirming the dismissal of
the petitioners complaint in Civil Case No. 18909 by the Regional Trial Court (RTC) of Makati City, Branch 63.

The antecedent facts are as follows:

On May 31, 1980, the First Countryside Credit Corporation (FCCC) and Efraim M. Santibaez entered into a loan
[3]
agreement in the amount of P128,000.00. The amount was intended for the payment of the purchase price of one
(1) unit Ford 6600 Agricultural All-Purpose Diesel Tractor. In view thereof, Efraim and his son, Edmund, executed a
promissory note in favor of the FCCC, the principal sum payable in five equal annual amortizations of P43,745.96 due
st
on May 31, 1981 and every May 31 thereafter up to May 31, 1985.
[4]
On December 13, 1980, the FCCC and Efraim entered into another loan agreement, this time in the amount
of P123,156.00. It was intended to pay the balance of the purchase price of another unit of Ford 6600 Agricultural All-
Purpose Diesel Tractor, with accessories, and one (1) unit Howard Rotamotor Model AR 60K. Again, Efraim and his
son, Edmund, executed a promissory note for the said amount in favor of the FCCC. Aside from such promissory
[5]
note, they also signed a Continuing Guaranty Agreement for the loan dated December 13, 1980.
[6]
Sometime in February 1981, Efraim died, leaving a holographic will. Subsequently in March 1981, testate
proceedings commenced before the RTC of Iloilo City, Branch 7, docketed as Special Proceedings No. 2706. On
April 9, 1981, Edmund, as one of the heirs, was appointed as the special administrator of the estate of the
[7]
decedent. During the pendency of the testate proceedings, the surviving heirs, Edmund and his sister Florence
[8]
Santibaez Ariola, executed a Joint Agreement dated July 22, 1981, wherein they agreed to divide between
themselves and take possession of the three (3) tractors; that is, two (2) tractors for Edmund and one (1) tractor for
Florence. Each of them was to assume the indebtedness of their late father to FCCC, corresponding to the tractor
respectively taken by them.
[9]
On August 20, 1981, a Deed of Assignment with Assumption of Liabilities was executed by and between FCCC and
Union Savings and Mortgage Bank, wherein the FCCC as the assignor, among others, assigned all its assets and
liabilities to Union Savings and Mortgage Bank.
[10]
Demand letters for the settlement of his account were sent by petitioner Union Bank of the Philippines (UBP) to
Edmund, but the latter failed to heed the same and refused to pay. Thus, on February 5, 1988, the petitioner filed a
[11]
Complaint for sum of money against the heirs of Efraim Santibaez, Edmund and Florence, before the RTC of
Makati City, Branch 150, docketed as Civil Case No. 18909. Summonses were issued against both, but the one
intended for Edmund was not served since he was in the United States and there was no information on his address
[12]
or the date of his return to the Philippines. Accordingly, the complaint was narrowed down to respondent Florence
S. Ariola.
[13]
On December 7, 1988, respondent Florence S. Ariola filed her Answer and alleged that the loan documents did not
bind her since she was not a party thereto. Considering that the joint agreement signed by her and her brother
Edmund was not approved by the probate court, it was null and void; hence, she was not liable to the petitioner under
the joint agreement.
[14]
On January 29, 1990, the case was unloaded and re-raffled to the RTC of Makati City, Branch 63. Consequently,
trial on the merits ensued and a decision was subsequently rendered by the court dismissing the complaint for lack of
merit. The decretal portion of the RTC decision reads:
[15]
WHEREFORE, judgment is hereby rendered DISMISSING the complaint for lack of merit.

The trial court found that the claim of the petitioner should have been filed with the probate court before which the
testate estate of the late Efraim Santibaez was pending, as the sum of money being claimed was an obligation
incurred by the said decedent. The trial court also found that the Joint Agreement apparently executed by his heirs,

44
Edmund and Florence, on July 22, 1981, was, in effect, a partition of the estate of the decedent. However, the said
agreement was void, considering that it had not been approved by the probate court, and that there can be no valid
partition until after the will has been probated. The trial court further declared that petitioner failed to prove that it was
the now defunct Union Savings and Mortgage Bank to which the FCCC had assigned its assets and liabilities. The
court also agreed to the contention of respondent Florence S. Ariola that the list of assets and liabilities of the FCCC
assigned to Union Savings and Mortgage Bank did not clearly refer to the decedents account. Ruling that the joint
agreement executed by the heirs was null and void, the trial court held that the petitioners cause of action against
respondent Florence S. Ariola must necessarily fail.

The petitioner appealed from the RTC decision and elevated its case to the Court of Appeals (CA), assigning the
following as errors of the trial court:

1. THE COURT A QUO ERRED IN FINDING THAT THE JOINT AGREEMENT (EXHIBIT A) SHOULD BE
APPROVED BY THE PROBATE COURT.

2. THE COURT A QUO ERRED IN FINDING THAT THERE CAN BE NO VALID PARTITION AMONG THE HEIRS
UNTIL AFTER THE WILL HAS BEEN PROBATED.

3. THE COURT A QUO ERRED IN NOT FINDING THAT THE DEFENDANT HAD WAIVED HER RIGHT TO HAVE
[16]
THE CLAIM RE-LITIGATED IN THE ESTATE PROCEEDING.

The petitioner asserted before the CA that the obligation of the deceased had passed to his legitimate children and
heirs, in this case, Edmund and Florence; the unconditional signing of the joint agreement marked as Exhibit A
estopped respondent Florence S. Ariola, and that she cannot deny her liability under the said document; as the
agreement had been signed by both heirs in their personal capacity, it was no longer necessary to present the same
before the probate court for approval; the property partitioned in the agreement was not one of those enumerated in
the holographic will made by the deceased; and the active participation of the heirs, particularly respondent Florence
S. Ariola, in the present ordinary civil action was tantamount to a waiver to re-litigate the claim in the estate
proceedings.

On the other hand, respondent Florence S. Ariola maintained that the money claim of the petitioner should have been
[17]
presented before the probate court.

The appellate court found that the appeal was not meritorious and held that the petitioner should have filed its claim
with the probate court as provided under Sections 1 and 5, Rule 86 of the Rules of Court. It further held that the
partition made in the agreement was null and void, since no valid partition may be had until after the will has been
probated. According to the CA, page 2, paragraph (e) of the holographic will covered the subject properties (tractors)
in generic terms when the deceased referred to them as all other properties. Moreover, the active participation of
respondent Florence S. Ariola in the case did not amount to a waiver. Thus, the CA affirmed the RTC decision, viz.:

WHEREFORE, premises considered, the appealed Decision of the Regional Trial Court of Makati City, Branch 63, is
hereby AFFIRMED in toto.
[18]
SO ORDERED.

In the present recourse, the petitioner ascribes the following errors to the CA:

I.

THE HONORABLE COURT OF APPEALS ERRED IN FINDING THAT THE JOINT AGREEMENT SHOULD BE
APPROVED BY THE PROBATE COURT.

II.

THE COURT OF APPEALS ERRED IN FINDING THAT THERE CAN BE NO VALID PARTITION AMONG THE
HEIRS OF THE LATE EFRAIM SANTIBAEZ UNTIL AFTER THE WILL HAS BEEN PROBATED.

III.

THE COURT OF APPEALS ERRED IN NOT FINDING THAT THE RESPONDENT HAD WAIVED HER RIGHT TO
HAVE THE CLAIM RE-LITIGATED IN THE ESTATE PROCEEDING.

IV.

45
RESPONDENTS CAN, IN FACT, BE HELD JOINTLY AND SEVERALLY LIABLE WITH THE PRINCIPAL DEBTOR
THE LATE EFRAIM SANTIBAEZ ON THE STRENGTH OF THE CONTINUING GUARANTY AGREEMENT
EXECUTED IN FAVOR OF PETITIONER-APPELLANT UNION BANK.

V.

THE PROMISSORY NOTES DATED MAY 31, 1980 IN THE SUM OF P128,000.00 AND DECEMBER 13, 1980 IN
THE AMOUNT OF P123,000.00 CATEGORICALLY ESTABLISHED THE FACT THAT THE RESPONDENTS
BOUND THEMSELVES JOINTLY AND SEVERALLY LIABLE WITH THE LATE DEBTOR EFRAIM SANTIBAEZ IN
[19]
FAVOR OF PETITIONER UNION BANK.

The petitioner claims that the obligations of the deceased were transmitted to the heirs as provided in Article 774 of
the Civil Code; there was thus no need for the probate court to approve the joint agreement where the heirs
partitioned the tractors owned by the deceased and assumed the obligations related thereto. Since respondent
Florence S. Ariola signed the joint agreement without any condition, she is now estopped from asserting any position
contrary thereto. The petitioner also points out that the holographic will of the deceased did not include nor mention
any of the tractors subject of the complaint, and, as such was beyond the ambit of the said will. The active
participation and resistance of respondent Florence S. Ariola in the ordinary civil action against the petitioners claim
amounts to a waiver of the right to have the claim presented in the probate proceedings, and to allow any one of the
heirs who executed the joint agreement to escape liability to pay the value of the tractors under consideration would
be equivalent to allowing the said heirs to enrich themselves to the damage and prejudice of the petitioner.

The petitioner, likewise, avers that the decisions of both the trial and appellate courts failed to consider the fact that
respondent Florence S. Ariola and her brother Edmund executed loan documents, all establishing the vinculum
juris or the legal bond between the late Efraim Santibaez and his heirs to be in the nature of a solidary obligation.
Furthermore, the Promissory Notes dated May 31, 1980 and December 13, 1980 executed by the late Efraim
Santibaez, together with his heirs, Edmund and respondent Florence, made the obligation solidary as far as the said
heirs are concerned. The petitioner also proffers that, considering the express provisions of the continuing guaranty
agreement and the promissory notes executed by the named respondents, the latter must be held liable jointly and
severally liable thereon. Thus, there was no need for the petitioner to file its money claim before the probate court.
Finally, the petitioner stresses that both surviving heirs are being sued in their respective personal capacities, not as
heirs of the deceased.

In her comment to the petition, respondent Florence S. Ariola maintains that the petitioner is trying to recover a sum
of money from the deceased Efraim Santibaez; thus the claim should have been filed with the probate court. She
points out that at the time of the execution of the joint agreement there was already an existing probate proceedings
of which the petitioner knew about. However, to avoid a claim in the probate court which might delay payment of the
obligation, the petitioner opted to require them to execute the said agreement.

According to the respondent, the trial court and the CA did not err in declaring that the agreement was null and void.
She asserts that even if the agreement was voluntarily executed by her and her brother Edmund, it should still have
been subjected to the approval of the court as it may prejudice the estate, the heirs or third parties. Furthermore, she
had not waived any rights, as she even stated in her answer in the court a quo that the claim should be filed with the
probate court. Thus, the petitioner could not invoke or claim that she is in estoppel.

Respondent Florence S. Ariola further asserts that she had not signed any continuing guaranty agreement, nor was
there any document presented as evidence to show that she had caused herself to be bound by the obligation of her
late father.

The petition is bereft of merit.

The Court is posed to resolve the following issues: a) whether or not the partition in the Agreement executed by the
heirs is valid; b) whether or not the heirs assumption of the indebtedness of the deceased is valid; and c) whether the
petitioner can hold the heirs liable on the obligation of the deceased.

At the outset, well-settled is the rule that a probate court has the jurisdiction to determine all the properties of the
deceased, to determine whether they should or should not be included in the inventory or list of properties to be
[20]
administered. The said court is primarily concerned with the administration, liquidation and distribution of the
[21]
estate.

In our jurisdiction, the rule is that there can be no valid partition among the heirs until after the will has been probated:

46
In testate succession, there can be no valid partition among the heirs until after the will has been probated. The law
enjoins the probate of a will and the public requires it, because unless a will is probated and notice thereof given to
the whole world, the right of a person to dispose of his property by will may be rendered nugatory. The authentication
of a will decides no other question than such as touch upon the capacity of the testator and the compliance with those
[22]
requirements or solemnities which the law prescribes for the validity of a will.
[23]
This, of course, presupposes that the properties to be partitioned are the same properties embraced in the will. In
[24]
the present case, the deceased, Efraim Santibaez, left a holographic will which contained, inter alia, the provision
which reads as follows:

(e) All other properties, real or personal, which I own and may be discovered later after my demise, shall be
distributed in the proportion indicated in the immediately preceding paragraph in favor of Edmund and Florence, my
children.

We agree with the appellate court that the above-quoted is an all-encompassing provision embracing all the
properties left by the decedent which might have escaped his mind at that time he was making his will, and other
properties he may acquire thereafter. Included therein are the three (3) subject tractors. This being so, any partition
[25]
involving the said tractors among the heirs is not valid. The joint agreement executed by Edmund and Florence,
partitioning the tractors among themselves, is invalid, specially so since at the time of its execution, there was already
a pending proceeding for the probate of their late fathers holographic will covering the said tractors.

It must be stressed that the probate proceeding had already acquired jurisdiction over all the properties of the
deceased, including the three (3) tractors. To dispose of them in any way without the probate courts approval is
[26]
tantamount to divesting it with jurisdiction which the Court cannot allow. Every act intended to put an end to
indivision among co-heirs and legatees or devisees is deemed to be a partition, although it should purport to be a
[27]
sale, an exchange, a compromise, or any other transaction. Thus, in executing any joint agreement which appears
to be in the nature of an extra-judicial partition, as in the case at bar, court approval is imperative, and the heirs
cannot just divest the court of its jurisdiction over that part of the estate. Moreover, it is within the jurisdiction of the
[28]
probate court to determine the identity of the heirs of the decedent. In the instant case, there is no showing that the
signatories in the joint agreement were the only heirs of the decedent. When it was executed, the probate of the will
was still pending before the court and the latter had yet to determine who the heirs of the decedent were. Thus, for
Edmund and respondent Florence S. Ariola to adjudicate unto themselves the three (3) tractors was a premature act,
and prejudicial to the other possible heirs and creditors who may have a valid claim against the estate of the
deceased.

The question that now comes to fore is whether the heirs assumption of the indebtedness of the decedent is binding.
We rule in the negative. Perusing the joint agreement, it provides that the heirs as parties thereto have agreed to
divide between themselves and take possession and use the above-described chattel and each of them to assume
the indebtedness corresponding to the chattel taken as herein after stated which is in favor of First Countryside Credit
[29]
Corp. The assumption of liability was conditioned upon the happening of an event, that is, that each heir shall take
possession and use of their respective share under the agreement. It was made dependent on the validity of the
partition, and that they were to assume the indebtedness corresponding to the chattel that they were each to receive.
The partition being invalid as earlier discussed, the heirs in effect did not receive any such tractor. It follows then that
the assumption of liability cannot be given any force and effect.

The Court notes that the loan was contracted by the decedent. The petitioner, purportedly a creditor of the late Efraim
Santibaez, should have thus filed its money claim with the probate court in accordance with Section 5, Rule 86 of the
Revised Rules of Court, which provides:

Section 5. Claims which must be filed under the notice. If not filed barred; exceptions. All claims for money against
the decedent, arising from contract, express or implied, whether the same be due, not due, or contingent, all claims
for funeral expenses for the last sickness of the decedent, and judgment for money against the decedent, must be
filed within the time limited in the notice; otherwise they are barred forever, except that they may be set forth as
counterclaims in any action that the executor or administrator may bring against the claimants. Where an executor or
administrator commences an action, or prosecutes an action already commenced by the deceased in his lifetime, the
debtor may set forth by answer the claims he has against the decedent, instead of presenting them independently to
the court as herein provided, and mutual claims may be set off against each other in such action; and if final judgment
is rendered in favor of the defendant, the amount so determined shall be considered the true balance against the
estate, as though the claim had been presented directly before the court in the administration proceedings. Claims
not yet due, or contingent, may be approved at their present value.

47
[30]
The filing of a money claim against the decedents estate in the probate court is mandatory. As we held in the
[31]
vintage case of Py Eng Chong v. Herrera:

This requirement is for the purpose of protecting the estate of the deceased by informing the executor or
administrator of the claims against it, thus enabling him to examine each claim and to determine whether it is a proper
one which should be allowed. The plain and obvious design of the rule is the speedy settlement of the affairs of the
deceased and the early delivery of the property to the distributees, legatees, or heirs. `The law strictly requires the
prompt presentation and disposition of the claims against the decedent's estate in order to settle the affairs of the
[32]
estate as soon as possible, pay off its debts and distribute the residue.

Perusing the records of the case, nothing therein could hold private respondent Florence S. Ariola accountable for
any liability incurred by her late father. The documentary evidence presented, particularly the promissory notes and
the continuing guaranty agreement, were executed and signed only by the late Efraim Santibaez and his son
Edmund. As the petitioner failed to file its money claim with the probate court, at most, it may only go after Edmund
as co-maker of the decedent under the said promissory notes and continuing guaranty, of course, subject to any
defenses Edmund may have as against the petitioner. As the court had not acquired jurisdiction over the person of
Edmund, we find it unnecessary to delve into the matter further.

We agree with the finding of the trial court that the petitioner had not sufficiently shown that it is the successor-in-
[33]
interest of the Union Savings and Mortgage Bank to which the FCCC assigned its assets and liabilities. The
petitioner in its complaint alleged that by virtue of the Deed of Assignment dated August 20, 1981 executed by and
[34]
between First Countryside Credit Corporation and Union Bank of the Philippines However, the documentary
[35]
evidence clearly reflects that the parties in the deed of assignment with assumption of liabilities were the FCCC,
and the Union Savings and Mortgage Bank, with the conformity of Bancom Philippine Holdings, Inc. Nowhere can the
petitioners participation therein as a party be found. Furthermore, no documentary or testimonial evidence was
presented during trial to show that Union Savings and Mortgage Bank is now, in fact, petitioner Union Bank of the
Philippines. As the trial court declared in its decision:

[T]he court also finds merit to the contention of defendant that plaintiff failed to prove or did not present evidence to
prove that Union Savings and Mortgage Bank is now the Union Bank of the Philippines. Judicial notice does not apply
here. The power to take judicial notice is to [be] exercised by the courts with caution; care must be taken that the
requisite notoriety exists; and every reasonable doubt upon the subject should be promptly resolved in the negative.
[36]
(Republic vs. Court of Appeals, 107 SCRA 504).

This being the case, the petitioners personality to file the complaint is wanting. Consequently, it failed to establish its
cause of action. Thus, the trial court did not err in dismissing the complaint, and the CA in affirming the same.

IN LIGHT OF ALL THE FOREGOING, the petition is hereby DENIED. The assailed Court of Appeals Decision is
AFFIRMED. No costs.

SO ORDERED.

48
SECOND DIVISION
G.R. No. 189121 July 31, 2013

AMELIA GARCIA-QUIAZON, JENNETH QUIAZON and MARIA JENNIFER QUIAZON, Petitioners,


vs.
MA. LOURDES BELEN, for and in behalf of MARIA LOURDES ELISE QUIAZON, Respondent.

DECISION

PEREZ, J.:

This is a Petition for Review on Certiorari filed pursuant to Rule 45 of the Revised Rules of Court, primarily assailing
the 28 November 2008 Decision rendered by the Ninth Division of the Court of Appeals in CA-G.R. CV No.
1
88589, the decretal portion of which states:

WHEREFORE, premises considered, the appeal is hereby DENIED. The assailed Decision dated March 11, 2005,
2
and the Order dated March 24, 2006 of the Regional Trial Court, Branch 275, Las Piñas City are AFFIRMED in toto.

The Facts

This case started as a Petition for Letters of Administration of the Estate of Eliseo Quiazon (Eliseo), filed by herein
respondents who are Eliseo’s common-law wife and daughter. The petition was opposed by herein petitioners Amelia
Garcia-Quaizon (Amelia) to whom Eliseo was married. Amelia was joined by her children, Jenneth Quiazon (Jenneth)
and Maria Jennifer Quiazon (Jennifer).

Eliseo died intestate on 12 December 1992.

On 12 September 1994, Maria Lourdes Elise Quiazon (Elise), represented by her mother, Ma. Lourdes Belen
3
(Lourdes), filed a Petition for Letters of Administration before the Regional Trial Court (RTC) of Las Piñas City. In her
Petition docketed as SP Proc. No. M-3957, Elise claims that she is the natural child of Eliseo having been conceived
and born at the time when her parents were both capacitated to marry each other. Insisting on the legal capacity of
Eliseo and Lourdes to marry, Elise impugned the validity of Eliseo’s marriage to Amelia by claiming that it was
bigamous for having been contracted during the subsistence of the latter’s marriage with one Filipito Sandico
(Filipito). To prove her filiation to the decedent, Elise, among others, attached to the Petition for Letters of
4
Administration her Certificate of Live Birth signed by Eliseo as her father. In the same petition, it was alleged that
Eliseo left real properties worth ₱2,040,000.00 and personal properties worth ₱2,100,000.00. In order to preserve the
estate of Eliseo and to prevent the dissipation of its value, Elise sought her appointment as administratrix of her late
father’s estate.

Claiming that the venue of the petition was improperly laid, Amelia, together with her children, Jenneth and Jennifer,
5
opposed the issuance of the letters of administration by filing an Opposition/Motion to Dismiss. The petitioners
6
asserted that as shown by his Death Certificate, Eliseo was a resident of Capas, Tarlac and not of Las Piñas City, at
7
the time of his death. Pursuant to Section 1, Rule 73 of the Revised Rules of Court, the petition for settlement of
decedent’s estate should have been filed in Capas, Tarlac and not in Las Piñas City. In addition to their claim of
improper venue, the petitioners averred that there are no factual and legal bases for Elise to be appointed
administratix of Eliseo’s estate.
8
In a Decision dated 11 March 2005, the RTC directed the issuance of Letters of Administration to Elise upon posting
the necessary bond. The lower court ruled that the venue of the petition was properly laid in Las Piñas City, thereby
discrediting the position taken by the petitioners that Eliseo’s last residence was in Capas, Tarlac, as hearsay. The
dispositive of the RTC decision reads:

Having attained legal age at this time and there being no showing of any disqualification or incompetence to serve as
administrator, let letters of administration over the estate of the decedent Eliseo Quiazon, therefore, be issued to
petitioner, Ma. Lourdes Elise Quiazon, after the approval by this Court of a bond in the amount of ₱100,000.00 to be
9
posted by her.
10
On appeal, the decision of the trial court was affirmed in toto in the 28 November 2008 Decision rendered by the
Court of Appeals in CA-G.R.CV No. 88589. In validating the findings of the RTC, the Court of Appeals held that Elise
was able to prove that Eliseo and Lourdes lived together as husband and wife by establishing a common residence at
No. 26 Everlasting Road, Phase 5, Pilar Village, Las Piñas City, from 1975 up to the time of Eliseo’s death in 1992.
For purposes of fixing the venue of the settlement of Eliseo’s estate, the Court of Appeals upheld the conclusion

49
reached by the RTC that the decedent was a resident of Las Piñas City. The petitioners’ Motion for Reconsideration
11
was denied by the Court of Appeals in its Resolution dated 7 August 2009.

The Issues

The petitioners now urge Us to reverse the assailed Court of Appeals Decision and Resolution on the following
grounds:

I. THE COURT OF APPEALS GRAVELY ERRED IN AFFIRMING THAT ELISEO QUIAZON WAS A RESIDENT OF
LAS PIÑAS AND THEREFORE, THE PETITION FOR LETTERS OF ADMINISTRATION WAS PROPERLY FILED
WITH THE RTC OF LAS PIÑAS;

II. THE COURT OF APPEALS GRAVELY ERRED IN DECLARING THAT AMELIA GARCIA-QUIAZON WAS NOT
LEGALLY MARRIED TO ELISEO QUIAZON DUE TO PREEXISTING MARRIAGE; AND

III. THE COURT OF APPEALS OVERLOOKED THE FACT THAT ELISE QUIAZON HAS NOT SHOWN ANY
12
INTEREST IN THE PETITION FOR LETTERS OF ADMINISTRATION.

The Court’s Ruling

We find the petition bereft of merit.

Under Section 1, Rule 73 of the Rules of Court, the petition for letters of administration of the estate of a decedent
should be filed in the RTC of the province where the decedent resides at the time of his death:

Sec. 1. Where estate of deceased persons settled. – If the decedent is an inhabitant of the Philippines at the time of
his death, whether a citizen or an alien, his will shall be proved, or letters of administration granted, and his estate
settled, in the Court of First Instance now Regional Trial Court in the province in which he resides at the time of his
death, and if he is an inhabitant of a foreign country, the Court of First Instance now Regional Trial Court of any
province in which he had estate. The court first taking cognizance of the settlement of the estate of a decedent, shall
exercise jurisdiction to the exclusion of all other courts. The jurisdiction assumed by a court, so far as it depends on
the place of residence of the decedent, or of the location of his estate, shall not be contested in a suit or proceeding,
except in an appeal from that court, in the original case, or when the want of jurisdiction appears on the record.
(Emphasis supplied).

The term "resides" connotes ex vi termini "actual residence" as distinguished from "legal residence or domicile." This
term "resides," like the terms "residing" and "residence," is elastic and should be interpreted in the light of the object
or purpose of the statute or rule in which it is employed. In the application of venue statutes and rules – Section 1,
Rule 73 of the Revised Rules of Court is of such nature – residence rather than domicile is the significant
13
factor. Even where the statute uses word "domicile" still it is construed as meaning residence and not domicile in the
14
technical sense. Some cases make a distinction between the terms "residence" and "domicile" but as generally
15
used in statutes fixing venue, the terms are synonymous, and convey the same meaning as the term "inhabitant." In
other words, "resides" should be viewed or understood in its popular sense, meaning, the personal, actual or physical
16
habitation of a person, actual residence or place of abode. It signifies physical presence in a place and actual stay
17 18
thereat. Venue for ordinary civil actions and that for special proceedings have one and the same meaning. As thus
defined, "residence," in the context of venue provisions, means nothing more than a person’s actual residence or
19
place of abode, provided he resides therein with continuity and consistency.

Viewed in light of the foregoing principles, the Court of Appeals cannot be faulted for affirming the ruling of the RTC
that the venue for the settlement of the estate of Eliseo was properly laid in Las Piñas City. It is evident from the
records that during his lifetime, Eliseo resided at No. 26 Everlasting Road, Phase 5, Pilar Village, Las Piñas City. For
this reason, the venue for the settlement of his estate may be laid in the said city.

In opposing the issuance of letters of administration, the petitioners harp on the entry in Eliseo’s Death Certificate that
he is a resident of Capas, Tarlac where they insist his estate should be settled. While the recitals in death certificates
can be considered proofs of a decedent’s residence at the time of his death, the contents thereof, however, is not
binding on the courts. Both the RTC and the Court of Appeals found that Eliseo had been living with Lourdes,
deporting themselves as husband and wife, from 1972 up to the time of his death in 1995. This finding is consistent
with the fact that in 1985, Eliseo filed an action for judicial partition of properties against Amelia before the RTC of
20
Quezon City, Branch 106, on the ground that their marriage is void for being bigamous. That Eliseo went to the
extent of taking his marital feud with Amelia before the courts of law renders untenable petitioners’ position that
Eliseo spent the final days of his life in Tarlac with Amelia and her children. It disproves rather than supports
petitioners’ submission that the lower courts’ findings arose from an erroneous appreciation of the evidence on

50
record. Factual findings of the trial court, when affirmed by the appellate court, must be held to be conclusive and
21
binding upon this Court.

Likewise unmeritorious is petitioners’ contention that the Court of Appeals erred in declaring Amelia’s marriage to
Eliseo as void ab initio. In a void marriage, it was though no marriage has taken place, thus, it cannot be the source
of rights. Any interested party may attack the marriage directly or collaterally. A void marriage can be questioned
22
even beyond the lifetime of the parties to the marriage. It must be pointed out that at the time of the celebration of
the marriage of Eliseo and Amelia, the law in effect was the Civil Code, and not the Family Code, making the ruling in
23
Niñal v. Bayadog applicable four-square to the case at hand. In Niñal, the Court, in no uncertain terms, allowed
therein petitioners to file a petition for the declaration of nullity of their father’s marriage to therein respondent after the
death of their father, by contradistinguishing void from voidable marriages, to wit:

Consequently, void marriages can be questioned even after the death of either party but voidable marriages can be
assailed only during the lifetime of the parties and not after death of either, in which case the parties and their
offspring will be left as if the marriage had been perfectly valid. That is why the action or defense for nullity is
imprescriptible, unlike voidable marriages where the action prescribes. Only the parties to a voidable marriage can
24
assail it but any proper interested party may attack a void marriage.

It was emphasized in Niñal that in a void marriage, no marriage has taken place and it cannot be the source of rights,
such that any interested party may attack the marriage directly or collaterally without prescription, which may be filed
25
even beyond the lifetime of the parties to the marriage.

Relevant to the foregoing, there is no doubt that Elise, whose successional rights would be prejudiced by her father’s
marriage to Amelia, may impugn the existence of such marriage even after the death of her father. The said marriage
may be questioned directly by filing an action attacking the validity thereof, or collaterally by raising it as an issue in a
proceeding for the settlement of the estate of the deceased spouse, such as in the case at bar. Ineluctably, Elise, as
26
a compulsory heir, has a cause of action for the declaration of the absolute nullity of the void marriage of Eliseo and
Amelia, and the death of either party to the said marriage does not extinguish such cause of action.

Having established the right of Elise to impugn Eliseo’s marriage to Amelia, we now proceed to determine whether or
not the decedent’s marriage to Amelia is void for being bigamous.

Contrary to the position taken by the petitioners, the existence of a previous marriage between Amelia and Filipito
was sufficiently established by no less than the Certificate of Marriage issued by the Diocese of Tarlac and signed by
the officiating priest of the Parish of San Nicolas de Tolentino in Capas, Tarlac. The said marriage certificate is a
competent evidence of marriage and the certification from the National Archive that no information relative to the said
marriage exists does not diminish the probative value of the entries therein. We take judicial notice of the fact that the
first marriage was celebrated more than 50 years ago, thus, the possibility that a record of marriage can no longer be
found in the National Archive, given the interval of time, is not completely remote. Consequently, in the absence of
any showing that such marriage had been dissolved at the time Amelia and Eliseo’s marriage was solemnized, the
27
inescapable conclusion is that the latter marriage is bigamous and, therefore, void ab initio.

Neither are we inclined to lend credence to the petitioners’ contention that Elise has not shown any interest in the
Petition for Letters of Administration.

Section 6, Rule 78 of the Revised Rules of Court lays down the preferred persons who are entitled to the issuance of
letters of administration, thus:

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.

51
Upon the other hand, Section 2 of Rule 79 provides that a petition for Letters of Administration must be filed by an
interested person, thus:

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.

An "interested party," in estate proceedings, is one who would be benefited in the estate, such as an heir, or one who
has a claim against the estate, such as a creditor. Also, in estate proceedings, the phrase "next of kin" refers to those
28
whose relationship with the decedent Is such that they are entitled to share in the estate as distributees.

In the instant case, Elise, as a compulsory heir who stands to be benefited by the distribution of Eliseo’s estate, is
deemed to be an interested party. With the overwhelming evidence on record produced by Elise to prove her filiation
to Eliseo, the petitioners’ pounding on her lack of interest in the administration of the decedent’s estate, is just a
desperate attempt to sway this Court to reverse the findings of the Court of Appeals. Certainly, the right of Elise to be
appointed administratix of the estate of Eliseo is on good grounds. It is founded on her right as a compulsory heir,
29
who, under the law, is entitled to her legitimate after the debts of the estate are satisfied. Having a vested right in
the distribution of Eliseo’s estate as one of his natural children, Elise can rightfully be considered as an interested
party within the purview of the law.

WHEREFORE, premises considered, the petition is DENIED for lack of merit. Accordingly, the Court of Appeals
assailed 28 November 2008 Decision and 7 August 2009 Resolution, arc AFFIRMED in toto.

SO ORDERED.

52
THIRD DIVISION

G.R. No. 150175 February 5, 2007

ERLINDA PILAPIL and HEIRS OF DONATA ORTIZ BRIONES, namely: ESTELA, ERIBERTO AND VIRGILIO
SANTOS, ANA SANTOS CULTURA, ELVIRA SANTOS INOCENTES, ERNESTO MENDOZA, RIZALINA SANTOS,
ADOLFO MENDOZA and PACITA MENDOZA, Petitioners,
vs.
HEIRS OF MAXIMINO R. BRIONES, namely: SILVERIO S. BRIONES, PETRA BRIONES, BONIFACIO
CABAHUG, JR., ANITA TRASMONTE, CIRILITA FORTUNA, CRESENCIA BRIONES, FUGURACION MEDALLE
and MERCEDES LAGBAS, Respondents.

RESOLUTION

CHICO-NAZARIO, J.:
1
On 10 March 2006, this Court promulgated its Decision in the above-entitled case, ruling in favor of the petitioners.
2
The dispositive portion reads as follows:

IN VIEW OF THE FOREGOING, the assailed Decision of the Court of Appeals in CA-GR CV No. 55194, dated 31
August 2001, affirming the Decision of the Cebu City RTC in Civil Case No. CEB-5794, dated 28 September 1986, is
hereby REVERSED and SET ASIDE; and the Complaint for partition, annulment, and recovery of possession filed by
the heirs of Maximino in Civil Case No. CEB-5794 is hereby DISMISSED.
3
On 10 May 2006, a Motion for Reconsideration of the foregoing Decision was filed by Atty. Celso C. Reales of the
Reales Law Office on behalf of the respondents, heirs of Maximino R. Briones. On 19 May 2006, petitioners Erlinda
Pilapil and the other co-heirs of Donata Ortiz Vda. de Briones, through counsel, filed an Opposition to Respondents’
4 5
Motion for Reconsideration, to which the respondents filed a Rejoinder on 23 May 2006. Thereafter, Atty. Amador F.
Brioso, Jr. of the Canto Brioso Arnedo Law Office entered his appearance as collaborating counsel for the
6 7
respondents. Atty. Brioso then filed on 11 June 2006 and 16 June 2006, respectively, a Reply and Supplemental
8
Reply to the petitioners’ Opposition to respondents’ Motion for Reconsideration. Finally, petitioners filed a
9
Rejoinder to the respondents’ Reply and Supplemental Reply on 5 July 2006.
10
The facts of the case, as recounted in the Decision, are as follows –

Petitioners are the heirs of the late Donata Ortiz-Briones (Donata), consisting of her surviving sister, Rizalina Ortiz-
Aguila (Rizalina); Rizalina’s daughter, Erlinda Pilapil (Erlinda); and the other nephews and nieces of Donata, in
representation of her two other sisters who had also passed away. Respondents, on the other hand, are the heirs of
the late Maximino Briones (Maximino), composed of his nephews and nieces, and grandnephews and grandnieces,
in representation of the deceased siblings of Maximino.

xxxx

Maximino was married to Donata but their union did not produce any children. When Maximino died on 1 May 1952,
Donata instituted intestate proceedings to settle her husband’s estate with the Cebu City Court of First Instance (CFI),
14th Judicial District, designated as Special Proceedings No. 928-R. On 8 July 1952, the CFI issued Letters of
Administration appointing Donata as the administratrix of Maximino’s estate. She submitted an Inventory of
Maximino’s properties, which included, among other things, the following parcels of land x x x.

xxxx

The CFI would subsequently issue an Order, dated 2 October 1952, awarding ownership of the aforementioned real
properties to Donata. On 27 June 1960, Donata had the said CFI Order recorded in the Primary Entry Book of the
Register of Deeds, and by virtue thereof, received new TCTs, covering the said properties, now in her name.

Donata died on 1 November 1977. Erlinda, one of Donata’s nieces, instituted with the RTC a petition for the
administration of the intestate estate of Donata. Erlinda and her husband, Gregorio, were appointed by the RTC as
administrators of Donata’s intestate estate. Controversy arose among Donata’s heirs when Erlinda claimed exclusive
ownership of three parcels of land, covered by TCTs No. 21542, 21545, and 58684, based on two Deeds of
Donation, both dated 15 September 1977, allegedly executed in her favor by her aunt Donata. The other heirs of
Donata opposed Erlinda’s claim. This Court, however, was no longer informed of the subsequent development in the
intestate proceedings of the estate of Donata; and as far as this Petition is concerned, all the heirs of Donata,
including Erlinda, appear to be on the same side.

53
On 21 January 1985, Silverio Briones (Silverio), a nephew of Maximino, filed a Petition with the RTC for Letters of
Administration for the intestate estate of Maximino, which was initially granted by the RTC. The RTC also issued an
Order, dated 5 December 1985, allowing Silverio to collect rentals from Maximino’s properties. But then, Gregorio
filed with the RTC a Motion to Set Aside the Order, dated 5 December 1985, claiming that the said properties were
already under his and his wife’s administration as part of the intestate estate of Donata. Silverio’s Letters of
Administration for the intestate estate of Maximino was subsequently set aside by the RTC.

On 3 March 1987, the heirs of Maximino filed a Complaint with the RTC against the heirs of Donata for the partition,
annulment, and recovery of possession of real property, docketed as Civil Case No. CEB-5794. They later filed an
Amended Complaint, on 11 December 1992. They alleged that Donata, as administratrix of the estate of Maximino,
through fraud and misrepresentation, in breach of trust, and without the knowledge of the other heirs, succeeded in
registering in her name the real properties belonging to the intestate estate of Maximino.

xxxx

After trial in due course, the RTC rendered its Decision, dated 8 April 1986, in favor of the heirs of Maximino x x x.

xxxx

x x x[T]he RTC declared that the heirs of Maximino were entitled to ½ of the real properties covered by TCTs No.
21542, 21543, 21544, 21545, 21546, and 58684. It also ordered Erlinda to reconvey to the heirs of Maximino the said
properties and to render an accounting of the fruits thereof.

The heirs of Donata appealed the RTC Decision, dated 8 April 1986, to the Court of Appeals. The Court of Appeals,
in its Decision, promulgated on 31 August 2001, affirmed the RTC Decision, x x x.

xxxx

Unsatisfied with the afore-quoted Decision of the Court of Appeals, the heirs of Donata filed the present Petition, x x
x.

In its Decision, dated 10 March 2006, this Court found the Petition meritorious and, reversing the Decisions of the
Court of Appeals and the Regional Trial Court (RTC), dismissed the Complaint for partition, annulment, and recovery
of possession of real property filed by the heirs of Maximino in Civil Case No. CEB-5794. This Court summed up its
11
findings, thus –

In summary, the heirs of Maximino failed to prove by clear and convincing evidence that Donata managed, through
fraud, to have the real properties, belonging to the intestate estate of Maximino, registered in her name. In the
absence of fraud, no implied trust was established between Donata and the heirs of Maximino under Article 1456 of
the New Civil Code. Donata was able to register the real properties in her name, not through fraud or mistake, but
pursuant to an Order, dated 2 October 1952, issued by the CFI in Special Proceedings No. 928-R. The CFI Order,
presumed to be fairly and regularly issued, declared Donata as the sole, absolute, and exclusive heir of Maximino;
hence, making Donata the singular owner of the entire estate of Maximino, including the real properties, and not
merely a co-owner with the other heirs of her deceased husband. There being no basis for the Complaint of the heirs
of Maximino in Civil Case No. CEB-5794, the same should have been dismissed.

Respondents move for the reconsideration of the Decision of this Court raising still the arguments that Donata
committed fraud in securing the Court of First Instance Order, dated 2 October 1952, which declared her as the sole
heir of her deceased husband Maximino and authorized her to have Maximino’s properties registered exclusively in
her name; that respondents’ right to succession to the disputed properties was transmitted or vested from the
moment of Maximino’s death and which they could no longer be deprived of; that Donata merely possessed and held
12
the properties in trust for her co-heirs/owners; and that, by virtue of this Court’s ruling in Quion v. Claridad and
13
Sevilla, et al. v. De Los Angeles, respondents’ action to recover title to and possession of their shares in Maximino’s
estate, held in trust for their benefit by Donata, and eventually, by petitioners as the latter’s successors-in-interest, is
imprescriptible. Respondents also advance a fresh contention that the CFI Order, dated 2 October 1952, being based
on the fraudulent misrepresentation of Donata that she was Maximino’s sole heir, was a void order, which produced
no legal effect. Lastly, respondents asseverate that, by relying on certain procedural presumptions in its Decision,
dated 10 March 2006, this Court has sacrificed their substantive right to succession, thus, making justice "subservient
14
to the dictates of mere procedural fiats."

While this Court is persuaded to reexamine and clarify some points in its previous Decision in this case, it does not
find any new evidence or argument that would adequately justify a change in its previous position.

54
On the finding of fraud

As this Court declared in its Decision, the existence of any trust relations between petitioners and respondents shall
be examined in the light of Article 1456 of the New Civil Code, which provides that, "[i]f property is acquired through
mistake or fraud, the person obtaining it is, by force of law, considered a trustee of an implied trust for the benefit of
the person from whom the property comes." Hence, the foremost question to be answered is still whether an implied
trust under Article 1456 of the New Civil Code had been sufficiently established in the present case.

In the Decision, this Court ruled in the negative, since there was insufficient evidence to establish that Donata
committed fraud. It should be remembered that Donata was able to secure certificates of title to the disputed
properties by virtue of the CFI Order in Special Proceedings No. 928-R (the proceedings she instituted to settle
Maximino’s intestate estate), which declared her as Maximino’s sole heir. In the absence of proof to the contrary, the
Court accorded to Special Proceedings No. 928-R the presumptions of regularity and validity. Reproduced below are
15
the relevant portions of the Decision –

At the onset, it should be emphasized that Donata was able to secure the TCTs covering the real properties
belonging to the estate of Maximino by virtue of a CFI Order, dated 2 October 1952. It is undisputed that the said CFI
Order was issued by the CFI in Special Proceedings No. 928-R, instituted by Donata herself, to settle the intestate
estate of Maximino. The petitioners, heirs of Donata, were unable to present a copy of the CFI Order, but this is not
surprising considering that it was issued 35 years prior to the filing by the heirs of Maximino of their Complaint in Civil
Case No. CEB-5794 on 3 March 1987. The existence of such CFI Order, nonetheless, cannot be denied. It was
recorded in the Primary Entry Book of the Register of Deeds on 27 June 1960, at 1:10 p.m., as Entry No. 1714. It was
annotated on the TCTs covering the real properties as having declared Donata the sole, absolute, and exclusive heir
of Maximino. The non-presentation of the actual CFI Order was not fatal to the cause of the heirs of Donata
considering that its authenticity and contents were never questioned. The allegation of fraud by the heirs of Maximino
did not pertain to the CFI Order, but to the manner or procedure by which it was issued in favor of Donata. Moreover,
the non-presentation of the CFI Order, contrary to the declaration by the RTC, does not amount to a willful
suppression of evidence that would give rise to the presumption that it would be adverse to the heirs of Donata if
produced. x x x.

xxxx

The CFI Order, dated 2 October 1952, issued in Special Proceedings No. 928-R, effectively settled the intestate
estate of Maximino by declaring Donata as the sole, absolute, and exclusive heir of her deceased husband. The
issuance by the CFI of the said Order, as well as its conduct of the entire Special Proceedings No. 928-R, enjoy the
presumption of validity pursuant to the Section 3(m) and (n) of Rule 131 of the Revised Rules of Court, reproduced
below –

SEC. 3. Disputable presumptions. – The following presumptions are satisfactory if uncontradicted, but may be
contradicted and overcome by other evidence:

xxxx

(m) That official duty has been regularly performed;

(n) That a court, or judge acting as such, whether in the Philippines or elsewhere, was acting in the lawful exercise of
jurisdiction.

By reason of the foregoing provisions, this Court must presume, in the absence of any clear and convincing proof to
the contrary, that the CFI in Special Proceedings No. 928-R had jurisdiction of the subject matter and the parties, and
to have rendered a judgment valid in every respect; and it could not give credence to the following statements made
by the Court of Appeals in its Decision.

xxxx

There was totally no evidentiary basis for the foregoing pronouncements. First of all, the Petition filed by Donata for
Letters of Administration in Special Proceedings No. 928-R before the CFI was not even referred to nor presented
during the course of the trial of Civil Case No. CEB-5794 before the RTC. How then could the Court of Appeals make
a finding that Donata willfully excluded from the said Petition the names, ages, and residences of the other heirs of
Maximino? Second, there was also no evidence showing that the CFI actually failed to send notices of Special
Proceedings No. 928-R to the heirs of Maximino or that it did not require presentation of proof of service of such
notices. It should be remembered that there stands a presumption that the CFI Judge had regularly performed his
duties in Special Proceedings No. 928-R, which included sending out of notices and requiring the presentation of

55
proof of service of such notices; and, the heirs of Maximino did not propound sufficient evidence to debunk such
presumption. They only made a general denial of knowledge of Special Proceedings No. 928-R, at least until 1985.
There was no testimony or document presented in which the heirs of Maximino categorically denied receipt of notice
from the CFI of the pendency of Special Proceedings No. 928-R. The only evidence on record in reference to the
absence of notice of such proceedings was the testimony of Aurelia Briones (Aurelia), one of the heirs of Maximino, x
x x.

xxxx

Aurelia’s testimony deserves scant credit considering that she was not testifying on matters within her personal
knowledge. The phrase "I don’t think" is a clear indication that she is merely voicing out her opinion on how she
believed her uncles and aunts would have acted had they received notice of Special Proceedings No. 928-R.

It is worth noting that, in its foregoing ratiocination, the Court was proceeding from an evaluation of the evidence on
record, which did not include an actual copy of the CFI Order in Special Proceedings No. 928-R. Respondents only
submitted a certified true copy thereof on 15 June 2006, annexed to their Supplemental Reply to petitioners’
opposition to their motion for reconsideration of this Court’s Decision. Respondents did not offer any explanation as to
why they belatedly produced a copy of the said Order, but merely claimed to have been "fortunate enough to obtain a
16
copy" thereof from the Register of Deeds of Cebu.

Respondents should be taken to task for springing new evidence so late into the proceedings of this case. Parties
should present all their available evidence at the courts below so as to give the opposing party the opportunity to
scrutinize and challenge such evidence during the course of the trial. However, given that the existence of the CFI
Order in Special Proceedings No. 928-R was never in issue and was, in fact, admitted by the petitioners; that the
copy submitted is a certified true copy of the said Order; and that the said Order may provide new information vital to
a just resolution of the present case, this Court is compelled to consider the same as part of the evidence on record.
17
The CFI Order in question reads in full as –

ORDER

This is with reference to the Motion of the Administratrix, dated January 5, 1960, that she be declared the sole heir of
her deceased husband, Maximino Suico Briones, the latter having died without any legitimate ascendant nor
descendant, nor any legitimate brother or sister, nephews or nieces.

At the hearing of this incident today, nobody appeared to resist the motion, and based on the uncontradicted
testimony of Donata G. Ortiz that she was the nearest surviving relative of the deceased Maximino Suico Briones at
the time of the latter’s death, and pursuant to the pertinent provisions of the new Civil Code of the Philippines, the
Court hereby declares the aforesaid Donata G. Ortiz the sole, absolute and exclusive heir of the estate of the
deceased Maximino Suico Briones, and she is hereby entitled to inherit all the residue of this estate after paying all
the obligations thereof, which properties are those contained in the Inventory, dated October 2, 1952.1awphi1.net

Cebu City, January 15, 1960.

From the contents of the afore-quoted Order, this Court is able to deduce that the CFI Order was in fact issued on 15
January 1960 and not 2 October 1952, as earlier stated in the Decision. It was the inventory of properties, submitted
18
by Donata as administratrix of Maximino’s intestate estate, which was dated 2 October 1952. Other than such
observation, this Court finds nothing in the CFI Order which could change its original position in the Decision under
consideration.

While it is true that since the CFI was not informed that Maximino still had surviving siblings and so the court was not
able to order that these siblings be given personal notices of the intestate proceedings, it should be borne in mind
19
that the settlement of estate, whether testate or intestate, is a proceeding in rem, and that the publication in the
newspapers of the filing of the application and of the date set for the hearing of the same, in the manner prescribed
by law, is a notice to the whole world of the existence of the proceedings and of the hearing on the date and time
indicated in the publication. The publication requirement of the notice in newspapers is precisely for the purpose of
informing all interested parties in the estate of the deceased of the existence of the settlement proceedings, most
especially those who were not named as heirs or creditors in the petition, regardless of whether such omission was
voluntarily or involuntarily made.

This Court cannot stress enough that the CFI Order was the result of the intestate proceedings instituted by Donata
before the trial court. As this Court pointed out in its earlier Decision, the manner by which the CFI judge conducted
the proceedings enjoys the presumption of regularity, and encompassed in such presumption is the order of

56
publication of the notice of the intestate proceedings. A review of the records fails to show any allegation or concrete
proof that the CFI also failed to order the publication in newspapers of the notice of the intestate proceedings and to
require proof from Donata of compliance therewith. Neither can this Court find any reason or explanation as to why
Maximino’s siblings could have missed the published notice of the intestate proceedings of their brother.

In relying on the presumptions of the regular performance of official duty and lawful exercise of jurisdiction by the CFI
in rendering the questioned Order, dated 15 January 1960, this Court is not, as counsel for respondents allege,
sacrificing the substantive right of respondents to their share in the inheritance in favor of mere procedural fiats.
There is a rationale for the establishment of rules of procedure, as amply explained by this Court in De Dios v. Court
20
of Appeals –

Procedural rules are designed to insure the orderly and expeditious administration of justice by providing for a
practical system by which the parties to a litigation may be accorded a full and fair opportunity to present their
respective positions and refute each other's submissions under the prescribed requirements, conditions and
limitations. Adjective law is not the counterfoil of substantive law. In fact, there is a symbiotic relationship between
them. By complying faithfully with the Rules of Court, the bench and the bar are better able to discuss, analyze and
understand substantive rights and duties and consequently to more effectively protect and enforce them. The other
alternative is judicial anarchy.

Thus, compliance with the procedural rules is the general rule, and abandonment thereof should only be done in the
most exceptional circumstances. The presumptions relied upon by this Court in the instant case are disputable
presumptions, which are satisfactory, unless contradicted or overcome by evidence. This Court finds that the
evidence presented by respondents failed to overcome the given presumptions.

Although Donata may have alleged before the CFI that she was her husband’s sole heir, it was not established that
she did so knowingly, maliciously and in bad faith, so as for this Court to conclude that she indeed committed fraud.
This Court again brings to the fore the delay by which respondents filed the present case, when the principal actors
involved, particularly, Donata and Maximino’s siblings, have already passed away and their lips forever sealed as to
what truly transpired between them. On the other hand, Special Proceedings No. 928-R took place when all these
principal actors were still alive and each would have been capable to act to protect his or her own right to Maximino’s
estate. Letters of Administration of Maximino’s estate were issued in favor of Donata as early as 8 July 1952, and the
CFI Order in question was issued only on 15 January 1960. The intestate proceedings for the settlement of
Maximino’s estate were thus pending for almost eight years, and it is the burden of the respondents to establish that
their parents or grandparents, Maximino’s surviving siblings, had absolutely no knowledge of the said proceedings all
21
these years. As established in Ramos v. Ramos, the degree of proof to establish fraud in a case where the principal
actors to the transaction have already passed away is proof beyond reasonable doubt, to wit –

"x x x But length of time necessarily obscures all human evidence; and as it thus removes from the parties all
the immediate means to verify the nature of the original transactions, it operates by way of presumption, in
favor of innocence, and against imputation of fraud. It would be unreasonable, after a great length of time, to
require exact proof of all the minute circumstances of any transaction, or to expect a satisfactory explanation of every
difficulty, real or apparent, with which it may be encumbered. The most that can fairly be expected, in such cases, if
the parties are living, from the frailty of memory, and human infirmity, is, that the material facts can be given with
certainty to a common intent; and, if the parties are dead, and the cases rest in confidence, and in parol agreements,
the most that we can hope is to arrive at probable conjectures, and to substitute general presumptions of law, for
exact knowledge. Fraud, or breach of trust, ought not lightly to be imputed to the living; for, the legal
presumption is the other way; as to the dead, who are not here to answer for themselves, it would be the
height of injustice and cruelty, to disturb their ashes, and violate the sanctity of the grave, unless the
evidence of fraud be clear, beyond a reasonable doubt (Prevost vs. Gratz, 6 Wheat. [U.S.], 481, 498).

Moreover, even if Donata’s allegation that she was Maximino’s sole heir does constitute fraud, it is insufficient to
22
justify abandonment of the CFI Order, dated 15 January 1960, considering the nature of intestate proceedings as
being in rem and the disputable presumptions of the regular performance of official duty and lawful exercise of
jurisdiction by the CFI in rendering the questioned Order, dated 15 January 1960, in Special Proceedings No. 928-R.

On prescription of the right to recover based on implied trust

Assuming, for the sake of argument, that Donata’s misrepresentation constitutes fraud that would impose upon her
the implied trust provided in Article 1456 of the Civil Code, this Court still cannot sustain respondents’ contention that
their right to recover their shares in Maximino’s estate is imprescriptible. It is already settled in jurisprudence that an
implied trust, as opposed to an express trust, is subject to prescription and laches.

57
23
The case of Ramos v. Ramos already provides an elucidating discourse on the matter, to wit –

"Trusts are either express or implied. Express trusts are created by the intention of the trustor or of the parties.
Implied trusts come into being by operation of law" (Art. 1441, Civil Code). "No express trusts concerning an
immovable or any interest therein may be proven by oral evidence. An implied trust may be proven by oral evidence"
(Ibid; Arts. 1443 and 1457).

"No particular words are required for the creation of an express trust, it being sufficient that a trust is clearly intended"
(Ibid; Art. 1444; Tuason de Perez vs. Caluag, 96 Phil. 981; Julio vs. Dalandan, L-19012, October 30, 1967, 21 SCRA
543, 546). "Express trusts are those which are created by the direct and positive acts of the parties, by some writing
or deed, or will, or by words either expressly or impliedly evincing an intention to create a trust" (89 C.J. S. 122).

"Implied trusts are those which, without being expressed, are deducible from the nature of the transaction as matters
of intent, or which are superinduced on the transaction by operation of law as matters of equity, independently of the
particular intention of the parties" (89 C.J.S. 724). They are ordinarily subdivided into resulting and constructive trusts
(89 C.J.S. 722).

"A resulting trust is broadly defined as a trust which is raised or created by the act or construction of law, but in its
more restricted sense it is a trust raised by implication of law and presumed always to have been contemplated by
the parties, the intention as to which is to be found in the nature of their transaction, but not expressed in the deed or
instrument of conveyance" (89 C.J.S. 725). Examples of resulting trusts are found in Article 1448 to 1455 of the Civil
Code. See Padilla vs. Court of Appeals, L-31569, September 28, 1973, 53 SCRA 168, 179).

On the other hand, a constructive trust is a trust "raised by construction of law, or arising by operation of law." In a
more restricted sense and as contradistinguished from a resulting trust, a constructive trust is "a trust not created by
any words, either expressly or impliedly evincing a direct intention to create a trust, but by the construction of equity in
order to satisfy the demands of justice. It does not arise by agreement or intention but by operation of law." (89 C.J.S.
726-727). "If a person obtains legal title to property by fraud or concealment, courts of equity will impress upon the
title a so-called constructive trust in favor of the defrauded party." A constructive trust is not a trust in the technical
sense (Gayondato vs. Treasurer of the P.I., 49 Phil. 244; See Art. 1456, Civil Code).

There is a rule that a trustee cannot acquire by prescription the ownership of property entrusted to him (Palma vs.
Cristobal, 77 Phil. 712), or that an action to compel a trustee to convey property registered in his name in trust for the
benefit of the cestui qui trust does not prescribe (Manalang vs. Canlas, 94 Phil. 776; Cristobal vs. Gomez, 50 Phil.
810), or that the defense of prescription cannot be set up in an action to recover property held by a person in trust for
the benefit of another (Sevilla vs. De los Angeles, 97 Phil. 875), or that property held in trust can be recovered by the
beneficiary regardless of the lapse of time (Marabilles vs. Quito, 100 Phil. 64; Bancairen vs. Diones, 98 Phil. 122,
126; Juan vs. Zuñiga, 62 O.G. 1351; 4 SCRA 1221; Jacinto vs. Jacinto, L-17957, May 31, 1962. See Tamayo vs.
Callejo, 147 Phil. 31, 37).

That rule applies squarely to express trusts. The basis of the rule is that the possession of a trustee is not adverse.
Not being adverse, he does not acquire by prescription the property held in trust. Thus, Section 38 of Act 190
provides that the law of prescription does not apply "in the case of a continuing and subsisting trust" (Diaz vs.
Gorricho and Aguado, 103 Phil. 261, 266; Laguna vs. Levantino, 71 Phil. 566; Sumira vs. Vistan, 74 Phil. 138; Golfeo
vs. Court of Appeals, 63 O.G. 4895, 12 SCRA 199; Caladiao vs. Santos, 63 O.G. 1956, 10 SCRA 691).

The rule of imprescriptibility of the action to recover property held in trust may possibly apply to resulting trusts as
long as the trustee has not repudiated the trust (Heirs of Candelaria vs. Romero, 109 Phil. 500, 502-3; Martinez vs.
Graño, 42 Phil. 35; Buencamino vs. Matias, 63 O. G. 11033, 16 SCRA 849).

The rule of imprescriptibility was misapplied to constructive trusts (Geronimo and Isidoro vs. Nava and Aquino, 105
Phil. 145, 153. Compare with Cuison vs. Fernandez and Bengzon, 105 Phil. 135, 139; De Pasion vs. De Pasion, 112
Phil. 403, 407).

Acquisitive prescription may bar the action of the beneficiary against the trustee in an express trust for the recovery of
the property held in trust where (a) the trustee has performed unequivocal acts of repudiation amounting to an ouster
of the cestui qui trust; (b) such positive acts of repudiation have been made known to the cestui qui trust and (c) the
evidence thereon is clear and conclusive (Laguna vs. Levantino, supra; Salinas vs. Tuason, 55 Phil. 729. Compare
with the rule regarding co-owners found in the last paragraph of Article 494, Civil Code; Casañas vs. Rosello, 50 Phil.
97; Gerona vs. De Guzman, L-19060, May 29, 1964, 11 SCRA 153, 157).

58
With respect to constructive trusts, the rule is different. The prescriptibility of an action for reconveyance based on
constructive trust is now settled (Alzona vs. Capunitan, L-10228, February 28, 1962, 4 SCRA 450; Gerona vs. De
Guzman, supra; Claridad vs. Henares, 97 Phil. 973; Gonzales vs. Jimenez, L-19073, January 30, 1965, 13 SCRA 80;
Boñaga vs. Soler, 112 Phil. 651; J. M. Tuason & Co., vs. Magdangal, L-15539, January 30, 1962, 4 SCRA
84). Prescription may supervene in an implied trust (Bueno vs. Reyes, L-22587, April 28, 1969, 27 SCRA 1179;
Fabian vs. Fabian, L-20449, January 29, 1968; Jacinto vs. Jacinto, L-17957, May 31, 1962, 5 SCRA 371).

And whether the trust is resulting or constructive, its enforcement may be barred by laches (90 C.J.S. 887-889; 54
Am Jur. 449-450; Diaz vs. Gorricho and Aguado, supra; Compare with Mejia vs. Gampona, 100 Phil. 277).
[Emphases supplied.]
24 25
A present reading of the Quion and Sevilla cases, invoked by respondents, must be made in conjunction with and
guided accordingly by the principles established in the afore-quoted case. Thus, while respondents’ right to
inheritance was transferred or vested upon them at the time of Maximino’s death, their enforcement of said right by
appropriate legal action may be barred by the prescription of the action.

Prescription of the action for reconveyance of the disputed properties based on implied trust is governed by Article
1144 of the New Civil Code, which reads –

ART. 1144. The following actions must be brought within ten years from the time the right of action accrues:

(1) Upon a written contract;

(2) Upon an obligation created by law;

(3) Upon a judgment.

Since an implied trust is an obligation created by law (specifically, in this case, by Article 1456 of the New Civil Code),
then respondents had 10 years within which to bring an action for reconveyance of their shares in Maximino’s
properties. The next question now is when should the ten-year prescriptive period be reckoned from. The general rule
is that an action for reconveyance of real property based on implied trust prescribes ten years from registration and/or
26
issuance of the title to the property, not only because registration under the Torrens system is a constructive notice
27
of title, but also because by registering the disputed properties exclusively in her name, Donata had already
unequivocally repudiated any other claim to the same.

By virtue of the CFI Order, dated 15 January 1960, in Special Proceedings No. 928-R, Donata was able to register
and secure certificates of title over the disputed properties in her name on 27 June 1960. The respondents filed with
the RTC their Complaint for partition, annulment, and recovery of possession of the disputed real properties,
docketed as Civil Case No. CEB-5794, only on 3 March 1987, almost 27 years after the registration of the said
properties in the name of Donata. Therefore, respondents’ action for recovery of possession of the disputed
properties had clearly prescribed.

Moreover, even though respondents’ Complaint before the RTC in Civil Case No. CEB-5794 also prays for partition of
the disputed properties, it does not make their action to enforce their right to the said properties imprescriptible. While
as a general rule, the action for partition among co-owners does not prescribe so long as the co-ownership is
expressly or impliedly recognized, as provided for in Article 494, of the New Civil Code, it bears to emphasize that
28
Donata had never recognized respondents as co-owners or co-heirs, either expressly or impliedly. Her assertion
before the CFI in Special Proceedings No. 928-R that she was Maximino’s sole heir necessarily excludes recognition
of some other co-owner or co-heir to the inherited properties; Consequently, the rule on non-prescription of action for
partition of property owned in common does not apply to the case at bar.

On laches as bar to recovery

Other than prescription of action, respondents’ right to recover possession of the disputed properties, based on
implied trust, is also barred by laches. The defense of laches, which is a question of inequity in permitting a claim to
be enforced, applies independently of prescription, which is a question of time. Prescription is statutory; laches is
29
equitable.

Laches is defined as the failure to assert a right for an unreasonable and unexplained length of time, warranting a
presumption that the party entitled to assert it has either abandoned or declined to assert it. This equitable defense is
30
based upon grounds of public policy, which requires the discouragement of stale claims for the peace of society.

59
This Court has already thoroughly discussed in its Decision the basis for barring respondents’ action for recovery of
31
the disputed properties because of laches. This Court pointed out therein that –

In further support of their contention of fraud by Donata, the heirs of Maximino even emphasized that Donata lived
along the same street as some of the siblings of Maximino and, yet, she failed to inform them of the CFI Order, dated
[15 January 1960], in Special Proceedings No. 928-R, and the issuance in her name of new TCTs covering the real
properties which belonged to the estate of Maximino. This Court, however, appreciates such information differently. It
actually works against the heirs of Maximino. Since they only lived nearby, Maximino’s siblings had ample opportunity
to inquire or discuss with Donata the status of the estate of their deceased brother. Some of the real properties, which
belonged to the estate of Maximino, were also located within the same area as their residences in Cebu City, and
Maximino’s siblings could have regularly observed the actions and behavior of Donata with regard to the said real
properties. It is uncontested that from the time of Maximino’s death on 1 May 1952, Donata had possession of the
real properties. She managed the real properties and even collected rental fees on some of them until her own death
on 1 November 1977. After Donata’s death, Erlinda took possession of the real properties, and continued to manage
the same and collect the rental fees thereon. Donata and, subsequently, Erlinda, were so obviously exercising rights
of ownership over the real properties, in exclusion of all others, which must have already put the heirs of Maximino on
guard if they truly believed that they still had rights thereto.

The heirs of Maximino knew he died on 1 May 1952. They even attended his wake. They did not offer any
explanation as to why they had waited 33 years from Maximino’s death before one of them, Silverio, filed a Petition
for Letters of Administration for the intestate estate of Maximino on 21 January 1985. After learning that the intestate
estate of Maximino was already settled in Special Proceedings No. 928-R, they waited another two years, before
instituting, on 3 March 1987, Civil Case No. CEB-5794, the Complaint for partition, annulment and recovery of the
real property belonging to the estate of Maximino. x x x

Considering the circumstances in the afore-quoted paragraphs, as well as respondents’ conduct before this Court,
particularly the belated submission of evidence and argument of new issues, respondents are consistently displaying
a penchant for delayed action, without any proffered reason or justification for such delay.

It is well established that the law serves those who are vigilant and diligent and not those who sleep when the law
requires them to act. The law does not encourage laches, indifference, negligence or ignorance. On the contrary, for
a party to deserve the considerations of the courts, he must show that he is not guilty of any of the aforesaid
32
failings.

On void judgment or order

Respondents presented only in their Reply and Supplemental Reply to the petitioners’ Opposition to their Motion for
Reconsideration the argument that the CFI Order, dated 15 January 1960, in Special Proceedings No. 928-R is void
and, thus, it cannot have any legal effect. Consequently, the registration of the disputed properties in the name of
Donata pursuant to such Order was likewise void.

This Court is unconvinced.


33
In the jurisprudence referred to by the respondents, an order or judgment is considered void when rendered by the
court without or in excess of its jurisdiction or in violation of a mandatory duty, circumstances which are not present in
the case at bar.

Distinction must be made between a void judgment and a voidable one, thus –

"* * * A voidable judgment is one which, though not a mere nullity, is liable to be made void when a person who has a
right to proceed in the matter takes the proper steps to have its invalidity declared. It always contains some defect
which may become fatal. It carries within it the means of its own overthrow. But unless and until it is duly annulled, it
is attended with all the ordinary consequences of a legal judgment. The party against whom it is given may escape its
effect as a bar or an obligation, but only by a proper application to have it vacated or reversed. Until that is done, it
will be efficacious as a claim, an estoppel, or a source of title. If no proceedings are ever taken against it, it will
continue throughout its life to all intents a valid sentence. If emanating from a court of general jurisdiction, it will be
sustained by the ordinary presumptions of regularity, and it is not open to impeachment in any collateral action. * * *"

But it is otherwise when the judgment is void. "A void judgment is in legal effect no judgment. By it no rights are
divested. From it no rights can be obtained. Being worthless in itself, all proceedings founded upon it are equally
worthless. It neither binds nor bars any one. All acts performed under it and all claims flowing out of it are void. The
parties attempting to enforce it may be responsible as trespassers. The purchaser at a sale by virtue of its authority

60
finds himself without title and without redress." (Freeman on Judgments, sec. 117, citing Campbell vs. McCahan, 41
Ill., 45; Roberts vs. Stowers, 7 Bush, 295, Huls vs. Buntin, 47 Ill., 396; Sherrell vs. Goodrum, 3 Humph., 418;
Andrews vs. State, 2 Sneed, 549; Hollingsworth vs. Bagley, 35 Tex., 345; Morton vs. Root, 2 Dill., 312; Commercial
Bank of Manchester vs. Martin, 9 Smedes & M., 613; Hargis vs. Morse, 7 Kan., 259. See also Cornell vs. Barnes, 7
Hill, 35; Dawson and Another vs. Wells, 3 Ind., 399; Meyer vs. Mintonye, 106 Ill., 414; Olson vs. Nunnally, 47 Kan.,
391; White vs. Foote L. & M. Co., 29 W. Va., 385.)

It is not always easy to draw the line of demarcation between a void judgment and a voidable one, but all authorities
agree that jurisdiction over the subject-matter is essential to the validity of a judgment and that want of such
jurisdiction renders it void and a mere nullity. In the eye of the law it is non-existent. (Fisher vs. Harnden, 1 Paine, 55;
Towns vs. Springer, 9 Ga., 130; Mobley vs. Mobley, 9 Ga., 247; Beverly and McBride vs. Burke, 9 Ga., 440; Central
Bank of Georgia vs. Gibson, 11 Ga., 453; Johnson vs. Johnson, 30 Ill., 215; St. Louis and Sandoval Coal and Mining
Co. vs. Sandoval Coal and Mining Co., 111 Ill., 32; Swiggart vs. Harber, 4 Scam., 364; Miller vs. Snyder, 6 Ind., 1;
34
Seely vs. Reid, 3 Greene [Iowa], 374.)

The fraud and misrepresentation fostered by Donata on the CFI in Special Proceedings No. 928-R did not deprive the
trial court of jurisdiction over the subject-matter of the case, namely, the intestate estate of Maximino. Donata’s fraud
and misrepresentation may have rendered the CFI Order, dated 15 January 1960, voidable, but not void on its face.
Hence, the said Order, which already became final and executory, can only be set aside by direct action to annul and
enjoin its enforcement.35 It cannot be the subject of a collateral attack as is being done in this case. Note that
respondents’ Complaint before the RTC in Civil Case No. CEB-5794 was one for partition, annulment, and recovery
of possession of the disputed properties. The annulment sought in the Complaint was not that of the CFI Order, dated
15 January 1960, but of the certificates of title over the properties issued in Donata’s name. So until and unless
respondents bring a direct action to nullify the CFI Order, dated 15 January 1960, in Special Proceedings No. 928-R,
and attain a favorable judgment therein, the assailed Order remains valid and binding.

Nonetheless, this Court also points out that an action to annul an order or judgment based on fraud must be brought
within four years from the discovery of the fraud.36 If it is conceded that the respondents came to know of Donata’s
fraudulent acts only in 1985, during the course of the RTC proceedings which they instituted for the settlement of
Maximino’s estate, then their right to file an action to annul the CFI Order, dated 15 January 1960, in Special
Proceedings No. 928-R (earlier instituted by Donata for the settlement of Maximino’s estate), has likewise prescribed
by present time.

In view of the foregoing, the Motion for Reconsideration is DENIED.

SO ORDERED.

61
EN BANC

A.M. No. P-01-1448 June 25, 2013


(Formerly OCA IPI No. 99-664-P)

RODOLFO C. SABIDONG, Complainant,


vs.
NICOLASITO S. SOLAS (Clerk of Court IV), Respondent.

DECISION

VILLARAMA, JR., J.:


1
The present administrative case stemmed from a sworn letter-complaint dated May 29, 1999 filed before this Court
by Rodolfo C. Sabidong (complainant) charging respondent Nicolasito S. Solas, Clerk of Court IV, Municipal Trial
Court in Cities (MTCC), Iloilo City with grave and serious misconduct, dishonesty, oppression and abuse of authority.

The Facts

Trinidad Sabidong, complainant’s mother, is one of the longtime occupants of a parcel of land, designated as Lot 11
(Lot 1280-D-4-11 of consolidation-subdivision plan [LRC] Pcs-483) originally registered in the name of C. N. Hodges
2
and situated at Barangay San Vicente, Jaro, Iloilo City. The Sabidongs are in possession of one-half portion of Lot
11 of the said Estate (Hodges Estate), as the other half-portion was occupied by Priscila Saplagio. Lot 11 was the
subject of an ejectment suit filed by the Hodges Estate, docketed as Civil Case No. 14706 of the MTCC Iloilo City,
Branch 4 ("Rosita R. Natividad in her capacity as Administratrix of C.N. Hodges Estate, plaintiff vs. Priscila Saplagio,
defendant"). On May 31, 1983, a decision was rendered in said case ordering the defendant to immediately vacate
3
the portion of Lot 11 leased to her and to pay the plaintiff rentals due, attorney’s fees, expenses and costs. At the
time, respondent was the Clerk of Court III of MTCC, Branch 3, Iloilo City.

Sometime in October 1984, respondent submitted an Offer to Purchase on installment Lots 11 and 12. In a letter
dated January 7, 1986, the Administratrix of the Hodges Estate rejected respondent’s offer in view of an application to
purchase already filed by the actual occupant of Lot 12, "in line with the policy of the Probate Court to give priority to
the actual occupants in awarding approval of Offers". While the check for initial down payment tendered by
respondent was returned to him, he was nevertheless informed that he may file an offer to purchase Lot 11 and that if
he could put up a sufficient down payment, the Estate could immediately endorse it for approval of the Probate Court
4
so that the property can be awarded to him "should the occupant fail to avail of the priority given to them."

The following day, January 8, 1986, respondent again submitted an Offer to Purchase Lot 11 with an area of 234
square meters for the amount of ₱35,100. Under the Order dated November 18, 1986 issued by the probate court
(Regional Trial Court of Iloilo, Branch 27) in Special Proceedings No. 1672 ("Testate Estate of the Late Charles
Newton Hodges, Rosita R. Natividad, Administratrix"), respondent’s Offer to Purchase Lot 11 was approved upon the
court’s observation that the occupants of the subject lots "have not manifested their desire to purchase the lots they
are occupying up to this date and considering time restraint and considering further, that the sales in favor of the x x x
offerors are most beneficial to the estate x x x". On January 21, 1987, the probate court issued another Order
granting respondent’s motion for issuance of a writ of possession in his favor. The writ of possession over Lot 11 was
5
eventually issued on June 27, 1989.

On November 21, 1994, a Deed of Sale With Mortgage covering Lot 11 was executed between respondent and the
Hodges Estate represented by its Administratrix, Mrs. Ruth R. Diocares. Lot 11 was thereby conveyed to respondent
on installment for the total purchase price of ₱50,000.

Consequently, Transfer Certificate of Title (TCT) No. T-11836 in the name of C. N. Hodges was cancelled and a new
certificate of title, TCT No. T-107519 in the name of respondent was issued on December 5, 1994. Lot 11 was later
subdivided into two lots, Lots 11-A and 11-B for which the corresponding titles (TCT Nos. T-116467 and T-116468),
6
also in the name of respondent, were issued on February 28, 1997.

On motion of Ernesto Pe Benito, Administrator of the Hodges Estate, a writ of demolition was issued on March 3,
7
1998 by the probate court in favor of respondent and against all adverse occupants of Lot 11.

62
On June 14, 1999, this Court received the sworn letter-complaint asserting that as court employee respondent cannot
buy property in litigation (consequently he is not a buyer in good faith), commit deception, dishonesty, oppression and
grave abuse of authority. Complainant specifically alleged the following:

3. Complainant and his siblings, are possessors and occupants of a parcel of land situated at Brgy. San Vicente,
Jaro, Iloilo City, then identified as Lot No. 1280-D-4-11, later consolidated and subdivided and became known as Lot
11, then registered and titled in the name of Charles Newton Hodges. The Sabidong family started occupying this lot
in 1948 and paid their monthly rentals until sometime in 1979 when the Estate of Hodges stopped accepting rentals. x
xx

4. Upon knowing sometime in 1987 that the property over which their house is standing, was being offered for sale by
the Estate, the mother of complainant, TRINIDAD CLAVERIO SABIDONG (now deceased), took interest in buying
said property, Lot 11;

5. TRINIDAD CLAVERIO SABIDONG, was then an ordinary housekeeper and a laundrywoman, who never received
any formal education, and did not even know how to read and write. When Trinidad Claverio Sabidong, together with
her children and the complainant in this case, tried to negotiate with the Estate for the sale of the subject property,
they were informed that all papers for transaction must pass through the respondent in this case, Nicolasito Solas.
This is unusual, so they made inquiries and they learned that, Nicolasito Solas was then the Clerk of Court 111,
Branch 3, Municipal Trial Court in Cities, Iloilo City and presently, the City Sheriff of Iloilo City;

6. The respondent Nicolasito Solas, then Clerk of Court III, MTCC, Iloilo City, has knowledge, by reason of his
position that in 1983 Hodges Estate was ejecting occupants of its land. x x x Taking advantage of this inside
information that the land subject of an ejectment case in the Municipal Trial Court in Cities, Iloilo City, whom
respondent is a Clerk of Court III, the respondent surreptitiously offered to buy the said lot in litigation. x x x

7. Complainant nor any member of his family did not know that as early as 1984, the respondent had offered to
purchase the subject lot from the estate x x x. After receiving the notice of denial of his offer to purchase, dated
January 7, 1986, respondent made a second offer to purchase the subject property the following day, January 8,
1986, knowing fully well that the subject property was being occupied. x x x

8. Because of this denial, respondent met with the family of the complainant and negotiated for the sale of the
property and transfer of the title in favor of the latter. Respondent made the complainant and his family believed that
he is the representative of the estate and that he needed a downpayment right away. All the while, the Sabidong
family (who were carpenters, laundrywomen, a janitor, persons who belong to the underprivileged) relied on the
representations of the respondent that he was authorized to facilitate the sale, with more reason that respondent
represented himself as the City Sheriff;

9. That between 1992-1993, a sister of the complainant who was fortunate to have worked abroad, sent the amount
of Ten Thousand (₱10,000.00) Pesos to complainant’s mother, to be given to respondent Nicolasito Solas. x x x After
receiving the money, respondent assured the Sabidong family that they will not be ejected from the lot, he being the
City Sheriff will take care of everything, and taking advantage of the illiteracy of Trinidad Claverio Sabidong, he did
not issue any receipt;

10. True enough, they were not ejected instead it took the respondent some time to see them again and demanded
additional payment. In the meanwhile, the complainant waited for the papers of the supposed sale and transfer of
title, which respondent had promised after receiving the downpayment of ₱10,000.00;

11. That sometime again in 1995, respondent again received from the mother of complainant the amount of Two
Thousand (₱2,000.00) Pesos, allegedly for the expenses of the documentation of sale and transfer of title, and again
respondent promised that the Sabidong family will not be ejected;

12. To the prejudice and surprise of the complainant and his family, respondent was able to secure an order for the
approval of his offer to purchase x x x in Special Proceedings No. 1672 x x x;

13. Worse, respondent moved for the issuance of a Writ of Possession in his favor, which the probate court acted
favorably x x x. A writ of possession was issued on June 27, 1989 x x x;

14. x x x respondent took advantage of the trust and confidence which the Sabidong family has shown, considering
that respondent was an officer of the court and a City Sheriff at that. The complainant and his family thought that

63
respondent, being a City Sheriff, could help them in the transfer of the title in their favor. Never had they ever
imagined that while respondent had been receiving from them hard-earned monies purportedly for the sale of the
subject property, respondent was also exercising acts of ownership adverse to the interest of the complainant and his
family;

15. Being an officer of the court and supposed to be an embodiment of fairness and justice, respondent acted with
malice, with grave abuse of confidence and deceit when he represented that he can facilitate the sale and titling of
the subject property in favor of the complainant and his family;

16. That when several thousands of pesos were given to the respondent as payment for the same and incidental
expenses relative thereto, he was able to cause the transfer of the title in his favor. x x x;

17. After the death of Trinidad Claverio Sabidong x x x the respondent received from the complainant the amount of
Five Thousand (₱5,000.00) Pesos x x x When a receipt was demanded, respondent refused to issue one, and
instead promised and assured the complainant that they will not be ejected;

xxxx

19. The complainant again, through his sister-in-law, Socorro Sabidong, delivered and gave to the respondent the
amount of Three Thousand (₱3,000.00) Pesos as expenses for the subdivision of the subject lot. The respondent
facilitated the subdivision and after the same was approved, the complainant did not know that two (2) titles were
issued in the name of the respondent. x x x;

20. Meanwhile, respondent prepared a Contract to Sell, for the complainant and his neighbor Norberto Saplagio to
affix their signatures, pursuant to their previous agreement for the buyers to avail of a housing loan with the Home
Development Mutual Fund (PAG-IBIG). Complainant attended the seminar of the HDMF for seven (7) times, in his
desire to consummate the sale. However, when the complainant affixed his signature in the contract, he was
surprised that the owner of the subject property was the respondent. When complainant raised a question about this,
respondent assured complainant that everything was alright and that sooner complainant will be the owner of the
property. Complainant and his family, all these years, had believed and continued to believe that the owner was the
estate of Hodges and that respondent was only the representative of the estate;

21. The Contract to Sell, appeared to have been notarized on June 3, 1996, however, no copy thereof was given to
the complainant by the respondent. Respondent then, took the papers and documents required by the HDMF to be
completed, from the complainant allegedly for the purpose of personally filing the same with the HDMF. Complainant
freely and voluntarily delivered all pertinent documents to the respondent, thinking that respondent was helping in the
fast and easy release of the loan. While the said documents were in the possession of the respondent, he never
made any transaction with the HDMF, worse, when complainant tried to secure a copy of the Contract to Sell, the
copy given was not signed by the Notary Public, x x x;

22. The complainant [was] shocked to learn that respondent had canceled the sale and that respondent refused to
return the documents required by the HDMF. Respondent claimed that as Sheriff, he can cause the demolition of the
house of the complainant and of his family. Respondent threatened the complainant and he is capable of pursuing a
demolition order and serve the same with the assistance of the military. x x x;

23. After learning of the demolition order, complainant attempted to settle the matter with the respondent, however,
the same proved futile as respondent boasted that the property would now cost at Four Thousand Five Hundred
(₱4,500.00) Pesos;

24. The threats of demolition is imminent. Clearly, complainant and his family were duped by the respondent and are
helpless victims of an officer of the court who took advantage of their good faith and trust. Complainant later was
informed that the subject property was awarded to the respondent as his Sheriff’s Fees, considering that respondent
executed the decisions in ejectment cases filed by the Hodges estate against the adverse occupants of its vast
properties;

25. A civil case for the Annulment of Title of the respondent over the subject property is pending before the Regional
Trial Court of Iloilo, Branch 37 and a criminal complaint for Estafa is also pending preliminary investigation before the
Office of the City Prosecutor of Iloilo City, known as I.S. No. 1559-99, both filed [by] the complainant against the
8
respondent.

64
9
Acting on the complaint, Court Administrator Alfredo L. Benipayo issued a 1st Indorsement dated July 8, 1999,
requiring respondent to file his comment on the Complaint dated May 29, 1999. On October 21, 1999, respondent
10
submitted his Comment.
11
In a Resolution dated July 19, 1999, Public Prosecutor Constantino C. Tubilleja dismissed the Estafa charge
against respondent for insufficiency of evidence.
12
On November 29, 2000, Court Administrator Benipayo issued an Evaluation and Recommendation finding
13
respondent guilty of violating Article 1491 of the Civil Code. Said rule prohibits the purchase by certain court officers
of property and rights in litigation within their jurisdiction. Court Administrator Benipayo recommended that:

1. this administrative complaint be treated as an administrative matter;

2. respondent Nicolasito S. Solas, Clerk of Court IV, OCC, MTCC, Iloilo City be SUSPENDED for six (6) months, with
warning that a repetition of the same offense in the future will be dealt with more severely;

3. inasmuch as there are factual issues regarding the delivery of substantial amounts which complainant alleged and
which defendant denied, this issue should be investigated and the Executive Judge of the Regional Trial Court of
Iloilo City should be designated to hear the evidence and to make a report and recommendation within sixty (60) days
14
from receipt.
15
In a Resolution dated January 22, 2001, this Court adopted the recommendation of the Court Administrator to treat
the present administrative action as a regular administrative matter and to designate the Executive Judge of the RTC
of Iloilo City to hear the evidence of the parties.

The Court, however, noted without action the Court Administrator’s recommendation to suspend respondent for six
months.

On March 13, 2001, Acting Court Administrator Zenaida N. Elepaño forwarded the records of this case to Executive
16 17
Judge Tito G. Gustilo of the Iloilo City RTC. In a Resolution dated July 18, 2001, the Court referred this case to
the Executive Judge of the RTC of Iloilo City for investigation, report and recommendation within 60 days from notice.
18
By Order dated August 30, 2001, Executive Judge Gustilo set the case for reception of evidence.

On March 19, 2004, the RTC of Iloilo, Branch 37, dismissed the case for annulment of title, damages and injunction
19
against respondent for lack of merit.
20
In a Resolution dated June 15, 2005, the Court resolved to reassign the instant administrative case to Executive
21
Judge Rene S. Hortillo for investigation, report and recommendation within 60 days from notice. In a Letter dated
September 15, 2005, Executive Judge Hortillo informed the Court that per the records, the parties have presented
their testimonial and documentary evidence before retired Executive Judge Tito G. Gustilo.

On September 12, 2005, Executive Judge Hortillo required the parties to file their respective memoranda within 60
22
days from notice, upon submission of which the case shall be deemed submitted for resolution.
23
In his Memorandum, respondent maintained that his purchase of the subject land is not covered by the prohibition
in paragraph 5, Article 1491 of the Civil Code. He pointed out that he bought Lot 11-A a decade after the MTCC of
Iloilo, Branch 3, had ordered the ejectment of Priscila Saplagio and Trinidad Sabidong from the subject lot. He
insisted that public trust was observed when complainant was accorded his right of first refusal in the purchase of Lot
11-A, albeit the latter failed to avail said right. Asserting that he is a buyer in good faith and for value, respondent
cited the dismissal of the cases for Estafa and annulment of title and damages which complainant filed against him.

On September 10, 2007, respondent compulsorily retired from service. Prior to this, he wrote then Senior Deputy
Court Administrator Zenaida N. Elepaño, requesting for the release of his retirement benefits pending resolution of
24 25
the administrative cases against him. In a Memorandum dated September 24, 2007, Senior Deputy Court
Administrator Elepaño made the following recommendations:

a) The request of Nicolasito S. Solas, former Clerk of Court, MTCC, Iloilo City for partial release of his retirement
benefits be GRANTED; and

65
b) Atty. Lilian Barribal Co, Chief, Financial Management Office, Office of the Court Administrator be DIRECTED to (1)
WITHHOLD the amount of Two Hundred Thousand Pesos (₱200,000.00) from the retirement benefits of Nicolasito S.
Solas to answer for any administrative liability that the Court may find against him in A.M. No. P-01-1448 (Formerly
Administrative Matter OCA IPI No. 99-664-P); OCA IPI No. 99-659-P; OCA IPI No. 99-670-P; and OCA IPI No. 99-
26
753-P; and (2) RELEASE the balance of his retirement benefits.

Eventually, the case was assigned to Judge Roger B. Patricio, the new Executive Judge of the Iloilo City RTC for
investigation, report and recommendation.
27
On June 2, 2008, Judge Patricio submitted his final Report and Recommendation finding respondent liable for grave
misconduct and dishonesty under A.M. No. 03-06-13-SC or the Code of Conduct for Court Personnel. Based on the
evidence presented, Judge Patricio concluded that respondent misappropriated the money which he received for the
filing of complainant’s loan application. Such money could not have been used for the partition of Lot No. 1280-D-4-
11 since the same was already subdivided into Lots 11-A and 11-B when respondent presented the Contract to Sell
to complainant. And despite respondent’s promise to keep complainant and his family in peaceful possession of the
subject property, respondent caused the issuance of a writ of demolition against them. Thus, Judge Patricio
recommended the forfeiture of respondent’s salary for six months to be deducted from his retirement benefits.
28
In a Resolution dated September 29, 2008, the Court noted Judge Patricio’s Investigation Report and referred the
same to the Office of the Court Administrator (OCA) for evaluation, report and recommendation.

Findings and Recommendation of the OCA


29
In a Memorandum dated January 16, 2009, then Court Administrator Jose P. Perez found respondent liable for
serious and grave misconduct and dishonesty and recommended the forfeiture of respondent’s salary for six months,
which shall be deducted from his retirement benefits.

The Court Administrator held that by his unilateral acts of extinguishing the contract to sell and forfeiting the amounts
he received from complainant and Saplagio without due notice, respondent failed to act with justice and equity. He
found respondent’s denial to be anchored merely on the fact that he had not issued receipts which was belied by his
admission that he had asked money for the expenses of partitioning Lot 11 from complainant and Saplagio. Since
their PAG-IBIG loan applications did not materialize, complainant should have returned the amounts given to him by
complainant and Saplagio.
30
On February 11, 2009, the Court issued a Resolution requiring the parties to manifest whether they are willing to
submit the case for decision on the basis of the pleadings and records already filed with the Court. However, the copy
of the Resolution dated February 11, 2009 which was sent to complainant was returned unserved with the postal
31
carrier’s notation "RTS-Deceased." Meanwhile, in a Compliance dated August 24, 2009, respondent expressed his
willingness to submit the case for decision and prayed for an early resolution of the case.

Our Ruling

Article 1491, paragraph 5 of the Civil Code prohibits court officers such as clerks of court from acquiring property
involved in litigation within the jurisdiction or territory of their courts. Said provision reads:

Article 1491. The following persons cannot acquire by purchase, even at a public or judicial auction, either in person
or through the mediation of another:

xxxx

(5) Justices, judges, prosecuting attorneys, clerks of superior and inferior courts, and other officers and employees
connected with the administration of justice, the property and rights in litigation or levied upon an execution before the
court within whose jurisdiction or territory they exercise their respective functions; this prohibition includes the act of
acquiring by assignment and shall apply to lawyers, with respect to the property and rights which may be the object of
any litigation in which they may take part by virtue of their profession.

x x x x (Emphasis supplied.)

The rationale advanced for the prohibition is that public policy disallows the transactions in view of the fiduciary
relationship involved, i.e., the relation of trust and confidence and the peculiar control exercised by these

66
32
persons. "In so providing, the Code tends to prevent fraud, or more precisely, tends not to give occasion for fraud,
33
which is what can and must be done."

For the prohibition to apply, the sale or assignment of the property must take place during the pendency of the
34
litigation involving the property. Where the property is acquired after the termination of the case, no violation of
35
paragraph 5, Article 1491 of the Civil Code attaches.

In the case at bar, when respondent purchased Lot 11-A on November 21, 1994, the Decision in Civil Case No.
14706 which was promulgated on May 31, 1983 had long become final. Be that as it may, it can not be said that the
property is no longer "in litigation" at that time considering that it was part of the Hodges Estate then under settlement
proceedings (Sp. Proc. No. 1672).

A thing is said to be in litigation not only if there is some contest or litigation over it in court, but also from the moment
36
that it becomes subject to the judicial action of the judge. A property forming part of the estate under judicial
settlement continues to be subject of litigation until the probate court issues an order declaring the estate proceedings
closed and terminated. The rule is that as long as the order for the distribution of the estate has not been complied
37
with, the probate proceedings cannot be deemed closed and terminated. The probate court loses jurisdiction of an
estate under administration only after the payment of all the debts and the remaining estate delivered to the heirs
38
entitled to receive the same. Since there is no evidence to show that Sp. Proc. No. 1672 in the RTC of Iloilo, Branch
27, had already been closed and terminated at the time of the execution of the Deed of Sale With Mortgage dated
November 21, 1994, Lot 11 is still deemed to be "in litigation" subject to the operation of Article 1491 (5) of the Civil
Code.

This notwithstanding, we hold that the sale of Lot 11 in favor of respondent did not violate the rule on disqualification
to purchase property because Sp. Proc. No. 1672 was then pending before another court (RTC) and not MTCC
where he was Clerk of Court.

On the charges against the respondent, we find him liable for dishonesty and grave misconduct.

Misconduct is a transgression of some established and definite rule of action, more particularly, unlawful behavior as
well as gross negligence by a public officer. To warrant dismissal from service, the misconduct must be grave,
serious, important, weighty, momentous and not trifling. The misconduct must imply wrongful intention and not a
mere error of judgment. The misconduct must also have a direct relation to and be connected with the performance of
the public officer’s official duties amounting either to maladministration or willful, intentional neglect, or failure to
39
discharge the duties of the office.

Dishonesty is the "disposition to lie, cheat, deceive, defraud or betray; untrustworthiness; lack of integrity; lack of
40
honesty, probity, or integrity in principle; and lack of fairness and straightforwardness."

In this case, respondent deceived complainant’s family who were led to believe that he is the legal representative of
the Hodges Estate, or at least possessed of such power to intercede for overstaying occupants of the estate’s
properties like complainant. Boasting of his position as a court officer, a City Sheriff at that, complainant’s family
completely relied on his repeated assurance that they will not be ejected from the premises. Upon learning that the lot
they were occupying was for sale and that they had to negotiate for it through respondent, complainant’s family
readily gave the amounts he demanded and, along with Saplagio, complied with the requirements for a loan
application with PAG-IBIG. All the while and unknown to complainant’s family, respondent was actually working to
acquire Lot 11 for himself.

Thus, while respondent was negotiating with the Hodges Estate for the sale of the property to him, he collected as
down payment ₱5,000 from complainant’s family in July 1986. Four months later, on November 18, 1986, the probate
court approved respondent’s offer to purchase Lot 11. The latter received further down payment from complainant in
the amount of ₱10,000 between 1992 and 1993, or before the Deed of Sale with Mortgage dated November 21,
41

1994 could be executed in respondent’s favor.

Thereafter, respondent demanded ₱3,000 from complainant supposedly for the subdivision of Lot 11 between the
latter and the Saplagios. Yet, it was not until respondent obtained title over said lot that the same was subdivided into
42
Lots 11-A and 11-B. The records of the case show that the Subdivision Plan dated April 25, 1996, duly approved by
the Land Management Services (DENR) subdividing Lot 11 into sublots 11-A and 11-B, was inscribed on February
28, 1997 – two years after TCT No. T-107519 covering Lot 11 was issued in respondent’s name on December 5,
1994.

67
Finally, in 1995, respondent received the amount of ₱2,000 to defray the expenses for documentation and transfer of
title in complainant’s name. In the latter instance, while it may be argued that respondent already had the capacity to
sell the subject property, the sum of all the circumstances belie an honest intention on his part to convey Lot 11-A to
43
complainant. We note the inscription in TCT No. T-11836 in the name of C.N. Hodges that respondent executed a
44
Request dated February 19, 1997 "for the issuance of separate titles in the name of the registered owner." Soon
45 46
after, TCT No. T-116467 covering Lot 11-A and TCT No. T-116468 covering Lot 11-B were issued in the name of
47
respondent on February 28, 1997 – only eight months after he executed the Contract to Sell in favor of complainant
on June 3, 1996.

Respondent’s bare denials were correctly disregarded by the Court Administrator in the light of his own admission
that he indeed asked money from both complainant and Saplagio. The evidence on record clearly established that by
misrepresenting himself as the estate’s representative and as a court officer having the power to protect
complainant’s family from eviction, respondent was able to collect sums totaling ₱20,000 from complainant’s family.
Even after the latter realized they were duped since respondent was already the owner of Lot 11, they still offered to
buy the property from him. Respondent, however, changed his mind and no longer wanted to sell the property after
nothing happened to the loan applications of complainant and Saplagio. This subsequent unilateral cancellation by
respondent of the contract to sell with complainant may have been an afterthought, and plainly unjustified, based
merely on his own assumption that complainant could not make full payment. But it did not negate the deception and
fraudulent acts perpetrated against complainant’s family who were forced into submission by the constant threat of
eviction. Such acts constitute grave misconduct for which respondent should be held answerable.

In Re: Complaint Filed by Paz De Vera Lazaro Against Edna Magallanes, Court Stenographer III, RTC Br. 28 and
48
Bonifacio G. Magallanes, Process Server, RTC Br. 30, Bayombong, Nueva Vizcaya, the Court stressed that to
preserve decency within the judiciary, court personnel must comply with just contractual obligations, act fairly and
adhere to high ethical standards. In that case, we said that court employees are expected to be paragons of
uprightness, fairness and honesty not only in their official conduct but also in their personal dealings, including
49
business and commercial transactions to avoid becoming the court’s albatross of infamy.
50
More importantly, Section 4(c) of Republic Act No. 6713 or the Code of Conduct and Ethical Standards for Public
Officials and Employees mandates that public officials and employees shall remain true to the people at all times.
They must act with justness and sincerity and shall not discriminate against anyone, especially the poor and the
underprivileged.1âwphi1 They shall at all times respect the rights of others, and shall refrain from doing acts contrary
to law, good morals, good customs, public policy, public order, public safety and public interest.
51
Under Section 52, Rule IV of the Uniform Rules on Administrative Cases in the Civil Service, dishonesty and grave
misconduct are classified as grave offenses with the corresponding penalty of dismissal for the first offense. Section
58(a) states that the penalty of dismissal shall carry with it the cancellation of eligibility, forfeiture of retirement
benefits, and the perpetual disqualification for reemployment in the government service.

Section 53 further provides that mitigating circumstances attendant to the commission of the offense should be
considered in the determination of the penalty to be imposed on the erring government employee. However, no such
mitigating circumstance had been shown. On the contrary, respondent had been previously held administratively
52
liable for irregularities in the performance of his duties as Clerk of Court. In A.M. No. P-01-1484, this Court imposed
on respondent a fine of ₱5,000 for acting imprudently in notarizing documents and administering oath on matters
alien to his official duties. And in A.M. Nos. P-08-2567 (formerly OCA IPI No. 99-670-P) and P-08-2568 (formerly
53
OCA IPI No. 99-753-P), respondent was found liable for simple misconduct and ordered to pay a fine equivalent to
his three (3) months salary to be deducted from his retirement benefits.

Since respondent had compulsorily retired from service on September 10, 2007, for this additional administrative
case he should be fined in an amount equivalent to his salary for six months which shall likewise be deducted from
his retirement benefits.

WHEREFORE, the Court finds respondent Nicolasito S. Solas, retired Clerk of Court IV, Municipal Trial Court in
Cities, Iloilo City, LIABLE FOR GRAVE MISCONDUCT AND DISHONESTY. Respondent is FINED in an amount
equivalent to his salary for six (6) months to be deducted from his retirement benefits.

SO ORDERED.

68
FIRST DIVISION

G.R. No. 156407 January 15, 2014

THELMA M. ARANAS, Petitioner,


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

DECISION

BERSAMIN, J.:

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

Antecedents

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

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

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

As the administrator, Teresita submitted an inventory of the estate of Emigdio on December 14, 1992 for the
consideration and approval by the RTC. She indicated in the inventory that at the time of his death, Emigdio had "left
no real properties but only personal properties" worth ₱6,675,435.25 in all, consisting of cash of ₱32,141.20; furniture
and fixtures worth ₱20,000.00; pieces of jewelry valued at ₱15,000.00; 44,806 shares of stock of Mervir Realty worth
₱6,585,585.80; and 30 shares of stock of Cebu Emerson worth ₱22,708.25.
2

Claiming that Emigdio had owned other properties that were excluded from the inventory, Thelma moved that the
RTC direct Teresita to amend the inventory, and to be examined regarding it. The RTC granted Thelma’s motion
through the order of January 8, 1993.
3
On January 21, 1993, Teresita filed a compliance with the order of January 8, 1993, supporting her inventory with
4
copies of three certificates of stocks covering the 44,806 Mervir Realty shares of stock; the deed of assignment
executed by Emigdio on January 10, 1991 involving real properties with the market value of ₱4,440,651.10 in
exchange for 44,407 Mervir Realty shares of stock with total par value of ₱4,440,700.00; and the certificate of stock
5

issued on January 30, 1979 for 300 shares of stock of Cebu Emerson worth ₱30,000.00.
6

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

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

69
On April 19, 1993, Thelma opposed the approval of the inventory, and asked leave of court to examine Teresita on
the inventory.

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

Ruling of the RTC

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

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

The Court also directs the said administratrix to render an account of her administration of the estate of the late
Emigdio S. Mercado which had come to her possession. She must render such accounting within sixty (60) days from
notice hereof.
9
SO ORDERED.

On March 29, 2001, Teresita, joined by other heirs of Emigdio, timely sought the reconsideration of the order of
March 14, 2001 on the ground that one of the real properties affected, Lot No. 3353 located in Badian, Cebu, had
already been sold to Mervir Realty, and that the parcels of land covered by the deed of assignment had already come
10
into the possession of and registered in the name of Mervir Realty. Thelma opposed the motion.
11
On May 18, 2001, the RTC denied the motion for reconsideration, stating that there was no cogent reason for the
reconsideration, and that the movants’ agreement as heirs to submit to the RTC the issue of what properties should
be included or excluded from the inventory already estopped them from questioning its jurisdiction to pass upon the
issue.

Decision of the CA

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

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

II

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

III

70
THE HONORABLE RESPONDENT JUDGE HAS COMMITTED GRAVE ABUSE OF DISCRETION AMOUNTING TO
LACK OR EXCESS OF JURISDICTION IN HOLDING THAT PETITIONERS ARE NOW ESTOPPED FROM
QUESTIONING ITS JURISDICTION IN PASSING UPON THE ISSUE OF WHAT PROPERTIES SHOULD BE
12
INCLUDED IN THE INVENTORY OF THE ESTATE OF THE LATE EMIGDIO MERCADO.
13
On May 15, 2002, the CA partly granted the petition for certiorari, disposing as follows:

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

SO ORDERED.

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

The CA further opined as follows:

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

Besides, public respondent court acting as a probate court had no authority to determine the applicability of the
doctrine of piercing the veil of corporate fiction and even if public respondent court was not merely acting in a limited
capacity as a probate court, private respondent nonetheless failed to adjudge competent evidence that would have
justified the court to impale the veil of corporate fiction because to disregard the separate jurisdictional personality of
14
a corporation, the wrongdoing must be clearly and convincingly established since it cannot be presumed.
15
On November 15, 2002, the CA denied the motion for reconsideration of Teresita, et al.

Issue

71
Did the CA properly determine that the RTC committed grave abuse of discretion amounting to lack or excess of
jurisdiction in directing the inclusion of certain properties in the inventory notwithstanding that such properties had
been either transferred by sale or exchanged for corporate shares in Mervir Realty by the decedent during his
lifetime?

Ruling of the Court

The appeal is meritorious.

Was certiorari the proper recourse


to assail the questioned orders of the RTC?

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

Thelma’s contention cannot be sustained.

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

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

The order dated November 12, 2002, which granted the application for the writ of preliminary injunction, was an
interlocutory, not a final, order, and should not be the subject of an appeal. The reason for disallowing an appeal from
an interlocutory order is to avoid multiplicity of appeals in a single action, which necessarily suspends the hearing and
decision on the merits of the action during the pendency of the appeals. Permitting multiple appeals will necessarily
delay the trial on the merits of the case for a considerable length of time, and will compel the adverse party to incur
unnecessary expenses, for one of the parties may interpose as many appeals as there are incidental questions
raised by him and as there are interlocutory orders rendered or issued by the lower court. An interlocutory order may
be the subject of an appeal, but only after a judgment has been rendered, with the ground for appealing the order
being included in the appeal of the judgment itself.

The remedy against an interlocutory order not subject of an appeal is an appropriate special civil action under Rule
65, provided that the interlocutory order is rendered without or in excess of jurisdiction or with grave abuse of
discretion. Then is certiorari under Rule 65 allowed to be resorted to.

The assailed order of March 14, 2001 denying Teresita’s motion for the approval of the inventory and the order dated
May 18, 2001 denying her motion for reconsideration were interlocutory. This is because the inclusion of the
properties in the inventory was not yet a final determination of their ownership. Hence, the approval of the inventory
and the concomitant determination of the ownership as basis for inclusion or exclusion from the inventory were
provisional and subject to revision at anytime during the course of the administration proceedings.
17
In Valero Vda. De Rodriguez v. Court of Appeals, the Court, in affirming the decision of the CA to the effect that the
order of the intestate court excluding certain real properties from the inventory was interlocutory and could be
changed or modified at anytime during the course of the administration proceedings, held that the order of exclusion
was not a final but an interlocutory order "in the sense that it did not settle once and for all the title to the San Lorenzo
Village lots." The Court observed there that:

The prevailing rule is that for the purpose of determining whether a certain property should or should not be included
in the inventory, the probate court may pass upon the title thereto but such determination is not conclusive and is
subject to the final decision in a separate action regarding ownership which may be instituted by the parties (3

72
Moran’s Comments on the Rules of Court, 1970 Edition, pages 448-9 and 473; Lachenal vs. Salas, L-42257, June
18
14, 1976, 71 SCRA 262, 266). (Bold emphasis supplied)
19
To the same effect was De Leon v. Court of Appeals, where the Court declared that a "probate court, whether in a
testate or intestate proceeding, can only pass upon questions of title provisionally," and reminded, citing Jimenez v.
Court of Appeals, that the "patent reason is the probate court’s limited jurisdiction and the principle that questions of
title or ownership, which result in inclusion or exclusion from the inventory of the property, can only be settled in a
20
separate action." Indeed, in the cited case of Jimenez v. Court of Appeals, the Court pointed out:

All that the said court could do as regards the said properties is determine whether they should or should not be
included in the inventory or list of properties to be administered by the administrator. If there is a dispute as to the
ownership, then the opposing parties and the administrator have to resort to an ordinary action for a final
determination of the conflicting claims of title because the probate court cannot do so. (Bold emphasis supplied)

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

Multiple appeals are permitted in special proceedings as a practical recognition of the possibility that material issues
may be finally determined at various stages of the special proceedings. Section 1, Rule 109 of the Rules of Court
enumerates the specific instances in which multiple appeals may be resorted to in special proceedings, viz:

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

(a) Allows or disallows a will;

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

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

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

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

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

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

II

Did the RTC commit grave abuse of discretion


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

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

73
Was the CA correct in its conclusion?

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

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

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

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

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

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

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

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

First, the probate court may provisionally pass upon in an intestate or a testate proceeding the question of inclusion
in, or exclusion from, the inventory of a piece of property without prejudice to final determination of ownership in a
separate action. Second, if the interested parties are all heirs to the estate, or the question is one of collation or
advancement, or the parties consent to the assumption of jurisdiction by the probate court and the rights of third

74
parties are not impaired, then the probate court is competent to resolve issues on ownership. Verily, its jurisdiction
extends to matters incidental or collateral to the settlement and distribution of the estate, such as the determination of
the status of each heir and whether the property in the inventory is conjugal or exclusive property of the deceased
27
spouse. (Italics in the original; bold emphasis supplied)

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

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

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

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

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

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

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

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

Secondly, with Emigdio and Teresita having been married prior to the effectivity of the Family Code in August 3,
29
1988, their property regime was the conjugal partnership of gains. For purposes of the settlement of Emigdio’s
estate, it was unavoidable for Teresita to include his shares in the conjugal partnership of gains. The party asserting
that specific property acquired during that property regime did not pertain to the conjugal partnership of gains carried
the burden of proof, and that party must prove the exclusive ownership by one of them by clear, categorical, and

75
30
convincing evidence. In the absence of or pending the presentation of such proof, the conjugal partnership of
Emigdio and Teresita must be provisionally liquidated to establish who the real owners of the affected properties
31
were, and which of the properties should form part of the estate of Emigdio. The portions that pertained to the
estate of Emigdio must be included in the inventory.

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

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

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

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

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

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

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

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

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

Lastly, the inventory of the estate of Emigdio must be prepared and submitted for the important purpose of resolving
the difficult issues of collation and advancement to the heirs. Article 1061 of the Civil Code required every compulsory

76
heir and the surviving spouse, herein Teresita herself, to "bring into the mass of the estate any property or right which
he (or she) may have received from the decedent, during the lifetime of the latter, by way of donation, or any other
gratuitous title, in order that it may be computed in the determination of the legitime of each heir, and in the account
of the partition." Section 2, Rule 90 of the Rules of Court also provided that any advancement by the decedent on the
legitime of an heir "may be heard and determined by the court having jurisdiction of the estate proceedings, and the
final order of the court thereon shall be binding on the person raising the questions and on the heir." Rule 90 thereby
expanded the special and limited jurisdiction of the RTC as an intestate court about the matters relating to the
inventory of the estate of the decedent by authorizing it to direct the inclusion of properties donated or bestowed by
38
gratuitous title to any compulsory heir by the decedent.

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

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

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

SO ORDERED.

77
THIRD DIVISION

G.R. No. 187524 August 5, 2015

SPOUSES MARIA BUTIONG and VILLAFRlA, DR. RUEL B. SPOUSES MARIA FRANCISCO substituted by
VILLAFRIA, Petitioners,
vs.
MA. GRACIA RINOZA PLAZO and MA. FE RINOZA ALARAS, Respondents.

DECISION

PERALTA, J.:

Before the Court is a petition for review on certiorari under Rule 45 of the Rules of Court seeking to reverse and set
1 2
aside the Decision and Resolution, dated March 13, 2009 and April 23, 2009·, respectively, of the Court Appeals
3
(CA) in CA-G.R. SP No. 107347, Which affirmed the Judgment dated October 1, 2001 of the Regional Trial Court
(RTC) of Nasugbu, Batangas, Branch 14, in Civil Case No. 217.

The antecedent facts are as follows:

On November 16, 1989, Pedro L. Rifioza died intestate, leaving several heirs, including his_ children with his first
wife, respondents Ma. Gracia R. Plazo and Ma. Fe Alaras, as well as several properties including a resort covered by
Transfer Certificates of Title (TCT) No. 51354 and No. 51355, each with an area of 351 square meters, and a family
4
home, the land on which it stands is covered by TCT Nos. 40807 and 40808, both located in Nasugbu, Batangas.
5
In their Amended Complaint for Judicial Partition with Annulment of Title and Recovery of Possession dated
September 15, 1993, respondents alleged that sometime in March 1991, they discovered that their co-heirs, Pedro’s
second wife, Benita"Tenorio and other children, had sold the subject properties to petitioners, spouses Francisco
Villafria and Maria Butiong, who are now deceased and substituted by their son, Dr. Ruel B. Villafria, without their
knowledge and consent. When confronted about the sale, Benita acknowledged the same, showing respondents a
document she believed evidenced receipt of her share in the sale, which, however, did not refer to any sort of sale
6
but to a previous loan obtoiined by Pedro and Benita from a bank. The document actually evidenced receipt from
Banco Silangan of the amount of ₱87, 352.62 releasing her and her late husband’s indebtedness therefrom. Upon
7

inquiry, the Register of Deeds of Nasugbu informed respondents that he has no record of any transaction involving
the subject properties, giving them certified true copies of the titles to the same. When respondents went to the
subject properties, they discovered that 4 out of the 8 cottages in the resort had been demolished. They were not,
however, able to enter as the premises were padlocked.

Subsequently, respondents learned that on July 18, 1991, a notice of an extra-judicial settlement of estate of their late
father was published in a tabloid called Balita. Because of this, They caused the annotation of their adverse claims
over the subject properties before the Register of Deeds of Nasugbu and filed their complaint praying, among others,
for the annulment of all documents conveying the subject properties to the petitioners and certificates of title issued
8
pursuant thereto.
9
In their Answer, petitioners denied the allegations of the complaint on the groun_d of lack of personal knowledge
and good faith in acquiring the subject properties. In the course of his testimony during trial, petitioner Francisco
10
further contended that what they purchased was only the resort. He also presented an Extra-Judicial Settlement
with Renunciation, Repudiations and Waiver of Rights and Sale which provides, among others, that respondents' co-
heirs sold the family home to the spouses Rolando and Ma. Cecilia Bondoc for Pl million as well as a Deed of Sale
whereby Benita sold the resort to petitioners for ₱650, 000.00.
11

On October 1, 2001, the trial court nullified the transfer of the subject Properties to petitioners and spouses Bondoc
due to irregularities in the Documents of conveyance offered by petitioner’s .as well as the circumstances
Surrounding the execution of the same. Specifically, the Extra-Judicial Settlement was notarized by a notary public
12
that was not duly commissioned as such on the date it was executed. The Deed of Sale was Undated, the date of
the acknowledgment therein was left blank, and the Typewritten name "Pedro Rifioza, Husband" on the left side of
13
the document Was not signed. The trial court also observed that both documents were Never presented to the
Office of the Register of Deeds for registration and That the titles to the subject properties were still in the names of
Pedro and His second wife Benita. In addition, the supposed notaries and buyers of the Subject properties were not
even presented as witnesses whom supposedly witnessed the signing and execution of the documents of

78
14
conveyance. On The basis thereof, the triaI court ruled in favor of respondents, in its Judgment, the pertinent
portions of its fallo provide:

WHEREFORE, foregoing premises considered, judgment is Hereby rendered as follows:

xxxx

4. A) Declaring as a nullity the ~'Extra-Judicial Settlement with Renunciation, Repudiation and Waiver of Rights and
Sale" (Ex. "l ", Villafria) notarized on December 23, 1991 by Notary Public Antonio G. Malonzo of Manila, Doc. No.
190, Page No. 20, Book No. IXII, Series of 1991. .

b) Declaring as a nullity the Deed of Absolute Sale (Ex. "2", Villafria), purportedly executed by Benita T. Rifioza in
favor of spouses Francisco Villafria and Maria Butiong, purportedly notarized by one Alfredo de Guzman marked Doc.
No. 1136, Page No. 141, and Book. No. XXX, Series of 1991.

c) Ordering the forfeiture of any and all improvements introduced By defendants Francisco Villafria and Maria Butiong
in the properties Covered by TCT No. 40807, 40808, 51354 and 51355 of the Register of Deeds for Nasugbu,
Batangas. .

5. Ordering defendant Francisco Villafria and all persons, whose Occupancy within the premises of the four- (4)
parcels of land described in Par. 4-c above is derived from the rights and interest of defendant Villafria, to vacate its
premises and to deliver possession thereof, and all improvements existing thereon to plaintiffs, for and in behalf of the
estate of decedent Pedro L. Rifioza.

6. Declaring the plaintiffs and the defendants-heirs in the Amended Complaint to be the legitimate heirs of decedent
Pedro L. Rifioza, each in the capacity and degree established, as well as their direct successors-in interest, and
ordering the defendant Registrar of Deeds to issue the co1Tesponding titles in their names in the proportion
established by law, pro in division, in TCT Nos. 40807, 40808, 51354, 51355 and 40353 (after restoration) within ten
(10) days from finality of this Decision, 4pon payment of lawful fees, except TCT No. 40353, which shall be exempt
from all expenses for its restoration.

With no costs.
15
SO ORDERED.
16
On appeal, the CA affirmed the trial ‘court’s Judgment in its Decision dated October 31, 2006 in the following wise:

The person before whom the resort deed was acknowledged, Alfredo de Guzman, was not commissioned as a notary
public from 1989 to July 3, 1991, the date the certification was issued. Such being the case, the resort deed is not a
public document and the presumption of regularity accorded to public documents will not apply to the same. As laid
down in Tigno, et al. v. Aquino, et al.:

The validity of a notarial certification necessarily derives from the authority of the notarial officer. If the notary public
docs net have the capacity to notarize a document, but does so anyway, then the document should be treated as A.
Unnotarized. The rule may strike as rather harsh, and perhaps may prove to be prejudicial to parties in good faith
relying on the proferred authority of the notary public or the person pretending to be one. Still, to admit otherwise
would render merely officious the elaborate process devised by this Court in order that a lawyer may receive a
notarial commission. Without such a rule,

The notarization of a document by a duly appointed notary public will have the same legal effect as one accomplished
by a non-lawyer engaged in pretense. The notarization of a document carries considerable legal effect. Notarization
of a private document converts such document into a public one, and renders it admissible in court without further
proof of its authenticity. Thus, notarization is not an empty routine; to the contrary, it engages public interest in a
substantial degree and the protection of that interest requires preventing those who are not qualified or authorized to
act as notaries public from imposing upon the public and the courts and administrative offices generally.

Parenthetically, the settlement/family home deed cannot be considered a public document. This is because the
following cast doubt on the document's authenticity, to wit: J.

1.) The date of its execution was not indicated;

79
2.) The amount of consideration was superimposed;

3.) It was not presented to the Registry of Deeds of Nasugbu, Batangas for annotation; and

4.) Not even the supposed notary public," Alfredo de Guzman, or the purported buyer, the Spouses Rolando and Ma.
Cecilia Bondoc, were presented as witnesses. · Concededly, the absence of notarization in the resort deed and/or the
lacking details in the settlement/family home deed did not necessarily invalidate the transactions evidenced by the
said documents. However, since the said deeds are private documents, perforce, their due execution and authenticity
becomes subject to the requirement of proof under the Rules on Evidence, Section 20, Rule 132 of which provides:
Sec. 20. Proof of private document. - Before any private. Document offered as authentic is received in evidence, its
due execution a"Q.d. authenticity must be proved either:

(a). By anyone who saw the document executed or written; or

(b) By evidence of the genuineness of the signature or handwriting of the maker.

The Complaining Heirs insist that the settlement/family home and the resort deed are void, as their signatures
thereon are forgeries as opposed to the Villafrias who profess the deeds' enforceability. After the Complaining Heirs
presented proofs in support of their claim that their signatures were forged, the burden then fell upon the Villafrias to
disprove the ~ame2 or conversely, to prove the authenticity and due execution of the said deeds. The Villafrias failed
in this regard.

As forestalled, the Villafrias did not present as witnesses (a) the notary public who purportedly notarized the
questioned instrument, (b) the witnesses who appear [Ed] in the instruments as eyewitnesses to the signing, or (c) an
expert to prove the authenticity and genuineness of all the signatures appearing on the said instruments. Verily, the
rule that, proper foundation must be laid for the admission of documentary evidence; that is, the identity and
authenticity of the document must be reasonably established as a pre requisite to its admission, was prudently
observed by the lower court when it refused to admit the settlement/family home and the resort deeds as their
17
veracity are doubtful.

Aggrieved, petitioners, substituted by their son Ruel Villafria, filed a Motion for Reconsideration dated November 24,
2006 raising the trial court’s lack of jurisdiction. It was alleged that when the Complaint for Judicial Partition with
Annulment of Title and Recovery of Possession was filed, there was yet no settlement of Pedro's estate,
determination as to the nature thereof, nor was there an identification of the number of legitimate heirs. As such, the
trial court ruled on the settlement of the intestate estate of Pedro in its ordinary· jurisdiction when the action filed was
for Judidal Partition. Considering that the instant action is really one for settlement of intestate estate, the trial court,
sitting merely in its probate jurisdiction, exceeded its jurisdiction when it ruled upon the issues of forgery and
ownership. Thus, petitioner argued that. Said ruling is void and has no effect for having been rendered without
jurisdiction. The Motion for Reconsideration was, however, denied by the appellate court on February 26, 2007.

On appeal, this Court denied on June 20, 2007, petitioner's Petition for Review on Certiorari for submitting a
verification of the petition, a certificate of non-forum shopping and an affidavit of service that failed to comply with the
18 19
2004 Rules on Notarial Practice regarding competent evidence of affiant' s identities. In its Resolution dated
September 26, 2007, this Court also denied petitioner's Motion for Reconsideration in the absence of any compelling
reason to warrant a modification of the previous denial. Thus, the June 20, 2007 Resolution became final and
20
executors on October 31, 2007 as certified by the Entry of Judgment issued by the Court. On January 16, 2008, the
Court further denied petitioner' s motion for leave to admit a second motion for reconsideration of its September 26,
2007 Resolution, considering that the same is a prohibited pleading under Section 2, Rule 52, in relation to Section 4,
Rule 56 of the 1997 Rules of Civil Procedure, as amended. Furthennore, petitioner's letter dated December 18, 2007
pleading the Court to take a second. Look at his petition for review on certiorari and that a decision thereon be
21
rendered based purely on its merits was noted without action.

Unsatisfied, petitioner wrote a letter dated March 24, 2008 addressed to then Chief Justice Reynato S. Puno praying
that a decision on the case be rendered based on the. Merits and not on formal requirements "as he stands to lose
everything his parents had left him just because the verification against non-forum shopping is formally defective."
However, in view of the Entry of Judgment having been made on October 31, 2007, the Court likewise noted said
22
letter without action.

On November 27, 2008, the RTC issued an Order, issuing a Part Writ of Execution of its October 1, 2001 Decision
with respect to the portions disposing of petitioner's claims as affirmed by the CA.

80
The foregoing notwithstanding, petitioner filed, on February 11, 200 a Petition for Annulment of Judgment and· Order
before the CA assailing October 1, 2001 Decision as well as the November 27, 2008 Order of the RTC on the
grounds of extrinsic fraud and lack of jurisdiction. In Decision dated March 13, 2009, however, the CA dismissed the
petition a affirmed the rulings of the trial court in the following wise: Although the assailed Decision of the Court a quo
has already become final and executory and in fact entry of judgment was issued on 31 October 2007, supra,
nevertheless, to put the issues to rest,·We deem it apropos to tackle the same.

The Petitioner argues that the assailed Decision and Order of the Court a quo, supra, should be annulled and set
aside on the grounds of extrinsic fraud and lack of jurisdiction.

We are not persuaded.

xxxx

Section 2 of the Rules as stated above provides that the annulment of a judgment may "be based only on grounds of
extrinsic fraud and lack of jurisdiction." In RP v. The Heirs of Sancho Magdato, the High Tribunal stressed that: There
is extrinsic fraud when "the unsuccessful party had been ·prevented from exhibiting fully his case, by fraud or
deception practiced on him by his opponent, as by keeping him away from court, ... or where the defendant never had
knowledge of the suit, being kept in ignorance by the acts of the plaintiff; ... "

Otherwise put, extrinsic or collateral fraud pertains to such fraud, which prevents the aggrieved party ·from having a
trial or presenting his case to the court, or is used to procure the judgment without fair submission of the controversy.
This refers to acts intended to keep the unsuccessful party away from the courts as when there is a false promise of
compromise or when one is kept in ignorance of the suit. The pivotal issues before us are (1) whether. There was a
time during the proceedings below that the Petitioners ever prevented from exhibiting fully their case, by fraud or
deception, practiced on them by Respondents, and (2) whether the Petitioners were kept away from the court or kept
in ignorance by the acts of the Respondent?

We find nothing of that sort. Instead, what we deduced as We carefully delved. Into the evidentiary facts surrounding
the instant case as well as the proceedings below as shown in the 36-page Decision of the Court a quo, is that the
Petitioners were given ample time to rebut the allegations of the Respondents and had in fact addressed every detail
of. Respondent's cause of action against them. Thus, Petitioners' allegation of the Court a quo ‘s lack of jurisdiction is
misplaced.

Our pronouncement on the matter finds support in the explicit ruling of the Supreme Court in Sps. Santos, et al. v.
Sps. Lumbao, thus: It is elementary that' the active participation of a party in a case pending against him before a
court is tantamount to recognition of that court's jurisdiction and willingness to abide by the resolution of the case
which will bar said party from later on impugning the court’s jurisdiction. ' In fine, under the circumstances obtaining in
this case the Petitioners are stopped from assailing the Court a quo 's lack of jurisdiction. Too, We do not find merit in
the Petitioners' second issue, supra. As mentioned earlier, entry of judgment had already been made on the assailed
Decision and Order as early as 31 October 2007.

xxxx

It maybe that the doctrine of finality of judgments permits certain equitable remedies such as a petition for annulment.
But the I. Rules are clear. The annulment by the Court of Appeals of judgments or final orders and resolutions in civil
actions of the Regional Trial Courts is resorted to only where the ordinary remedies of new trial, appeal, petition for
relief or other appropriate remedies are no longer available through no fault of the petitioner, supra.

If Petitioners lost their chance to avail themselves of the appropriate remedies or appeal before the Supreme Court,
that is their own look out. The High Tribunal has emphatically pointed out in Mercado, et al. v. Security Bank
Corporation, thus:

A principle almost repeated to satiety is that "an action for annulment of judgment cannot and is not a substitute for
the lost remedy of·appeal." A party must have first availed of appeal, a motion for new trial or a petition for relief
before an action for annulment can prosper. Its obvious rationale is to prevent the party from benefiting from his
inaction or negligence. Also, the action for annulment of judgment must be based either on (a) extrinsic fraud or (b)
lack of jurisdiction or denial of due process. Having failed to avail of the remedies and there being 'a Clear showing
that neither of the grounds was present, the petition must be dismissed. Only a disgruntled litigant would find such
legal disposition unacceptable. 23 When the appellate court denied Petitioner’s Motion for Reconsideration in its

81
Resolution dated April 23, 2009, petitioner filed the instant Petition for Review on Certiorari on June 10, 2009,
invoking the following ground:

I.

THE COURT OF APPEALS COMMITTED REVERSIBLE ERROR IN NOT RULING THAT THE REGIONAL TRIAL
COURT, BRANCH 14, NASUGBU, BATANGAS, ACTED WITHOUT JURISDCITION IN ENTERTAINING THE
SPECIAL PROCEEDING FOR THE SETTLEMENT OF ESTATE OF PEDRO RINOZA AND THE CIVIL ACTION
24
FOR ANNULMENT OF TITLE OF THE HEIRS AND THIRD PERSONS IN ONE PROCEEDING.

Petitioner asserts that while the complaint filed by respondents was captioned as "Judicial Partition with Annulment of
Title and Recovery of Possession," the allegations therein show that the cause of action is actually one for settlement
of estate of decedent Pedro. Considering that settlement of estate is a special proceeding cognizable by a probate
court of limited jurisdiction while judicial partition with annulment of title and recovery of possession are ordinary civil
actions cognizable by a court of general jurisdiction, the trial court exceeded its jurisdiction in entertaining the latter
while it was sitting merely in its probate jurisdiction. This is in view of the prohibition found in the Rules on the joiner of
25
special civil actions and ordinary civil actions. Thus, petitioner argued that the ruling of the trial court is void and
has no effect for having been rendered in without jurisdiction.

Petitioner also reiterates the arguments raised before the appellate court that since the finding of forgery relates only
to the signature of respondents and not to their co-heirs, who assented to the conveyance, the transaction should be
considered valid as to them. Petitioner also denies the indings of the courts below that his parents are builders in bad
faith for they only took possession of the subject properties after the execution of the transfer documents and after
they paid the consideration on the sale.

The petition is bereft of merit. Petitioner maintains that since. Respondents’ complaint alleged the following causes of
action, the same is actually one for settlement of estate and not of judicial partition: FIRST CAUSE OF ACTION

1. That Pedro L. Rifi.oza, Filipino and resident of Nasugbu, Batangas at the time of his death, died intestate on
November 16, 1989. Copy of his death certificate is hereto attached as Annex "A";

2. That Plaintiffs together with the Defendants enumerated from paragraph 2-A to 2-J are the only known heirs of the
above-mentioned decedent. The plaintiffs and the Defendants Rolando, Rafael, Antonio, Angelita, Loma all surnamed
Rifioza, and Myrna R. Limon or Myrna R. Rogador, Epifania Belo and Ma. Theresa R. Demafelix are the decedent’s
legitimate children with his first wife, while Benita Tenorio Rifioza, is the decedent’s widow and Bernadette Rifioza,
the decedent's daughter with said widow. As such, said parties are co-owners by virtue of an intestate inheritance
from the decedent, of the properties enumerated in the succeeding paragraph; ‘

3. That the decedent left the following real properties all located in Nasugbu, Batangas:

xxxx

16. That the estate of decedent Pedro L. Rifioza has no known legal indebtedness;

17. That said estate remains undivided up to this date and it will be to the best interest of all heirs that it be partitioned
26
judicially. .

Petitioner is mistaken. It is true that some of respondents' causes of action pertaining to the properties left behind by
the decedent Pedro, his known heirs, and the nature and extent of their interests thereon may fall under an action for
settlement of estate. However, a complete reading of the complaint would readily show that, based on the nature of
the suit, the llegations therein, and the relief’s prayed for, the action, is clearly one for udicial partition with annulment
of title and recovery of possession.

Section 1, Rule 74 of the Rules of Court proyides:

RULE 74
Summary Settlement of Estate

Section 1. Extrajudicial settlement by agreement between heirs. - If the decedent left no will and no debts and the
heirs are all of age5 or the minors are represented by their judicial or legal representatives duly authorized for the

82
purpose, the parties may without securing letters of administration, divide the estate among themselves as they see
fit by means of a public instrument filed in the office of the register of deeds, and should they disagree, they may do
so in an ordinary action of partition. If there is only one heir, he may adjudicate to himself the entire estate by means
of an affidavit filled in the office of the register of deeds. The parties to an Extrajudicial settlement, whether by public
instrument or by stipulation in a pending action for partition, or the sole heir who adjudicates the entire estate to
himself by means of an affidavit shall file, simultaneously with and as a condition precedent to the filing of the public
instrument, or stipulation in the action for partition, or of the affidavit in the office of the register of deeds, a bond with
the said register of deeds, in an amount equivalent to the value of the personal property involved as certified to under
oath by the parties concerned and conditioned upon the payment of any just claim that may be filed under section 4
of this rule. It shall be presumed that the decedent left no debts if no creditor files a petition for letters of
administration within two (2) years after the death of the decedent.

The fact of the Extrajudicial settlement or administration shall be Published in a newspaper of general circulation in
the manner provided in the next succeeding section; but no Extrajudicial settlement shall be binding upon any person
27
who has not participated therein or had no notice thereof.

In this relation, Section 1, Rule 69 of the Rules of Court provides:

Section 1. Complaint in action for partition of real estate. - A person having the right to compel the partition of real
estate may do so as provided in this Rule, setting forth in his complaint the nature and extent of his title and an
adequate description of the real estate of which partition is demanded and joining as defendants all other persons
28
interested in the property.

As can be gleaned from the foregoing provisions, the allegations of respondents in their complaint are but customary,
in fact, mandatory, to a complaint for partition of real estate. Particularly, the complaint alleged: (1) that Pedro died
intestate; (2) that respondents, together with their co-heirs, are all of legal age, with the exception of one who is
represented by a judicial representative duly authorized for the purpose; (3) that the heirs enumerated are the only
known heirs of Pedro; (4) that there is an account and description of all real properties left by Pedro; (5) that Pedro's
estate has no known indebtedness; and (6) that respondents, as rightful heirs to the decedent’s estate, pray for the
partition of the same in accordance with the laws of intestacy. It is clear, therefore, that based on the allegations of
the complaint, the case is one for judicial partition. That the complaint alleged causes of action identifying the heirs of
the decedent, properties of the estate, and their rights thereto, does not perforce make it an action for settlement of
estate.

It must be recalled that the general rule is that when a person dies intestate, or, if testate, failed to name an executor
in his will or the executor o named is incompetent, or refuses the trust, or. Fails to furnish the bond equipped by the
Rules of Court, then the decedent's estate shall be judicially administered and the competent court shall appoint a
29
qualified administrator the order established in Section 6 of Rule 78 of the Rules of Court. An exception to this rule,
however, is found in the aforequoted Section 1 of Rule 4 wherein the heirs of a decedent, who left no will and no
debts due from is estate, may divide the estate either extrajudicially or in an ordinary action or partition without
30
submitting the same for judicial administration nor applying for the appointment of an administrator by the court. The
reasons that where the deceased dies without pending obligations, there is no necessity for the appointment of an
administrator to administer the. Estate for hem and to deprive the real owners of their possession to which they are
31
immediately entitled.

In this case, it was expressly alleged in the complaint, and was not isputed, that Pedro died without a will, leaving his
estate without any ending obligations. Thus, contrary to petitioner’s contention, respondents were under no legal
obligation to submit the subject properties of the estate of a special proceeding for settlement of intestate estate, and
32
are, in fact, encouraged to have the same partitioned, judicially or extrajudicially, by ereira v. Court of Appeals:

Section 1, Rule 74 of the Revised Rules of Court, however, does not preclude the heirs from instituting administration
proceedings, even if the estate has no· debts or obligations, if they do not desire to resort for good reasons to an
ordinary action for partition. While Section 1 allows the heirs to divide the estate among themselves as they may see
fit, qr. to resort to an ordinary action for partition, the said provision does not compel them to do so if they have good
reasons to take a different course of action. It should be noted that recourse to an administration proceeding even if
the estate has no debts is sanctioned only if the heirs have good reasons for not resorting to an action for partition.
Where partition is possible, either in or out of court, the estate should not be burdened with an administration
proceeding without good and compelling reasons.

Thus, it has been repeatedly 4eld that when a person dies without leaving pending obligations to be paid, his heirs,
whether of age or not, are not bound to submit the property to a judicial administration, which is always long and

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costly, or to apply for the appointment of an administrator by the Court. It has been uniformly held that in such case
33
the judicial administration and the appointment of an administrator are superfluous and unnecessary proceedings.

Thus, respondents committed no error in. filing an action for judicial partition instead of a special proceeding for the
settlement of estate as law expressly permits the same.1avvphi1 That the complaint contained allegations inherent in
an action for settlement of estate does not. Mean that there was a prohibited joined of causes of action for questions
as to the estate's properties as well as a determination of the heirs, their status as such, and the nature and extent of
34
their titles to the estate, may also be properly ventilated in partition proceedings alone. In fact, a complete inventory
of the estate may likewise be done during the partition proceedings, especially since the estate has no debts.~5
Indeed, where the more expeditious remedy 9f partition is available to the heirs, then they may not be compelled to
36
submit to administration proceedings, dispensing of the risks of delay and of the properties being dissipated.

Moreover, the fact that respondents' complaint also prayed for the annulment of title and recovery of possession does
not strip the trial court off of its jurisdiction to hear and decide the case. Asking for the annulment of certain transfers
37
of property could very well be achieved in an action for partition, as can be seen in cases where 1-ourts determine
the parties' rights arising from complaints asking not only for the partition of estates but also for the annulment of titles
38 39
and recovery of ownership and possession of property. In fact, in Bagayas v. Bagayas, ·wherein a complaint for
annulment of sale and partition was dismissed by the trial court due to the impropriety of an action for annulment as it
constituted a collateral attack on the certificates of title of the respondents therein, this Court found the dismissal to
be improper in the following manner:

In Lacbayan v. Samoy, Jr. (Lacbayan) which is an action. For partition premised on the existence or non-existence of
co-ownership between the parties, the Court categorically pronounced that a resolution on the issue of ownership
does not subject the Torrens title issued over the disputed realties 'to a collateral attack. It must be borne in mind that
what cannot be collaterally attacked is the certificate of title and not the title itself. As pronounced in Lacbayan:

There is no dispute that a Torrens certificate of title cannot be collaterally attacked, but that rule is not material to the
case at bar. What cannot be collaterally attacked is the certificate of title and not the title itself. The' certificate referred
to is that -document issued by the Register of Deeds known as the TCT. In contrast, the title referred to by law means
ownership, which is, more often than not, represented by that document. Petitioner c.pparently confuses title with the
certificate of title. Title as a concept of ownership should not be confused with the certificate of title as evidence of
such ownership although both are interchangeably used. (Emphases supplied)

Thus, the RTC erroneously dismissed petitioner's petition for annulment of sale on the ground that it constituted a
collateral attack since she was actually assailing Rogelio and Orlando's title to the subject lands and not any Torrens
certificate oftitle over the same.

Indeed, an action for partition does not preclude the settlement of the issue of ownership. In fact, the determination as
to the existence of the same is necessary in the resolution of an action for partition, as held in Municipality of
40
Bifzan·v. Garcia:

The first phase of a partition and/or accounting suit is taken up with the determination of whether or not a co-
ownership in fact exists, and a partition is proper (i.e., not otherwise legally proscribed) and may be made by
voluntary agreement of all the parties interested in the property. This phase may end with a declaration that plaintiff is
not entitled to have a partition either because a co-ownership does not exist, or partition is_ legally prohibited. It may
end, on the other hand, with an adjudgment that a co-ownership does in truth exist, partition is proper in the premises
and an accounting of rents and profits received by the defendant from the real estate in question is in order. x x x

The second phase commences when it appears that "the parties are unable to agree upon the partition" directed by
the court. In that event [,] partition shall be done for the parties by the [c] ourt with the assistance of not more than
three (3) commissioners. This second stage may well also deal with the rendition of the accounting itself and its
approval by the [c] ourt after the. Parties have been accorded opportunity to be heard Thereon, and an award for the
recovery by the party or parties thereto entitled of their just share in the rents and profits of the real estate in question.
41
xx x. ·

An action for partition, therefore, is premised on the existence or non-existence of co-ownership between the
42
parties. Unless and until the issue of co-ownership is definitively resolved, it would be premature to effect a partition
43
of an estate.

In view of the foregoing, petitioner' s argument that the trial court acted without jurisdiction in entertaining the action of
settlement of estate and annulment of title in a single proceeding is clearly erroneous for the instant complaint is

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precisely one for judicial partition with annulment of title and recovery of possession, filed within the confines of
44 45
applicable law and jurisprudence. Under Section 1 of Republic Act No. 7691 (RA 7691), amending Batas
Pambansa Big. 129, the RTC shall exercise exclusive original jurisdiction over all civil actions in which the subject of
the litigation is incapable of pecuniary estimation. Since the action herein was not merely for partition and recovery of
ownership but also for annulment of title and documents, the action is incapable of pecuniary estimation and thus
cognizable by the RTC. Hence, considering that the trial court clearly had jurisdiction in rendering its decision, the
instant petition for annulment of judgment must necessarily fail.

Note that even if the instant action was one for annulment of title alone, without the prayer for judicial partition, the
requirement of instituting a separate special proceeding for the determination of the status and rights of the
respondents as putative heirs may be dispensed with, in light of the fact that the parties had voluntarily submitted the
46
issue to the trial court and had already presented evidence regarding the issue of heirship. In Portugal v. Portugal-
47
Beltran, the Court explained:

In the case at bar, respondent, believing rightly or wrongly that she was the sole heir to Portugal's estate, executed
on February 15, 1988 the questioned Affidavit of Adjudication under the second sentence of Rule 74, Section 1 of the
Revised Rules of Court. Said rule is an exception to the general rule that when a person dies leaving a property, it
should be judicially administered and the competent court should appoint a qualified administrator, in the order
established in Sec. 6, Rule 78 in case the deceased left no will, or in case he did, he failed to name an executor
therein.

xxxx

It appearing, however, that in the present case the only property of the intestate estate of Portugal is the Caloocan
parcel of land, to still subject it, under the circumstances of the case, to a special proceeding which could be long,
hence, not expeditious, just to establish the status of petitioners as heirs is not only impractical; it is burdensome to
the estate with the costs and expenses of an administration proceeding. And it is superfluous in light of the fact that
the parties to the evil case - subject of the present case, could and had already in fact presented evidence before the
trial court which assumed jurisdiction over the case upon the issues it defined during pre-trial.

In fine, under the circumstances of the present case, there being no compelling reason to still subject · Portugal’s
estate to administration proceedings since a determination of petitioners’ status as heirs could be achieved in the civil
case filed by petitioners, the trial court should proceed to evaluate the evidence presented by the parties during the
48
trial and render a decision thereon upon the issues it defined during pre-trial, x x x.

Thus, in view of the clarity of respondents' complaint and the causes of action alleged therein, as well as the fact that
the trial court, in arriving at its decision, gave petitioner more than ample opportunity to advance his claims, petitioner
cannot now be permitted to allege lack of jurisdiction just because the judgment rendered was adverse to them. To
repeat, the action filed herein is one for judicial partition and not for settlement of intestate estate. Consequently, that
respondents also prayed for the annulment of title and recovery of possession in the same proceeding does not strip
the court off of its jurisdiction for asking for 'the annulment of certain transfers of property could very well be achieved
in an action for partition.

As for petitioner's contention that the sale must be considered valid as to the heirs who assented to the conveyance
as well as their allegation of good faith, this Court does not find any compelling reason to deviate from the ruling of
the appellate court. As sufficiently found by both courts below, the authenticity and due execution of the documents
on which petitioner’s claims are based were inadequately proven. They were undated, forged, and acknowledged
before a notary public who was not commissioned as such on the date they were executed. They were never
presented to the Register of Deeds for registration. Neither were the supposed notaries and buyers of the subject
properties presented as witnesses.

While it may be argued that Benita, one of the co-heirs to the estate, actually acknowledged the sale of the resort, the
circumstances surrounding the same militate against the fact of its occurrence. Not only was the Deed of Sale
supposedly executed by Benita undated and unsigned by Pedro, but the document she presented purportedly
evidencing her receipt of her share in the sale, did not refer to any sort of sale but to a previous loan obtained by
Pedro and Benita from a bank.

Moreover, credence must be given on the appellate court’s observations as to petitioners' actuations insofar as the
transactions alleged herein are concerned. First, they were seemingly uncertain as to the number and/or identity of
49
the properties bought by them. In their Answer, they gave the impression 'that· they bought both the resort and the
family home and yet, during trial, Francisco Villafria claimed they only bought the resort. In fact, it was only then that

85
50
they presented the subject Extra Judicial Settlement and Deed of Sale. Second, they never presented any other
51
document which w0uld evidence their actual payment of consideration to the selling heirs. Third, in spite of the.
Blatant legal infirmities of the subject documents of conveyance, petitioners still took possession of the properties,
demolished several cottages, and introduced permanent improvements thereon.

In all, the Court agrees with the appellate court: that petitioners failed to adequately substantiate, with convincing,
credible and independently verifiable proof, their claim that they had, in fact, purchased the subject properties. The
circumstances surrounding the purported transfers cast doubt on whether they actually took place. In substantiating
their claim, petitioners relied solely on the Extra-Judicial Settlement and Deed of Sale, who utterly failed to prove their
authenticity and due execution. They cannot, therefore, be permitted to claim. Absolute ownership of the subject
lands based on the same.

Neither can they be considered as innocent purchasers for value and builders in good faith. Good faith consists in the
belief of title builder that the land the latter is building on is one's own without knowledge of any defect or flaw in
52
one's. Title. However, in view of .the manifest defects in the instruments conveying their titles, petitioners should
have been placed on guard. Yet, they still demolished several cottages and constructed improvement on the
properties. Thus, their claim of. Good faith cannot be given credence.

Indeed, a judgment which has acquired finality becomes immutable and unalterable, hence, may no longer be
modified in any respect except to correct clerical errors or mistakes, all the issues between the parties being deemed
53
resolved and. laid to rest. it is a fundamental principle in our judicial system and essential to an effective and
efficient administration of justice that, once a judgment has become final, the winning party be, not through a mere
54
subterfuge, deprived of the fruits of the verdict. Exceptions to the immutability of final judgment is allowed only
55
under the most extraordinary of circumstances. Yet, when petitioner is given more than • ample opportunity to be
heard, unbridled access to the appellate courts, as well as unbiased judgments rendered after a consideration of
evidence presented by the parties, as in the case at hand, the Court shall refrain from reversing the rulings of the
courts below in the absence of any showing that the same were rendered with fraud or lack of jurisdiction. ·

WHEREFORE, premises considered, .the instant petition is DENIED. The Decision and Resolution, dated March 13,
2009 and April 23, 2009, respectively, of the Court Appeals for CA-G.R. SP No. 107347, which affirmed the
Judgment dated October 1, 2001 of the Regional Trial Court of Nasugbu, Batangas, Branch 14, in Civil Case No.
217, insofar as it conce1ns the resort covered by Transfer Certificates of Title No. 513 54 and No. 51355, and family
home covered by TCT No. 40807 and 40808, are AFFIRMED.

SO ORDERED.

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